Governor of Massachusetts mandates 120-day notice for hospital closures by Steward Health Care

Gov. Maura Healey of Massachusetts has emphasized the importance of Steward Health Care abiding by a state health regulation that demands a 120-day notice before closing any medical facility in the state. This statement comes after a bankruptcy judge recently allowed Steward Health Care to move forward with the closure of two hospitals in Massachusetts, namely Carney Hospital and Nashoba Valley Medical Center. Steward had declared its intention to shut down these hospitals by August 31 due to not receiving viable bids for their acquisition.

Despite facing financial challenges and bankruptcy proceedings, Steward Health Care revealed that it had received qualified bids for six other hospitals it operates in Massachusetts. Gov. Healey expressed the need for a smooth transition of ownership from Steward to a responsible operator, pointing out that Steward must keep the hospitals operational for the mandated 120 days. She criticized Steward and its CEO, Ralph de la Torre, for the situation at hand and their approach to handling the closures.

The issue of lease payments owed by Steward post the sale of hospital properties to another company has further complicated the ownership transfer process. The U.S. Bankruptcy Court in Houston recently approved Steward’s request to terminate the master lease for the Massachusetts hospitals. Additionally, Massachusetts lawmakers have highlighted the state regulation requiring formal notification to the state 120 days prior to a hospital’s closure, emphasizing the importance of adhering to legal procedures even during a financial crisis.

To support the transition of six hospitals to new ownership, Massachusetts has agreed to provide approximately $30 million in advance Medicaid funds to Steward Health Care. This financial aid is subject to specific conditions, including progress milestones and restrictions on how the funds can be utilized. Amidst these developments, a Senate committee has moved to investigate Steward’s bankruptcy and has issued a subpoena to CEO Ralph de la Torre for a hearing on September 12. Steward Health Care operates hospitals in multiple states across the U.S.