Chelsea Adolphus had been bleeding for a week. She told Danny Gyal, her best friend, that it was like a period that wouldn’t end. It was getting worse, and she felt so weak she couldn’t stand.
Adolphus’ mother eventually convinced her to call 911, and early on the morning of January 22, 2025, an ambulance took her to the only emergency room in town: Vista Medical Center East. After so much blood loss, the 28-year-old was disoriented and anemic. Staff at the Waukegan, Illinois, hospital examined her and noted symptoms of alcohol withdrawal. They gave her Ativan and had her settle in for monitoring.
When Adolphus later called Gyal from the hospital, she was frustrated by all the waiting. As long as Gyal had known her, Adolphus was the one who brought the energy: playing music all day, doing everyone’s hair, refusing to sit long enough to watch a whole movie, and dancing—always dancing, especially to the hip-shaking rhythms of the punta from her native Belize. What was the point of lying here if the hospital wasn’t doing anything? Could Gyal come pick her up?
Gyal said Adolphus needed to stay and get treated. She promised to visit in the morning.
Information we obtained from court records and public record requests— including police reports and body camera footage—and interviews, describes what happened next. Over the next several hours, nurses noted that Adolphus still seemed disoriented and agitated. She was talking to herself and hallucinating, a known side effect of Ativan. Multiple times, Adolphus left her room, saying she wanted to go home.
When she left her room again in the middle of the night, nurses radioed for security. A guard coaxed Adolphus back to bed and told the nurses that she would need a sitter, which hospitals employ to stay with patients at high risk of wandering off or getting hurt. But no one was available: A week earlier, the company that owns Vista, American Healthcare Systems, had furloughed 78 employees, including many of the hospital’s sitters, to cut costs.
Around 2 a.m., Adolphus left her room again—this time running. She pushed through an emergency exit and flew down a stairwell. Two nurses followed, but not for long: They had other patients they couldn’t leave. So instead, they called security. Guards began walking the halls to look for her, but eventually were called away by an incident in the ER. When they reviewed the hospital’s security camera footage, they found no trace of her.
Staff knew there weren’t cameras in many parts of the building, and the ones that were there often didn’t work. Still, at 4:30a.m., they called off the search. They marked Adolphus as “discharged” without any evidence that she had left the hospital.
Later that morning, a nurse helping a patient about to give birth glanced out the window and spotted a woman lying on the second-floor rooftop, right outside. She was face down in a thin gown and socks. Staff rushed to the scene and found patches of bloody snow around a body. It was Adolphus.
Her wandering had led her through a boiler room door—propped open to keep the hallway warm—and then through another leading to the roof. Police reports and court records show that when Adolphus walked out onto the roof, no alarm sounded, and the door locked behind her. By the time staff decided to stop looking, Adolphus was stuck outside in temperatures that plunged to the low 20s.
When she was found nearly seven hours after she went missing, Adolphus had no pulse and her internal body temperature was 50 degrees. For 14 hours, emergency room staff tried to resuscitate her, her mom by her side, praying through tears. Adolphus’ mom had called Gyal, and she was there watching as staff used paddles to shock Adolphus’ heart, in what felt to her like a gruesome performance to give false hope. “You guys are sitting there lying to us that there’s a chance of her living,” Gyal recalls thinking to herself. “There was never a chance.”
Body camera footage shows that the next day, when police came to investigate, they waited for hospital leadership downstairs. They leaned on a ledge in the security office while the hospital’s guards talked through the shock of Adolphus’ death. One guard shook his head, emphatic: Why was there no sitter?
“It’s embarrassing—a total embarrassment,” he said.
“They could have sent one of us,” another guard said. “It’s crazy.”
According to court filings, the hospital first told her family that Adolphus had been found in the parking lot of a Dollar General down the road. Then, her brother was told she had been found in the facility’s backyard. Only after Adolphus’ family requested her medical records did the hospital admit the truth.
Today, American Healthcare Systems is one of the 10 largest for-profit hospital operators in the country, running 18 facilities in six states. It has expanded at a rip-roaring pace after being founded just six years ago, in a small office building sandwiched between a McDonald’s and a budget gym in a Los Angeles suburb. Vista was one of AHS’s first purchases.
The company has sold itself as turnaround specialists—a fix-it crew of executives ready to revitalize distressed facilities. But court records, tax bills, hospital inspections, internal emails, and other documents indicate that AHS has been sinking hospitals into financial chaos, slashing expenditures and leaving millions in unpaid bills while its mansion-collecting CEO gallivants on a private jet and his fellow executives run the company like a personal fiefdom, tapping relatives and associates for top roles or lucrative contracts. A couple of executives have even been charged with crimes; one spent years in business with a sanctioned Russian oligarch. The company is also embroiled in a multistate legal tug-of-war over control of the hospital portfolio that has earned it millions. AHS CEO Michael Sarian declined to speak with us, but a spokesman for him said that “in every decision his teams make, the stability of patient care comes first.” He added that many of the unpaid bills at AHS’s hospitals today were accrued by previous owners and that in several instances, Sarian used more than $2 million of his personal money to support hospital operations.
The company’s mismanagement has led to a crisis in Illinois, where Vista faces a threat of foreclosure as soon as this year; another AHS hospital in southern Illinois, Gateway Regional Medical Center, is barreling toward a similar fate. Previously unreported documents shared with us by a former AHS staffer, as well as a paper trail of court records, tax liens, and hospital inspection reports, show that the company has left critical expenses unpaid for years, in what may be either stunning negligence or a calculated plan to leech cash from its hospitals before the walls tumble down. Bills from state agencies show AHS’s two Illinois hospitals owe more than $116 million in state taxes. More than 100 cases filed against AHS and its subsidiaries across the country claim at least another $65 million in unpaid bills. The real number could be much higher, since additional vendors may not have sued. Sarian’s spokesman claimed that most of the Illinois tax debt predates AHS ownership. Property tax assessments and provider tax bills show the opposite: that the vast majority of these debts accrued after AHS took over.
“The modus operandi was the same across everybody I talked to: ‘They keep promising me that they’re going to pay.’ ”
For years, experts have warned about the human costs when private equity firms or other institutional investors buy into health care. As for-profit owners come in and slash expenses, hospital chains around the country have gone bankrupt, scores of facilities have closed, and hundreds of thousands of people have lost access to reliable care. Take, for example, Steward Health Care, which, as we reported last year, racked up $9 billion in debt to more than 100,000 creditors on its way to gutting dozens of hospitals—a nationwide disaster documented in court and in congressional hearings. Yet, save for a few isolated state-level laws, no meaningful safeguards protect patients from the faceless investors who will never seek care at the faraway hospitals they’re ravaging.
AHS was born in that vacuum. It is the logical conclusion of health care’s transformation into a seductive asset: a young company run by a team of businessmen making unproven claims and inflated promises that managed to gain control of critical hospitals. And now, with Donald Trump’s Medicaid cuts set to begin in 2027—an inflection point that will place unprecedented financial strain on hospitals—the landscape of patient care has never looked more dire.
When it bought Vista in 2023, AHS promised to insulate the hospital against such upheavals. The hospital was on good footing—they’d hired a few extra doctors and opened a new clinic. AHS leaders told the local paper that they planned to continue that upswing, by interviewing the hospital’s doctors, to ask them what they need to make Vista “as good as it can be.” They said they were contemplating upgrading Vista’s trauma center designation—a major commitment to top-notch care, and a potential boon given that Vista was the only hospital in their city. They held a reception at the hospital with cupcakes and a ribbon-cutting. Scissors in hand, AHS’s CEO, Michael Sarian, promised to focus on compassionate care.
To his left stood Jennifer Banek, a nurse anesthetist at Vista, a major in the Army Reserve, and an elected official—the county coroner.
Over the next several months, Banek watched with increasing desperation as AHS jeopardized Vista’s ability to care for many of its patients, leaving key bills unpaid, delaying doctors’ and nurses’ pay, and shrinking or closing entire departments, from urology to obstetrics. Eventually, she became so concerned that something horrible was going to happen that she wrote a letter to Vista’s board about AHS’s business practices.
Someone leaked Banek’s letter to the press. A day later, she was fired midshift. As security walked her out of the hospital, Banek called hospital board member Rick Harris. He’d been wary of AHS since it took over, when he’d learned the company owned only a few hospitals. After the publicity over her letter, he says suppliers, consultants, and doctors across the country reached out to complain to him that AHS also owed them money. “The modus operandi was the same across everybody I talked to: ‘They keep promising me that they’re going to pay.’” Over the next several weeks, Harris and two others resigned from the board.
Adolphus died almost exactly a year later. By that time, the list of critical items and personnel that AHS was behind on paying for at Vista had grown even longer: blood for the blood bank, dialysis supplies, anesthesiologists, and ENTs.
In her role as coroner, Banek held a press conference about the death. Her rage was palpable. She stared into the TV cameras as she punctuated every word: “I had warned…that lives were at stake.”
Adolphus’ death, Banek told the press, was a direct result of AHS’s decision to cut costs—by furloughing sitters and failing to provide basic safety measures. She had little faith that the company would change unless someone held it accountable.
Decades before he founded AHS in 2020, Michael Sarian ran a jewelry company with his brother. The family had emigrated from Lebanon in the 1970s, when Sarian was a teenager, leaving their tight-knit Armenian community in Beirut for Los Angeles. In 1983, when Sarian was fresh out of college with a business degree, his family started Michael’s Jewelers, opening several stores in California and taking out millions in loans to expand nationally.
While Michael’s Jewelers was growing, Sarian was also getting into health care, earning a public health PhD at a university in Armenia and working in hospital finance in Southern California. In 1990, he became the CEO of a small hospital outside Los Angeles. According to his LinkedIn résumé, Sarian claims that he increased its profits by $8 million. But the hospital declared bankruptcy two years into his tenure and shut down by 1994 after accruing nearly $200,000 in unpaid taxes. Sarian’s spokesman noted that this bankruptcy happened decades ago and that Sarian was not personally accused of any wrongdoing.
Sarian’s jewelry business, meanwhile, began to fall into a similar pattern. Court records show that he seemed to treat business commitments and tax bills like suggestions—defaulting on rent at multiple California malls and stiffing diamond suppliers. By 2002, Michael’s Jewelers became the second business he ran to declare bankruptcy, owing at least $6.4 million, including $450,000 in unpaid taxes.
As bankruptcy proceedings dragged on, the Sarians’ lender grew worried that the family was hiding assets to avoid paying their debts: Filings show the bank started taking inventory of the stores’ holdings—gold, diamonds, wedding bands, engagement rings, watches—and found that $2.6 million worth had gone missing in a single month. The banks’ lawyers asked the court if they could depose the Sarians—Michael, his sister, his brother, and his brother’s wife.
The Sarians later switched from Chapter 11 to Chapter 7 bankruptcy, which is designed to liquidate companies that have no hope of staying open. The process makes it easier for struggling businesses to abandon their debts, and it’s unclear whether the dozens of companies and people owed money were ever repaid. Sarian walked away from discount jewelry and back into health care: first as CEO of a physicians’ practice in Pennsylvania and then, in 2005, running hospitals at two for-profit health care giants, Prospect Medical Holdings and later Prime Healthcare.
The Sarians’ lender grew worried that the family was hiding assets to avoid paying their debts. It inventoried the stores’ holdings—gold, diamonds, watches—and found that $2.6 million worth had gone missing.
His timing was perfect. For decades, hospitals and health care had largely been the realm of religious organizations and community trusts: lean nonprofits that prioritize care. But Sarian entered the business just as focus was shifting from public service to the pursuit of profits, thanks to two huge changes in the marketplace: the creation of Obamacare and the aging of tens of millions of baby boomers.
After the Affordable Care Act passed in 2010 and gave millions of Americans insurance and new access to health care, Wall Street firms flooded into the sector, purchasing community hospitals and turning them into slot machines for speculative investment. Private equity fund managers newly involved in hospitals promised growth. But instead, the cuts soon began: slashing staffing, downgrading supplies, and skimping on services. After five to seven years, the firm would typically sell the hospital to another cadre of investors, who’d start the cycle anew. From the outside, hospitals might get a slight name change, or maybe a tacked-on corporate affiliation. But each owner made the care a little worse, as investors cut fat, then muscle, and into bone.
During Sarian’s time as a senior vice president at Prospect, private equity firm Leonard Green bought a majority stake in the company. The firm pushed a rapid expansion, buying 16 hospitals in just four years. A 2025 Senate report found that Leonard Green extracted more than $435 million from Prospect for itself and its investors, and then ditched its stake after a decade. In the end, six hospitals bought during the firm’s tenure closed their doors. (Leonard Green and Prospect did not respond to questions.)
In 2012, when Sarian moved to Prime to become president of hospital operations, the for-profit company was trying another money-generating tactic—selling its hospital real estate. The idea was simple: Prime would get a cash windfall by selling its hospitals and the land they sat on to a real estate company, Medical Properties Trust, and MPT would lease the hospitals back to Prime.
It’s unclear whether Sarian was involved directly in Prime’s sale of hospitals to MPT. But what is clear is that MPT would eventually become a key business relationship. Fourteen of the hospitals that AHS and its subsidiaries run today are owned by MPT and were won in bankruptcy proceedings, where MPT had to approve AHS as their new tenant, often amid other competitive bids. As their relationship deepened, MPT also gave AHS a major boost, loaning the company and its subsidiaries $85 million to improve facilities, according to court documents. (MPT did not respond to questions.)
In June 2020, Sarian abruptly left Prime. Three months later, he started American Healthcare Systems. Within a month, it won a bid to buy its first hospital out of bankruptcy. AHS outbid two major health systems to purchase Randolph Health in Asheboro, North Carolina. Residents scratched their heads at why a virtually unknown entity had decided to invest so much—$10.2 million—in their debt-ridden hospital. But AHS made big promises. Company attorney Faisal Gill told a local newspaper that Sarian’s specialty was “getting troubled hospitals and turning them around.” Sarian told the local business paper that Randolph Health would be making money in just three months. Within a year, he expected monthly profits to rise to $1 million.
“We came across this beautiful hospital that was poorly run and managed,” Sarian told the paper. “Most people saw it as in distress. I saw it as an opportunity.”
AHS made big promises. Sarian told a local paper that within a year, he expected Randolph Health’s monthly profits to rise to $1 million.
To facilitate the revival AHS promised, the county loaned it $12 million with few strings attached. After the Randolph purchase went through in summer 2021, AHS accelerated its search for more bankrupt or struggling hospitals to buy and ramped up its branding as turnaround experts. AHS didn’t mind coming to “underserved communities,” because “that’s where we can make a difference,” Gill told one reporter. Within a year and a half, the company bought a St. Louis hospital and then Gateway Regional Medical Center, just across the Mississippi River in Granite City, Illinois. In 2023, AHS purchased a bankrupt hospital in Texas and announced plans to buy Vista in Waukegan. To struggling facilities, AHS seemed like a savior. “God is good,” said the CEO of one acquired hospital. “He has blessed us with a new owner, American Healthcare Systems.”
In each new location, the company repeated its alluring vision, almost verbatim: In Granite City, they would “focus on growing and expanding quality services.” At Vista, they would “preserve and grow hospital services” and be profitable within a year.
But the cracks in the pitch quickly began to show. A month after AHS arrived in Waukegan, its St. Louis hospital closed due to financial troubles. A linen company sued AHS for nearly $1 million in unpaid bills at Gateway. Banek heard that Vista’s urologists weren’t getting paid and were canceling important surgeries—a trend that would later show up in hospital inspection reports. She heard about a patient who had to wait five hours for a hip prosthesis to arrive because the vendor had not been paid; the company’s rep refused to take it out of their car until a Vista employee cut them a check. Within a few months of AHS’s takeover, Vista’s urology department shuttered, according to hospital inspections, as did vascular surgery, oral surgery, and neurosurgery.
After Banek wrote her letter to Vista’s board and was fired, she started filing public records requests. She found that Vista owed $80,000 to Waukegan police and more than $100,000 in unpaid water bills. Across the state in Granite City, a new hire at Gateway would soon make similar discoveries.
Jeff, who asked to be referred to only by his first name, started as a compliance staffer at Gateway about a month after Banek’s firing. A lawyer and self-proclaimed health care nerd, Jeff had once printed out the entire 906-page Affordable Care Act to analyze it with his law school classmates—an activity he called “pretty exciting.” Before arriving at Gateway, he’d worked in compliance at two other hospitals, making sure that they didn’t break rules in one of the country’s most regulated industries.
To Jeff, AHS’s approach to rules was unlike anything he’d seen—especially if they involved money. A state grant to improve the facility was instead distributed to full-time employees as a $1,000 bonus. The hospital hadn’t paid a boiler inspection fee and had stopped paying unemployment taxes.
The delinquent bills were overwhelming, and Jeff soon became the point person when one became an emergency. There were so many, he tried to limit himself to one payment request to the Gateway CFO per week—whichever bill was most pressing. “It was impossible for even little stuff to get paid,” he said. At one point, the CFO told Jeff something the company would later admit in court filings: that on payroll days, it could not schedule vendor payments. There wasn’t enough cash to do both.
It was never clear to Jeff, though, what was happening to all the money AHS got taking in patients. Gateway alone was billing for more than $600 million in care each year.
Jeff started to wonder if AHS’s boom was being financed by funds siphoned from the hospitals it already owned and by skipping critical payments.
And the cash flow problems at Gateway didn’t prevent AHS from simultaneously financing a major national expansion. In the spring of 2024, when Steward Health Care, the country’s largest for-profit hospital operator, declared bankruptcy, AHS again saw opportunity and rushed to be among the earliest bidders for some of its 34 hospitals. But as more offers came in, Sarian ran into a problem. According to Sarian’s account in court records, banks refused to lend money to AHS because Aramais Paronyan, one of its owners and its medical director, had a history of health care fraud. In 1998, he’d been arrested by the FBI over claims his business had billed Medicare and Medicaid for at least $13 million of fake tests; he eventually settled with the government for $10 million. (Paronyan did not respond to a detailed list of questions.)
To get around this, Sarian formed a subsidiary in which he was the sole investor and gave it a scrambled version of his company’s name: Healthcare Systems of America, or HSA. Then HSA’s bids for the hospitals were shepherded through the byzantine bankruptcy process by the company’s regional counsel, Asim Ghafoor, even though he was facing felony federal tax charges. (He pleaded guilty to tax fraud in May 2025 but continued to arrange hospital deals until he was sentenced last October. Ghafoor’s lawyer declined to answer emailed questions.) By September 2024, HSA had bought eight former Steward hospitals in Florida, Texas, and Louisiana.
On paper, the parent company, AHS, seemed to be thriving, with plenty of cash available to fund a tripling of its portfolio. But as time went on, Jeff kept finding unpaid bills at Gateway. He started to wonder if AHS’s boom was being financed by funds siphoned from the hospitals it already owned and by skipping critical payments. (Lawsuits filed against AHS have since raised a similar question.) He saw AHS owed nearly $1 million to two companies that provided hospital software and hadn’t paid the nutritionist group since it was hired. Then he got overdue invoices for the hospital’s overnight security provider. He also learned that AHS wasn’t paying the architect tasked with refurbishing Gateway’s behavioral unit, which had closed after a flood.
But those were relatively minor issues: When he logged on to the county tax assessor website, he discovered that AHS hadn’t paid property taxes since it purchased Gateway a year prior. The company owed about $1 million, plus thousands every month in interest and late fees. Jeff then looked up AHS’s other hospital in Illinois, Vista, and saw that it was in the same boat: $1.2 million in unpaid county property taxes. The portal showed many of these bills had been going to AHS’s California headquarters, but the company hadn’t paid them and didn’t seem to notify executives on the ground in Illinois. Jeff started emailing Gateway’s executives. His tone was clear and polite, but he tried to communicate a growing urgency that AHS could lose its hospitals. Most of the time, no one wrote back. Eventually he started copying chief compliance officer Jonathan Burket.
Burket appeared to do nothing with Jeff’s increasingly urgent emails. He also held a favored position at the company: Burket was the stepson of the company’s legal counsel, Faisal Gill. A one-time Bush administration staffer, Gill has a long history switching between Republican and Democratic political circles. He has run for public office as a member of both parties in three states—a Republican in Virginia, a Democrat in Vermont, and most recently as a Democrat for city attorney in Los Angeles.
It’s unclear how Gill wound up working for AHS, but once in he allegedly pushed to hire several more people close to him into cushy jobs, including his wife, who became the company’s head of PR and its deputy general counsel; Burket’s girlfriend; and Gill’s former nanny, whom, according to court records, he helped install as the CEO of two AHS hospitals, though she’d never run one before—first at its St. Louis facility for eight months before it closed, and then at Vista. At HSA’s new Florida hospitals, Gill secured a food services contract for his brother’s catering business. (Gill did not respond to a detailed list of questions, citing ongoing litigation involving HSA. He added, “Our commitment to excellence in healthcare is unwavering, and HSA will continue to provide high-quality care to our patients every day.” Burket, Gill’s wife, and Gill’s former nanny also did not respond to lists of questions.)
Several of the Florida hospitals also stopped paying property taxes. (As of July, they owe at least $1.1 million, according to local tax assessments.) Payroll collected thousands in 401(k) contributions from nurses but didn’t deposit that money into employee accounts for almost a year, and only after a lengthy union grievance process, according to two nurses and the union itself. It also ran up $3 million in unpaid Florida water bills. As Vista’s taxes went unpaid and penalties multiplied, AHS wired at least $3 million out of Vista’s accounts over one year to support its newly purchased hospital in Sherman, Texas, according to bank statements buried in court records.
Two months after Jeff first alerted AHS’s leaders, county records show that Vista’s tax debts were bought at auction—sold to a private equity group that planned to pay them off and then force AHS to either reimburse it with interest or hand over the property. Gateway’s unpaid taxes were auctioned to a different investor on similar terms. Both sales started the clock on a process that could soon end in foreclosure.
All Jeff could do was keep emailing.
“If these debts remain unpaid, the tax buyer can take deed,” Jeff wrote to the hospital’s C-suite in March 2025. “These entities and individuals absolutely will exercise that option at the earliest available time.”
In the weeks between the auctions, Adolphus froze to death on Vista’s roof.
When Jeff first read about her death and Vista’s problems with understaffing and low resources, he felt like he was reading about his own hospital. As soon as he finished, he bolted upstairs to Gateway’s roof. As he’d feared, the door he tried was unlocked and unalarmed. What if, Jeff thought, a psychiatric patient got up there and jumped?
He notified his bosses. The next week, he checked if the issue had been fixed, and again, the door swung open. He walked across the roof until he was beneath the hospital’s executive wing, called his boss, and told her to look out her window. He waved. It took a few more weeks for the door to finally get a deadbolt.
That’s around the time when Jeff made another troubling discovery. Illinois, like nearly every state, requires hospitals to pay a so-called provider tax to help fund Medicaid and smooth health care gaps across wealthy and poor communities. Gateway had received a stern email from the state health department warning that AHS was more than $19 million behind on the payments—even though AHS had been accepting cash directed through the program. “Basically, they were double-dipping,” Jeff says.
It was the biggest unpaid bill he’d seen. The health department said it would soon start clawing the money back. In April, Jeff flagged it for Gateway’s top executives. He called his boss later in the day but never heard back. The next morning, she texted asking to meet in the HR director’s office. When he arrived, Jeff was informed his services were “no longer needed,” apparently to save money. Security escorted him out, forbidding him from speaking to anyone or returning to his workspace.
One week later, he received a delivery of items that had been on his desk. On his last day, he had printed documents about the provider tax issue. Those were missing.
A few months after Gateway dismissed Jeff, AHS spotted a fresh expansion opportunity. Prospect, Sarian’s old employer, was in the middle of bankruptcy, leaving its hospitals in California and other states for sale. Even though debt was continuing to pile up at AHS’s existing locations—$29 million unpaid for Vista’s provider taxes, $4.8 million unpaid for food services at Vista, and an estimated $27 million more in unpaid bills, according to court records— Sarian created yet another subsidiary, NOR, just to nab Prospect’s properties.
In August, NOR—“new” in Armenian— was the top bidder for Prospect’s six California hospitals. Shortly after, the state of Illinois gave Vista $4.5 million in aid money, some of it from the provider tax pool Jeff had been worried about. At that moment, Vista’s outstanding property taxes and utility bills had grown to nearly $3 million. But instead of using that money on Vista or to pay those debts, the hospital’s CFO would later claim in court records that someone at AHS directed him to transfer the full sum to complete the purchase of Prospect hospital operations in Los Angeles. There are conflicting accounts about who directed this transfer, but without it, it seemed the company didn’t have enough cash to go through with its latest takeover.
Sarian, however, appeared to be swimming in extra income: That summer, he flew to Cannes to visit a French villa he said he’d purchased. On Facebook, he posted a photo of the mansion: white stucco, a crystal blue pool, and palm trees, not far from the beach.
That fall, after his jaunt to the French Riviera, court records show that Sarian wired more than $100,000 out of hospital accounts to pay for his infant son’s baptism party at the swanky Beverly Wilshire Hotel, where guests dined on gold-rimmed china and danced to a live band. He also allegedly used company funds to buy a Rolls-Royce. (Sarian’s spokesman claimed that the baptism wire was repayment of a personal loan Sarian made to AHS.)
Just a few months later, information about the origins of all this wealth began to spill out in competing lawsuits between Sarian and his partners, Gill and Paronyan, that have spread across courtrooms in three states. The parties have accused each other of stealing enormous sums from the hospitals they run. Gill and Paronyan allege that the thefts’ ringleader has always been Sarian: that he transferred more than $50 million out of NOR’s and AHS’s operating accounts to different ones that he controls, and at least $11 million to fund other properties in AHS’s portfolio. They also claim he moved another $14 million from HSA to his family trust and other accounts he controls. Speaking to several news outlets about the lawsuits against him, Sarian has denied ever taking money from the hospitals for himself.
Sarian meanwhile alleges that Gill helped divert more than $6 million from AHS coffers; more than $5.5 million of those funds is still missing. He also claims that Gill and Burket have paid themselves extravagant salaries to do little work: Over five years, AHS’s North Carolina hospital—which is on the verge of financial collapse—has paid Gill $2.2 million for legal services and $500,000 to Burket to serve as the hospital’s top compliance officer.
Meanwhile, Gill and Sarian each allege that it was the other who authorized the dubious transfer of $4.5 million of Vista’s state grants to fund AHS’s takeover of Prospect’s bankrupt hospitals.
These claims depict a company in deep disarray—far from the order and prosperity AHS once promised communities around the country. In Illinois, AHS missed a June deadline to pay $1.2 million to the company that bought Vista’s property tax debt, clearing the firm to move ahead with foreclosure. (At Gateway, AHS has an extension until 2027.) Later that month, the medical billing company that provides some staff to both hospitals told most of their employees to stop coming to work because AHS hasn’t paid the company in months.
In Waukegan, the aftershocks of these decisions continue to rip through the community. Adolphus’ family has filed a wrongful death lawsuit against Vista and AHS. The hospital continues to argue that it isn’t responsible for her death, and an inquest by the sheriff’s office ruled it an accident.
For Adolphus’ best friend Gyal, staying in Waukegan became painful. The city had too many memories of all she had lost. So she moved to Indiana with her kids. She still feels alone every day. “We miss her so much at home,” Gyal says. “She was with me everywhere, every day, every holiday, every birthday for my kids. Everything I do, I can’t have fun.”
This story was produced in partnership with the McGraw Center for Business Journalism at the Craig Newmark Graduate School of Journalism at the City University of New York.
