Hartford-based Saint Francis Hospital and Medical Center has reached a settlement in a lawsuit it filed two years ago against Hartford HealthCare, alleging the larger health system engaged in anticompetitive behavior, according to a filing in federal court. Terms of the settlement were not disclosed in the filing.
The status of the negotiations between Tenor Health Partners, the company supposed to take over operations, and Sharon Regional Medical Center is currently unknown while Monday marked the deadline to close the hospital. Sources say the closure began Sunday with the emergency room at 7 a.m. and for a few hours, there were no emergency services available at the hospitals serving the Sharon area. Monday all was quiet as darkness fell over Sharon Regional Medical Center. There were some lights on and signs of hope hung in the windows but the hospital had no patients, and all medical procedures had stopped. Paramedics were available to transport patients who showed up at the hospital not realizing it was closed.
California-based, for-profit Tenor Health Partners has reached an agreement to acquire Steward Health Care's Sharon Regional Medical Center that was scheduled to close Monday. Dallas-based Steward Health System LLC is the 31-hospital chain that declared bankruptcy in May and owns Sharon Regional. Medical Properties Trust Inc. is the Birmingham, Ala.-based investment company that owns all of the hospital's real estate. Steward's creditors have not yet endorsed the deal. If approved, Pasadena-based Tenor would be the third for-profit owner of the struggling 80-bed hospital since 2014. The deal could save some 850 jobs and critical heart care services that are not available elsewhere in rural Mercer County. Tenor's website indicates the company targets struggling hospitals for partnerships and acquisitions. As of April, Tenor did not own any hospitals.
Massachusetts Gov. Maura Healey's office is making positive noises about recently approved legislation to tame the role of private equity in healthcare. The bill would close loopholes in state law exposed by last year's collapse of Steward Health Care.
The rise and fall of Steward Health Care tracks a surge in private equity into all sectors of U.S. healthcare in the wake of the 2010 Affordable Care Act. The annual value of private equity health care deals roughly tripled over the 2010s, reaching $120 billion by 2019, according to experts. Today, private equity firms own around 460 US hospitals, about 8 percent of all private hospitals and 22 percent of all for-profit hospitals, according to the nonprofit Private Equity Stakeholder Project. At its peak, Steward, with more than 30 hospitals, was a significant slice of that pie. Private equity deals are often pitched as the last chance to save struggling hospitals. Sometimes they do. In other cases, hospital systems have been stripped of assets and neglected while executives and investors reap huge payouts. Today, Steward is under scrutiny in several ways, including bankruptcy court, where the carcass of the company — $9 billion in debt — is being picked over. And in federal district court, where prosecutors are digging into allegations of financial mismanagement that hastened the company’s collapse. In Massachusetts, taxpayers are bracing for a $700 million bill to rescue several Steward hospitals, from the same government that permitted this to happen. A Steward spokeswoman said the company declined to comment. Early this year, the Globe Spotlight Team set out to examine what went wrong in this once-promising, Boston-born hospital chain. What's emerged is a cautionary tale about letting a wannabe billionaire, a titan of private equity, and a real estate investment trust become stewards of a public necessity like healthcare. It is about how they took a business dedicated to serving patients, and by their own account, turned it into a business for finance and investing. And it is about how everyone, so far, has gotten away with it.
Lawmakers rushed a hospital oversight bill to Gov. Maura Healey on Monday, agreeing on policy responses to the Steward Health Care crisis that aim to better regulate private equity firms and stiffen penalties for entities that fail to submit required information. The healthcare market reform bill would give state health regulators and Attorney General Andrea Campbell more regulatory oversight and enforcement authority over transactions involving private equity investors, health care real estate investment trusts and management services organizations.