Embattled medical system Steward Health Care announced Friday it plans to close two of its eight hospitals in Massachusetts within several weeks.
Carney Hospital in Boston's Dorchester neighborhood and Nashoba Valley Medical Center in Ayer will close around the end of August, according to an announcement from Steward, calling it a "challenging and unfortunate situation."
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Steward, which owns 31 hospitals in eight states, including Massachusetts, filed for bankruptcy in May, with more than $9 billion in debt. It has been working to sell of its proceedings amid the bankruptcy proceedings, and Gov. Maura Healey said earlier this week that bids were submitted for all of Steward Health Care's Massachusetts hospitals.
Read Steward's statement on the closure of Carney Hospital and Nashoba Valley Medical Center here:
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Over the past several months, Steward Health Care has been actively working to sell or transition all its Massachusetts hospitals and we are in active final negotiations to sell six of them. Despite the extensive sale process, which involved close coordination with lenders and regulators, there were no qualified bids for two hospitals, Carney Hospital and Nashoba Valley Medical Center, and, unfortunately, they will be closing on or around August 31, 2024.
This is a challenging and unfortunate situation, and the effect it will have on our patients, our employees, and the communities we serve is regrettable. We will do all we can to ensure a smooth transition for those affected while continuing to provide quality care to the patients we will continue to serve.
We will work closely with our Carney and Nashoba patients to help them find the best possible care alternative and with our valued employees and health care professionals to assist with this very difficult transition. Further, we have notified and are closely coordinating with the appropriate state and federal agencies on the closure process.
We will provide further updates as additional or more detailed information becomes available.
Also Friday, Healey issued a statement in response to the planned closure, noting that the state has prepared for the moment and will work to smoothly transition patients and employees impacted the closure.
Read Gov. Healey's statement here:
This is not over. It’s regrettable that Ralph de la Torre and Steward’s greed and mismanagement are resulting in the closures of Carney and Nashoba Valley hospitals. 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.
For the remaining hospitals, we know that Steward received several bids to not only maintain but improve five of their hospitals in three key regions. It is time for Steward and their real estate partners to finally put the communities they serve over their own selfish greed. They need to finalize these deals that are in their best interest and the best interest of patients and workers.
As this process continues, I want to particularly recognize the employees at Steward hospitals who have continued to work day after day to provide care and comfort to patients in need. These employees have demonstrated a selfless commitment to their patients, and I am immensely grateful to them. We are committed to supporting them through this transition, as well as the communities who will be impacted by these closures. For our administration, this has always been about protecting health care and jobs. We have been working every day toward that goal, and I can tell you that we are continuing to do everything we can to accomplish that.
Other Massachusetts politicians released scathing statements Friday.
Sen. Elizabeth Warren called the closures "outrageous," and 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."
"The callousness demonstrated for the health and well-being of the people of Massachusetts is nothing short of astonishing," Sen. Ed Markey said.
Boston Mayor Michelle Wu called the closure of Carney Hospital Steward's "latest failure for the people of Boston," and added that the city is "grateful to all of the dedicated staff of Carney Hospital for their commitment to our community, and we will work closely with those workers, their unions, and all community stakeholders as we move forward."
The news comes within a day a U.S. Senate committee opening a federal investigation into Steward Health Care and subpoenaing company CEO Ralph de la Torre.
Senators had asked de la Torre to testify before Congress voluntarily several times, but he has refused. The rare subpoena from the Senate Committee on Health, Education, Labor and Pensions compels Steward's CEO to testify.
Before the vote, Sen. Bernie Sanders, I-Vt., said that while Steward was shutting down hospitals, de la Torre received a $100 million pay day, purchased a $62 million private jet, a $15 million custom fishing boat and a $40 million yacht.
"It is time for Dr. de la Torre to get off his yacht and to explain to Congress the financial chicanery, which made him extremely wealthy while the hospitals he managed went bankrupt. It is time for Congress to hold Dr. de la Torre accountable for his extreme greed," Sanders said.
In a statement, Steward Health Care said it plans to address the subpoena.
"We understand the desire for increased transparency around our journey and path forward," the company said. "The bankruptcy process is public and to date the record, including briefings, court appearances, mediations and related proceedings, reflect active monitoring and participation from various state regulatory agencies, governmental units, secured creditors, and unsecured creditors."
That congressional hearing is scheduled for Sept. 12.
