Senators to Steward Health Care execs: ‘How do you live with yourself’ when gutting hospitals, communities, the American health system?

Expert witnesses watch at the conclusion of the Senate Committee on Health, Education, Labor & Pensions hearing, “Examining the Bankruptcy of Steward Health Care: How Management Decisions Have Impacted Patient Care," held Sept. 12, 2024. This image was taken from the committee hearing webcast.

Steward Health Care leaders are “health care terrorists” responsible for the deaths of patients, said a state lawmaker testifying in Congress.

Private equity investment in Steward Health Care, and the health system’s subsequent bankruptcy, have received national attention for the effects on the delivery of health care. On Sept. 12, two nurses and two elected officials translated that to the human cost with reports about alarming – at times, abysmal – cuts that pressured patient conditions from bad to worse, sometimes with fatal consequences.

The Senate Committee on Health, Education, Labor & Pensions (HELP Committee) convened the hearing, “Examining the Bankruptcy of Steward Health Care: How Management Decisions Have Impacted Patient Care.” The star witness, Steward Chairman and CEO Ralph de la Torre, MD, was a no-show; his attorneys informed the committee he would not testify due to pending bankruptcy court proceedings.

The committee will seek a resolution to authorize civil enforcement and criminal contempt proceedings against de la Torre requiring compliance with the subpoena, said committee Ranking Member Sen. Bill Cassidy, MD (R-Louisiana).

In a hearing lasting more than 90 minutes, Cassidy and other senators had strong comments about the situation. Four other witnesses described their experiences in the hospital halls, the community, and at the state regulatory level.

‘Commodification of health care’

“The corporatization and commodification of health care is the guiding ethos of Steward. It's the one and only priority, and it has led to horrific suffering to our patients, the people who take care of our patients, and our communities,” said Ellen MacInnis, RN, nurse at St. Elizabeth’s Medical Center in Boston, Massachusetts. The most immediate and debilitating effect is that the company understaffs facilities whenever and wherever they can, leading to patient waiting times measured in hours, or even days, she said.

Supplies are short, equipment is not maintained, and IV pumps in computers have just seconds of battery life because no maintenance has been done. Staff has had to go out to shop for items such as Similac, Pedialyte and diapers. When the hospital ran out of bereavement boxes for newborns who died, staff had to use cardboard shipping boxes, then pitched in money to buy bereavement boxes from Amazon, MacInnis said.

‘Systematically extracted every possible dollar’

Audra Sprague, RN, a former nurse at Nashoba Valley Medical Center in Lunenburg, Massachusetts, said Steward “systematically extracted every possible dollar that they could get out of our hospital until it led to its closure 12 days ago,” on Aug. 31.

As a nurse, Sprague described chronic understaffing and lack of supplies, with nurses doing the best they could. As a mother, Sprague described taking her son to the hospital’s emergency department (ED). He was diagnosed with new onset Type 1 diabetes and was in diabetic ketoacidosis. The intensive care unit had beds, but no nurses, so he stayed in the ED among 18 other patients and his mother.

“I had to be his nurse that night and not his mother, and he deserved to have both,” Sprague said. “He deserved to have a one-on-one nurse and a mother there to support him, and I wasn't able to do that because I was I had to focus on his nursing care and make sure that he was OK.”

‘Invest … in a responsible manner’

In West Monroe, Louisiana, Steward managed the Glenwood Regional Medical Center, serving an eight-parish region of almost 300,000 people, with transfers from 26 rural hospitals. The largest employer in town, the medical center has dropped from 1,200 employees to approximately 750, said West Monroe Mayor Staci Albritton Mitchell.

A potential closure would devastate the livelihoods of families, including maintenance, janitorial and clerical staff, along with clinicians, and would force patients to look for care elsewhere, Mitchell said. Steward has denied or delayed payments to local vendors, she said.

The employees have done their best to keep the facility going, and West Monroe welcomes outside investment in business, Mitchell said.

“It is imperative that when individuals or companies invest in critical infrastructure such as health care, that they do so in a responsible manner, and they have their patients and the well-being of all in mind,” Mitchell said. “And in Stewart's case, there was a failure to uphold this responsibility.”

‘Health care terrorists’

Steward’s management has drawn attention of state lawmakers in Baton Rouge, the capital, said state Rep. Michael Charles Echols, of Monroe, Louisiana. They began hearing from physicians, nurses and other providers highly alarmed by the inability to deliver quality care, he said.

In a committee hearing of the state legislature, a health system leader admitted Steward was responsible for not providing financial resources, and because of that mismanagement, patients died or were maimed, Echols said.

“When I hear my colleagues from across America here to talk about these deficiencies in the health care system, it is glowingly clear to me that the executives of Steward Health Group are health care terrorists,” Echols said. “They are killing our patients. They are killing our communities, and they need to be held accountable.”

The employees taking care of patients are terrific people, Echols said.

“They've done everything in their power to make sure that the patients get everything they can, but their hands have been just completely tied,” he said.

‘Their own personal piggy bank’

Too often, the U.S. health care system is designed not to make patients well, but to make executives and stockholders extraordinarily wealthy, said committee Chair Sen. Bernie Sanders (I-Vermont).

“There could not be a clearer example of that than private equity billionaires on Wall Street who are making billions by purchasing hospitals throughout our country, stripping all of their assets and loading them up with debt that these hospitals could never pay back, perhaps more than anyone else in America,” Sanders said. De la Torre “is the poster child for this type of corporate greed” permeating the nation’s for-profit health care system, he added.

The hospital system’s financial woes did not happen overnight; instead, they developed over a decade, Sanders said. Estimates put at least 15 patient deaths at Steward hospitals due to lack of equipment or staff, and at least 2,000 other patients were put at serious risk, he said, citing federal regulators who cited Steward hospitals more than 30 times for putting patients in “immediate jeopardy” since 2019.

The Massachusetts hospital closures may have gotten the most public attention, but those are not the only ones affected. Sanders cited examples in Ohio, Texas, and Arizona, where a behavioral center was shut down for lack of air conditioning as daytime highs topped 100 degrees.

Meanwhile, de la Torre spent $40 million on a yacht, $15 million on a custom-built luxury fishing boat, $62 million on a private jet, $33 million on a backup jet, and allowed Steward health to donate $10 million to a prep school in Dallas, Texas, Sanders said.

Sanders railed against the business model that drains the coffers of health care systems and hurts patients.

“We cannot allow wealthy private equity executives to treat our health care system as their own personal piggy bank,” Sanders said. “Health care in America, in my view, must be a human right for every man, woman and child in this country, and not simply an opportunity for billionaire investments, investors to make huge profits.”

‘A broken health care system’

Other members of the HELP Committee did not mince words describing the situation.

Sen. Edward J. Markey (D-Massachusetts) displayed a poster with portraits of patients who died at Steward Health Care hospitals in Massachusetts in a Sept. 12, 2024, hearing of the Senate Committee on Health, Education, Labor & Pensions. This image was taken from the committee's hearing webcast.

Sen. Edward J. Markey (D-Massachusetts) displayed a poster with portraits of patients who died at Steward hospitals in Massachusetts as the company was sucking millions of dollars out to benefit its corporate executives. He cited Boston Globe reporting that found more than 2,000 patients were endangered by Steward Health Care.

“They were grandparents, parents, children, aunts, uncles, nephews, nieces, friends, community members,” he said. “But for those corporations, private equity, those profits came first, meaning the patients came last, and ultimately, just left it to the nurses to try to deal with this situation as it unfolded. And this just was a situation where every patient meant something special to the families and to the nurses as they tried to help this.”

He thanked the witnesses and said they were brave, while “Dr. de la Torre is a coward,” avoiding the reality of his legacy at those hospitals.

The situation is another egregious example of a broken health care system, said Sen. Mike Braun, (R-Indiana).

“This is part of a broken health care system that even doctors and nurses and pharmacists don't want to get into anymore, because it's been taken over,” he said. “When private equity gets into emergency rooms and gets into something, that's because it's easy cash flow. That's OK if you want to do it on something that isn't critical, if the marketplace allows it. Here, it ends up in a story like this. It ends up to where we're paying twice as much as most other countries are for health care, and in many cases, we have poor results.”

He called for greater transparency and more competition, with fewer barriers to market entry, as a method of market reform.

‘Why do we accept that as a country?’

Sen. Maggie Hassan (D-New Hampshire) said de la Torre’s absence was absolutely unacceptable. As someone with family in the Boston area, she told MacInnis that St. Elizabeth’s Medical Center had a reputation as a wonderful hospital, especially for mothers and babies. “And to hear your stories shakes me to the core, and I thank you for being willing to share it,”Hassan said.

Sen. John Hickenlooper (D-Colorado) said examples of mismanagement threaten the future of the health care workforce by stifling the interest of young people considering careers in medicine.

Steward Health Care is not alone – in fact, the situation is repeating in hundreds of hospitals with hundreds of executives “making a disgusting fortune off of withholding health care from people in need,” said Sen. Chris Murphy (D-Connecticut). He cited an example from Connecticut, where a private equity investment company in 2016 took over three hospitals. Two years later, those hospitals were in trouble while executives still got paid.

“How have we let American capitalism get so off the rails, so unmoored from the common good that anybody thinks it's OK to make a billion dollars off of degrading health care for poor people in Waterbury, Connecticut,” he said. “A, how do you live with yourself? But B, why do we accept that as a country? This is just a choice to decide to commoditize our health care system in Connecticut, in Louisiana, in Massachusetts, in every state across this country.”

‘Pain worth more than punishment?’

Sen. Mitt Romney (R-Utah) asked about the U.S. Department of Health and Human Services’ ability to monitor and regulate hospital operations. Echols cited his experience with state inspections and hospital licensure investigations, which can be effective, but also create a greater threat.

“Some states are more aggressive than others. I mean, when you look at shutting down a hospital and potentially hurting more people because of that, this is how both private equity and these facilities get away with these schemes because they put your facility in jeopardy, they shut them down, your community has nothing, so they suffer even more,” Echols said. “So then they can come to politicians like you and me and ask for additional bailout money and other lifelines, which, to me, is part of the broader crime. So, to answer your question, yes, there are pathways for our departments of health to hold them accountable. But the question is, is the pain worth more than the punishment?”