INSIDE THE ISSUE

> New Steward Hospital Operators
> Physician Group Sold
> Flexibilities at Closing Hospitals
> Maternal Health Legislation
> Progress on the Waiver

MONDAY REPORT

New Operators Announced for Steward’s Massachusetts Hospitals

More than three months after the beleaguered Steward Health Care declared bankruptcy, three New England health systems have been identified to take over the company’s remaining Massachusetts hospitals.

Governor Maura Healey announced last Friday that, pending finalized deals, Lawrence General Hospital will assume operations of Holy Family Hospital’s two campuses in Haverhill and Methuen. Boston Medical Center Health System would take over Good Samaritan Hospital in Brockton and Saint Elizabeth’s Medical Center in Boston. Rhode Island-based Lifespan would be the new owner of Morton Hospital in Taunton and Saint Anne’s Hospital in Fall River.

“This is a win for Massachusetts,” Healey said at a Friday afternoon press conference. She referred to the three organizations as “quality hospital operators who understand the way you provide quality care to residents and communities.”

The announcement comes amid continued delays in the federal bankruptcy court process. The Healey Administration has repeatedly criticized Steward’s landlords for drawing out negotiations and standing in the way of finalized purchase agreements. Steward’s lawyer last week stated that the parties were “very, very close” on the hospital deals, which would require approval from U.S. Bankruptcy Judge Christopher Lopez.

The administration also shared that it is prepared to seize the land for Saint Elizabeth’s Hospital through eminent domain, citing especially protracted negotiations with the landlords around that property.

For the local healthcare community, the new ownership announcements were met with a sense of relief.

“MHA and our members commend the Healey-Driscoll Administration for its advocacy and action to protect Massachusetts’ healthcare system,” said MHA President & CEO Steve Walsh. “We are highly encouraged to see that trusted health systems are on track to take over Steward’s Massachusetts hospitals and have every confidence in their ability to restore normalcy, build upon relationships with patients and caregivers, and create a new legacy for these hospitals moving forward. In turn, we are hopeful that this process will help alleviate the pressures being felt by other healthcare facilities and give Massachusetts a unique opportunity to create an even more responsive system of the future.

“MHA and our members will be doing everything in our power to help facilitate a safe and efficient transition of these hospitals,” Walsh continued.

The Healey Administration shared that it is working with the legislature on a “fiscally responsible financing plan” that will help jump-start the transition process. It says funding will made available through a mix of cash advances, capital support, and federal matches.

“The work for [the operators] starts now,” stated Health and Human Services Secretary Kate Walsh. “They’re going to be taking over these hospitals, they’re going to be staffing them up, stocking them up, and making capital investments to make sure that they are safe. “

Reactions from the New Operators

All three prospective operators issued public comments last Friday. And while they largely focused on the procedural steps ahead, they were also the first public acknowledgement from any organization seemingly deemed a “qualified bidder” during Steward’s bankruptcy process.

Lawrence General Hospital

“With support from the commonwealth, we look forward to finalizing and signing an agreement that will allow Holy Family Hospital, both the Methuen and Haverhill campuses, to join Lawrence General Hospital to build a true regional healthcare care system in the Merrimack Valley.

“We are excited about the opportunity that puts quality and safety at the forefront of everything we do and is guided by the principle of caring for our community. We are grateful to the many stakeholders who have helped in this process, including our federal and state legislative delegations, local officials, and the unions who represent employees at Holy Family Hospital.”

Boston Medical Center Health System

“Boston Medical Center Health System is working with the Commonwealth to assume responsibility for Good Samaritan Medical Center and St. Elizabeth’s Medical Center to help mitigate a looming public health crisis in the region. Details of the transfer of these hospitals will still need to be finalized in a process overseen by the U.S. Bankruptcy Court. If approved, BMC Health System looks forward to working with the highly skilled clinicians and staff at each hospital to revitalize clinical services and help the communities they serve thrive. BMCHS is committed to ensuring access to high quality, equity-led care for all in need.”

Lifespan

“Lifespan continues to work on finalizing the terms of a bid to purchase St. Anne’s Hospital in Fall River, MA, and Morton Hospital in Taunton, MA, both owned by Steward Health Care System, LLC, a for-profit corporation based in Dallas, Texas.

“Once the bid is finalized and Steward and Apollo (owners of the hospital properties) designate the bid as the best bid it will then be filed with the bankruptcy court, since the terms of our purchase are subject to the court’s approval. Furthermore, the transaction will also require state and federal regulatory approvals, as well as satisfaction of sale contingencies.”

Steward’s Physician Group Finds a Buyer

While the federal bankruptcy process has been slow-going for the transfer of local hospitals, Steward did receive court approval for the sale of its national physician group last week.

Tennessee-based Rural Healthcare Group (RHG) struck a deal to acquire Stewardship Health, a network of nearly 5,000 physicians and affiliated providers across the country, for $245 million. RHG is owned by the private investment firm Kinderhook Industries, which according to the company’s press release, “invests in mid-sized health care businesses that serve the nation’s most vulnerable populations.”

When the arrangement was first announced last Tuesday, Massachusetts’ two senators immediately urged caution. “Selling Massachusetts doctors to another private equity firm could be a disaster,” said Senator Elizabeth Warren. “We can’t make the same mistake again. Regulators must scrutinize this deal.”

“Private equity did to Steward what it will keep doing to hospitals and physician networks across the U.S. — unless we put guardrails on them,” said Senator Ed Markey in his own reaction to the deal.

The Massachusetts Medical Society, the largest physician organization in the state, called upon RHG and Steward “to uphold their ethical obligations to establish and maintain transparent, timely, and simplified sharing of information with the commonwealth and our regulatory agencies to ensure deliberate and careful scrutiny of this transaction.”

The physician network has widely been viewed as one of Steward’s more valuable assets for potential buyers throughout the bankruptcy process. Optum, a national physician group owned by insurance giant UnitedHealthcare, had previously expressed its intent to purchase Stewardship, but withdrew from the process in late June.

DOI to Insurers: Flexibilities Needed for Carney and Nashoba Patients

As the healthcare system and local communities brace for the expected closures of Carney Hospital and Nashoba Valley Medical Center, the Division of Insurance (DOI) is asking health insurers to make a series of accommodations to ensure patients can continue to receive care that is covered by their plan.

DOI issued this Bulletin 2024-09 to commercial health plans, health maintenance organizations, and Blue Cross Blue Shield Massachusetts last Friday. Among other requests, it asks them to waive prior authorization requirements for the next sixty days for any previously approved surgeries, procedures, and admissions that require a transfer to another facility. MHA has asked for clarification as to whether the prior auth flexibility extends to all procedures (such as high-tech imaging, chemotherapy, or infusion treatment), as had been requested by provider organizations.

DOI also asks plans to have trained staff available to assist patients as they transition to new healthcare providers, and to expedite credentialing for clinicians who are relocating to another facility.

“The Division will continue to monitor the impact of the closures of Carney Hospital and Nashoba Valley Medical Center with respect to the availability of services for insured members and may update the timelines during which Carriers are expected to grant the flexibilities identified in this Bulletin,” stated DOI.

For MassHealth’s part, the agency said in an August 16 memo that it, too, is preparing supports for its members, easing prior authorization and pre-admission screening requirements, and expediting credentialing around Carney and Nashoba Valley.

Legislature Passes Maternal Health Reforms

Massachusetts lawmakers returned to business last Thursday and passed a wide-ranging maternal health bill that had earned support from patient advocates and the hospital community.

The legislation places special emphasis on the type of professionals who are authorized to deliver birthing and maternal care. It creates a licensure pathway for certified midwives and lactation consultants, while requiring MassHealth to cover doula services for pregnant and postpartum patients.

The bill also enhances insurance coverage for pediatrician wellness visits, requires coverage for human breast milk, and eases licensure requirements for freestanding birth centers. A new task force will be assembled around maternal health access and birthing safety, on which MHA and other provider representatives will sit.

“I am so proud that we continue to lead the nation in safeguarding reproductive health and honoring birthing autonomy by allowing more birthing options, expanding equitable access to midwifery care and postpartum support, and providing better insurance coverage for perinatal individuals in the commonwealth,” said Representative Marjorie Decker (D-Cambridge), who was a central figure in the the development of the reforms.

“This legislation is a powerful advancement of maternal healthcare in Massachusetts,” said MHA’s Vice President of Government Advocacy & Public Policy Emily Dulong. “It expands birthing options for the commonwealth’s patients, empowers midwifery and doula care, and further integrates perinatal professionals into patient care teams. We fully support the bill’s critical investments in community-based behavioral healthcare for perinatal patients, patient screenings for postpartum depression, and the new task force to set a pathway for continued access and quality in our statewide maternal health system. Hospitals and health systems have long supported this and other legislative efforts to address existing equity gaps in birthing patient care and stand ready as strong partners for anyone seeking an out-of-hospital delivery who ultimately needs medical intervention.”

While the state’s formal lawmaking period ended on July 31, the maternal health package was passed through a less common informal session. Decker had previously expressed optimism that the chambers would reach consensus in the remaining weeks of the summer given the broad similarities between the House and Senate versions passed earlier in the year.

The status of birthing and maternal care services has been the subject of increased focus among local policymakers and the hospital community. MHA’s Maternal Health Advisory Group is continuing to convene around topics such as the doula and midwife workforce, levels of maternal care implementation, federal reproductive health policies, and services delivered outside of the hospital setting. That group is comprised of 30 experts across 24 Massachusetts hospitals and health systems.

How Can a Medicaid Waiver Support Equity?

“Our hospital systems have various milestones that they have to effectuate over the course of five years. And there are measures of success attached to those,” MHA Vice President of Health Equity Izzy Lopes explained to the Health Disparities Podcast in an interview published last week. “We have, for example, collection of demographic and health-related social needs information of our patients. It also entails ensuring equitable access and quality. So this entails looking at disparities, for example, and seeking to close those disparities by developing meaningful interventions that speak to the patient population.”

The statewide waiver program is fueled by a nine-figure assessment — or tax — on hospitals that is effectively matched by the federal government, with funding made available to hospitals only once they achieve specific equity-related improvements and deliverables. This includes tracking patients’ non-medical-related needs that may affect their health (such as housing and food security), documenting unique accomodation needs for patients who have disabilities or who do not speak English as their primary language, and creating new partnerships with Accountable Care Organizations (ACO) focused on closing specific disparities such as maternal morbidity.

So far, all Massachusetts acute care hospitals have met The Joint Commission’s healthcare equity accreditation requirements – a first-in-the-nation distinction. Hospitals have also spent the past twenty months looking inward to assess how they can better accommodate the needs of certain populations, create concrete health equity goals, and successfully screen for patients’ everyday health needs.

They are now working to roll out the joint ACO projects, begin staff trainings for disability-competent care, and laying the groundwork for the new patient data collection.

“This really does [require] an intentionality on the part of our hospital systems that I think is unmatched in many ways; an intentionality and a will and a drive and a desire to do this work,” Lopes went on to say. “Because it does also entail the ability for hospital systems to look at internal processes, workflows, and procedures to really ask the question, ‘Are we serving our patients in a way that is going to achieve outcomes that are going to result in in a patient being healthy as defined by the patient?’”

The 1115 waiver was developed through a years-long collaborative process between the Executive Office of Health and Human Services and MHA member hospitals. This coordination continues as hospitals and the state further define goals for the remainder of the waiver period.

“To see the journey, the evolution of the journey, and the trajectory that our hospitals are currently on…is truly historic,” said Lopes. “Everyone has really corralled around this overall goal that the waiver seeks to achieve.”

John LoDico, Editor