Regional medical practices part of sale group
A financially stressed hospital chain is proposing to sell its U.S. network of physician practices, a move that would affect about 100 doctors and other medical providers who have offices in Lawrence and Mercer counties.
For-profit Steward Health Care of Dallas on Tuesday petitioned the Massachusetts Health Policy Commission to sell its U.S. physician network for an undisclosed sum to Collaborative Care Holdings LLC, an Eden Prairie, Minn.-based subsidiary of UnitedHealthcare’s Optum Care unit.
Family practice doctors, cardiologists, cardiothoracic surgeons and other physicians practicing in northwest Pennsylvania would be among those affected by the deal.
According to Steward’s website, the company employs 1,700 doctors and other medical providers in 11 states, 99 of whom practice in Pennsylvania. Optum Care employs 60,000 doctors at 2,000 locations nationwide.
The transaction, which requires a formal review by the Health Policy Commission and other regulatory agencies, isn’t expected to close for several months.
If approved, patients may not see many changes at the doctor’s office: Steward and Optum said no immediate effects on physician referral patterns, reimbursement rates or quality and access to medical care were anticipated.
Steward owns the 163- bed Sharon Regional Medical Center, the biggest of three hospitals in Mercer County and the county’s dominant employer. The sale is expected to draw renewed attention to the influence of private capital in health care, a new focus of the Federal Trade Commission and Department of Justice.
“This is a significant proposed change involving two large medical providers, both in Massachusetts and nationally, with
It would be a terrible mistake for Steward to be allowed to walk away while looting Massachusetts hospitals one more time. Steward executives have no credibility.”
Sen. Elizabeth Warren
D-Mass.
important implications for the delivery and cost of health care across Massachusetts,” David Seltz, executive director of the public watchdog group Health Policy Commission, said in a prepared statement.
“The sale cannot be completed until after the HPC’s review and any concurrent review by state or federal antitrust authorities.”
Steward spokeswoman Josephine Martin did not respond to inquiries Wednesday.
Steward operates 33 hospitals in eight states, including nine in Massachusetts, where the company has clashed with elected officials.
In a statement Tuesday, U.S. Sen. Elizabeth Warren, D-Mass., said Steward’s plan, which follows “years of gross profiteering and mismanagement,” raises more questions.
“It would be a terrible mistake for Steward to be allowed to walk away while looting Massachusetts hospitals one more time,” she said. “Steward executives have no credibility.”
A Wall Street Journal story March 20 detailed a deep cash crunch at the company and legal efforts by an exterminator to get paid $936,320 for removing 3,000 bats from a Steward hospital in Florida last spring.
In January, Birmingham, Ala.-based Medical Properties Trust Inc., which owns most of Steward’s buildings, said it was accelerating efforts to recover $50 million in rent and outstanding loans due from Steward as of Dec. 31.
In response, Steward was considering potentially selling certain hospital operations and divesting non-core operations, according to Medical Properties.
Spokesman Drew Babin did not return calls seeking comment.
On March 5, the Justice Department’s Antitrust Division, the Federal Trade Commission and other agencies issued a request for public comment on the effects of private equity in health care deals.
The agencies raised concerns that corporate ownership in health care delivery may threaten worker safety and quality and affordability of care. The comments will help guide future enforcement priorities.