Under the proposal, American Healthcare Systems (AHS) would hand over operational control to a group represented by the hospital's Medical Executive Board. That new management team would then enter a 45-day restructuring period to convert the hospital from for-profit to not-for-profit status. The hospital would likely file for Chapter 11 bankruptcy to restructure tens of millions of dollars in debt, with a possibility that AHS could be forced to relinquish ownership entirely. Members of the physicians group and a consultant retained by AHS confirmed the details.

The stakes are high for Waukegan, a city of nearly 90,000 residents, many of them low-income and vulnerable. Vista lost its Level 2 trauma center designation in October, no longer has a fully functioning emergency department, and as of last Saturday can no longer accept EMS vehicles. The hospital is also in danger of foreclosure.

"We had a fully functional hospital for so many years," said Dr. Zvvetan Naydenov, a 20-year hospitalist at Vista. "I think AHS is the main problem with the way they manage, or mismanage the hospital I should say."

The EMS bypass means patients needing trauma services must travel to other facilities. Dr. Vrati Parikh, a family practice physician, said the closest alternative hospital is about 30 minutes away in good weather.

"We are dedicated. We are very much ready to fight for this hospital. We just need a little help," Naydenov said.

The financial picture at AHS is grim. The parent company has failed to pay water bills, power bills, and property taxes, and owes the state nearly $130 million in unpaid provider taxes and advanced funds intended for employee payroll. Some physicians said they have not received paychecks in months but continue to show up for work.

"We're still here," Parikh said. "The physicians are still here. We're still providing good care. Safe care."

The ripple effects extend beyond the hospital walls. Ben Kramer, CEO of Aspyre, a post-acute care assisted living facility located within five minutes of Vista, said his residents rely on around-the-clock care and are often taken to the emergency room.

"It would be catastrophic if the hospital would shut down," Kramer said. Tiffany Curry, Aspyre's nursing director, noted that the loss of pre-existing relationships with Vista physicians could be dire.

"Sometimes when we encounter something severe, time is of the essence," Curry said. "So getting prompt treatment to keep continuity of care could be a matter of life or death at times."

The physicians argue that a nonprofit model could help alleviate some of the debt burden. Their letter to the governor requests the $4.5 million to finance the restructuring. Without state support, the tentative agreement may not move forward, leaving Waukegan at risk of losing its only hospital.