'A Better Chapter': Tentative Deals Reached For 6 Massachusetts Steward Hospitals
The fate of six hospitals formerly owned by troubled healthcare REIT Medical Properties Trust in Massachusetts has been made clearer after Gov. Maura Healey announced preliminary deals were reached with new owners to keep the hospitals open.
Three healthcare groups plan to purchase five of Steward Health Care's Massachusetts hospitals, Healey announced Friday afternoon. The deals come after the state has scrambled for months to keep the hospitals open as the healthcare system goes through bankruptcy proceedings.
"Today, I'm pleased to say we're closing the chapter on Steward once and for all," Healey said at a Friday afternoon press conference. "Good riddance and goodbye.
"It's not just a new chapter but a better chapter," she added.
Boston Medical Center will acquire Good Samaritan Hospital in Brockton, Lifespan Health System will purchase Morton Hospital in Taunton as well as St. Anne's Hospital in Fall River, and Lawrence General Hospital will purchase Holy Hospital's campuses in Haverhill and Methuen.
However, Steward's flagship location at St. Elizabeth's Hospital in Brighton hasn't found a qualified purchaser, which Healey said was due to difficulty securing a deal with the former property owners, Medical Properties Trust and Macquarie Infrastructure Partners.
Healey announced that she plans to seize control of the hospital in an eminent domain proceeding.
Her administration will send Apollo Global Management, the lender on the properties, an offer letter for $5M for the hospital, she told reporters on Friday. The proceeding will act as a transitional period until Boston Medical Center can step in as operator of the property.
"This will ensure that the hospital remains open and operating in that community," Healey said.
Healey said the care of these hospitals will be effectively in the hands of the new owners soon, with the paperwork needed to be done and financing to be shored up through the state's administration and finance department.
"We are grateful for their partnership and their commitment to not only maintaining the quality of care but improving the quality of care in these communities," Healey said.
Though the state is celebrating the preservation of five hospitals, deals weren't reached for Steward's Carney Hospital in Dorchester or Nashoba Valley Medical Center in Ayer. The hospitals are slated to close Aug. 31.
"It's an incredibly upsetting reality," Healey said. "Our administration will continue to work with those communities to safely transition care."
The news of the sales comes after Steward landlords MPT and Macquarie handed the eight properties to lender Apollo earlier this month.
"We believe exiting these eight properties and allowing Steward and the Commonwealth to determine the most appropriate outcome is in the best interest of all stakeholders," MPT CEO Edward Aldag Jr. said during the company's earnings call earlier this month.
With the deals now in place, Healey can dispense $30M in bridge financing to help keep the hospitals operating until the end of the month as new operators take over.
The deals still need to be approved by bankruptcy Judge Christopher Lopez, who is expected to hear the case next week. Lopez also approved the sale of Steward's Stewardship Health physician network to Rural HealthCare Group for $245M.
Steward filed for bankruptcy on May 6, effectively putting its 31 hospitals up for sale across the country. Steward executives blamed high costs and "insufficient reimbursement" from the federal government for its financial burdens.
