Carney and Nashoba closure permit is not a mandate, there is still time to save hospitals

The state’s largest nursing organization isn’t ready to give up just yet when it comes to the pair of Steward Health Care hospitals that a Texas-based bankruptcy judge ruled could close by the end of August, and they’re calling on state leaders to act.

Despite U.S. Bankruptcy Judge Christopher Lopez’s ruling that Steward’s business interests would dictate whether Carney Hospital in Boston and Nashoba Valley Medical Center in Ayer should close or stay open, the Massachusetts Nursing Association says the way has been cleared for another buyer to step in and save the pair of medical facilities.

“Following last week’s bankruptcy hearing, we are relieved that the court appropriately rejected the master lease covering the Massachusetts hospitals. We fully support this decision, as it is necessary to allow the new operators to negotiate new lease terms with the owner (Medical Properties Trust and Macquarie Infrastructure Partners) for these hospitals,” the association said in a statement Monday.

Dallas-based Steward filed for bankruptcy protection in May after it became clear the company could not meet mounting debts. Detailing its $9 billion in unpaid obligations, the company’s lawyers told Judge Lopez that it would have to sell its 31 hospital properties at auction to make ends meet.

Eight of those properties are in Massachusetts, and most of them received “qualified bids” at an auction held last month. However, Carney and Nashoba did not receive a “qualified bid,” and Steward announced it would close the two hospitals on or about Aug. 31.

According to the Healey administration, that closing date would violate state law because it falls within a 120-day notification period before any hospital closes. MNA expects the state to follow its own law.

“We are pleased to learn that the Governor has stated that her administration supports Steward’s adherence to state law requiring 120 days’ notice prior to the closure of Carney and Nashoba to allow for a transition to a new operator, and we call on the Attorney General to exercise her authority to enforce that law,” the nursing association said.

Despite that rule, Lopez said last week that the two hospitals were losing money and that even though a state law requires notification, that doesn’t pay the bills to keep the lights on. What he didn’t say, according to MNA, is that Steward should close those hospitals, only that they could.

“It is important to note that while the Bankruptcy Court ruling authorized the closure of Nashoba Valley and Carney, it did not mandate it. Therefore, there is still an avenue to salvage those facilities, as the court’s relief from the burdensome prior lease agreement provides a new opportunity to re-examine and engage with potential bidders for those two hospitals,” the nursing association wrote.

At least one company, Michigan-based Insight, has expressed interest in Carney and Nashoba Valley. Atif Bawahab, chief strategy officer for Insight Health System, told the Herald on Monday that the company remains interested.

“As a physician-led organization, Insight Health System believes in providing equitable access to healthcare services for all, and we deeply understand how disruptive healthcare facility closures can be to local communities. We have proven experience transforming struggling healthcare facilities into financially stable pillars of community health services with unmatched patient care – something we’ve done in Southside, Chicago; Flint, Michigan; and we’re ready and able to do it here in Massachusetts.”

Keeping both hospitals running, according to the nurses’ association, will require the “willingness of all stakeholders to act.”

“And no one more so than our leaders across state government, who are ultimately responsible for protecting and ensuring the public health of all of our residents,” they wrote.

In addition to Carney and Nashoba Valley, Steward owns and operates Good Samaritan Medical Center in Brockton, Holy Family Hospitals in Haverhill and Methuen, Morton Hospital in Taunton, Saint Anne’s Hospital in Fall River and St. Elizabeth’s Medical Center in Brighton. Its Norwood Hospital has been closed since 2020 due to flooding, and it closed New England Sinai Hospital permanently in April.

Originally published: August 5, 2024 at 6:17 p.m.