Bankrupt Steward Health Care secures new funding to run Mass. hospitals ahead of sale

BOSTON — Bankrupt Steward Health Care on Tuesday announced that it had secured new funding to operate its hospitals in Massachusetts through the end of June.

Steward, the largest physician-led hospital operator in the United States, secured an additional loan of $225 million and will seek court approval of the financing this week.

“Since entering the Chapter 11 process, everything we have done has been to ensure that our hospitals, medical centers, and physician’s offices stay open, we continue to serve our patients and maintain our commitment to employees,” John Castellano, Steward’s Chief Restructuring Officer, said in a statement. “Securing this additional financing from a group of our secured lenders provides Steward with comprehensive financing to stabilize our operations during this bankruptcy case.”

Last week, Steward agreed to hold an auction on its hospitals later this month, including the eight facilities it operates in Massachusetts. A judge will then rule on the final sale.

After the announcement, Sen. Elizabeth Warren introduced legislation aimed at warding off future cases of “corporate greed” in the health care space, like the kind that her office says led to Steward Health Care filing for bankruptcy.

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