Optum Abandons Acquisition of Steward Health Care Physician GroupOptum Abandons Acquisition of Steward Health Care Physician Group Optum has withdrawn its pursuit of acquiring the Steward Health Care physician group, as per a statement from the Massachusetts Health Policy Commission (HPC). Optum informed the HPC that it is no longer finalizing an agreement with Steward. However, the parties have yet to withdraw their material change notices to the HPC. Optum declined to comment on the matter. Significance: Optum’s acquisition of the Steward physician group was part of Steward’s bankruptcy restructuring process, which aimed to sell off the system’s 31 hospitals. The Ministry of Justice (DOJ) had raised objections to the financing conditions of the deal, which placed the debt burden on Steward. Background: * In March 2023, Steward Health Care reached an agreement to sell its physician group to Optum Care. * Steward Health Care operates nine healthcare facilities in Massachusetts and faces financial challenges due to accumulated debt. * In May 2023, Steward announced plans to sell all its hospitals in a bankruptcy restructuring. * The DOJ filed an objection to the deal in May, citing concerns about the sale of Steward’s physician services network to UnitedHealth Group and the limited time for review. Outlook: Despite the setback with Optum, Steward Health Care remains committed to exploring other potential buyers. The company has faced challenges in the review process with the DOJ.
Photo: Courtesy of UnitedHealth Group
Optum is no longer pursuing a deal to acquire the Steward Health Care physician group, according to the Massachusetts Health Policy Commission.
Optum has informed the Health Policy Commission that it is no longer finalizing an agreement with Steward, the HPC said. The parties have not yet withdrawn submissions of material change notices to the HPC, the spokesperson said.
Optum declined to comment, saying it had nothing to report at this time.
WHY THIS IS IMPORTANT
Optum’s acquisition of the Steward physician group in Massachusetts was one step in a bankruptcy restructuring process to sell off the ailing health system’s 31 hospitals.
The Ministry of Justice has objected to the financing conditions for Steward Health Care where the debtor bears the debt.
According to WMUR, Steward called it a “challenging” review process at the federal Department of Justice, but said it is still looking for other buyers.
THE BIG TREND
In March, Steward Health Care in Massachusetts had a deal to sell its physician group to Optum Care. Steward Health Care, which operates nine healthcare facilities in Massachusetts, is currently facing significant financial uncertainty due to previously accrued debt.
In May, Steward announced it would sell all of its hospitals in a bankruptcy restructuring. Steward owns 31 hospitals in eight states in Massachusetts, Arizona, Ohio, Pennsylvania, Arkansas, Louisiana, Texas and Florida.
Later in May, the Justice Department filed an objection to the deal. The DOJ specifically objected to Steward’s proposed sale of its physician services network, Stewardship Health, to UnitedHealth Group. The timeline outlined in the sale did not give the DOJ enough time to complete its review.
