Holy Family Hospital President to Step Down; Setback Follows Poor Financial Reports

Holy Family Hospital President Craig A. Jesiolowski. (Courtesy photograph.)

The head of Holy Family Hospital in Methuen and Haverhill is stepping down to take a position in Illinois—the latest setback for its owner, Steward Health Care.

Craig A. Jesiolowski, president of Holy Family Hospital since 2016, told Steward’s board, employees and providers Friday that he will become president of two hospitals—a tertiary medical center and a community hospital in Illinois.

Jesiolowski’s decision comes on the heels of Holy Family’s landlord, Medical Properties Trust, reporting this month Steward’s “total unpaid rent under its consolidated master lease with MPT is approximately $50 million” as of the end of December. Last month, as WHAV reported, Steward Health Care said it would close its New England Sinai Acute Long-Term Care and Rehabilitation Hospital by early April. Last April, Steward won a temporary restraining order to keep a dialysis services vendor, Fresenius Management Services, from ending services due to nonpayment.

Following the Stoughton announcement, Jesiolowski told staff by email, “In fact, the difficult decision to close NESH was made specifically to safeguard the strength of operations of other Steward hospitals, including ours, and protect our standard of care.”

In a statement Friday, Steward officials blamed “a payor-mix system-wide that is over 70% Medicare and Medicaid, where reimbursement meaningfully trails commercial reimbursement.” They added, “Over the past decade plus, there has been a widening gap in reimbursement for all the state’s community hospitals compared to larger, academic medical centers. This gap has only continued to increase and most community hospitals—including Steward hospitals in Massachusetts—are suffering losses that jeopardize their ability to continue to offer services.

Medical Properties Trust spent $1.25 billion in 2016 to buy Steward’s real estate “through a real estate sale-leaseback transaction and acquisition of a limited equity stake in the company. The $1.25 billion total value of the transaction includes a $1.2 billion investment in hospital real estate and a $50 million equity investment in Steward,” according to a company press release. At the time, the real estate firm said the money would allow the then-Boston-based Steward to “to expand nationally.”

In a press release, the landlord said Steward reported “its liquidity has been negatively impacted by significant changes to vendors’ payment terms. As a result, Steward has continued to make partial monthly rent payments.”

Jesiolowski said in his message Friday, “The decision was a very difficult one for me and my wife as New England has been home for us the past 24 years, 14 of them being in Massachusetts, but we felt it was time to move back to the Midwest to be closer to our respective families.”

Friday’s statement explained what steps the for-profit company is taking to resolve financial issues. “While we are pursuing inequities and our aggressive advocacy for fairer reimbursements, Steward is advancing an action plan to strengthen its liquidity, restore its balance sheet and put the tools necessary in place to continue forward as a key provider of healthcare services to our patients, communities, physicians, and employees. Our physicians will continue to deliver excellent care and we are very confident that our hospitals have adequate supplies for us to provide high-quality health care to our patients. At the same time, we continue to be among the largest employers and taxpayers within the state’s lowest-income communities.”

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