Steward Healthcare files Chapter 11 bankruptcy

Steward Health Care, the troubled operator of eight hospitals in Massachusetts, filed for Chapter 11 bankruptcy protection early Monday.

The company said in a statement that it seeks to conduct this process voluntarily to facilitate the restructuring process.

The for-profit, private equity-backed hospital group’s problems exploded to the surface this year with revelations that it owed nearly $50 million in unpaid rent. Supervising officials subsequently closed one facility and expressed interest in selling their other properties.

“I don’t want to lose sight of the fact that this situation stems from greed, mismanagement and a lack of transparency on the part of the leadership in Dallas, Texas,” Governor Maura Healey said Monday.

State officials too Launched a website To distribute information about the situation.

The company is headquartered in Dallas He said It is finalizing terms for debtor-in-possession financing with the property’s owner, Medical Properties Trust, for $75 million and up to an additional $225 million when certain conditions are met.

Healey also said, “Ultimately, this is a step toward our goal of getting Steward out of Massachusetts.”

“I hope the state does what it needs to do to keep our hospitals open. People are going to die. We cover eight towns in our hospital system, and one of the busiest emergency rooms in the region, so it’s going to be devastating,” Mara Daly said. Respiratory therapist at Morton Hospital.

Steward’s eight hospitals in Massachusetts are: St. Elizabeth Hospital in Brighton, Carney Hospital in Dorchester, Good Samaritan Medical Center in Brockton, Holy Family Hospital in Methuen, Haverhill Hospital in Haverhill, Morton Hospital in Taunton, Nashoba Valley Medical Center in Ayer, and Norwood Hospital . and St. Anne’s in Fall River.

“Steward Health Care has done everything we can to operate successfully in an extremely challenging health care environment. Filing for Chapter 11 restructuring is in the best interests of our patients, doctors, employees and communities,” Dr. Ralph de la Torre, Steward’s CEO, said in a statement. at this time”.

“The potential loss of any of these facilities would have devastating consequences for hundreds of thousands of residents from the South Shore to southern New Hampshire,” the Massachusetts Nurses Association warned. “However, Steward going through the reorganization process provides an opportunity for other stakeholders to take long-overdue action and center the voices of caregivers and patients.”

Healey and Massachusetts Secretary of Health and Human Services Kate Walsh said the state was preparing for bankruptcy.

“I want to be clear: Steward Hospitals remain open,” Healey said. “Patients should keep their appointments. Continue to seek care when you need it at these facilities. I want to reiterate: Hospitals are operating as usual and Public Health remains on site at these facilities to ensure they are providing the highest standards of care.”

The company’s announcement stressed that hospitals, medical centers and doctors’ offices will remain open during the bankruptcy process.

“The other primary factor driving this voluntary Chapter 11 case, in large part, is Steward continuing to face the challenges of insufficient reimbursement by government payers as a result of low reimbursement rates while at the same time facing rising labor costs, increased material costs,” he said. De La Torre also stated: “Operational costs due to inflation and the ongoing impacts of the COVID-19 pandemic.” “Steward’s goal is to resolve the Chapter 11 process as quickly as possible, with the assistance of the court, with the goal of maintaining the sustainable long-term financial health of the system.”

Massachusetts officials announced last week the activation of an “emergency operations plan” in response to the crisis.

According to the State Council News Service, officials last month began holding private meetings with local health care leaders to help Navigating uncertainty about the Steward crisis, a move that Health and Human Services Secretary Kate Walsh said should be “very reassuring” to those concerned about preparing for disruption.

During a recent Senate hearingWalsh said officials were preparing for the possibility of Steward filing for bankruptcy and acknowledged there had been some discussions surrounding receivership.