US-based Steward Health Care, which is currently navigating bankruptcy proceedings, has announced the impending closure of two of its hospitals in Massachusetts.
The hospitals include Carney Hospital in Dorchester and Nashoba Valley Medical Center in Ayer.
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Steward filed for bankruptcy in May this year but has been unable to secure buyers for these facilities amid efforts to alleviate its $9bn debt.
The closure of the two hospitals is expected to occur by the end of August, according to Steward.
According to a Reuters report, the latest development deviates from the company’s initial intention, shared with the bankruptcy judge, to maintain operations across all sites during the transition to new ownership.
The decision has drawn sharp criticism from Massachusetts officials.
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By GlobalDataMassachusetts governor Maura Healey expressed her disapproval, stating that ‘Steward CEO Ralph de la Torre’s greed and mismanagement’ are to blame for the closures.
In a statement, Healey said: “These hospitals have long served their communities, their closures are about more than the loss of beds, doctors, and nurses. We want to assure the people of Massachusetts that we have prepared diligently for this moment and will take all available steps to help facilitate a smooth transition for impacted patients and employees.”
Healey assured that the state is ready to assist patients and employees in finding alternatives.
The statement highlighted that both Carney and Nashoba hospitals will close in an orderly and regulated manner.
Meanwhile, Steward must notify the Department of Public Health, which will manage the transition for affected patients and employees, the statement added.
In a statement issued on 26 July, Senator Elizabeth Warren also condemned the hospital closures.
Warren said: “The closures of Carney Hospital and Nashoba Valley Medical Center are a direct consequence of looting by Steward executives, private equity investors, and corporate landlords at the expense of patients, health care workers, and Massachusetts communities.
“I won’t stop fighting hard to hold Steward executives accountable, and I’ll continue working with Healey to help protect health care in these communities.”
Steward, which was under the ownership of Cerberus Capital Management until 2020, has faced financial instability after selling its hospital land to a real estate company, resulting in long-term rent commitments of more than $6.6bn.
In response to all these events, a US Senate committee has subpoenaed de la Torre to testify on Steward’s financial decline at a public hearing scheduled for 12 September.
Steward has agreed to support the subpoena and emphasised that the bankruptcy process will ensure additional oversight to guarantee the safety of its hospitals for patient care.
The company recently said it found buyers for the sale of its two hospitals in Arkansas and Louisiana.
