Nashoba Valley parent company enters $245M agreement to sell physicians network
Photo I Courtesy of Alison Kuznitz/State House News Service
Nurses from Carney Hospital in Dorchester and Nashoba Valley Medical Center in Ayer demanded action from Gov. Maura Healey on July 31 after Steward Health Care announced it would close the facilities in August
There are still no signs of firm agreements related to the sale of Steward Health Care hospitals in Massachusetts, but the bankrupt company announced late Monday night that it has "entered into a definitive agreement" to sell its physicians network to a subsidiary of a New York-based private equity firm for $245 million in cash.
Rural Healthcare Group, an affiliate of Kinderhook Industries, will buy Stewardship Health pending U.S. Bankruptcy Court and regulatory approvals, the company said. Steward said its doctor network "will continue to serve its loyal patient following in the Commonwealth of Massachusetts under new ownership."
"Kinderhook has over 20 years of experience investing in mid-sized health care businesses that serve the nations’ most vulnerable populations. Kinderhook’s investments are focused on protecting access to high-quality healthcare in communities that are truly underserved. Rural Healthcare Group is a well-respected group of healthcare professionals that specifically focuses on underserved and underinsured areas," Steward President Mark Rich said in a statement. "We are confident that Stewardship Health will continue its stellar treatment of the patient population as a result of this transaction."
Stewardship Health is "among the largest Medicare accountable care organizations in the United States" and serves more than 800,000 patients annually with about 3,250 affiliate providers. Stewardship Health employs more than 290 physicians, the company said.
Also Monday, the U.S. Department of Justice filed an objection related to Steward's plan to seek court approval to sell Stewardship Health and a number of its hospitals (including as many as five in Massachusetts) at a 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 by the end of the week.
"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 Debtors have indicated, however, that despite their lack of disclosures they intend to seek approval of the Proposed Sales at the Sale Hearing."
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