State officials are stepping up preparations for what would happen if Steward Health Care were to cut back services or close hospitals in Eastern Massachusetts, convening five regional meetings with hospitals and community health centers to plan for a possible influx of patients.
The meetings, to be held virtually, will start next Thursday and be closed to the public. They are part of what some in the sector describe as a flurry of behind-the-scenes planning in recent weeks. State agencies have been taking inventories of regional health care resources, assessing their capacity to accommodate patients from Steward’s eight hospitals at a time when facilities are already strained.
Meanwhile, as the state Health Policy Commission opens a preliminary review of Steward’s plan to sell its doctors network to UnitedHealth’s Optum unit, commissioners warned Thursday that the agency needs to determine how the proposed sale will affect Steward hospitals.
“It is impossible to understand the impact of the proposed physician transaction without understanding what that means for the hospitals and, of course, for the patients,” Deborah Devaux, who chairs the agency’s board, told fellow commissioners Thursday.
Letters sent Thursday invited the heads of hospitals and community health centers in areas where Steward operates hospitals to sessions that will “focus on what we can do in the coming months to meet the needs of the patients and providers in our communities.”
Among the focus areas at the regional meetings will be the need to assure adequate medical and surgical, maternity, emergency, and urgent care services over the next six months, the letters said. At separate meetings in the coming weeks, the parties will discuss behavioral health, workforce planning, academic programs, and clinical rotations.
The letters, obtained by the Globe, were sent by the state Department of Public Health. They were signed by DPH Commissioner Robbie Goldstein along with Steve Walsh, president of the Massachusetts Health & Hospital Association, and Michael Curry, president of the Massachusetts League of Community Health Centers.
Walsh applauded state leaders for hosting the meetings. “The most important thing is that we serve patients,” he said Thursday. “We’re beginning to see those [Steward] patients show up at other hospitals in the region. It’s important to have conversations with local health care leaders to make sure patients get the services they need.”
In a statement, Goldstein said the meetings would provide updates on what state officials are doing, hear concerns from participants, and “strategize” about how to jointly address the Steward crisis.
The letters don’t explicitly warn of hospital closures. Instead, they cite “growing uncertainty and concern” about Steward’s future, saying “the situation has become increasingly urgent.” But Steward’s financial problems are clearly mounting.
Weighed down by debt, Steward has missed payments of bills to vendors and rents to a real estate investment trust that bought its hospital buildings in 2016. It is trying to sell its hospitals, but next week’s meetings won’t be a forum for any negotiations. It wasn’t immediately clear whether Steward hospital representatives were invited.
Steward struck a preliminary deal to transfer its doctors network, called Stewardship Health, to Optum. That transaction is currently being reviewed by state and federal agencies. But it’s uncertain how long the reviews will take and whether the deal, even if completed, would be enough to stave off a potential Steward bankruptcy filing.
While the Health Policy Commission has begun its initial review, staffers told its board of commissioners Thursday that their 30-day timetable for completing that review won’t start until Steward and Optum have completed their filing and provided data requested by the staff.
If the initial review finds the deal could drive up costs or harm competition, the agency could launch a more intensive cost and market impact review, potentially extending the process for up to nine months.
Steward has the third largest physician contracting network in the state with about 2,950 employed and affiliated doctors, behind Mass General Brigham with about 7,600, and Beth Israel Lahey Health, with about 4,500, according to the commission staff. But the commission is still trying to nail down how many of those doctors would be part of the Optum transaction and their relationship to Steward hospitals afterward.
Commissioner Barbara Blakeney said the agency also needs to know how much of the proceeds from a sale will be used to strengthen Steward’s financially struggling hospitals and “how much goes to Dallas” and the Steward corporate executives who are based there.
Thursday’s letter from the state public health commissioner said Steward’s financial problems pose particular challenges for “health care providers in service areas that overlap with one of more Steward hospitals.”
Steward operates eight hospitals in Massachusetts: St. Elizabeth’s in Brighton, Carney Hospital in Dorchester, Good Samaritan in Brockton, Holy Family in Methuen and Haverhill, Morton Hospital in Taunton, Nashoba Valley in Ayer, Norwood Hospital, and St. Anne’s in Fall River. It closed a rehabilitation hospital in Stoughton in March.
Most of the hospitals are part of the former Caritas Christi health system long run by the Catholic archdiocese of Boston. In 2010, those hospitals were sold to Steward, backed by private equity firm Cerberus Capital Management, and converted into a for-profit system.
Steward, which moved its headquarters to Dallas from Boston, expanded nationally and now operates 33 hospitals around the country. Cerberus, based in New York, cashed out of its investment in 2020.
At the upcoming meetings, state officials plan to update hospital and health center leaders about “likely scenarios” and seek their thoughts on how to respond, according to the invitations. They also plan to initiate weekly “emergency preparedness calls,” convened by the DPH, echoing a strategy used in the early months of the COVID pandemic.
The hosts said they are trying to limit the size of the sessions to encourage frank and open discussions. In addition to the hospital and health center leaders, they’ve invited Tara Gregorio, president of the Massachusetts Senior Care Association, and Amy Rosenthal, executive director of the nonprofit Health Care for All, who represent patients and senior care residents.
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