Steward Health Care to Sell Physician Group to Optum, Pending Regulatory Approval

File photograph. (Image licensed by Ingram Image.)

Steward Health Care, owner of Holy Family Hospitals in Haverhill and Methuen, said it plans to sell its physician group, Stewardship Health, to a UnitedHealth Group’s subsidiary, Minnesota-based Optum Financial.

Stewardship Health is the parent of Stewardship Health Medical Group, which employs primary care physicians and other clinicians across nine states, according to the state’s Health Policy Commission. The company’s hospitals were not included in the deal.

“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,” Health Policy Commission 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.”

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 Health Policy Commission said that transactions involving the sale of Steward’s Massachusetts hospitals would also require review by the agency and the Determination of Need program at the Department of Public Health.

U.S. Sens. Elizabeth Warren called out her antitrust concerns in Massachusetts and nationally, noting the Justice Department of is already “reportedly investigating UnitedHealth’s relationship with its Optum health services arm.”

“After years of gross profiteering and mismanagement, Steward’s latest plan raises more serious questions about the future of the Massachusetts health care system. 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,” Warren said.

Sen. Edward J. Markey, chair of the Senate Health, Education, Labor and Pensions Subcommittee on Primary Health and Retirement Security, said Steward’s past record mean more scrutiny must be placed on the proposed deal.

“After Steward recklessly took on massive debt that is continuing to that put hospitals in Massachusetts and across the country into financial crisis, the Massachusetts health care system must move away from Steward’s financial insecurity. 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.”

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