Steward Health finalizes four of six Mass. hospital sales

A two-story building with a driveway in front

Image | Courtesy of Google Maps A Steward Health Care facility located in Brockton

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By Colin A. Young I State House News Service

Steward Health Care has signed "definitive agreements" to sell four of the six Massachusetts hospitals it has been working to offload since filing for bankruptcy in May.

The company announced Thursday that it has finalized asset purchase agreements for Lifespan to buy Morton Hospital in Taunton and Saint Anne's Hospital in Fall River, and for Lawrence General Hospital to buy the Holy Family Hospital facilities in Methuen and Haverhill.

Steward is still working to finalize agreement related to the sale of Good Samaritan Medical Center in Brockton and the operations of St. Elizabeth’s Medical Center in Brighton to Boston Medical Center.

Terms of the deals, which still require U.S. Bankruptcy Court clearance and various regulatory approvals, were not immediately available.

"We are thrilled to have identified such qualified acquirers for hospitals in the Commonwealth that are critical to the health of underserved populations," John Castellano, Steward’s chief restructuring officer, said. "In Lifespan, Lawrence General Hospital and Boston Medical Center, we have found partners with established track records of treating communities in the northeast United States. Through these transactions, the people of the Commonwealth will continue to receive critically needed care while Steward continues to focus on its ongoing Chapter 11 process."

The finalization of some of the deals comes nearly two weeks after Gov. Maura Healey announced that there were agreements in principle among the array of parties involved. Steward had not confirmed or commented on the governor's announcement until Thursday.

Peter Markell, chief financial officer for Lifespan, said the health system has a deal to buy both the operations and the land and buildings of Morton Hospital in Taunton and Saint Anne's Hospital in Fall River. He said it is one purchase price for everything, but he said he was "not allowed" to disclose the price at this point.

"The basic agreement and what we're going to pay is in the asset purchase agreement," he said Thursday morning. "There is a separate agreement with the owners of the property, a [purchase and sale] on the acquisition of the property."

Markell said the agreement for Lifespan to buy the land does not need Bankruptcy Court approval, "but because it's all tied together, the parties involved have had to work things out ... and that has been part of the bankruptcy proceeding."

He said Lifespan is hopeful to have the state and federal regulatory approvals necessary by the end of September. He said the real estate purchase requires a filing under the Hart-Scott-Rodino Act, which generally includes a 30-day federal government review period.

"We are assuming that the authorities in both Massachusetts and the federal government want this to happen and these hospitals to stay open and get going. So we are assuming they will approve, but that is up to them," Markell said. "And we are hopeful that we will have those approvals by September 30, so we can close then."

The Lifespan CFO also said that the system has "committed X amount of money" to making capital investments and improvements in the facilities and digital infrastructure at the two hospitals.

"We don't have any plans for any significant changes now," Markell said. "The goal is to get these places stabilized and serving their communities, and we will do that and evaluate everything as we're going through that. Both these places have, [from] what we can see, good management teams, so we're looking forward to working with them and moving it forward."

Rhode Island’s largest hospital system, Lifespan has ties between its executive suite and Massachusetts.

The company is under the relatively new leadership of President and CEO John Fernandez, who left his job as president of Mass Eye and Ear and president of Mass General Brigham Integrated Care to take over at Lifespan in early 2023. And Markell joined Lifespan around the same time after a career as executive vice president of administration and finance, and chief financial officer and treasurer of Mass General Brigham.