Governor Maura Healey's plan to bail out five bankrupt Steward Health Care hospitals could cost Massachusetts taxpayers $700 million by 2027, the Boston Globe reported Saturday, citing “people with direct knowledge of the rescue plan.”
Eight days ago, Healey held a press conference to announce a financing plan that had been reviewed with legislative leaders that would help “save” the hospitals as they were handed over to potential new buyers. The governor's office said that day the plan included cash advances, capital support and maximizing federal grants, but did not provide many other details.
“Those are the three sources and we are working with the buyers to make sure they have the resources they need to be able to meet their bids,” Health Minister Kate Walsh said on August 16, adding that government funding would be available for three more years to help with staffing and capital investments.
While Healey made the plan public, saying it was a “win for Massachusetts” and “to close out Steward,” her team has since declined to provide details on the cost to taxpayers.
Healey was asked on Aug. 16 where the money for the hospital contracts would come from, and she said she was “working that out with her finance team right now.” Walsh also said the administration is working on “funding sources,” and neither Walsh nor Healey estimated the total amount.
None of the hospital contracts have been approved by the federal bankruptcy court. The next court hearing is scheduled for Tuesday.
“At this time we are unable to comment on the financial terms or discussions due to ongoing negotiations,” Olivia James, spokeswoman for Health Minister Kate Walsh, told the News Service on August 23. The statement suggests that the financial terms may still evolve.
Healey and Walsh's offices did not respond Saturday to requests to confirm or deny the plan's reported $700 million cost. It is also unclear how the hospital rescue plan's costs will affect other health care spending in Massachusetts.
“The details are going to be really important here,” Dough Howgate, president of the Massachusetts Taxpayers Foundation, said Saturday afternoon.
Howgate said he could imagine some of the funding being secured within the MassHealth system, but others would require “legislative action” from the Legislature. Understanding the components of the plan “sooner rather than later” would be helpful and will allow people to understand things like how state and federal funding will be split, as well as short-term and long-term costs.
“Until we see more about it, it's hard to judge what the plan is really about,” Howgate said.
