CEO got big bucks as his hospital chain imploded. Here's who suffered.

 

Donna Gittens realized as she  plodded to form words. regale plans with my hubby and  musketeers will have to  stay. She was  upset that she was in the middle of a stroke.   Gittens was taken to Carney Hospital,  twinkles from his home in Boston's Dorchester neighborhood.

Last summer's  exigency gauged  two  installations as croakers  unraveled a medical  riddle. The main problem was a brain infection, but she credits the croakers  and  nursers at her neighborhood sanitarium with saving her life.

She now worries that others in her area may not have access to the same emergency care.

Carney is one of two Massachusetts hospitals targeted for closure on Aug. 31 following recent turmoil at Steward Health Care. The for-profit hospital chain filed for bankruptcy on May 6 and has been mired in crises involving patients and creditors in several states.

The streak is led by a former heart surgeon who collected more than $100 million in compensation and bought a $40 million yacht while Steward Hospital employees complained of a lack of basic equipment, according to a Senate committee. More than 2,200 employees are now expected to be laid off in Massachusetts and Ohio, according to notices filed with state regulators.

The company's CEO, who lawmakers say has declined multiple requests to voluntarily answer questions, is expected to appear in mid-September before a Senate committee to deal with "financial misconduct" in Steward. will appear in front of

The case has raised broader issues for lawmakers and analysts about the role of private equity investment in health care. Many in communities affected by hospital closings are asking why there aren't pre-existing safeguards when a corporation takes over an institution that provides life-or-death services.

The problem extends beyond Massachusetts. State health regulators in Arizona this month suspended operations at a Phoenix facility at a psychiatric hospital owned by Steward after the air conditioning cut out amid triple-digit temperatures. In West Monroe, Louisiana, hospital workers described searching the premises for basic medical supplies during procedures. According to testimony at a Louisiana House Health and Welfare Committee hearing in April, one patient died at the hospital while waiting to be transferred to another hospital, prompting regulators to cite an "immediate risk."

After the chain declared bankruptcy, the governor of Massachusetts created a contingency plan to manage its remaining seven hospitals there. The company sought and received bankruptcy court approval to close Carney and another facility, Nashoba Valley Medical Center, by the end of August.

Gittens, who survived the health scare, worried the diverse, mixed-income population in her local neighborhood would be left without essential medical care. During medical emergencies like hers last summer, timely care can be the difference between life and death.

"Carney is integral not only to my family — but to the broader community," Gittens said.

Despite pleas from neighborhood leaders, the state has no plans to keep Carney or Nashoba Valley open. However, Massachusetts Governor Maura Haley said at a news conference on August 16 that the state plans to use eminent domain to take control of another Steward hospital, St. Elizabeth's Medical Center in Brighton. The state has entered into agreements with other operators to run the other four stewarded hospitals.

Haley blamed Steward's financial collapse on its CEO, Dr. Ralph De La Torre, and executives at the hospital chain.

"This is not something that Massachusetts created," Haley said. "It was born out of the greed and exploitation of one individual, Ralph de la Torre, and his team members. De la Torre's actions brought us to the brink of near collapse at Steward's Hospitals".

A spokeswoman representing De La Torre did not respond to USA TODAY's questions about allegations of problems in the ranks of Steward Health Care facilities.

In a statement, the company said it will try to minimize disruption to patients.

"This is a challenging and extremely unfortunate situation, and the impact on our patients, our employees and the communities we serve is tragic," said a statement provided by Steward representative Deborah Chiaravalotti. " "SHC (Steward Health Care) is doing everything possible to ensure a smooth transition for those affected, while continuing to provide quality care to the patients we serve."

Lawmakers cite 'outrageous corporate greed'

Steward Healthcare was formed in 2010 when Cerberus Capital Management, a private equity firm, acquired a financially struggling nonprofit hospital chain from the Archdiocese of Boston. De La Torre, a Harvard medical faculty member who previously led cardiac surgery at Boston's Beth Israel Deaconess Medical Center, became CEO of the new entity, Steward Health Care.

The Dallas-based company aggressively expanded to a chain of more than 30 hospitals that employ more than 30,000 people. The expansion was prompted by a brilliant deal worked out by de la Torre to sell the land beneath Steward's hospitals to a corporate landlord, the Medical Properties Trust. The sale-leaseback deal left hospitals with hefty rent payments. The bankruptcy filing shows the company is now $9 billion in debt, including more than $6 billion in lease payments to its landlords.

After the  ruin form in May, Steward  blazoned plans to close hospitals and lay off thousands of workers, leaving community members who depend on the hospitals bothered about where they will get care.

The chain's  fiscal  down captured the attention of the Senate Health, Education, Labor and Pensions Committee, which authorized an  disquisition into the company's  fiscal dealings. The Senate  inquiry is anticipated to include questions about Steward Health's deal with private equity investors, its lavish spending, the parcel deal and the sanitarium closures. The commission also issued a process that compels de la Torre to answer questions about his company's struggles.

At a July 25  hail, Sen. Bernie Sanders, I- Vermont, who chairs the commission overseeing the  disquisition, said de la Torre refused multiple assignations to  swear before lawgivers, which  urged the bipartisan vote to order him to  swear on Sept. 12.

When Steward closed his hospitals, Sanders said, de la Torre was collecting a "$100 million payday that he used to buy a $40 million yacht." The executive also bought a $15 million, custom-built fishing boat and had access to two private jets, Sanders said.

De la Torre" epitomizes the type of outrageous commercial  rapacity that's  percolating  throughout our for- profit health care system," Sanders said at the  hail." moment we're saying enough is enough. It's time for Dr. de la Torre to get off of his yacht and to explain to Congress the  fiscal  jugglery which made him extremely  fat, while the hospitals he managed went  void."

When asked which sources Sanders  reckoned on for his July  evidence about de la Torre's compensation and boats, his staff  handed links to  papers in The American Prospect, The Boston Globe and Becker's Hospital Review.

Beyond Capitol Hill, Steward is being  scanned by other  realities. The Justice Department launched a felonious  disquisition into allegations of fraud and corruption at the company, CBS and other outlets reported. The Justice Department and the U.S. Attorney in Boston declined to  note on whether the health care chain was under  disquisition.

Steward has also been investigated in the Mediterranean country of Malta, where the company signed a $4 billion euro deal to manage three hospitals. In May, a Maltese magistrate recommended criminal charges against de la Torre. The investigation involved the former Prime Minister of Malta, Joseph Muscat, who was accused of money laundering, corruption and bribery. He has pleaded not guilty and faces up to 18 years in prison, according to local media.

Private equity in health care scrutinized

The  ruin, sanitarium  conclusions and  dislocations to patient care at Steward are n't the only issues the Senate commission will probe. Sanders plans to seek answers into private equity's growing stake in the health care sector.

Sanders said at a July  hail private equity  enterprises  enjoy 460 hospitals in the United States – or about 1 in 5 for- profit hospitals.

" How  numerous of these hospitals are being loaded up with debt in order to make a  sprinkle of  directors and private equity  enterprises indeed  fat?" Sanders pondered audibly." How  numerous of these hospitals are in  peril of being shut down? How  numerous cases are at  threat?"

Experts say the Steward  ruin raises  enterprises about private equity's involvement in the health care assiduity. Under the Steward model, the company's debt came inviting as it acquired more hospitals and croaker ' practices.

Dr. Vikas Saini, president of the Lowen Institute, a Massachusetts-based health think tank, said financial problems were inevitable after Steward's acquisition.

Saini blamed the chaos on a lack of regulatory oversight for healthcare mergers and acquisitions.

"This illustrates how our oversight and regulatory apparatus for the healthcare sector has been bitten by worms," ​​Saini said. Hospitalization, he added, "has a huge social impact, means more to communities than whether or not to become an iPhone plant."

Saini said changes in hospital ownership require more checkpoints, transparency and public scrutiny. "We need to make sure you're not just selling us a bill of goods."

Louisiana patients in 'immediate jeopardy'

In Louisiana, state health regulators investigated Steward-owned Glenwood Regional Medical Center, which was issued three "immediate danger" warnings in 120 days from December 2023 to early 2024. Ending Medicare and Medicaid payments.

Glenwood nurse practitioner Debra Russell worked at the hospital for more than three decades before retiring last November.

During an April hearing before a Louisiana legislative committee, he described dire conditions for patients at the hospital. He recalled changing tactics in the middle of a procedure because the hospital didn't have a $5 tube called a guidewire. In another case, a young man came to the emergency room after suffering a heart attack but staff could not reach an on-call cardiologist because the specialist had not been paid. When staff attempted to order medication from the pharmacy for the patient, the medication was not stocked because the hospital supplier had not been paid.

Evidence of the financial crisis was visible outside the emergency room. Russell described the repossession of the coffee pots and said the document shredding companies had gone out of business.

Looks like the Steward's days of running this hospital are coming to an end. Steward has announced that another hospital operator, American Healthcare Systems, has made a bid to buy Glenwood. The bankruptcy court must approve the agreement.

Steward declined to answer questions about sales or operations in Glenwood. In a news release last May, the hospital said it had addressed issues raised by state and federal regulators after an immediate warning of the threat.

During a Senate hearing this spring, Russell, a former Louisiana staffer, recalled his final days at the Steward-owned hospital to testify specifically.

"It's the saddest thing I've ever been around," Russell said.

 New Gov jobs 

                         Apply now