As more than 30 hospitals in Steward Health System raked together cash to cover supplies, shuttered pediatric and neonatology departments, closed maternity wards, laid off hundreds of health care workers and put patients at risk, the system paid out at least $250 million to the CEO and his company. According to a report from the Wall Street Journal:.
The newly revealed financial details have prompted further scrutiny of Steward CEO Ralph de la Torre, a Harvard-trained cardiac surgeon who acquired majority ownership of Steward from private equity firm Cerberus in 2020. De la Torre and his company have reportedly received at least $250 million since the acquisition. In May, Steward filed for bankruptcy. There are hospitals in eight states.has filed for Chapter 11 bankruptcy protection.
Critics, including members of the Senate Health, Education, Labor and Pensions Committee (HELP), allege that Delatore stripped the health system’s hospitals of assets, misappropriated payments and drove them into debt while making himself outrageously wealthy through huge payouts.
Suspicion of greed
For example, de la Torre sold the system’s hospital sites to Medical Properties Trust, a major hospital landlord, forcing Steward Hospital to make large rent payments. Under de la Torre’s leadership, Steward paid $30 million a year to a management consulting firm to provide “executive management and overall strategic direction.” But de la Torre was the majority owner of the consulting firm, which also employed other Steward executives. As the WSJ put it, Steward “was in effect paying the CEO’s company, which also employed Steward executives, for Steward’s executive management services.”
In 2021, as hospitals were overwhelmed by the COVID-19 pandemic, Steward distributed $111 million to shareholders. Del Torre owned 73% of the company at the time, so his share was about $81 million, the WSJ reported. That year, Del Torre bought a 190-foot yacht for $40 million. He also bought a $15 million custom-built luxury fishing boat, ” JarcoMeanwhile, the Senate Advocacy Committee noted that a company affiliated with Steward owns two jets, one valued at $62 million and a second “backup” jet valued at $33 million.
In 2022, de la Torre had a lavish wedding on Italy’s Amalfi Coast and bought a 500-acre ranch in Texas for at least $7.2 million. His new wife, Nicole Acosta, 29, is an equestrian who trains at a facility near the ranch. The horses she rides were sold for $3.5 million in 2014, but it’s unclear how much the couple paid for them. In addition to the ranch, de la Torre, 58, owns a 11,108-square-foot mansion in Dallas worth $7.2 million, the WSJ reports.
While de la Torre lived a life of luxury, Steward Hospital faced dire circumstances, as it had for years. According to an investigation by the Senate HELP Committee, between 2014 and this year, Steward closed hospitals in Massachusetts, Ohio, Arizona and Texas, laid off thousands of health care workers and put communities in dire straits. It closed pediatric wards in Massachusetts and Texas, closed newborn rooms and eliminated obstetric services in Florida. In Louisiana, Steward patients faced “imminent crisis.”
“Third World Medicine”
At a hearing in JulySen. Bill Cassidy (R-Louisiana), the ranking member of the HELP committee, spoke about the situation at Glenwood Regional Medical Center in West Monroe, Louisiana, where Steward is alleged to have mismanaged the hospital. “According to a report from the Centers for Medicare & Medicaid Services, doctors at Glenwood told Louisiana state inspectors that the hospital was providing ‘Third World medicine,'” Cassidy said.
Additionally, “one patient died while awaiting transfer to another hospital because Glenwood did not have the resources to treat them,” the senator said. “Unfortunately, Glenwood is no exception,” he continued. “At the Steward-owned Massachusetts hospital, A woman died after giving birth “Halfway through the operation, doctors discovered that supplies needed for her treatment had already been seized due to Steward’s financial difficulties. The hospital was reportedly $2.5 million in unpaid bills to suppliers.”
Additionally, the Journal investigation unearthed records showing that a pest-control company found 3,000 bats living in one of Steward’s Florida hospitals. In Arizona, a Phoenix-area hospital was without air conditioning during a heatwave and its kitchen was closed for violating health codes. The state ordered the hospital closed last week.
“Dr. de la Torre and his executive team’s poor financial decisions and gross mismanagement of the hospital are shocking,” Cassidy said. “Patients’ lives are at risk. The American people deserve an explanation.”
Indignation
Senate HELP Committee Chairman Bernie Sanders (I-VT) went further, saying the U.S. health care system “is designed not to make patients healthy, but to make healthcare professionals and shareholders enormously wealthy. … Perhaps more than anyone in the United States, Steward Healthcare CEO Ralph de la Torre embodies the outrageous corporate greed that permeates our entire for-profit health care system.”
Sanders lamented that Delatorre’s payments were meant to benefit patients and the community, asking: “How many of Steward’s hospitals would have survived, how many lives would have been saved, how many health care workers would not have lost their jobs if Dr. Delatorre had spent $150 million on quality medical care instead of his yacht, two private jets and luxury fishing boat?”
On July 25, the committee voted 16-4 to subpoena Del Torre and question him in person. To date, Del Torre has refused to appear before the committee voluntarily and has refused to comment on the WSJ report. This is the first time the committee has issued a subpoena since 1981.
Meanwhile, Steward and de la Torre are under investigation by the Department of Justice for fraud and corruption. Contract to run hospital in Malta.
