DALLAS--(BUSINESS WIRE)--Amidst unprecedented challenges across the health care industry and within its system, Steward Health Care announced today a six-point action plan that will enable the organization to emerge as a sustainable business and move into its next operational phase.
Since its inception in 2010, with the purchase of the struggling Caritas Christi community hospital system, providing high-quality health care to the most vulnerable patient populations, beginning with Massachusetts, has been Steward’s north star. Steward’s evolution of its business and operations allows for a model of care that addresses external pressures and ensures uninterrupted patient care in Massachusetts and the other regions it serves.
“First and foremost, we want to continue to do the right thing for patients, our staff, and our communities. That is our commitment going forward. In the future, that will take a different form, but the mission remains the same,” said Michael Callum, M.D., Steward’s Executive Vice President for Physician Services and Interim President, NE Region.
The pillars of the Action Plan include:
Funding and Financial Stability: Steward, in concert with its current lenders, has recently finalized a robust financing agreement that will provide a $150 million cash infusion to provide additional liquidity as the company marches towards the sale of its highly desired asset physician group Stewardship Health. This allows Steward to reset its operations and address vendor obligations, which it is working diligently to resolve in service to getting to a sustainable operating model. Included in these agreements, the lenders have provided an additional “vote of confidence” in this plan. They have not only decided to increase their financial commitment to Steward through the bridge loan, but they have also agreed to extend their forbearance agreement through April 30, 2024 to give the Company time to execute this plan.
Employee Retention and Continuity: Steward’s skilled and dedicated clinicians and staff are the Company’s primary “asset.” The employees that come in day after day to care for its patients with the common goal of simply healing the sick, comforting the dying, and showing compassion to the families are the foundation of Steward. To maintain staffing and levels of care, Steward has successfully negotiated new labor agreements with the MNA and SEIU and secured and maintained its robust pension plan. It is continuing to incentivize its employees to ensure that medical centers and physician’s offices are open and continuing to serve patients and the broader community. In addition to be able to continue to recruit in a very competitive nursing market, the Company has instituted a plan to attract nursing employees to work at its busiest hospitals and has offered “referral” fees to current employees of up to $40,000 per hired employee.
Asset Sales: Steward is in process and working proactively to immediately sell non-essential assets, including Steward-owned aviation, and, downsizing its non-patient footprint through back-office consolidations – many of which have been completed. In addition, Steward is continuing to actively seek strategic opportunities to divest non-core assets with a focus on improving the system’s liquidity position.
Northeast Restructuring: Steward has retained Alix Partners to advise on a restructuring of Steward to better support their hospitals and continue to deliver high-quality care in community settings. New leadership within the northeast region has been appointed who will continue Steward’s laser focus on patient care and quality. It will be physician led and patient centric every step of the way.
Cooperation and Transparency in Massachusetts:
Steward sent a letter in response Governor Healey on Wednesday, February 21, 2024.
Steward has tried to be transparent, compliant and cooperative over the years in providing a significant amount of detailed and relevant financial documentation to various state agencies and regulatory bodies and moving forward it commits to do even better.
Since November 2023, Steward has worked to comply with every request of the Massachusetts Attorney General’s Office and the EOHHS. It has supplied all of the audited financial statements that have been prepared. Steward has supplied draft statements with footnotes for years where the audit remains incomplete.
Steward has also provided over 613 megabytes of documentation (tens of thousands of pages of information) to the Massachusetts AG office’s and will continue to provide more.
Leadership Communication: Senior Steward representatives intend to meet with public officials in the Commonwealth to discuss the go forward plan for ensuring continued first-class care to its patient population.
About Steward Health Care
Over a decade ago, Steward Health Care System emerged as a different kind of health care company designed to usher in a new era of wellness. One that provides our patients better, more proactive care at a sustainable cost, our providers unrivaled coordination of care, and our communities greater prosperity and stability.
As the country’s largest physician-led, minority-owned, integrated health care system, our doctors can be certain that we share their interests and those of their patients. Together we are on a mission to revolutionize the way health care is delivered - creating healthier lives, thriving communities and a better world.
Steward is among the nation’s largest and most successful accountable care organizations (ACO), with more than 4,450 providers and 30,000 health care professionals who care for 12.3 million patients a year through a closely integrated network of hospitals, multispecialty medical groups, urgent care centers, skilled nursing facilities and behavioral health centers.
Based in Dallas, Steward currently operates 33 hospitals across Arizona, Arkansas, Florida, Louisiana, Massachusetts, Ohio, Pennsylvania, and Texas.
For more information, visit www.steward.org.
