Steward Health Care, a bankrupt healthcare system, has put all 31 of its US hospitals up for sale in an effort to address its $9 billion in total liabilities. The company filed for bankruptcy protection and hopes to keep all of its hospitals open over the long term. Steward’s goal is to finalize transactions for the sale of its hospitals by the end of the summer, with the hope of avoiding any closures in the communities they serve.
The company has faced criticism in Massachusetts for past financial decisions, including the closure of a hospital earlier this year. Massachusetts officials have raised concerns about Steward’s management and its former private equity owners, citing short-sighted financial decisions that negatively impacted patient care. Court documents reveal over $9 billion in total liabilities for Steward, including loans, long-term rent obligations, unpaid bills from vendors, and unpaid employee wages and benefits.
Despite its significant debt load, Steward maintains that it has real value, with $6 billion in annual revenue prior to filing for bankruptcy. The company had been pursuing a sale of its physician group, Stewardship Health Care, to UnitedHealth subsidiary Optum Care in an effort to repay loans and pay off vendors. Regulatory delays in the approval process led Steward to seek emergency financing, which ultimately forced the company into bankruptcy.
During a court hearing, Steward was granted permission to borrow $75 million from Medical Properties Trust, with hopes of receiving an additional $225 million later in bankruptcy proceedings. All of Steward’s hospitals are up for sale, with auctions scheduled for June 28 for hospitals outside of Florida and July 30 for its nine hospitals in Florida. The company aims to avoid a fire sale of its assets and maximize the value of its hospitals in the selling process.
Steward’s attorney, Ray Schrock, emphasized the company’s commitment to keeping all of its hospitals open and serving the communities they are located in. While ownership changes are anticipated for many of the hospitals, Steward aims to prevent any closures during the transition. The company’s focus is on finding buyers for its hospitals that value and prioritize the continuation of quality healthcare services for the communities they serve.
Despite the challenges faced by Steward Health Care, including significant debts and previous financial decisions that have drawn criticism, the company remains optimistic about the value of its hospitals and the potential for successful sales. As the bankruptcy proceedings continue, Steward is working to secure additional financing and negotiate sale agreements that will allow for the ongoing operation of its hospitals without disrupting patient care or community services.
