A year after Steward declared bankruptcy, hospitals and communities still feel repercussions: report

Diving brief:

• A year has passed since Steward health care was deposited in bankruptcylaunch The greatest health care restructuring of providers in decades, including An effort of several months to sell its 31 hospitals.
• Five steward hospitals have permanently closed since its bankruptcy, while two other services temporarily interrupted. Many remaining facilities landed in the hands of investor capital and investor owners, according to a new report The project of investigating in investment.
• The prospects for hospitals are dark, after those who were “lucky not to close” were “simply transferred from one company belonging to investors to another, with little surveillance or regulatory conditions to protect patients and community access to critical health services,” the report.

Diving insight:

Steward sent shock to the health care industry when she filed a record last year. The operator had More than $ 9 billion in total liabilities, including nearly $ 1 billion in unpaid invoices and $ 6.6 billion in long -term rent bonds towards its owner, Medical Properties Trust.

While the health system had climbed signs of distress before the deposit, including fence hospitalsThe judicial archives were the first glimpse of how bad steward finances were really. CEO Ralph de la Torre had Laws on the financial disclosure of the dodged hospital for years In Massachusetts, where the steward had its head office between 2010 and 2018.

The bankruptcy procedure launched a One month’s auction processin which the steward tried to find quality offers for its installations distributed through Arizona, Arkansas, Florida, Louisiana, Massachusetts, Ohio, Pennsylvania and Texas. The process was difficult, with several stops and departures. Potential buyers are selected from agreements and steward lawyers have snatched hands in the court, claiming certain hospitals Were not attractive enough to court buyers.

The majority of steward hospitals have finally moved to new owners. However, five hospitals have closed since May 2024, which resulted in dismissals of around 2,400 employees and adding pressure on health resources in Massachusetts, Florida and Ohio.

For example, the Carney Hospital based in Boston Closed in August 2024 After failing to find a buyer. After closing, Boston’s emergency medical services reported a 20% increase in transport times and emergency services In the nearby facilities, have reported a size, according to the report of the project stakeholder stakeholders.

Likewise, the closure of The Nashoba Valley Medical Center, also in August, pushed the EMS services to “The penchard of collapse” and created a “crisis situation … On several fronts due to the distances and increased times for ambulances and the first stakeholders to travel”, according to Firefighters and city administrators quoted in the report.

The installations of the delegates that remain open may not have been getting better for a long time. Several hospitals have been purchased by groups with questionable history of hospital management, according to the report.

For example, Healthcare Systems of America, which bought five steward hospitals in Florida, is managed by the CEO Michael Sarian. According to the report.

Ohio legislators also started examining Insight Health, which bought the Steward’s Ohio portfolio. Insight interrupted the hospital operations at the Hillside Rehabilitation Center and Trumbull Régional on March 27, linking nearly 700 employees after Steward was not transferred to Insight which was due to the health services.

Senator Bernie Moreno, R-Ohio, sent a letter to Steward Health Care, Medical Properties Trust and Insight Health Systems in April, alleging that companies had engaged in predatory and potentially illegal actions. The hill closed also threatened the viability of the Trumbull County 911 distribution center, Moreno.

Critics allegedly allegedly allegedly alleged steward, including the former Steward capital owner, Cerberus Capital Management, became rich while the health system wading.

When the investment capital company left its position in 2020, the health system paid a dividend of $ 111 million to its owners, including torre. In total, Cerberus and the Torre extracted approximately $ 1.3 billion from the intendant, according to the report.

De la Torre left his CEO post in September. The executive rejected repeated calls from the legislators to testify on its management practices. In September, Torre Defined an assignment to the Congress to appear before the Senate Committee for Health, Education, Labor and Pensions, which made the Senate depress it.

Tuesday, meaning. Edward Markey and Elizabeth Warren, both Democrats from Massachusetts, urged the Ministry of Justice to pursue the Torre to court and asked the Securities and Exchange Commission to know if the MPT relations with the delegate have “induced his investors in error and violated the securities laws”, according to letters sent to agencies.

Meanwhile, the investment capital participation project, a non-profit guard dog which analyzes the impact of investment capital, puts pressure for more strict laws supervising health care transactions.

The organization applauded the legislation adopted in Massachusetts this winter which aims to increase transparency in hospital transactions – but the laws should go even further, said the non -profit organization in the report published on Tuesday.

“State and federal legislation should go beyond transparency and disclosure measures to limit or prohibit extractive commercial practices which should not have room in health care,” said the report. “This includes the limitation or prohibition of the sale-lighter to all Hospitals, prohibiting hospital investors from paying dividends funded by health systems debt (also called dividend recapitalization) and limiting the amount of debt which can be used to finance hospital acquisitions and other health establishments. »»