Heywood Healthcare files exit plan from Chapter 11 bankruptcy
Editor’s Note: In an earlier version of this story, the headline inaccurately described the hospital’s status in bankruptcy proceedings.
GARDNER — Nearly nine months after filing for Chapter 11 bankruptcy, Heywood Healthcare has filed papers to exit Chapter 11.
In a press release issued today, the hospital points to several key areas of success that have allowed the system to take this step.
“The system has optimized multiple service lines, reopened its inpatient mental health unit, and experienced growth in inpatient, surgical, and ambulatory volume, including a 16% increase in labor and delivery. Equally critical to its success, the system retained and expanded the medical staff,” the release states.
CEO and President Rozanna Penney credited the progress to the health care system’s dedicated medical staff and employees, along with strong financial and operational prudence.
Penney also thanked federal, state and local representatives, and expressed appreciation for the patients who continue to choose Heywood Healthcare.
Heywood Healthcare is parent company of Heywood Hospital in Gardner and several other organizations, including Athol Hospital, Heywood Medical Group, Ashburnham Family Medicine, Heywood Rehabilitation Center, Summit Family Medicine & Heywood Primary Care, The Winchendon Health Center & Murdock School-based Health Center, Tully Family Medicine and Walk-In Care and ACES Athol Community Elementary School Based Health Center.
About Heywood Healthcare’s bankruptcy filing
Heywood Healthcare filed for Chapter 11 bankruptcy protection on Oct. 1, 2023. The filing cited the COVID-19 pandemic as a factor along with a costly and lengthy electronic medical record transition, managing its aging infrastructure, engagement in a milestone construction project, as well as the current economic landscape. The financial strains were exacerbated by low reimbursement rates.
Prior to filing for bankruptcy, Heywood Healthcare had experienced a difficult year, with merger negotiations with UMass Memorial Health Care falling apart in January. In June, CEO Win Brown was ousted and construction on the highly touted surgical pavilion was halted.
What’s next for Heywood Healthcare?
According to the documents filed with the bankruptcy court, Heywood Healthcare actively sought to be acquired, and partnered with Houlihan Lokey Capital, Inc. to market the system. Only seven possible purchasers signed nondisclosure agreements; of the seven, five became inactive during the sales process and two signed indication of interest letters.
One letter was withdrawn, and the other party could only assume part of the system’s debts, which could put a possible sale in jeopardy.
Heywood Healthcare is not the only hospital system facing financial troubles. Earlier this month, Steward Health Care, which operates eight hospitals in Massachusetts, also filed for bankruptcy protection.
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