Hospitals can't find their footing
The metaphor could not be more striking: the hospital system literally sold the land out from under it patients. And then blamed everyone else for its 3:27 a.m. bankruptcy filing.
Steward Health Care’s middle-of-the-night move may well be the final chapter in the saga of a skilled cardiac surgeon who thought he could reinvent the health care system. In the end he may have been right, just not in the way he envisioned.
Ralph de la Torre is a big man, with a big voice and like all surgeons, a big ego. Our paths crossed at Beth Israel Deaconess Medical Center where he made waves as he thought he could bring his talents with a scalpel to the business side of the house.
We’re seeing how that worked out as Massachusetts’ already heavily burdened health care system faces the prospect of eight hospitals, mainly in low-income or working class communities, struggling to maintain their own footing.
That’s because those hospitals sit on land owned by Medical Properties Trust, an Alabama real estate company that bought the land and the buildings in 2016 for $1.2 billion. MPT is now poised to lend Steward another $75 million in debtor-in-possession financing as the company looks to emerge from a financial nightmare that it blames — on everyone else.
That includes poor Medicare and Medicaid reimbursements, the high cost of equipment and labor and the failure of Massachusetts regulators to act quickly on the sale of its physician practices to a for-profit health care company.
“Steward Health Care has done everything in its power to operate successfully in a highly challenging health care environment.”
No mention though of the $111 million payout de la Torre received in the MPT deal. Certainly no mention of his two yachts or company jet.
OK, they were planning to sell the corporate jets.
True to form, the Dallas-based company filed for Chapter 11 bankruptcy protection in Houston, in what is described as:
“the foremost destination of ponzified companies seeking to avoid questions and accountability. In the alleged name of speed and efficiency…”
As in Charles Ponzi, a con artist so skilled at what he did they named a scheme after him.
Massachusetts regulators tried to find the bright side, saying the court will now unlock documents that Steward long refused to make public.
And House Speaker Ron Mariano now promises to bring broad-based legislation to the floor next week that would, among other things, require hospitals to own the land under their feet and increase financial reporting requirements.
Somewhat like closing the barn door after the horses escape.
The bigger question is what will happen to the remaining Massachusetts-based Steward hospitals? Who would buy something where they have to pay rent on the land and the buildings? Regulators would also be loath to enable the two largest systems — Mass General Brigham and Beth Israel Lahey Health — to get even bigger.
The state is blessed with a robust health care system that includes community health and urgent care centers that can handle routine issues and feed tougher cases into affiliated hospitals.
But those hospitals are now bursting at the seams and their relief valve, nursing homes and rehabilitation centers are also dealing with long-term issues.
Maybe de la Torre’s yachts can sail up to Boston and becoming floating hospitals for the patients he’s left adrift?