Senator Elizabeth Warren criticizes Steward Health CEO Ralph De La Torre
During a visit to Fall River, Senator Elizabeth Warren said Steward Health CEO Ralph De La Torre “should be replaced” and called his leadership style “outrageous.”
Saint Anne’s Hospital in Fall River and Morton Hospital in Taunton will have a new owner: Rhode Island-based nonprofit healthcare provider Lifespan has agreed to purchase both facilities.
Lifespan announced Thursday that it would acquire the hospital operations, buildings and land for $175 million.
Lifespan CEO John Fernandez said his company is acquiring Steward Health Care’s hospital licenses and operations and the property from Medical Properties Trust through its lender Apollo Global Management.
“We are very happy about it,” Fernandez said in an interview. “I have to take my hat off to the people who work there. They have been through a lot, much more than we have in the last few months of uncertainty.”
How will Lifespan finance the deal?
In May, for-profit Steward suddenly filed for bankruptcy, throwing into question the future of its eight hospitals in Massachusetts and others nationwide. In its filing, it disclosed that it owed billions of dollars to more than 100,000 creditors.
His debts included $50 million to his landlord, Medical Properties Trust, a real estate company based in Alabama. MPT bought hospital buildings and land from Steward — including Good Samaritan Medical Center in Brockton, Morton Hospital in Taunton and St. Anne’s Hospital in Fall River — and leased them back to Steward.
Lifespan said the majority of the $175 million purchase price will be used to acquire the land and buildings.
The deal will be financed through debt. The company said it will receive “modest support from the state of Massachusetts for a limited period of time to maintain hospital operations.” Earlier this week, Governor Maura Healey announced a plan to rescue five bankrupt Steward Health Care hospitals. The deal could cost $700 million by 2027.
Fernandez said Lifespan and the state “have not yet reached an exact agreement” on how much money the company would receive, adding that that deal will be worked out at closing, which is expected to take place next month.
The deal is subject to court and regulatory approval. If approved, the two hospitals would be owned by Lifespan of Massachusetts, a nonprofit subsidiary of Lifespan.
Will anyone at Saint Anne’s or Morton Hospital lose their job?
Fernandez said no one at the two hospitals is expected to lose their jobs, from janitors to doctors.
“We need more people, not fewer,” Fernandez said. “We plan to keep the staff and just keep going.”
“We probably need more staff because of the nursing shortage, etc. In the healthcare sector, I wish I had the problem of too many people right now.”
He said his company has been working with Steward on a transition services agreement, with the process expected to take a year to a year and a half.
“We need to intervene and assess what needs to be fixed quickly and what needs to be implemented over time,” he said.
The hospitals would join Lifespan’s network of more than 1,600 hospitals and clinics, including Rhode Island Hospital, Hasbro Children’s Hospital, Newport Hospital and others.
“We look forward to working with them and really digging in and figuring out how we can make these organizations thrive in these two communities,” Fernandez said.
This story will be updated.
