U.S. Bankruptcy Court Judge Chris Lopez approved the sale of six Dallas-based Steward Health Care hospitals in Massachusetts to three different health systems during a Sept. 4 court hearing.
"It's the right answer, but it's also the right answer under law," Mr. Lopez said during the hearing. "There are real people in these hospitals right now. There's no greater business justification."
The approval includes the sale of Brockton-based Good Samaritan Hospital and St. Elizabeth's Medical Center to Boston Medical Center for $140 million.
Providence, R.I.-based Lifespan has been approved to acquire Taunton, Mass.-based Morton Hospital and Fall River, Mass.-based St. Anne's Hospital for $175 million and Lawrence (Mass.) General Hospital will purchase Holy Family Hospital in Methuen (Mass.) and Holy Family Hospital in Haverhill (Mass.) for $28 million.
"The Massachusetts hospitals operate at a loss," Steward representative Candace Arthur said during the hearing. "Without the sale, the debtors would have to close the hospitals or continue to operate them to the detriment of the rest of the hospitals, and we would be asking for the profitable hospitals to continue to carry those that are not profitable. We do not think that is in the best interest of any other stakeholders."
Steward representative Ray Schrock said that the goal is to have the sales closed by Sept. 30.
While the hospital sales received support from state and federal officials, Michael Price, a representative for Steward's "first-in, last-out" lenders, objected to the sale, stating that they cannot support a sale that doesn't provide any collateral to the lenders.
Mr. Lopez also approved $42 million in funding from the Commonwealth of Massachusetts to help keep the hospitals operational during the transition. The funding comes after the state provided Steward, which sought Chapter 11 protection May 6, $30 million in August for hospital operations.
"The funding is vital," Mr. Lopez said. "This is an easy call for me to approve."