The governor’s office said the move was needed to keep it open, while an asset management firm previously said the state’s officer was too low.
Massachusetts Gov. Maura Healey said on Friday that her administration has formally seized a hospital via eminent domain to keep it open and transfer the facility to a new owner.
St. Elizabeth Medical Center in Boston is one of a group of medical facilities operated by Texas-based Steward Health Care, which announced its bankruptcy in May.
St. Elizabeth Medical Center’s operations will be transferred to the Boston Medical Center (BMC) to “protect access to care for tens of thousands of patients and save thousands of jobs,” the Democratic governor said in a statement.
Healey’s office said that Steward and the BMC came to an agreement to transfer operations to BMC but that one of the asset management companies that owns the land, Apollo Global Management, did not accept BMC’s bid.
The governor accused Apollo of putting “greed ahead of the health and wellbeing of the people of Massachusetts,” saying that it’s one reason why her office is targeting the property via eminent domain. According to the Legal Information Institute, eminent domain is the power a government has to take private property for public use if it provides compensation to the property’s owners.
The statement did not say whether compensation will be provided to Apollo, which has not released a statement on Healey’s actions. The Epoch Times contacted the asset management firm and Healey’s office for comment but received no reply by publication time.
Last month, Apollo Global Management and two other companies rejected the state’s takeover plan and said its proposal “significantly undervalues the real property underlying St. Elizabeth’s” hospital, according to a letter from the groups.
If Massachusetts moves forward with the “plan to exercise eminent domain and compensate ACREFI [Apollo Commercial Real Estate Finance Inc.] only $4.5 million for the property, ACREFI will have no choice but to exercise its constitutional and statutory rights and take any and all actions necessary to protect the interests of the investors to which it has fiduciary obligations,” the letter said.
The company said that it “believes there are numerous procedural and constitutional issues raised by the Commonwealth’s proposed plan and conduct to date that it will vigorously challenge.”
But St. Elizabeth’s facility was described by the governor’s office on Friday as a “crucial provider of hospital services to traditionally underserved populations, including MassHealth and Medicare patients,” further explaining why the action was taken.
“Its closure would put vulnerable patients at risk who would no longer have access to emergency services, maternity care, behavioral health services, and inpatient care,” her office added. “Further, inpatient capacity in the Boston area remains at record highs, and the more than 60 patients currently at St. Elizabeth’s would not have immediate access to health care.”
The governor’s administration announced last month that new operators had been secured for five of Steward’s seven hospitals in Massachusetts. Lawrence General Hospital will become the new operator for both campuses of Holy Family in Haverhill and Methuen, Lifespan will assume operations of Morton and Saint Anne’s, and BMC will take over Good Samaritan. These transfers of ownership are expected to take effect on Oct. 1.
Steward received inadequate bids for two other hospitals, Carney Hospital in Boston and Nashoba Valley Medical Center in the town of Ayer, both of which have closed as a result.
A federal bankruptcy court this month approved the sale of Steward’s other Massachusetts hospitals. On Wednesday, the U.S. Senate voted in favor of a resolution that is designed to hold Steward’s CEO, Ralph de la Torre, in criminal contempt for not testifying before the upper congressional chamber’s panel.
“Steward’s mismanagement has nationwide implications affecting patient care in more than 30 hospitals across eight states including one in my home state,” Sen. Bill Cassidy (R-La.) said earlier this week.
The Associated Press contributed to this report.
