Bankrupt Steward Health Care Puts All 31 U.S. Hospitals Up for Sale
Bankrupt Steward Health Care Puts 31 U.S. Hospitals Up for Sale
In a bid to address its staggering $9 billion in total liabilities, bankrupt Steward Health Care has put all 31 of its U.S. hospitals up for sale. The company, which filed for bankruptcy protection on Monday, aims to finalize transactions by the end of the summer, according to its attorneys who spoke at a court hearing in Houston.
Despite the financial turmoil, Steward’s attorneys emphasized their commitment to keeping all hospitals open over the long term. Steward attorney Ray Schrock assured U.S. Bankruptcy Judge Chris Lopez that the company’s goal is to prevent any hospital closures, stating, “Our goal remains that there are zero hospitals closed on our watch.”
The privately-owned company has faced criticism in the past, particularly in Massachusetts where a hospital was closed earlier this year. State officials have accused Steward’s management and former private equity owners of making short-sighted financial decisions that compromised patient care.
Court documents revealed that Steward carries over $9 billion in total liabilities, including loans, long-term rent obligations, unpaid bills from vendors, and unpaid employee wages and benefits. Despite this hefty debt load, Schrock highlighted the company’s $6 billion in annual revenue before filing for bankruptcy, indicating that there is still value in Steward.
Steward had initially planned to avoid bankruptcy through the sale of its physician group to UnitedHealth subsidiary Optum Care. However, regulatory delays forced the company to seek emergency financing, leading to its current bankruptcy filing.
During the court hearing, Steward was granted permission to borrow $75 million from Medical Properties Trust, with plans to borrow an additional $225 million later in the bankruptcy process. The company is set to hold auctions for its hospitals on June 28 and July 30, with Schrock emphasizing the importance of maximizing the value of these assets.
As Steward navigates through its bankruptcy proceedings, the fate of its hospitals remains uncertain. However, the company’s determination to keep its doors open and serve its communities underscores its commitment to providing quality healthcare amidst financial challenges.