Steward Health Care said late Wednesday night that it has again postponed the sales hearing for its hospitals in Massachusetts, this time to next Thursday.
"[T]he Sale Hearing for the Debtors’ Hospitals in Arkansas, Louisiana, and Massachusetts, previously scheduled for August 16, 2024 at 10:00 a.m. (Central Time), is hereby adjourned to August 22, 2024 at 1:00 p.m. (Central Time)," the company said in a late-night U.S. Bankruptcy Court filing.
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Steward has said that it has bids for five hospitals on six campuses in Massachusetts but has not yet revealed the identities of its suitors or the details of offers on the table. The latest in a parade of delays comes the same week that the bankrupt company announced it has "entered into a definitive agreement" to sell its physicians network to a Tennessee-based subsidiary of a New York private equity firm for $245 million in cash. That deal is still up for court approval at a hearing this Friday at 10 a.m. CT, the filing says.
The company has already received court approval to close Carney Hospital in Dorchester and Nashoba Valley Medical Center in Ayer, but officials have told the court that they "received binding bids from local operators to acquire six (6) of their Massachusetts hospitals which includes Saint Elizabeth’s Medical Center, Saint Anne’s Hospital, Good Samaritan Medical Center, Holy Family Hospital – Haverhill, Holy Family Hospital – Methuen, and Morton Hospital."
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Massachusetts state government struck a deal with Steward to provide $30 million in advance Medicaid payments to keep hospitals here afloat through August, but officials did not answer questions this week about whether any payments have been or will be made under the terms of that agreement. It called for Steward to have entered into "agreements to acquire the hospital operations and land of" the Massachusetts hospitals by Aug. 9 and for Bankruptcy Court approval of sales by Aug. 15.
Instead, the Executive Office of Health and Human Services said Monday that it was disappointed that asset purchase agreements for the remaining five for-sale hospitals had not yet been signed by that point.
Also Monday, the U.S. Department of Justice filed an objection related to Steward's original plan to seek court approval to sell Stewardship Health and a number of its hospitals in three states at the now-delayed hearing this Friday.
The federal government "objects to any Proposed Sales to the extent such sales seek to transfer the Debtors’ Medicare Part A Provider Agreements in violation of applicable federal law," the filing said. The DOJ suggested that it filed the objection and reservation of its rights in part because Steward has not yet disclosed the identities of the companies bidding on hospitals that it expects to sell.
"Under the Bid Procedures Order … the Debtors should have disclosed the results of the auctions, including the Successful Bidders and material terms for the Proposed Sales, on August 7, 2024. As of this filing, the Debtors have not disclosed the Successful Bidders for the Proposed Sales, or filed proposed orders or asset purchase agreements indicating the terms of such Proposed Sales pursuant to the Bid Procedures Order," DOJ wrote.
The court-approved procedures that Steward must follow during its bankruptcy off-selling process allow that "Sale Hearings may be adjourned or rescheduled as ordered by the Bankruptcy Court, or by the Debtors after consultation with the Consultation Parties, but without further notice to creditors and parties in interest other than by announcement by Debtors of the adjourned date at the Sale Hearing(s)."
