Private Equity Hospitals’ Nightmares Exposed as Steward CEO Ignores Subpoena: Nurses Speak Out

Ralph de la Torre, the exceedingly wealthy CEO of Steward Health Care, a for-profit hospital chain established with private equity support, blatantly disregarded a subpoena on Thursday by failing to appear at a Senate hearing focused on the impact of the mismanagement of the now-insolvent hospitals on patient care.

Despite de la Torre’s absence, the Senate Health, Education, Labor, and Pensions (HELP) Committee was able to hear from nurses who experienced firsthand how Steward’s emphasis on shareholder dividends and exorbitant executive pay resulted in their hospitals being in a state of crisis due to severely inadequate staffing and resources.

Ellen MacInnis, a veteran nurse at St. Elizabeth’s Medical Center in Boston, revealed to Sen. Chris Murphy (D-Conn.) that there is a “marked difference” in hospital conditions under private equity ownership.

MacInnis explained that after Steward took control, the hospital “breached agreements” made with the nursing staff and “dismissed all the nursing assistants on our maternity wards.”

When Murphy suggested that the aim of hospitals under Steward’s control seemed to be to “enrich the owners immensely,” MacInnis concurred, “Yes, absolutely.”

Earlier in her testimony, MacInnis provided what she termed an “outrageous and horrifying example” of Steward’s managerial incompetence and insensitivity: “Steward’s inability to maintain a stock of bereavement boxes, which are used to transport the remains of deceased newborns to the morgue.”

“Instead, the staff was expected to transport these remains in banker’s and shipping boxes,” MacInnis added. “To compensate for this disgrace, our own nurses had to order suitable containers from Amazon.”

The “most heartbreaking example,” MacInnis noted, was the death of a 39-year-old mother “simply because the embolism coil that could have saved her life had been reclaimed by another unpaid supplier.”

View the complete hearing:

Steward has been under intense examination by lawmakers since it declared bankruptcy in May, following de la Torre and his private equity associates amassing vast amounts of money—making the for-profit network a glaring example of the detrimental effects of private equity on the U.S. healthcare system.

The Senate HELP Committee, chaired by progressive Sen. Bernie Sanders (I-Vt.), voted to subpoena de la Torre in late July when he refused to voluntarily testify before the committee.

The defiance of the panel’s subpoena by the Steward CEO prompted Sanders to declare on Thursday that he “will be requesting the committee to report a resolution to authorize civil enforcement and criminal contempt proceedings against Dr. de la Torre requiring compliance with the subpoena.”

A hearing on the proposed contempt resolution is planned for next week.

“A for-profit company that’s focused on squeezing every penny from the hospital and its services has no motivation to hire more nurses.”

As pointed out by Maureen Tkacik in The American Prospect last week, Steward “entered bankruptcy with $8 billion in debt while its CEO drained more than a quarter-billion dollars and squandered most of it on a spectacular midlife crisis, featuring a new spouse 29 years his junior, a 500-acre ranch for her award-winning racehorses, a $77,000-a-month security detail for her travel between the couple’s various mansions, a wedding on the Amalfi Coast organized by Gwen Stefani and Blake Shelton’s wedding planner, and not one but two yachts.”

Just before Thursday’s hearing, The Wall Street Journal reported that Steward distributed $790 million in dividends to shareholders years before declaring bankruptcy. A substantial portion of the $790 million went to Cerberus, the private equity behemoth that owned Steward from 2010 to 2020.

The nurses’ testimonies during Thursday’s hearing clearly demonstrated that such greed came at the cost of healthcare workers and patients.

“There’s no incentive for a for-profit company that’s striving to extract every cent from the hospital and all its services to hire more nurses,” Audra Sprague, a former nurse at the recently closed Nashoba Valley Medical Center, stated to the Senate Health, Education, Labor, and Pensions (HELP) Committee during Thursday’s hearing.

“They don’t care about your day,” Sprague continued. “They’re not there to genuinely help patients, they’re there to generate profit.”

After the hearing concluded, Sen. Ed Markey (D-Mass.) held a press briefing with nurses and other advocates in front of the U.S. Capitol Building.

Markey, a staunch critic of Steward, praised the bravery of healthcare workers advocating for their patients in the face of private equity’s avarice.

“Their courage,” the Massachusetts senator stated, “is only equaled by Dr. de la Torre’s lack of it.”