Deal between Steward Health Care and Optum is off

A proposed sale of Steward Health Care’s physician network to for-profit insurance company Optum has been called off, causing uncertainties about the future of Steward Health Care’s hospitals and providers in Massachusetts. Optum communicated this decision to the Health Policy Commission, although they have yet to withdraw their filings regarding the deal. The sale, which was initially announced in March, faced several concerns from lawmakers over its potential impact on the state’s health care market and disruptive influence during a critical time for the healthcare system.

Initially, both Steward and Optum did not submit required information to initiate a review process with the Health Policy Commission, causing raised eyebrows among state and federal representatives. Speaker Ronald Mariano emphasized in March that the sale might lead to significant impacts on Massachusetts’s competitive healthcare market and create further instability.

Despite withdrawing the sale deal, Steward Health remains valuable and still attracts interested parties seeking to acquire its services. In their statement, Steward stated, “The DOJ regulatory review process was challenging; Steward and United Optum have decided not to move forward,” indicating challenges posed during the regulatory review as the reason behind the decision. The sale of Stewardship Health forms an integral part of Steward’s ongoing bankruptcy restructuring process, during which bids are due for the company’s Massachusetts hospitals in the following month. As part of the bankruptcy reorganization, the sale was a move to help deleverage and secure much-needed liquidity for Steward’s ongoing operations.

Officials from Optum were not immediately available for comment at the time of reporting this news. The continued uncertainty leaves the future of Steward Health Care hospitals and their employees hanging in the balance as discussions about alternative acquisition parties and investment continue.

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