Steward Health Care seeks bankruptcy protection amid financial strain, includes Florida hospitals

by | May 6, 2024

Steward Health Care has filed for Chapter 11 bankruptcy to manage financial challenges and ensure continuous operations across its U.S. hospitals, including several facilities in Florida, despite facing decreased government payments, increased costs, and lingering COVID-19 effects.

Steward Health Care, the largest physician-led hospital operator in the U.S., has filed for Chapter 11 bankruptcy amid financial pressures heightened by reduced government reimbursements, rising operational costs, and lingering impacts of the COVID-19 pandemic.

The Dallas-based company, which operates a network of hospitals across several states including Florida, seeks to restructure its debts to ensure operational continuity.

Steward Health Care operates several facilities in Florida, playing pivotal roles in their communities. In Miami-Dade County, its hospitals include Coral Gables Hospital, Hialeah Hospital, North Shore Medical Center, and Palmetto General Hospital. Florida Medical Center serves Broward County, while Melbourne Regional Medical Center and Rockledge Regional Medical Center are located in Brevard County. Additionally, Sebastian River Medical Center operates in Indian River County.

“Steward Health Care has done everything in its power to operate successfully in a highly challenging health care environment. Filing for Chapter 11 restructuring is in the best interests of our patients, physicians, employees, and communities at this time,” said Dr. Ralph de la Torre, Chief Executive Officer of Steward. “In the past several months we have secured bridge financing and progressed the sale of our Stewardship Health business in order to help stabilize operations at all of our hospitals.”

The bankruptcy filing is designed to allow Steward to maintain business as usual across all its hospitals, ensuring that healthcare services remain uninterrupted for the communities they serve. This move is crucial for maintaining public health access and economic stability in these regions, particularly during a time of general healthcare industry strain.

To facilitate its financial restructuring, Steward has secured $75 million in debtor-in-possession financing, with the potential for an additional $225 million, pending the satisfaction of certain conditions. This financing is critical for Steward to continue operations without compromising service quality or workforce stability.

The Chapter 11 process will also enable Steward to potentially reorganize its assets, including the planned sale of its Stewardship Health business, as part of its strategy to stabilize operations.


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