The health system is currently under Chapter 11 bankruptcy protection and is seeking to sell all of its 31 hospitals in the US. Credit: Martha Dominguez de Gouveia/Unsplash.

Steward Health Care has reportedly found buyers for the sale of its two hospitals in Arkansas and Louisiana, US. 

The company filed for protection under Chapter 11 of the US Bankruptcy Code, in May this year. The case is being heard in the US Bankruptcy Court for the Southern District of Texas. 

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It also announced the sale of all 31 of its hospitals in the country.  

According to Bloomberg, Steward has now said that it found buyers for Glenwood Regional Medical Center in Louisiana and Wadley Regional Medical Center in Arkansas.  

The sales come as the company faces a bipartisan Senate investigation into its financial practices. 

Pafford Health Systems and an affiliate of American Healthcare Systems have agreed to purchase the hospitals for $200,000 and $500,000 respectively, also assuming certain liabilities, the report added. 

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These agreements are subject to approval by a bankruptcy judge but are intended to keep the hospitals operational under new ownership. 

The health system has been actively marketing its assets while under scrutiny from state and federal lawmakers.  

Bloomberg highlighted that the Senate health committee revealed plans to subpoena Steward CEO Ralph de la Torre to testify on the company’s bankruptcy and the financial decisions that led to its insolvency. 

Senators Bernie Sanders and Bill Cassidy have expressed their intention to investigate the circumstances surrounding Steward’s financial decline.  

They are particularly interested in the role of Cerberus Capital Management, the former majority owner of the company, in its financial troubles. 

Cerberus and de la Torre established Steward in 2010 after purchasing six hospitals from a nonprofit healthcare system. The company expanded rapidly thereafter.  

In 2020, the management of Steward acquired stake in Cerberus by issuing a $350m convertible note and later borrowed $335m to settle this debt. 

Bloomberg said that Cerberus has responded to the scrutiny by stating that its ownership helped rescue failing hospitals.