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Heywood Hospital opened its doors to receive patients on June 27, 1907. The Hospital was given to the community by Martha Heywood and her daughter, Helen, in memory of their husband and father, Henry Heywood.

Since it's founding, Heywood has continually advanced it's programs, services, technology and facilities. 

The first addition to the hospital came in 1921, adding Maternity and a Pediatrics ward. The north wing of the hospital was built in 1941 and consisted of three stories, the basement and the first and second floors; the third floor was finished in 1945. In 1952, the hospital again expanded to add the Obstetrical Department, Radiology, Laboratory and a new Pediatrics floor.

In 1961, The Favor wing opened on the south side of the hospital, creating four surgical suites, an eight bed Recovery Room, large Emergency Department area, Central Supply and educational classroom areas. On the upper floor, a modern nursing unit was developed to include 40 medical and surgical beds. In 1972, a 3.5 million dollar expansion project was completed adding two additional floors for Coronary Care, Nuclear Medicine, Administrative offices and a much needed cafeteria. In 1978, the north wing was renovated and the 12 bed Mental Health Unit was completed.

In 1982, the Winchendon Hospital joined Heywood and became the outpatient Winchendon Health Center. Also during that year, a new Radiology wing was added to the hospital housing the Radiographic Imaging, Ultrasound, Nuclear Medicine, Mammography and CT Scan Department in a modern, functional facility.

In 1990, a new Medical Office Building was completed on the campus, which houses physician offices and a pharmacy. In 1993, the hospital completed several renovations and expansion projects including the Watkins Emergency Center, the LaChance Maternity Center, Physical Therapy, and the Mental Health Unit. In addition, major renovation projects began at the Winchendon Health Center and the hospital Annex Administration building. The majority of these renovations were made possible by a successful $3.2 million capital campaign, involving more than 1,000 donors from the hospital and the community.

In 1996, the hospital completed an addition to the Medical Office Building and additional renovations to the Hospital Annex building.

In December of 2010, the Hospital completed its largest expansion ever, with the opening of the Watkins Center for Emergency and Acute Care. Named for the Watkins Family Foundation in honor of Chris and Karen Watkins, the Watkins Center offers a state-of-the-art 20-bed Emergency Center, the Garrison CT Suite, a new Gift Shop, and two floors of private inpatient rooms.  The first floor is known as Watkins I and has 19 private telemetry, medical and surgical beds, and 6 ICU beds. The new ICU is named for the Robinson-Broadhurst Foundation.  The second floor is known as Watkins II and houses 25 private medical surgical beds. The project cost $37.6 million, and was completed over an 18-month period from June of 2009 to November of 2010. The Hospital raised over $10 million in philanthropy to support the project.