WARREN — Trumbull Regional Medical Center and Hillside Rehabilitation Hospital, part of bankrupt Steward Health Care, are expected to begin an “orderly closure process” around Sept. 19.
The Dallas-based company, which filed for Chapter 11 protection listing billions in debt May 6, announced through a spokeswoman late Wednesday afternoon that despite exhaustive efforts to sell or transition the facilities to new operators, there have been no actionable offers received.
“Therefore, due to our significant cash constraints we are now in the regrettable, but unavoidable situation where the process of closing the facilities must begin,” the spokeswoman said in an emailed statement. “We remain hopeful we can find an alternative solution that would keep the hospitals open and preserve the jobs of our dedicated team members. We want to help save these hospitals and will continue to work with qualified bidders during this process.”
Meanwhile, nothing has been decided regarding Sharon Regional Medical Center in Sharon, Pa., another Steward Health-owned hospital, according to the spokeswoman.
“Negotiations are ongoing,” she said.
Two days after the health care system filed bankruptcy in a federal court in Houston, it announced plans to sell off the 31 hospitals it operates across the U.S.
Steward Health had auctions scheduled for Trumbull Regional, Hillside and Sharon Regional in July, but canceled the events, saying it had not received qualified bids for the facilities. Earlier this month, the company indefinitely delayed sale hearings for the hospitals, but did not provide a reason.
The closure, according to the company, would be in “close coordination with the appropriate government agencies,” according to the statement.
“Before that time, we will work closely with patients and their families to help them find the best possible care alternative and provide the community with all the information they need about the closures and where they can go for care in the future,” the spokeswoman said. “We will also provide support to our valued employees and health care professionals to assist with this transition. “
“This is a challenging and unfortunate situation, but we will continue to keep patient safety and care at the forefront of everything we do,” the spokeswoman said.
Objections to the planned closure must be filed with the court by Aug. 28, according to notices of closure filed Wednesday.
REACTION
“I am greatly concerned about the future of the hospital,” Warren Mayor Doug Franklin said. “I have been for some time, but the filing of that petition obviously heightens that concern and I am in contact with local representatives from the hospital, some specialized consultants and local stakeholders about a path forward to stave off the closure.”
Franklin said he would be using the “full weight of my office and all of the resources at my disposal” to work toward a solution that “keeps the delivery of health care services from that institution alive and well.”
“That is a big boulder to push uphill, but we have a lot of stakeholders who have already stepped up and have been working behind the scenes for months to prevent the closure of that historical institution in our community,” Franklin said.
Earlier this month, a group of health care professionals and community and business leaders emerged with plans to acquire Trumbull Regional’s assets and operate the hospital.
Secretary for the Warren City Hospital group, John T. Woods, president of the Insurance Navigators health insurance agency in Warren, said the group “remains optimistic about our efforts to save and upgrade the hospital.”
“Trumbull Regional has a strong staff of doctors and employees. We are eager to work with them and the operating specialists who are looking to manage the hospital. It is still our intent to get the job done,” he said.
Rick Lucas, president and executive director of the Ohio Nurses Association, said the closure of Hillside in Howland “is a tragic result of greed-driven hospital executives, backed by private equity, who prioritize their yachts and private jets over patient care.”
“This decision leaves our community without crucial rehabilitation services and forces our dedicated team of nurses and health professionals into unemployment due to Steward’s unchecked greed,” Lucas said.
The ONA and American Federation of Teachers represent 24 registered nurses at Hillside.
Guy Coviello, president / CEO of the Youngstown / Warren Regional Chamber, said he has “complete confidence in Mercy Health delivering quality health care” to the region, which is key in efforts to attract people and companies to grow the local economy.
“The priority now is helping the city of Warren and (the) Mayor (Doug) Franklin administration with the potential loss of income tax and both the city and Howland with the re-use of those properties,” Coviello said.
Mercy Health operates St. Joseph Warren Hospital, St. Elizabeth Youngstown Hospital and St. Elizabeth Boardman Hospital.
Mercy Health spokeswoman Kara Franz said in light of the decision to close Trumbull Regional and Hillside, “Mercy Health is prepared and remains ready to help offer a smooth transition for patients during this time of need.”
“Mercy Health is committed to serving our patients and extending the compassionate ministry of Jesus by improving the health and well-being of communities in the Mahoning Valley,” Franz said. “As such, we will continue providing high quality, compassionate care, now and in the future, regardless of changes in the local health care landscape.”
Gov. Mike DeWine and Bruce Vanderhoff, director of the Ohio Department of Health, issued a joint statement Wednesday night calling for accountability for Steward Health’s corporate leadership to “ensure they are actively working to support their local doctors while they work with patients and their families to find the best possible care alternative. While they have committed to do so, we will actively work with the local health care community to ensure they properly follow through on that pledge.”
“Nevertheless, we are optimistic that area residents will still be able to access quality care close to home,” citing the closeness of Mercy Health’s Warren and Youngstown hospital’s to Trumbull Regional and Hillside.
IN COURT
On Monday, attorneys for Steward Health asked the judge in case to be released from what it called “expensive and burdensome” lease agreements with its landlord, Alabama-based Medical Properties Trust.
Doing so, according to a motion, would help Steward Health to more easily sell its facilities, including the three in the Mahoning and Shenango valleys as well as other hospitals in Louisiana, Arkansas, Arizona, Texas and Florida.
The motion claimed Steward Health’s sale process has been “challenged by the self-interested involvement and interference” of Medical Properties Trust, which has imposed “daunting requirements” on potential hospital buyers.
The motion also states Steward Health has requested all bidders submit bids that “contemplate a total enterprise value” for operations and real estate. Also, the company wants in connection to the sale of certain hospitals, for the court to order proceeds from real estate and operations to be placed in an escrow account “pending a determination … regarding allocation of value” between Steward Health and Medical Properties Trust.
Steward Health also Monday filed an adversary lawsuit that requests the judge in the case to make a determination of value of Steward Health’s assets and the leases held by Medical Properties Trust.
Medical Properties Trust fired back the same day.
In response, Medical Properties Trust said if Steward Health’s proposal is allowed to move forward, it “would be an affront of the bankruptcy process and an affront to MPT’s property rights.” Also, neither the U.S. bankruptcy laws of the Constitution allows a debtor-tenant and purchaser of the Steward Health’s operations “to dictate the terms on which the debtor’s landlord (MPT) will sell its private property.”
It is Steward Health that has “prevented sales from going forward, not to protect public health or the like, but to attempt to force MPT to transfer real estate value to the debtors and their lenders as the price of allowing sales to go forward that are necessary to avoid closures.”
