Steward plans to close Carney Hospital, Nashoba Valley Medical Center

Steward Health Care, the bankrupt, for-profit hospital chain, plans to shutter Carney Hospital in Dorchester and Nashoba Valley Medical Center in Ayer. The company said Friday that despite efforts to sell the facilities no “qualified” bids had emerged.

Steward expects to close both hospitals “on or around August 31,” according to a statement.

“This is a challenging and unfortunate situation, and the effect it will have on our patients, our employees, and the communities we serve is regrettable,” the company's statement said. “We will do all we can to ensure a smooth transition for those affected while continuing to provide quality care to the patients we will continue to serve.”

Steward, the third largest hospital system in Massachusetts, filed for Chapter 11 bankruptcy in May. The company ran eight hospitals in the state and dozens more across seven other states. It is attempting to sell them through auctions as it works to restructure. Steward said it is “in active final negotiations” to sell its other Massachusetts facilities.

Steward doesn't own the buildings or land for its hospitals, which has presented a significant challenge to would-be buyers. In Massachusetts, the properties are jointly owned by a pair of real estate companies. Potential buyers have to reach deals with Steward and make agreements to lease or purchase the properties.

Gov. Maura Healey, in a written statement, blamed “greed and mismanagement” for the closures, adding, "This is not over." But she said the state is ready to help patients and workers through the transition. Healey urged Steward and its landlords to move forward with sales for the other hospitals.

“It is time for Steward and their real estate partners to finally put the communities they serve over their own selfish greed,” Healey said. “They need to finalize these deals that are in their best interest and the best interest of patients and workers.”

A group of more than two dozen elected officials called for the state to step in and save Carney Hospital, saying it provides crucial health care and addresses disparities in an underserved community. Workers there were still digesting the news on Friday, according to Karl Odom, 69, a cardio pulmonary technician at the Carney for 47 years.

"Everybody's in shock," Odom said, describing a hallway where staff were gathered in small groups, some crying. "They could have given us more time but 30-60 days, that's a gut punch."

Congresswoman Lori Trahan, a Democrat whose district includes Ayer, said she plans to request a federal investigation into the decision to close Carney and Nashoba Valley.

"Steward executives should be ashamed of what they’ve done to patients and providers here in Massachusetts and across our country," Trahan said in a statement. "Their predatory private equity business model focused on extracting every last penny of profits while ignoring their obligations to their hardworking staff and the families they serve."

Steward has confirmed that is already cooperating with a federal Department of Justice probe of its business practices.

Court filings earlier this week revealed Steward did not receive any "qualified bids" for its hospitals in Ohio and Pennsylvania. It received one bid each for a pair of hospitals in Arkansas and Louisiana. An auction for hospitals in Florida has not yet taken place.

According to Healey, the next step in the closure process for the Carney and Nashoba Valley facilities will be for Steward to seek approval from the judge in its bankruptcy case.

Healey, speaking earlier this week, indicated there were bidders for all of Steward's Massachusetts hospitals. However, Health and Human Services Secretary Kate Walsh said there were no qualified bidders, meaning bids the bankruptcy court would accept, for Carney and Nashoba Valley. Still, she said it was Steward's decision to close them. Walsh said the state can't force Steward to keep the hospitals open for the usual transition period, 120 days, rather than the announced 30-60 days.

"The state could revoke Steward's license," she said, "but they've already surrendered it."

Steward patients are voting with their feet too, reducing overnight stays at the Carney and Nashoba Valley to about a dozen patients each, according to Walsh. The state will try to boost access to urgent care clinics, so patients in Nashoba Valley aren't left driving long distances when they have chest pain or signs of a stroke, Walsh said.

Steward's other hospitals include Morton Hospital in Taunton, Saint Elizabeth's Medical Center in Boston, Good Samaritan Medical Center in Brockton, Saint Anne's Hospital in Fall River and Holy Family Hospital in Methuen and Haverhill. Its Norwood Hospital closed after flooding in 2020 and was not included in the list of hospitals for auction.

"We think we can save five hospitals," Walsh said of the facilities other than Norwood. Walsh called on Steward, its lenders and the bankruptcy court to accept the qualified bids offered for these hospitals.

"Otherwise there will be nothing left," Walsh said.