Steward Health Care has announced plans to sell all its hospitals after filing for bankruptcy protection. The Dallas-based company, which operates over 30 hospitals nationwide, assured that its day-to-day operations will not be interrupted during the Chapter 11 process. The company has initiated a process to sell its hospital facilities, with all hospitals currently being marketed for sale. Steward filed for bankruptcy early in the week, stating that it took this step to ensure continued care for patients.
In Massachusetts, Steward operates eight hospitals, including St. Elizabeth’s Hospital and Carney Hospital in Boston. The company filed for protection in the U.S. Bankruptcy Court for the Southern District of Texas. Massachusetts Attorney General Andrea Campbell is advocating for the creation of a Patient Care Ombudsman to represent the interests of patients and employees throughout the bankruptcy process. She also stated that her office has the authority to review any proposed sale under antitrust laws.
Political figures in Massachusetts, such as U.S. Sens. Elizabeth Warren and Edward Markey, have criticized Steward’s previous private equity owners for allegedly selling the company “for parts” and walking away with large profits. Massachusetts Governor Maura Healey expressed disappointment in Steward’s leadership in Dallas, Texas, citing greed, mismanagement, and lack of transparency. Despite the bankruptcy filing, Steward hospitals in the state will remain open, and patients are encouraged to keep their appointments.
Steward announced that it is finalizing the terms of debtor-in-possession financing from Medical Properties Trust for initial funding of $75 million, with the potential for an additional $225 million subject to certain conditions. Dr. Ralph de la Torre, CEO of Steward, pointed to insufficient government reimbursement rates and increasing healthcare costs as contributing factors to the company’s financial challenges. Torre stated that seeking bankruptcy protection will allow Steward to responsibly transition ownership of its Massachusetts hospitals.
In March, Steward announced a deal to sell its nationwide physician network to Optum, a subsidiary of UnitedHealth Group. This move was seen as part of the company’s efforts to stabilize its finances amidst the changing healthcare landscape. Steward emphasized its commitment to continuing to serve patients and the community during the bankruptcy process. Overall, the company is taking steps to address its financial challenges and ensure the ongoing provision of healthcare services during these uncertain times.
