The chair for Steward Health CEO Ralph de la Torre was notably empty during the U.S. Senate’s hearing on the significant financial mismanagement of the company’s Massachusetts hospitals and the increasing precarious role of private equity in healthcare.
“That seat for (Steward executives’) testimony was empty today, as empty as the promises which Steward and Ralph de la Torre had made to the state of Massachusetts,” said Sen. Ed Markey. “So we’re going to make sure that Dr. de la Torre and Steward become nationally famous; that they become the example of the dangers of allowing private equity to take over a healthcare system.”
Markey chaired a hearing of the U.S. Senate Health, Education, Labor, and Pensions hearing, “When Health Care Becomes Wealth Care: How Corporate Greed Puts Patient Care and Health Workers at Risk,” exploring the issue and announcing legislation in the Massachusetts State House on Wednesday.
The hearing follows months of chaos and uncertainty surrounding Steward Health Care and the future of their nine hospitals in Massachusetts. The private equity company’s millions of dollars of debt came to light in early 2024, and after a push from state officials, they’ve looked to offload all hospitals in the Commonwealth.
Sen. Elizabeth Warren called de la Torre’s absence “cowardice,” noting he didn’t want to “face the nurses who can’t provide the care people need because he decided to loot the hospital system to buy himself a couple of yachts.”
Testimony from healthcare professionals highlighted the cost of companies prioritizing profits for shareholders over patient care.
“Having spent time at several other Steward facilities briefly, I began to realize how resources were being dwindled down and pulled from each facility,” said Ellana Stinson, President of New England Medical Association, speaking about her decision to leave the Steward-run Carney Hospital. … “Not having blood products, respiratory therapy at times, or specialty services no longer felt like I was able to provide safe or quality care.”
There is mounting evidence the for-profit model in healthcare results in harms for patients, said Donald Berwick, President Emeritus and Senior Fellow at the Institute for Healthcare Improvement. Private equity ownership in nursing homes has resulted in a 10% increase in mortality and 11% increase in costs, he cited, and in hospitals resulted in a 25% in avoidable injuries like falls and infections.
Markey launched a bill called the “Health Over Wealth Act,” which would up financial transparency and enact safeguards for hospital workers at facilities owned by private equity companies, among other provisions. Warren also spoke to her broader goals to add oversight into private equity firms, citing her “Stop Wall Street Looting Act.”
Speakers also emphasized the importance of oversight in the the recent proposal from the company Optum to buy Steward’s physician network, which they said may lead back into the cycle of putting profit over patients by a new for-profit company.
“The first thing we need to do is keep us hospitals open and able to deliver high-quality care,” said Warren. “We also need to hold these executives accountable, because failure to do so now just invites them to come back and do this to another part of the healthcare system, and another part of the healthcare system, and another part of the healthcare system.”
