BOSTON (WHDH) - Gov. Maura Healey and other state leaders sought to reassure Massachusetts residents while previewing their next steps Monday after Steward Health Care filed for bankruptcy overnight.
Steward, which operates eight hospitals in Massachusetts, announced its filing in a statement after months of financial turmoil.
State officials, who launched an incident command system late last week to brace for possible disruptions, said they were prepared.
“We understand that the idea of a hospital in bankruptcy may be unsettling,” said Massachusetts Department of Public Health Commissioner Robbie Goldstein. “Yet this declaration of bankruptcy marks an important transition.”
“Ultimately, this is a step toward our goal of getting Steward out of Massachusetts,” Healey said.
Healey said Steward employs 16,000 people in Massachusetts. The company serves approximately 200,000 patients annually.
Despite the bankruptcy, Healey and others said Steward’s hospitals are operating as usual. Department of Public Health personnel also remain on site “to ensure that they are providing the highest standard of care that all Massachusetts patients are entitled to,” according to Healey.
“Patients should keep your appointments,” Healey said. “Continue to seek care when you need it at these facilities.”
“The hospitals that were open yesterday remain open today,” said Secretary of Health and Human Services Kate Walsh. “The providers that were employed yesterday remain employed today and the community care that you could access yesterday, you can access today.”
Steward CEO says company ‘has done everything in its power to operate successfully’
Steward’s Massachusetts footprint includes St. Elizabeth’s Medical Center 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, Norwood Hospital, and St. Anne’s Hospital in Fall River.
The company is based in Texas.
In crisis in recent months, Steward CEO Ralph de la Torre on Monday said the company “has done everything in its power to operate successfully in a highly challenging health care environment.”
de la Torre said Steward secured bridge financing and moved to sell its physician group, known as Stewardship Health, in hopes of stabilizing operations.
But a delay in closing the Stewardship Health transaction forced the company to seek “alternative methods of bridging its operations,” according to de la Torre.
“By working collaboratively with stakeholders in this court-supervised controlled environment, and having the benefit of our earlier strategic efforts, Steward will be better positioned to responsibly transition ownership of its Massachusetts-based hospitals, keep all of its hospitals open to treat patients, and ensure the continued care and service of our patients and our communities,” de la Torre said.
In addition to other issues, Steward said rising labor, material and operational costs coupled with the impacts of the COVID-19 pandemic and “insufficient reimbursement by government payors” as factors leading to bankruptcy.
Gov. Healey cites ‘greed, mismanagement and lack of transparency,’ vows to advocate Massachusetts interests
Hours after Steward’s announcement, Healey said this situation “stems from and is rooted in greed, mismanagement and lack of transparency on the part of Steward leadership in Dallas, Texas.”
“It’s a situation that should never have happened and we will be working together to ensure that there are steps taken to make sure that this does not happen again,” Healey said.
Moving forward, Healey said her administration will be “open, transparent and responsive to our communities every step of the way.”
Walsh said state officials would be sending representatives to Texas to represent Massachusetts interests in bankruptcy proceedings. Healey similarly said officials will advocate Massachusetts interests in the bankruptcy process.
Back in Massachusetts, Walsh said state actions will be built around regional needs.
“We know the health care landscape in Methuen is different from the health care landscape in Taunton,” she said.
Steward in its statement said it does not expect any interruptions in its day-to-day operations during the bankruptcy process.
Speaking alongside Healey and others, state Attorney General Andrea Campbell said some of Steward’s operations may still “wind down in time.”
“There are a lot of unknowns and a lot of variables that we do not have control of in the bankruptcy process. And I’m not naïve about that,” she said. “…However, I want to stress that any changes in footprint will still be subject to state law.”
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