Steward Health granted emergency relief to keep hospitals afloat during bankruptcy process

Steward hospitals in Massachusetts will be able to live another day with another loan infusion approved in bankruptcy court to keep the facilities limping along.

“I’m satisfied, based upon the record before me here, that the relief request is warranted, and it’s warranted now,” said U.S. Bankruptcy Court Judge Christopher Lopez on Wednesday. “And I’m going to grant it.”

Steward Health Care representatives came before the bankruptcy court judge to request approval of a $225 million loan to keep their hospitals functioning during the bidding process to sell off the facilities. Steward owns eight functioning hospitals in Massachusetts.

Several parties, including representatives from Massachusetts state government and the landlord of several Steward facilities Medical Properties Trust, spoke in favor of the additional funding at the hearing.

Speakers acknowledged that the loans were “critical” to continuing to operate the hospitals safely, while expressing limited concerns about the details of the new arrangement in light of the continued precariousness of Steward’s financial mismanagement and future.

“While we hope that ultimately all hospitals will receive bids, and there will be new operators for each of those hospitals, we are obviously concerned about a situation when there’s no bid for a particular hospital,” said Hugh McDonald, a lawyer representing the Commonwealth of Massachusetts, noting the loan agreement leaves who is financially responsible for hospital that are not sold “ambiguous.”

Even if a hospital is ultimately closed, McDonald said, there needs to be adequate funding during the 120 day closure notification process.

An MPT representative clarified that they “have made no such commitment to fund hospitals that don’t receive a bid on a working capital basis at any particular point in time.”

Parties agreed to keep working on language, applauding the decision to keep funding the hospitals in the interim.

Healthcare workers at Steward facilities represented by the 1199SEIU union also heralded the judges decision and called for more state support in a statement Wednesday.

“The Massachusetts healthcare system is already stretched past the breaking point, and any hospital closure or service reduction would result in patients not receiving the life-saving care they need in their community,” said 1199SEIU executive vice president Tim Foley. “We need our state leaders to take aggressive action now to prevent hospital closures and protect our patients, who deserve to be cared for in their communities.”

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Steward facilities in Massachusetts include Carney Hospital in Dorchester, Good Samaritan Medical Center in Brockton, Holy Family Hospitals in Haverhill and Methuen, Morton Hospital in Taunton, Nashoba Valley Medical Center in Ayer, Saint Anne’s Hospital in Fall River and St. Elizabeth’s Medical Center in Brighton. The company’s Norwood Hospital has been closed since 2020, and New England Sinai Hospital was permanently closed in April.

Patients within Steward hospitals can find that information at mass.gov/StewardResources or by calling the patient hotline at 617-468-2189 (for local callers) or 833-305-2070 (toll-free).

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