For-Profit Hospital Chain Never Put Aside Money for Malpractice Insurance to Compensate Injured Patients

Prospect Medical, a for-profit hospital chain, collapsed due to financial mismanagement, including failing to set aside funds for malpractice insurance, leaving patients like Pamela Dorn without recourse after her husband's death from alleged hospital negligence. The company's bankruptcy in 2025 exposed systemic risks of self-insuring against malpractice claims.