The resolution, sponsored by Councilors John FitzGerald and Ed Flynn, urges the city and the Boston Public Health Commission to declare a public health emergency and to “take all possible steps necessary to preserve the operations of Carney Hospital, and ensure that Steward is following all state and local laws.”

Steward last month announced its plans to close the Dorchester hospital and Nashoba Valley Medical Center in Ayer by Aug. 31 as part of the company’s bankruptcy proceedings, despite state regulations that require providers to give 120 days’ notice for an essential services closure. A bankruptcy court judge has given his blessing to that plan.

FitzGerald and Flynn’s resolution describes the closure plan as “unconscionable” and warns that losing Carney “will have devastating and cascading negative impacts on Boston residents who are reliant on care from Carney Hospital.”

“With the anticipated widespread negative public health impact that the closure of Carney Hospital will bring to the City of Boston, it is therefore critical for our city and the Boston Public Health Commission to do all that they can, including declaring a public health emergency, in order to ensure that Steward follow state laws, and prevent the catastrophic loss of access to healthcare access for our residents,” the resolution states.

The City Council meets at noon on Wednesday.

The resolution also states the City Council “urges the City of Boston and State Government to be prepared that if there are no bidders for Carney hospital, to seize the property by eminent domain and to continue to operate the facility until a permanent operator is found.”

Boston Mayor Michelle Wu said in a radio interview Tuesday that Carney is a “key location” for health care services in Dorchester and other nearby neighborhoods. Many residents have signaled they are more likely to transition to Boston Medical Center instead of other, closer facilities, she said.

“The feeling is that if this closes and there is no health care on site for the foreseeable future, some of our other local hospitals are going to be overwhelmed with a surge in demand and need,” Wu said.

Meanwhile in Ayer on Tuesday night, the Select Board is holding a special meeting to discuss declaring a public health emergency in an effort to save Nashoba, according to the Massachusetts Nurses Association. The agenda also includes a state legislative delegation update about the pending closure.

Thirteen state lawmakers and Boston city councilors also called on the Healey administration last week to reach to out to prospective bidders to purchase the Carney and Nashoba, declare a public health state of emergency to keep the hospitals open, and provide bridge funding to help them stay afloat during negotiations. Sen. Jamie Eldridge, who represents Ayer, read the letter aloud during Monday’s Senate session.

“We believe the requests above are reasonable and will not only ensure that the current quality healthcare is provided to all Massachusetts residents, but that all of the collateral consequences and costs of two community hospitals closing will be avoided,” according to the letter sent to Gov. Maura Healey, Lt. Gov. Kim Driscoll, Health and Human Services Secretary Kate Walsh, and Department of Public Health Commissioner Robbie Goldstein.

Chris Lisinski contributed reporting.

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That money would go toward supporting the six hospitals that are transitioning from Steward to new owners, as well as keeping Carney Hospital in Boston’s Dorchester neighborhood and Nashoba Valley Medical Center in Ayer operating for the next month — until they’re slated to close.

This was detailed in an emergency motion filed in Steward Health Care’s bankruptcy case, which still needs to be approved.

However, with the “commitment” outlined in the filing, it appears the first payment of just over $11 million would be made Thursday, with the second payment of nearly $19 million to be made in mid-August.

State House News Service reports that Gov. Maura Healey’s office described the payments as “advances” on Medicaid funds that the state owes Steward and they said they’re contingent upon an orderly movement toward new ownership, and cannot be used for rental payments, debt service or management fees.

As announced Friday, Nashoba Valley and Carney hospitals are slated to close by Aug. 31, while Stewards remaining six hospitals have “reputable bidders.”

“[Carney Hospital] has been the heart of our health care community here in the Dorchester and surrounding communities,” Congressman Stephen Lynch said Monday during a press conference. “So, the news of that closure was a real shock, a real kick in the gut to the Dorchester neighborhood.”

Lynch said Steward’s closure announcement “violates state law, state regulations and federal law.” He said the company is supposed to provide a 120-day notice, a formal notice 90 days out of a hearing and a notice to the workers with ample notice of severance pay and benefits if the closure was to be final.

“But all of that was short circuited in the bankruptcy court announcement two days ago that Steward would close Carney Hospital…and the Nashoba Valley hospital,” he said. “Just as Steward Health Care has protections in bankruptcy court, we believe the neighborhood has rights, too.”

Lynch said they are pushing back on this effort to close Carney Hospital, adding that they want the “full rights that are entitled to [the] neighbors, to the families, to [the] employees [and] to the patients.”

Sen. Ed Markey said Andrew Carney, founder of Carney Hospital, is “rolling in his grave right now at what Steward Health Care has done to his legacy.”

“Greedy corporations feed on community anchors, such as Carney Hospital,” said Markey. “Steward and the private equity firms saw the community reliance on this hospital as an opportunity to make money, and it means they knew the risk when they piled debt onto this hospital. ”

Markey said they will make Steward Health Care and its CEO, Dr. Ralph de la Torre, “answer for their greed.”

De la Torre, he said, should be forced to sell his yacht and private planes to ensure they can pay doctors, nurses and workers at the hospitals.

The company’s CEO will have to testify in front of a Senate committee in September, where he will answer questions Carney Hospital workers want him to answer about how “he looted this hospital of its ability to be able to provide for the healthcare of the community,” Markey said.

Markey said he will be sending a letter to the U.S. Bankruptcy Court for the Southern District of Texas, calling on the court to mandate that Steward Health Care comply with its legal requirements for hospital closure, to reduce and restructure the hospital leases with medical property trust and to direct any revenue from the hospital sales towards the Commonwealth’s healthcare system.

The senator didn’t specify when he will be sending that letter to the court.

“For our low-income neighbors who already face significant barriers to care, [the closure] could mean longer waits and more expensive care or simply denial of care,” added Congresswoman Ayanna Pressley. “For our Black and brown communities who have been historically underserved and overlooked, it would mean even greater health disparities.”

Mayor Michelle Wu said Boston will do “everything we can to support the ongoing state and federal investigations into Steward, Ralph de la Torre and the parties responsible for this collapse.”

The city and Boston Public Health Commission will be partnering with Healey and the state’s Department of Public Health to make sure there’s a “clear path forward to meet the needs of this community,” added Wu.

“We are calling on Steward to provide a transparent plan,” said Wu. “They cannot get away with breaking the law.”

The closures of Carney Hospital and Nashoba Valley Medical Center will impact roughly 1,500 Steward employees, according to the filing.

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The resolution, sponsored by Councilors John FitzGerald and Ed Flynn, urges the city and the Boston Public Health Commission to declare a public health emergency and to “take all possible steps necessary to preserve the operations of Carney Hospital, and ensure that Steward is following all state and local laws.”

Steward last month announced its plans to close the Dorchester hospital and Nashoba Valley Medical Center in Ayer by Aug. 31 as part of the company’s bankruptcy proceedings, despite state regulations that require providers to give 120 days’ notice for an essential services closure. A bankruptcy court judge has given his blessing to that plan.

FitzGerald and Flynn’s resolution describes the closure plan as “unconscionable” and warns that losing Carney “will have devastating and cascading negative impacts on Boston residents who are reliant on care from Carney Hospital.”

“With the anticipated widespread negative public health impact that the closure of Carney Hospital will bring to the City of Boston, it is therefore critical for our city and the Boston Public Health Commission to do all that they can, including declaring a public health emergency, in order to ensure that Steward follow state laws, and prevent the catastrophic loss of access to healthcare access for our residents,” the resolution states.

The City Council meets at noon on Wednesday.

The resolution also states the City Council “urges the City of Boston and State Government to be prepared that if there are no bidders for Carney hospital, to seize the property by eminent domain and to continue to operate the facility until a permanent operator is found.”

Boston Mayor Michelle Wu said in a radio interview Tuesday that Carney is a “key location” for health care services in Dorchester and other nearby neighborhoods. Many residents have signaled they are more likely to transition to Boston Medical Center instead of other, closer facilities, she said.

“The feeling is that if this closes and there is no health care on site for the foreseeable future, some of our other local hospitals are going to be overwhelmed with a surge in demand and need,” Wu said.

Meanwhile in Ayer on Tuesday night, the Select Board is holding a special meeting to discuss declaring a public health emergency in an effort to save Nashoba, according to the Massachusetts Nurses Association. The agenda also includes a state legislative delegation update about the pending closure.

Thirteen state lawmakers and Boston city councilors also called on the Healey administration last week to reach to out to prospective bidders to purchase the Carney and Nashoba, declare a public health state of emergency to keep the hospitals open, and provide bridge funding to help them stay afloat during negotiations. Sen. Jamie Eldridge, who represents Ayer, read the letter aloud during Monday’s Senate session.

“We believe the requests above are reasonable and will not only ensure that the current quality healthcare is provided to all Massachusetts residents, but that all of the collateral consequences and costs of two community hospitals closing will be avoided,” according to the letter sent to Gov. Maura Healey, Lt. Gov. Kim Driscoll, Health and Human Services Secretary Kate Walsh, and Department of Public Health Commissioner Robbie Goldstein.

Chris Lisinski contributed reporting.

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The resolution, sponsored by Councilors John FitzGerald and Ed Flynn, urges the city and the Boston Public Health Commission to declare a public health emergency and to “take all possible steps necessary to preserve the operations of Carney Hospital, and ensure that Steward is following all state and local laws.”

Steward last month announced its plans to close the Dorchester hospital and Nashoba Valley Medical Center in Ayer by Aug. 31 as part of the company’s bankruptcy proceedings, despite state regulations that require providers to give 120 days’ notice for an essential services closure. A bankruptcy court judge has given his blessing to that plan.

FitzGerald and Flynn’s resolution describes the closure plan as “unconscionable” and warns that losing Carney “will have devastating and cascading negative impacts on Boston residents who are reliant on care from Carney Hospital.”

“With the anticipated widespread negative public health impact that the closure of Carney Hospital will bring to the City of Boston, it is therefore critical for our city and the Boston Public Health Commission to do all that they can, including declaring a public health emergency, in order to ensure that Steward follow state laws, and prevent the catastrophic loss of access to healthcare access for our residents,” the resolution states.

The City Council meets at noon on Wednesday.

The resolution also states the City Council “urges the City of Boston and State Government to be prepared that if there are no bidders for Carney hospital, to seize the property by eminent domain and to continue to operate the facility until a permanent operator is found.”

Boston Mayor Michelle Wu said in a radio interview Tuesday that Carney is a “key location” for health care services in Dorchester and other nearby neighborhoods. Many residents have signaled they are more likely to transition to Boston Medical Center instead of other, closer facilities, she said.

“The feeling is that if this closes and there is no health care on site for the foreseeable future, some of our other local hospitals are going to be overwhelmed with a surge in demand and need,” Wu said.

Meanwhile in Ayer on Tuesday night, the Select Board is holding a special meeting to discuss declaring a public health emergency in an effort to save Nashoba, according to the Massachusetts Nurses Association. The agenda also includes a state legislative delegation update about the pending closure.

Thirteen state lawmakers and Boston city councilors also called on the Healey administration last week to reach to out to prospective bidders to purchase the Carney and Nashoba, declare a public health state of emergency to keep the hospitals open, and provide bridge funding to help them stay afloat during negotiations. Sen. Jamie Eldridge, who represents Ayer, read the letter aloud during Monday’s Senate session.

“We believe the requests above are reasonable and will not only ensure that the current quality healthcare is provided to all Massachusetts residents, but that all of the collateral consequences and costs of two community hospitals closing will be avoided,” according to the letter sent to Gov. Maura Healey, Lt. Gov. Kim Driscoll, Health and Human Services Secretary Kate Walsh, and Department of Public Health Commissioner Robbie Goldstein.

Chris Lisinski contributed reporting.

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Bids were due Monday as part of Steward’s complex bankruptcy proceedings. Goldstein told the Public Health Council on Wednesday morning that he had no information on the bids submitted, and expressed hope that updates would come later in the day.

“We’d hoped we would have some information about these bids yesterday, but as of early this morning, we have not heard from Steward or others about the bidding process — nothing about the bidders, the number of bids, or whether all the hospitals received bids has been shared with the department,” Goldstein said during the virtual council meeting.

Steward took bids on its seven hospitals operating in Massachusetts: Good Samaritan Medical Center in Brockton, Morton Hospital in Taunton, St. Anne’s Hospital in Fall River, St. Elizabeth’s Hospital in Brighton, Carney Hospital in Dorchester, Holy Family Hospital with campuses in Methuen and Haverhill, and Nashoba Valley Medical Center in Ayer.

Norwood Hospital, which is temporarily closed, was not included in the sale process.

Steward is required to provide a proposed transition plan if a hospital does not receive a qualified bid, Attorney General Andrea Campbell’s office said in a court filing. The office also noted that state health care regulations require hospitals to transition or close their facilities “in a safe manner and in accordance with specified timeframes.”

An auction is scheduled for Thursday for hospitals that received multiple bids, though Goldstein said that timeline could be pushed back as Steward looks to solicit more interest from prospective buyers. After the auction, Steward has a sale hearing scheduled in U.S. Bankruptcy Court on July 31.

“We at DPH will be ready to move forward with regulatory processes to transition Steward hospitals to new operators,” Goldstein said. “We remain resolute about preserving access to safe, quality health care for all residents of the commonwealth. We’ll soon know what it will take to fully execute on that promise, but for now, we wait.”

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In an ongoing trend, the number of patients seeking care at “many” Steward hospitals is declining, Goldstein said. Non-Steward hospitals, in turn, have recorded an increase in emergency department visits and inpatient admissions.

DPH monitors remain deployed at Steward hospitals to ensure safety for patients and health care providers, the commissioner said. Health officials are also bracing for worker shortages at Steward hospitals, but Goldstein said Steward has “been able to manage the situation in most cases.”

“We also have been regularly meeting with our partners in the health care community, and there seems to be a collective understanding that the transition of Steward hospitals will have an impact on the health care ecosystem in eastern Massachusetts,” Goldstein said. “It’s been quite uplifting to speak with hospital CEOs, the Massachusetts Health and Hospital Association, community health center leaders, and the Mass. League of Community Health Centers to hear firsthand from this group that they’re ready to do what is needed to protect health care for those caught up in these challenges through no fault of their own.”

Optum informed the Health Policy Commission that it is no longer working to finalize an agreement with Steward around the sale of Stewardship Health to Optum Care, but the companies have not yet withdrawn the deal’s material change notice filings with the HPC, the agency said.

The potential sale was first announced in March, but the two large medical providers never submitted information necessary for the HPC to begin a review that would have been required for the sale to go through. A slew of state and federal lawmakers raised concerns about the potential sale. House Speaker Ronald Mariano said in March that the sale “has the potential to significantly impact the competitiveness of the health care market in Massachusetts, and cause further disruption during a period of acute instability in the health care system.”

Spokespeople for Optum did not immediately respond to a request for comment.

“The DOJ regulatory review process was challenging; Steward and United Optum have decided not to move forward,” Steward said in a Friday afternoon statement. “Stewardship Health remains a valuable asset that provides excellent care for its patients; there are multiple other parties that remain interested in acquiring the business and Steward is in active negotiations.”

The sale of Stewardship Health is a key part of Steward’s bankruptcy restructuring, a process that is still playing out with bids due for Massachusetts hospitals next month. One investment banker working on Steward’s behalf told the U.S. Bankruptcy Court that the sale of Stewardship was the company’s “attempt to deleverage and secure liquidity for use in their operations.”

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“It’s so frustrating that they can come in and pull all the money and resources out of this town, I don’t get it,” said Nashoba Valley Medical Center nurse Audra Sprague.

Eight of those hospitals are currently open in Massachusetts, including Nashoba Medical Center in the small town of Ayer.

At Monday’s hearing, Judge Christopher Lopez approved a motion for next steps, breaking up Steward’s assets into two tracks with the first including all hospitals outside of Florida and much of Texas.

“Today we’re just outlining procedures and process, and that is what this motion is really about. We’re not picking a winner today, we’re picking a process that will allow parties’ rights and provide transparency to the process, and that’s what today is really about, and that’s what this motion is requesting,” Lopez said after hearing about half an hour of arguments, almost entirely in support of the timeline Steward proposed. “So today’s just step one in the process. And I understand that, but an important one. You can’t get to step two without step one, and today I will approve the motion.”

The timeline that Lopez approved Monday sets a deadline for bids on Steward’s Massachusetts hospitals (and hospitals in other states aside from Florida) of June 24 and schedules sale hearings to be held before the judge on July 11. Steward is proposing to sell its physician services network, Stewardship Health, along the same timeline.

Massachusetts Gov. Maura Healey is watching those moves closely.

“We continue to advocate for Massachusetts inside and outside of court,” Healey said.

A representative for the Commonwealth was in the courtroom warning that any buyer would need to go through the state’s regulatory process.

Attorney General Andrea Campbell also submitted a filing to the court calling for Massachusetts to have, “the opportunity to…legally challenge or approve any proposed sale of the Steward hospitals to new owners…”

“My job is to make sure we’re doing everything we can to protect patients access to care,” said Healey, “and to protect the 16,000 healthcare workers in the Steward network.”

Healey, House Speaker Ron Mariano and Senate President Karen Spilka have all ruled out a bailout of Steward. But their comments have also not ruled out that the state might need or want to provide some other kind of assistance to make the transition from Steward to other operators a smooth one.

A lawyer for the U.S. Department of Justice spoke during Monday’s hearing to highlight for Lopez how the timeline, especially as it applies to the sale of Stewardship Health, could conflict with the U.S. government’s antitrust review of the transaction. A lawyer for Steward said the company has been talking with the DOJ about ironing out any potential issues.

“It is important, though, to note that while the parties are working very quickly, as quickly as they can, regarding the review, that these reviews are time intensive. A lot of it is coming from papers that the debtor and the proposed purchaser, United, need to get to the United States,” Augustus Curtis said. “And it is not likely, frankly, that a review of these antitrust concerns will be completed by the time of the sale hearing.”

Curtis said he wanted to raise the issue Monday because the DOJ “didn’t want to stand up for the sale hearing and indicate that there were problems that we didn’t let the court know about from the very outset of the case.”

Katie Murphy, president of the Massachusetts Nurses Association, put pressure on top state officials to maintain care at Steward facilities during a press conference in Ayer on Monday afternoon, warning the loss of any hospital would be “catastrophic” for communities and for remaining health care providers.

“We as a state and those in charge of protecting the state have ultimate responsibility to do whatever is needed to protect this and all communities from the loss of any essential health care services. And that means the governor and her administration, the attorney general, and the two leaders of our legislative body cannot be silent and must be active, pushing any and all levels of government power at their disposal to save these hospitals,” Murphy said. “If we can allocate hundreds of millions of state dollars in corporate welfare, with initiatives to help industries like the Big Pharma-driven biotech industry, we can also divert some of those resources to protecting the health of hundreds of thousands of our most vulnerable friends and neighbors, while also preserving the jobs and economic engines that these hospitals provide to their respective communities.”

While it all plays out, those in Ayer anxiously await solutions.

“It is scary, it’s their livelihood,” said Sprague.

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The resolution, sponsored by Councilors John FitzGerald and Ed Flynn, urges the city and the Boston Public Health Commission to declare a public health emergency and to “take all possible steps necessary to preserve the operations of Carney Hospital, and ensure that Steward is following all state and local laws.”

Steward last month announced its plans to close the Dorchester hospital and Nashoba Valley Medical Center in Ayer by Aug. 31 as part of the company’s bankruptcy proceedings, despite state regulations that require providers to give 120 days’ notice for an essential services closure. A bankruptcy court judge has given his blessing to that plan.

FitzGerald and Flynn’s resolution describes the closure plan as “unconscionable” and warns that losing Carney “will have devastating and cascading negative impacts on Boston residents who are reliant on care from Carney Hospital.”

“With the anticipated widespread negative public health impact that the closure of Carney Hospital will bring to the City of Boston, it is therefore critical for our city and the Boston Public Health Commission to do all that they can, including declaring a public health emergency, in order to ensure that Steward follow state laws, and prevent the catastrophic loss of access to healthcare access for our residents,” the resolution states.

The City Council meets at noon on Wednesday.

The resolution also states the City Council “urges the City of Boston and State Government to be prepared that if there are no bidders for Carney hospital, to seize the property by eminent domain and to continue to operate the facility until a permanent operator is found.”

Boston Mayor Michelle Wu said in a radio interview Tuesday that Carney is a “key location” for health care services in Dorchester and other nearby neighborhoods. Many residents have signaled they are more likely to transition to Boston Medical Center instead of other, closer facilities, she said.

“The feeling is that if this closes and there is no health care on site for the foreseeable future, some of our other local hospitals are going to be overwhelmed with a surge in demand and need,” Wu said.

Meanwhile in Ayer on Tuesday night, the Select Board is holding a special meeting to discuss declaring a public health emergency in an effort to save Nashoba, according to the Massachusetts Nurses Association. The agenda also includes a state legislative delegation update about the pending closure.

Thirteen state lawmakers and Boston city councilors also called on the Healey administration last week to reach to out to prospective bidders to purchase the Carney and Nashoba, declare a public health state of emergency to keep the hospitals open, and provide bridge funding to help them stay afloat during negotiations. Sen. Jamie Eldridge, who represents Ayer, read the letter aloud during Monday’s Senate session.

“We believe the requests above are reasonable and will not only ensure that the current quality healthcare is provided to all Massachusetts residents, but that all of the collateral consequences and costs of two community hospitals closing will be avoided,” according to the letter sent to Gov. Maura Healey, Lt. Gov. Kim Driscoll, Health and Human Services Secretary Kate Walsh, and Department of Public Health Commissioner Robbie Goldstein.

Chris Lisinski contributed reporting.

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The operator of the third-largest hospital system in Massachusetts, Steward filed for Chapter 11 bankruptcy in Texas on Monday, seeking legal protection to restructure debt of between $1 billion and $10 billion while leaving its hospitals open. The company operates eight Bay State hospitals and has been sinking under a pile of debt to vendors and its de facto landlord. It has also been feeling the pressure from Massachusetts officials who are focused on making sure Bay Staters have appropriate access to care and that Steward’s floundering does not worsen the capacity crunch at Massachusetts hospitals.

Judge Christopher Lopez of the U.S. Bankruptcy Court for the Southern District of Texas held a hearing on initial motions related to Steward’s bankruptcy Tuesday, primarily requests from Steward to pay certain bills or meet specific obligations while its more than 100,000 creditors scramble to try to ensure they will be paid. Among the motions was one to authorize (but not require) Steward to pay wages, salaries, employee benefits, expenses, and other compensation while the bankruptcy case moves ahead. Lopez said he was comfortable with the request and approved it after the hearing in the absence of objections from creditors.

“This case feels different. It’s real patients who are showing up at the hospital like right now and I want them to feel comfortable that the physician that they are going to see, that there are nothing in the back of their mind other than their treatment and the care that they’re going to receive. I have no doubt the physicians would do their best and would honor their duties,” the judge said. “But I’m going to make sure that any concerns are taken off the table, especially when the folks with the money on the line have not objected to this relief.”

An attorney for Steward told the court that the company pays approximately $150 million a month in employee wages, mostly in arrears. And as of Monday, Steward owed approximately $68 million for accrued, but unpaid, wages that had already been earned. As of February, there were 9,753 employees on Steward’s payroll in Massachusetts and 6,405 licensed independent practitioners working within Steward hospitals, the state said.

Massachusetts state government was represented at Tuesday’s hearing by Andrew Troop, a lawyer who leads the Insolvency & Restructuring Practice Group in the New York office of Pillsbury Winthrop Shaw Pittman. The Amherst College graduate previously represented Massachusetts and other states in the Chapter 11 bankruptcy of Purdue Pharma and has served on the board for Greater Boston Legal Services for more than a decade.

“Health care cases, as everyone has acknowledged, are not your typical cases. This is not an issue for someone in a manufacturing job,” Troop said in support for the wages motion Tuesday. “On this one, your honor, making sure that the people who provide critical care services leave today confident that their base pay is going to be paid in tomorrow’s payroll is both the right thing to do [and] well within your authority and power to execute on.”

He added, “Vendors are waiting for the outcome of this hearing. Patients are waiting for the outcome of this hearing.”

Steward operates eight hospitals in Massachusetts: St. Elizabeth’s in Brighton, Carney Hospital in Dorchester, Good Samaritan Medical Center in Brockton, Holy Family Hospital in Methuen and Haverhill Hospital in Haverhill, Morton Hospital in Taunton, Nashoba Valley Medical Center in Ayer, Norwood Hospital (which is closed as it undergoes restoration work) and St. Anne’s in Fall River.

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Gov. Maura Healey and other state leaders have said they want to see Steward exit the Massachusetts health care world but Healey’s Health and Human Services Secretary Kate Walsh has also noted that due to the company’s debt and lease arrangements, “People can’t figure out what they’re buying.”

One state filing in bankruptcy court said the state’s objective is to get “results where Steward no longer operates hospitals in Massachusetts.”

Steward has been working for months to find other operators interested in buying its hospitals. Ray Schrock, Steward’s lawyer from the firm Weil, Gotshal & Manges, told the court Tuesday that Steward faces a June 25 deadline to auction its hospitals in Massachusetts and other states except for Florida under the terms of a $75 million loan the company got from its landlord. But he also said that timeline isn’t likely to be satisfied.

“We’ll see how the timing goes. We’ll see whether or not this is revisited. We’re going to keep our word and do everything we can to meet it. But I’m here to tell you now, you can’t close these hospital sales on the timeline of likely into June. It’s not feasible, OK? It’s not something that I can sit here and say that you can do it without violating state law. So we’ll have to work with parties.”

Schrock said Steward’s “sales strategy is the foundation of these cases, it’s going to be critical to maximizing recoveries” for creditors, but that the company does not want to “fire sale the assets.”

“I know that [landlord Medical Properties Trust] has a strong desire to get … new tenants in here. But we want to proceed deliberately and we don’t want to pursue a value-minimizing strategy,” he said.

Because MPT owns the land that Steward’s for-sale hospitals sit on, Schrock said he expects there will be “tension between MPT and some of the stakeholders in these cases that we’re just going to have to work through.”

“MPT, listen, they’re here to maximize the real estate value and maximize the value of their claims. That’s their job. The other stakeholders are looking at the sale processes and say, ‘Listen, there’s an operational value that’s really the crux of these hospitals and these operations.’ And how you sort between the operational value of a hospital and the real estate value of a hospital, I’ll just say people could logically debate,” Schrock said. He added, “How you get that value between the [operating company] and the lease is something that’s going to have to be resolved.”

Since Steward’s financial troubles came to the surface earlier this year, the Department of Public Health has conducted regular monitoring visits to all Steward hospitals, wanting to ensure the facilities continued to comply with state laws and regulations.

“Based on the findings of the Department’s monitoring, it has become clear that Steward’s fiscal challenges have already presented patient safety and health challenges, which to date have been isolated, and DPH has been able to detect and remediate quickly. These challenges include maintaining the physical premises (e.g., fire safety equipment) as well as critical supplies and equipment,” DPH Commissioner Robbie Goldstein wrote in a filing. “For the most part, the cause of any issues the monitors have identified is lack of funding made available to the hospitals from the Steward corporate level.”

Massachusetts’ filings in bankruptcy court shed a more detailed light on the financial problems at Steward.

Since 2022, there have been at least 21 lawsuits filed by vendors and staff against Steward and/or its Massachusetts hospitals for alleged nonpayment of more than $60 million, the state said. In November, Goldstein said, DPH learned that Steward’s hospitals here owed a collective $540,908.16 to UMass Chan Medical School’s New England Newborn Screening Program for newborn screening tests performed from January 2022 to September 2023. As of April 30, Steward had accrued additional debt related to this program for a total balance of $766,691.99.

On Jan. 9, DPH found out that Good Samaritan Medical Center in Brockton owes $1.2 million to Brockton Hospital for nurses that Brockton Hospital provided on loan. Brockton Hospital also told the state that it was providing products, like sterile surgical drapes, to other Steward hospitals in Massachusetts.

And late last month, one “critical vendor” got in touch with DPH and Health and Human Services Secretary Walsh about an outstanding debt owed by Steward and threatened to cease servicing its equipment unless Steward made a cash payment by May 1. (The state’s filing does not indicate whether that payment was made).

“Steward enters bankruptcy with its hospitals in Massachusetts compromised by fiscal and operational mismanagement, the nature and scale of which it actively concealed from both the government and the public. Steward created an untenable situation by over-leveraging its hospitals and imposing exorbitant and unsustainable rental obligations on each hospital. It is now clear that not long after creating this situation, hospital operations could not bear the excessive rent costs, Steward could not service the debt it had incurred, and Steward started to shirk its obligations to pay vendors and suppliers. All the while, Steward continued to enrich its investors and management,” the state wrote in a brief. “Instead of advancing a global solution to stabilize its financial situation, Steward pivoted to a plan to sell its physician network to pay off its landlords and senior lenders, to whom Steward had leveraged all available accounts receivable and, in effect, given nearly exclusive control over the survival of Steward’s Massachusetts Hospitals.”

The Dallas-based company, which operates more than 30 hospitals nationwide, said it does not expect any interruptions in its hospitals’ day-to-day operations, which the company said will continue in the ordinary course throughout the Chapter 11 process.

In court filings, the company said that beginning in late January, Steward initiated what it described as a “phased marketing process” for the sale of its hospital facilities.

“Presently, the company is marketing all of its hospitals,” the company said a filing Tuesday.

Steward filed for bankruptcy protection early Monday. In a news release, company officials said Steward took the step to let it continue to provide needed care to patients.

“Steward’s hospitals, medical centers and physician’s offices are open and continuing to serve patients and the broader community and our commitment to our employees will not change,” the company said in a written statement.

Steward’s eight hospitals in Massachusetts include St. Elizabeth’s Hospital and Carney Hospital, both in Boston. It filed for protection in the U.S. Bankruptcy Court for the Southern District of Texas.

Massachusetts Attorney General Andrea Campbell said Wednesday that she is pushing for the creation of a Patient Care Ombudsman to advocate for patients and employees throughout the bankruptcy process. She also said she has the authority to review any proposed sale under her office’s antitrust powers.

“The office has authority to review any proposed sale, and we would do so in order to best protect access to a competitive and affordable healthcare marketplace,” she said in a written statement. “If we find violations of the law, we will address them.”

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Steward’s troubles in Massachusetts have drawn the ire of political figures including U.S. Sens. Elizabeth Warren and Edward Markey, who have said the company’s previous private equity owners “sold (Steward) for parts” and “walked away with hundreds of millions of dollars.”

Massachusetts Gov. Maura Healey said Monday that the state had been preparing for a possible bankruptcy filing. Despite the filing, she said, Steward hospitals will remain open and patients should keep their appointments.

“This situation stems from and is rooted in greed, mismanagement and lack of transparency on the part of Steward leadership in Dallas, Texas,” Healey said Monday. “It’s a situation that should never have happened and we’ll be working together to take steps to make sure this never happens again.”

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Steward said it is finalizing the terms of “debtor-in-possession financing” from its landlord Medical Properties Trust for initial funding of $75 million and “up to an additional $225 million upon the satisfaction of certain conditions.”

“Steward Health Care has done everything in its power to operate successfully in a highly challenging health care environment,” Dr. Ralph de la Torre, CEO of Steward said in a news release.

He pointed in part to what he described as insufficient reimbursement by government payers as a result of decreasing rates at a time of skyrocketing costs.

Torre said that by seeking bankruptcy protections, Steward will be better positioned to “responsibly transition ownership of its Massachusetts-based hospitals.”

In March, the company announced it had struck a deal to sell its nationwide physician network to Optum, a subsidiary of UnitedHealth Group, as it works to stabilize its finances.

The system, activated through an emergency operations plan, will enable better coordination across state agencies, hospitals, community health centers, community service organizations, labor groups and other stakeholders, the Executive Office of Health and Human Services announced Friday morning.

The Department of Public Health’s Incident Command will be led by Gregg Meyer, a longtime executive at Mass General Brigham, MGH/MGPO, and Dartmouth Health. 

Officials say the structure is meant to safeguard care and services at Steward hospitals, as well as respond to any “transitions in care” that could create cascading effects for regional health care access.

“As part of Emergency Operations activation, the Department has formalized an Incident Command System to coordinate the regional planning work already underway,” DPH Commissioner Robbie Goldstein said in a statement. “The Incident Command System incorporates the ongoing external monitoring in all Steward hospitals, enables DPH to rapidly respond to any clinical needs or issues that arise, and fosters increased communication with other regional health care organizations, first responders and community leaders.”

State officials stressed that Steward’s network of hospitals in Massachusetts remain open and providing care.

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The resolution, sponsored by Councilors John FitzGerald and Ed Flynn, urges the city and the Boston Public Health Commission to declare a public health emergency and to “take all possible steps necessary to preserve the operations of Carney Hospital, and ensure that Steward is following all state and local laws.”

Steward last month announced its plans to close the Dorchester hospital and Nashoba Valley Medical Center in Ayer by Aug. 31 as part of the company’s bankruptcy proceedings, despite state regulations that require providers to give 120 days’ notice for an essential services closure. A bankruptcy court judge has given his blessing to that plan.

FitzGerald and Flynn’s resolution describes the closure plan as “unconscionable” and warns that losing Carney “will have devastating and cascading negative impacts on Boston residents who are reliant on care from Carney Hospital.”

“With the anticipated widespread negative public health impact that the closure of Carney Hospital will bring to the City of Boston, it is therefore critical for our city and the Boston Public Health Commission to do all that they can, including declaring a public health emergency, in order to ensure that Steward follow state laws, and prevent the catastrophic loss of access to healthcare access for our residents,” the resolution states.

The City Council meets at noon on Wednesday.

The resolution also states the City Council “urges the City of Boston and State Government to be prepared that if there are no bidders for Carney hospital, to seize the property by eminent domain and to continue to operate the facility until a permanent operator is found.”

Boston Mayor Michelle Wu said in a radio interview Tuesday that Carney is a “key location” for health care services in Dorchester and other nearby neighborhoods. Many residents have signaled they are more likely to transition to Boston Medical Center instead of other, closer facilities, she said.

“The feeling is that if this closes and there is no health care on site for the foreseeable future, some of our other local hospitals are going to be overwhelmed with a surge in demand and need,” Wu said.

Meanwhile in Ayer on Tuesday night, the Select Board is holding a special meeting to discuss declaring a public health emergency in an effort to save Nashoba, according to the Massachusetts Nurses Association. The agenda also includes a state legislative delegation update about the pending closure.

Thirteen state lawmakers and Boston city councilors also called on the Healey administration last week to reach to out to prospective bidders to purchase the Carney and Nashoba, declare a public health state of emergency to keep the hospitals open, and provide bridge funding to help them stay afloat during negotiations. Sen. Jamie Eldridge, who represents Ayer, read the letter aloud during Monday’s Senate session.

“We believe the requests above are reasonable and will not only ensure that the current quality healthcare is provided to all Massachusetts residents, but that all of the collateral consequences and costs of two community hospitals closing will be avoided,” according to the letter sent to Gov. Maura Healey, Lt. Gov. Kim Driscoll, Health and Human Services Secretary Kate Walsh, and Department of Public Health Commissioner Robbie Goldstein.

Chris Lisinski contributed reporting.

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A day after regulators announced they would review a potential sale of Stewardship Health to Optum Care, House Speaker Ron Mariano said the transaction could “cause further disruption” and requires intense scrutiny.

“The proposed sale of Steward’s physician group to Optum has the potential to significantly impact the competitiveness of the health care market in Massachusetts, and cause further disruption during a period of acute instability in the health care system,” Mariano said Wednesday.

Steward, a for-profit, private equity-backed system that operates several hospitals in Massachusetts, has become one of the biggest boogeymen for policymakers since its financial woes burst into public view in January.

The company filed paperwork with the Health Policy Commission on Tuesday signaling plans to sell its physician network to Optum Care, a subsidiary of the national giant UnitedHealth Group. Parties did not disclose financial details, but the sale could provide relief for Steward amid financial precarity, or serve as a precursor to offloading hospitals down the road.

Steward, whose leaders have faced calls to leave the state from Gov. Maura Healey and others, noted in one of its filings that it expects to disclose transactions concerning “certain of its acute care hospitals and other provider operations in the next 12 months.”

The sale of Steward’s physician network will not proceed until the HPC and other regulators complete a review of the proposal, according to HPC Executive Director David Seltz.

“As described in the notice, this is a significant proposed change involving two large medical providers, both in Massachusetts and nationally, with important implications for the delivery and cost of health care across Massachusetts,” Seltz said on Tuesday. “Details of the proposal will be reviewed by the HPC to examine potential impacts on health care costs, quality, access, and equity.”

Mariano, who has voiced his disdain for Steward and its decision to shutter a hospital in his hometown of Quincy, called on the HPC to consider the “vulnerability” of Steward’s remaining hospitals and a federal antitrust probe as it examines the deal.

The Wall Street Journal reported last month that the U.S. Department of Justice is conducting an antitrust investigation into UnitedHealth Group.

“The HPC’s statutory authority to review the health care impacts of this transaction should not delay state and federal antitrust authorities from doing their own rigorous review as we all seek to protect patient access and affordability, communities, employees, and the overall health care system,” Mariano said.

U.S. Sen. Elizabeth Warren said that Optum already covers more than 10% of doctors in the country, making it the nation’s largest employer of physicians. The deal, she said, “raises significant antitrust concerns.”

“After years of gross profiteering and mismanagement, Steward’s latest plan raises more serious questions about the future of the Massachusetts health care system,” Warren said in a statement. “My top priority is ensuring Steward’s Massachusetts hospitals remain open. But Steward executives have no credibility, and I am concerned that this sale will not benefit patients or health care workers, or guarantee the survival of these facilities. It would be a terrible mistake for Steward to be allowed to walk away while looting Massachusetts hospitals one more time.”

A U.S. Senate subcommittee plans to meet in Boston next week to explore the impact of for-profit companies in the health care industry, and the delegation has set their sights squarely on Steward.

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Warren and U.S. Sen. Ed Markey have repeatedly called on Steward Health Care CEO Ralph de la Torre to face questions at the hearing, seemingly without success.

“On March 7, we sent you a letter about these troubling transactions and Steward’s role in this growing crisis, but nearly three weeks later, you have failed to provide us with any response,” they wrote in a letter to de la Torre published Tuesday. “Investing in and operating a health care system includes a responsibility to the public, and you must answer for Steward’s current financial insecurity and its impact on access to health care.”

If regulators on the HPC determine the sale of Stewardship Health to Optum will inflict a significant impact on health care costs and the market, they can pursue a more expansive “cost and market impact review.” But it’s not clear how forcefully they could reshape the proposal.

“After Steward recklessly took on massive debt that is continuing to … put hospitals in Massachusetts and across the country into financial crisis, the Massachusetts health care system must move away from Steward’s financial insecurity,” Markey said in a statement Tuesday. “With this announcement, Optum must demonstrate that it can meet the even greater responsibility to preserve and protect health care access in the Commonwealth, and I hope they will live up to that responsibility by controlling costs and putting patients and providers first.”

Leaders of the agency for years have urged the Legislature to award them with greater muscle to little avail. At a state legislative hearing earlier this week about private equity in health care, Seltz said other states empower regulators to deny or impose conditions upon health care transactions.

“That is not something the HPC currently has authority to do,” he said Monday. “Our process is really a public report at the end of the day.”

Steve Walsh, president of the Massachusetts Health and Hospital Association, said any sale of Steward’s physician network “should center around the needs of patients and help stabilize — not further harm — the commonwealth’s already fragile healthcare system.”

“We believe a transaction of this magnitude must be subject to a stringent and transparent approval process that invokes Massachusetts’ best oversight tools — the very same oversight that local hospitals are held to,” Walsh said.

The office of Sen. Ed Markey issued a press release that “Minnesota-based Optum Financial has purchased the physician group of Steward Health Care.”

Stewardship Health Inc. is the parent of Stewardship Health Medical Group Inc., which employs primary care physicians and other clinicians across nine states, according to the Health Policy Commission.

“This is a significant proposed change involving two large medical providers, both in Massachusetts and nationally, with important implications for the delivery and cost of health care across Massachusetts,” HPC Director David Seltz said. “Details of the proposal will be reviewed by the HPC to examine potential impacts on health care costs, quality, access, and equity. The sale cannot be completed until after the HPC’s review and any concurrent review by state or federal antitrust authorities.”

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Once all required information has been provided about the sale, the HPC will have 30 days to assess potential impacts of the transaction, according to the agency. If the sale is anticipated to have a significant impact on health care costs and market functioning, the HPC can initiate a full Cost and Market Impact Review, an option that it has often not pursued in the past.

Steward’s financial problems have received widespread attention in recent weeks and the outlook for its Massachusetts assets remains cloudy. The HPC said that transactions involving the sale of Steward’s eight Massachusetts hospitals would also require review by the agency, and review by the Determination of Need program at the Department of Public Health.

“After Steward recklessly took on massive debt that is continuing to … put hospitals in Massachusetts and across the country into financial crisis, the Massachusetts health care system must move away from Steward’s financial insecurity,” Democratic Sen. Ed Markey said in a statement. “With this announcement, Optum must demonstrate that it can meet the even greater responsibility to preserve and protect health care access in the Commonwealth, and I hope they will live up to that responsibility by controlling costs and putting patients and providers first.”

In its new notice of material change, Steward Operations Holdings LLC, in response to a question about other material changes anticipated in the next 12 months, wrote: “Steward anticipates providing Notices of Material Change regarding transactions concerning certain of its acute care hospitals and other provider operations in the next 12 months.”

This comes as Steward Health Care, which owns nine hospitals in Massachusetts is in the middle of a financial crisis.

The company is now considering pulling out of the state. If this happens, health care will be far less accessible for hundreds of thousands of people.

Gov. Maura Healey has placed the blame on the company’s management.

On Monday, lawmakers heard from a top government watchdog who warned that industry consolidation, for-profit ownership and private equity investment in healthcare “will only continue.”

Health Policy Commission Executive Director David Seltz presented data showing that the share of health care transactions in Massachusetts involving private equity interests has more than doubled in recent years.

The agency examined 182 provider purchases and sales between 2013 and 2023. Between 2013 and 2016, Seltz said, private equity was involved in about 25% of transactions. That jumped to 47% of transactions between 2017 and 2020 and 63% between 2020 and 2023.

Health Policy Commission leaders discussed similar data in December, before the problems at Steward erupted into public view and accelerated calls for reform.

“Our attention should also be focused on the future because the trends of private equity, for-profit ownership and consolidation of all types into larger, horizontally and vertically integrated health systems will only continue in Massachusetts and across the country,” Seltz told the Health Care Financing Committee on Monday.

He later added, “The need for urgent action could not be greater.”

State House News Service contributed to this report.

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The resolution, sponsored by Councilors John FitzGerald and Ed Flynn, urges the city and the Boston Public Health Commission to declare a public health emergency and to “take all possible steps necessary to preserve the operations of Carney Hospital, and ensure that Steward is following all state and local laws.”

Steward last month announced its plans to close the Dorchester hospital and Nashoba Valley Medical Center in Ayer by Aug. 31 as part of the company’s bankruptcy proceedings, despite state regulations that require providers to give 120 days’ notice for an essential services closure. A bankruptcy court judge has given his blessing to that plan.

FitzGerald and Flynn’s resolution describes the closure plan as “unconscionable” and warns that losing Carney “will have devastating and cascading negative impacts on Boston residents who are reliant on care from Carney Hospital.”

“With the anticipated widespread negative public health impact that the closure of Carney Hospital will bring to the City of Boston, it is therefore critical for our city and the Boston Public Health Commission to do all that they can, including declaring a public health emergency, in order to ensure that Steward follow state laws, and prevent the catastrophic loss of access to healthcare access for our residents,” the resolution states.

The City Council meets at noon on Wednesday.

The resolution also states the City Council “urges the City of Boston and State Government to be prepared that if there are no bidders for Carney hospital, to seize the property by eminent domain and to continue to operate the facility until a permanent operator is found.”

Boston Mayor Michelle Wu said in a radio interview Tuesday that Carney is a “key location” for health care services in Dorchester and other nearby neighborhoods. Many residents have signaled they are more likely to transition to Boston Medical Center instead of other, closer facilities, she said.

“The feeling is that if this closes and there is no health care on site for the foreseeable future, some of our other local hospitals are going to be overwhelmed with a surge in demand and need,” Wu said.

Meanwhile in Ayer on Tuesday night, the Select Board is holding a special meeting to discuss declaring a public health emergency in an effort to save Nashoba, according to the Massachusetts Nurses Association. The agenda also includes a state legislative delegation update about the pending closure.

Thirteen state lawmakers and Boston city councilors also called on the Healey administration last week to reach to out to prospective bidders to purchase the Carney and Nashoba, declare a public health state of emergency to keep the hospitals open, and provide bridge funding to help them stay afloat during negotiations. Sen. Jamie Eldridge, who represents Ayer, read the letter aloud during Monday’s Senate session.

“We believe the requests above are reasonable and will not only ensure that the current quality healthcare is provided to all Massachusetts residents, but that all of the collateral consequences and costs of two community hospitals closing will be avoided,” according to the letter sent to Gov. Maura Healey, Lt. Gov. Kim Driscoll, Health and Human Services Secretary Kate Walsh, and Department of Public Health Commissioner Robbie Goldstein.

Chris Lisinski contributed reporting.

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“The financial information that Steward provided this week continues to be incomplete and insufficient. What Steward must do from this point forward is clear – complete an orderly transition out of Massachusetts”, said the governor’s office in a statement Friday.

Elected officials have been pressuring Steward, the owner of nine health care facilities across the state, including Carney Hospital in Dorchester, to turn over its financial records. But so far, the Dallas-based company has failed to do so.

The for-profit health care system is reportedly $50 million dollars behind on its rent. And employees say Steward is not paying their vendors, so they’ve been short on supplies. They also say construction on the Norwood Hospital that flooded in 2020 has come to a halt because it’s not paying the contractors.

Health care workers here say this financial crisis is taking a toll on patient care.

Earlier this week, Senator Warren blamed private equity for stepping in years ago, stripping Steward Health of its assets and leaving behind a shell of a hospital system.

“For the CEO to sit offshore on his yacht and for the private investors who already took away literally hundreds of millions of dollars while people suffer here in this commonwealth is not. It is important the first we make sure everybody’s got the health care coverage that they need but also that the people who have wrecked this institution are held accountable for it.”

Many are concerned that if Steward shuts down locations like Carney, other hospitals in the city won’t be able to handle the influx of patients.

Meanwhile, the financial crisis are showing even in the little things such as the shortage of supplies due to not paying their vendors. Workers at two Boston locations say patients have already stopped coming in assuming hospitals are closed or are concerned about the care they may receive.

“Sometimes it’s difficult to get paper, water, some extension sets for IVs in the emergency room,” said a health care worker during a Boston City Council meeting Thursday.

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The announcement came after the state’s deadline for Steward to turn its financial records to the state.

“The financial information that Steward provided this week continues to be incomplete and insufficient,” Healey spokesperson Karissa Hand said in a statement. “What Steward must do from this point forward is clear — complete an orderly transition out of Massachusetts.”

Healey said earlier this week that Steward should transfer ownership of the hospitals and leave the state altogether.

She’s demanding Steward create an action plan to detail how they plan to address these financial woes, saying if they don’t comply, the state will act by possibly freezing admissions to any of their nine hospitals in the state, closing beds and transferring patients to other hospitals.

In a three-page letter to Steward’s CEO, Healey listed several demands, including ensuring safe staffing and supply levels, allowing the state Department of Public Health to put monitors in all of its locations and immediately release its financial records.

Steward — a Texas-based health care system — operates nine hospitals in Massachusetts and reportedly owes $50 million in unpaid rent.

Meanwhile, the financial crisis are showing even in the little things such as the shortage of supplies due to not paying their vendors. Workers at two Boston locations say patients have already stopped coming in assuming hospitals are closed or are concerned about the care they may receive.

“Sometimes it’s difficult to get paper, water, some extension sets for IVs in the emergency room,” said a health care worker during a Boston City Council meeting Thursday.

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