The Massachusetts healthcare landscape is undergoing significant change as the state steps in to take control of St. Elizabeth’s Medical Center through eminent domain. Governor Maura Healey announced this decisive move following protracted negotiations and delays by Steward Health Care and its private equity investors. This action is part of a broader effort to stabilize hospital operations across the state amidst Steward Health Care’s financial turmoil.

The Path to Eminent Domain: Why St. Elizabeth’s?

St. Elizabeth’s Medical Center, located in Boston’s Brighton neighborhood, has long been a cornerstone for the community. As negotiations to sell the hospital stalled repeatedly, the state determined that taking control was essential to ensure continued care for patients. Governor Healey specifically called out private equity firms like Medical Properties Trust, Macquarie Infrastructure Partners, and Apollo Capital Management for prioritizing their financial interests over the well-being of Massachusetts residents.

In addition to St. Elizabeth’s, deals are underway for other Steward hospitals in Massachusetts. Notably, Lawrence General Hospital is set to operate the Holy Family campuses in Haverhill and Methuen, and Lifespan Health System is expected to take over Morton Hospital in Taunton and Saint Anne’s Hospital in Fall River. Boston Medical Center plans to operate both Good Samaritan Medical Center in Brockton and St. Elizabeth’s in Brighton once the transition is finalized.

The State’s Bold Move: A New Chapter for Massachusetts Healthcare

Governor Healey’s administration has committed $30 million to support hospital operations through the end of the month, ensuring uninterrupted patient care. The move to seize St. Elizabeth’s and the broader agreements reached for other Steward hospitals mark a turning point. It also highlights the growing trend of states stepping in to protect critical healthcare resources from the potentially destabilizing effects of private equity ownership.

“This is the exact kind of aggressive action that healthcare workers have been demanding from our state leaders,” said Tim Foley, executive vice president of 1199SEIU, which represents many of the affected hospital employees. The state’s intervention ensures that thousands of healthcare jobs will be preserved, and the hospitals will continue to serve their communities.

However, not all hospitals were able to secure buyers. Carney Hospital and Nashoba Valley Medical Center are still set to close, impacting over 1,200 employees. The Healey administration has pressured Steward to provide severance pay to these workers.

What’s Next for Massachusetts Healthcare?

The successful transitions of these hospitals to new operators mark the end of Steward Health Care’s troubled tenure in Massachusetts. As Governor Healey stated during the press conference, “We’re closing the book on Steward once and for all. Good riddance and goodbye.” The state’s proactive approach offers a blueprint for how public officials can intervene to ensure the stability and quality of healthcare services amid corporate and financial instability.

Call to Action: Navigating Healthcare Transitions

The evolving situation surrounding the sale and state intervention of these hospitals highlights the complex intersections of healthcare, law, and finance. If you have questions about the legal and regulatory implications of such transitions or need guidance on navigating healthcare transactions, please contact Parrella Health Law at 857-328-0382 or email Chris directly at cparrella@parrellahealthlaw.com. Our team is here to help you navigate these complex regulatory changes and protect your organization from legal exposure.