Steward Health Care filed Chapter 11 on Monday May 6, 2024. Steward operates over 30 hospitals across Arizona, Arkansas, Florida, Louisiana, Massachusetts, Ohio, Pennsylvania and Texas, and has more than 400 physician practice locations.

Steward has grown substantially since it was created in 2010 when its then-owner Cerberus Capital purchased six non-profit hospitals in Massachusetts. Cerberus exited its investment in 2020, handing ownership to a group of Steward physicians led by its CEO. Steward has taken on more than $1 billion in debt in recent years and late last year, Steward began marketing its physician group and hospitals for sale.

Steward has attracted significant attention in recent years. In addition to complaints from various parties about Cerberus’ leverage practices, the latest news came after the announcement of a potential sale of its physician group, Stewardship Health, to UnitedHealth’s Optum subsidiary. Among others, Senator Elizabeth Warren has questioned the benefit of this sale and raised antitrust concerns because Optum is already the largest employer of physicians in the country.

Steward has obtained debtor-in-possession financing from its landlord, Medical Properties Trust, which also provided financing to Steward previously. Steward indicates this funding will be sufficient for it to operate throughout the chapter 11 process. As part of the financing, Steward is required to meet milestones related to the sale of Steward’s hospitals and physician group over the next few months.

Bankruptcy cases move quickly and many deadlines already have been set that will affect the rights of numerous parties.