Hospitals’ Closures Paused; Trumbull, Hillside Accepting Patients

WARREN — Efforts to close both Trumbull Regional Medical Center and Hillside Rehabilitation Hospital have been paused and both facilities will remain fully operational, according to a hospital spokeswoman said Saturday.

Trumbull Regional is no longer diverting EMS patients and both Hillside in Howland and Trumbull in Warren are accepting all admissions, according to the statement. 

Following the Aug. 21 announcement by Steward that it planned to close both Ohio hospitals by Sept. 20, some patients had been diverted and Hillside nurses were reporting a more than 50% drop in patients expected by the end of this weekend. 

The announcement came from following the settlement agreement outlined in bankruptcy court Friday that cleared the way for Steward hospitals to be transitioned to new ownership. Steward and its landlord, Medical Properties Trust, agreed that MPT would fund and take over existing hospital operations, and following the sale of Steward’s hospitals, MPT would make payments to lenders and creditors with proceeds from the transactions.

On Friday, an attorney for Steward stated the settlement did not apply to Ohio and Pennsylvania hospitals, but he was hopeful agreements would be completed soon with buyers that would stop the closure of all Steward hospitals. 

An offer to buy Trumbull Regional was made by the Western Reserve Health Education Inc., in conjunction with efforts led by the Warren City Hospital group that succeeded in raising $20.5 million for interim financing. However, there is no word if Steward accepted the WRHE proposal. 

And there is no word if actionable offers have been made to buy Hillside or Steward’s Sharon Regional Medical Center in Sharon, Pa.

Steward  and MPT issued a joint news release late Friday. Here is the full text of their release:

Steward Health Care, the country’s largest physician-led, minority-owned, integrated health care system, announced today it has reached an agreement in principle with its landlord, Medical Properties Trust Inc., supported by the “FILO” secured lenders under its funded debt and the official committee of unsecured creditors.

Following Bankruptcy Court approval, the agreement allows for the transfer of hospitals that are governed by MPT’s master lease to new interim operators and the funding of ongoing operational costs by MPT. Additionally, Steward and MPT have agreed to the mutual release of all claims on secured lease obligations between them, including the release of billions of dollars of claims held by MPT against Steward. Upon transferring Steward’s interests in these hospitals, MPT will become fully responsible for all related operational expenses, and Steward will be well positioned to advance towards effectively and efficiently administering the balance of their chapter 11 cases and providing recoveries to creditors. Additionally, the global agreement provides for Steward’s retention of proceeds from the sale of its “Space Coast” hospitals located in Florida to pay lenders and creditors.

Steward is seeking approval from the court on the settlement agreement as soon as possible with a possible hearing on Sept. 10, 2024.  

This settlement achieves a major milestone in Steward’s chapter 11 efforts and, together with the binding agreements reached for the transition of six Steward hospitals in Massachusetts, supports continuity of patient care by establishing a path for keeping the majority of Steward hospitals open, provides stability for its valued workforce by retaining nearly 30,000 jobs and a potential recovery for general unsecured creditors, avoiding contentious and costly litigation.

“This is a crucial and positive development today in our ongoing effort to transition Steward hospitals to new operators, pay Steward’s debts, and support our patients, employees, and the communities we have had the privilege of serving for many years,” said Dr. Ralph de la Torre, CEO of Steward Health Care. “After exhaustive, round-the-clock efforts by all parties, we are extremely pleased that this potential agreement creates a path that we hope will enable all remaining Steward hospitals to stay open and allows our dedicated staff of providers and others to devote their full attention to patient care.”

The agreement marks a pivotal point in the Chapter 11 process and pending approval from the bankruptcy court, Steward, with the oversight of the transformation committee, will engage with key stakeholders in connection with formulating the terms of a confirmable Chapter 11 plan.

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