Heywood Healthcare in Gardner files for Chapter 11 bankruptcy

GARDNER, Mass. — Gardner-based Heywood Healthcare has voluntarily filed for Chapter 11 bankruptcy protection, the organization announced Monday.

Heywood Healthcare operates Athol Hospital, Heywood Hospital, Heywood Medical Group, Heywood Rehabilitation Center, Murdock School-based Health Center, The Quabbin Retreat, and Winchendon Health Center.

“Core hospital services will continue to operate as usual,” Rozanna Penney, co-CEO of Heywood Healthcare, said in a statement Monday.

In a statement on its website, Heywood Healthcare said, ”In the midst of the pandemic, Heywood Healthcare and community hospitals across the Country were adversely affected by workforce and supply chain challenges and the revenue shortfalls it caused. Heywood Healthcare was also impacted by a costly and lengthy electronic medical record (EMR) transition, while managing its aging infrastructure, and engagement in a milestone construction project, also significantly impacted by the current economic landscape.”

Over the past few months, Heywood Healthcare said it “has made significant progress. Strong volume, responsible fiscal management, excellent operational stewardship, robust revenue cycle work and a dedicated workforce has contributed to improving its financial performance.”

“However, low reimbursement rates and the impact of the aforementioned events have contributed to a substantially challenging operational infrastructure,” the organization said.

“Heywood Hospital has stood independently for 116 years, while navigating national and local challenges, which include Heywood being one of the lowest commercially reimbursed hospitals in Commonwealth. Athol Hospital has operated for 73 years, and remains a hallmark critical access hospital. Though our health system has stood the test of time, we are not impervious to financial challenges,” Tom Sullivan, co-CEO of Heywood Healthcare, said in a statement.

Sullivan said Chapter 11 protection or “Reorganization” is a strategic business measure that provides the necessary framework and process to address historical and pressing fiscal challenges.

“This path enables us to continue to provide essential healthcare services to our community, while restructuring historical financial obligations,” he said.

Penney said, “Access to quality healthcare in the Gardner and Athol areas remains our utmost priority. We are committed to our community, our patients, our medical staff and our employees.”

She said in the days and weeks ahead, “Heywood Healthcare will continue to provide exceptional patient-centered care and remain laser-focused on operational stability.”

For more information, visit www.heywood.org.

This is a developing story. Check back for updates as more information becomes available.

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