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health over wealth act
'Poster Child for...Corporate Greed': Sanders Slams Health Industry CEO's Subpoena Refusal
"It is time for Dr. de la Torre to get off of his $40 million yacht and explain to the American people how much he has gained financially while bankrupting the hospitals he manages."
Sep 04, 2024
U.S. Sen. Bernie Sanders on Wednesday blasted Dr. Ralph de la Torre—the CEO of a bankrupt health services company "who has made hundreds of millions of dollars ripping off patients and healthcare providers"—for refusing to comply with a bipartisan subpoena compelling him to testify about his company's insolvency.
"Perhaps more than anyone else in America, Dr. de la Torre is the poster child for the type of outrageous corporate greed that is permeating through our for-profit healthcare system," said Sanders (I-Vt.), who chairs the Senate Committee on Health, Education, Labor, and Pensions (HELP).
"Working with private equity vultures, he became obscenely wealthy by loading up hospitals across the country with billions in debt and selling the land underneath these hospitals to real estate executives who charge unsustainably high rent," the senator added. "As a result, Steward Health Care, and the more than 30 hospitals it owns in eight states, were forced to declare bankruptcy with some $9 billion in debt."
Steward is trying to sell all 31 of its hospitals in order to pay down its debt.
As Common Dreamsreported on July 25, the HELP committee, which includes 10 Republicans, voted 20-1 to investigate Steward Health Care's bankruptcy, and 16-4 to subpoena de la Torre.
"I am now working with members of the HELP committee to determine the best path forward," Sanders said on Wednesday. "But let me be clear: We will not accept this postponement. Congress will hold Dr. de la Torre accountable for his greed and for the damage he has caused to hospitals and patients throughout America. This committee intends to move forward aggressively to compel Dr. de la Torre to testify to the gross mismanagement of Steward Health Care."
"It is time for Dr. de la Torre to get off of his $40 million yacht and explain to the American people how much he has gained financially while bankrupting the hospitals he manages," Sanders added, referring to the 190-foot megayacht the CEO purchased as Steward hospitals failed to pay their bills.
Sens. Ed Markey (D-Mass.)—a HELP committee member—and Elizabeth Warren (D-Mass.) also slammed de la Torre on Wednesday, calling his failure to appear before the panel "outrageous."
"De la Torre used hospitals as his personal piggy bank and lived in luxury while gutting Steward hospitals," the senators said. "De la Torre is as cowardly as he is cruel. He owes the public and Congress answers for his appalling greed—and de la Torre must be held in contempt if he fails to appear before the committee."
De la Torre's attorney, Alexander Merton, lashed out against the Senate subpoena Wednesday in a letter
accusing HELP committee members of being "determined to turn the hearing into a pseudo-criminal proceeding in which they use the time, not to gather facts, but to convict Dr. de la Torre in the eyes of public opinion."
The same day the HELP Committee voted to probe Steward and subpoena de la Torre, Markey and Rep. Pramila Jayapal (D-Wash.), who chairs the Congressional Progressive Caucus, introduced the Health Over Wealth Act, which would increase the powers of the U.S. Department of Health and Human Services to block private equity deals in the healthcare industry.
Last month, Markey and Warren expressed concerns over the proposed $245 million sale of Steward Health Care's nationwide physician network to a private equity firm.
"Two Massachusetts hospitals are closing and communities are suffering because of private equity's looting of Steward," said Warren. "Selling Massachusetts doctors to another private equity firm could be a disaster. We can't make the same mistake again. Regulators must scrutinize this deal."
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Markey, Warren Sound Alarm Over Private Equity Firm's Deal to Buy Doctors Group
"Selling Massachusetts doctors to another private equity firm could be a disaster," said Sen. Elizabeth Warren. "Regulators must scrutinize this deal."
Aug 13, 2024
Both of Massachusetts' Democratic U.S. senators on Tuesday expressed concern about a private equity firm striking a $245 million deal to buy the nationwide physicians network of the for-profit Steward Health Care, which filed for bankruptcy in May.
The network, Stewardship Health, has about 5,000 employees across nine states and serves around 400,000 patients, according to Steward. It is set to be acquired by Rural Healthcare Group, an affiliate of Kinderhook Industries.
"Steward also operates eight hospitals in Massachusetts," The Boston Globereported Monday. "Last month, it said it will close two of them, Carney Hospital in Dorchester and Nashoba Valley Medical Center in Ayer, by August 31. It's currently in the final stages of negotiations to sell the other six."
Sen. Elizabeth Warren (D-Mass.), a former bankruptcy law professor, noted the planned closures in her social media post urging regulators to review the deal.
"Two Massachusetts hospitals are closing and communities are suffering because of private equity's looting of Steward," she said. "Selling Massachusetts doctors to another private equity firm could be a disaster. We can't make the same mistake again. Regulators must scrutinize this deal."
In March, Steward had confirmed plans for the Optum unit of insurer UnitedHealth to buy the network, but that was never finalized.
"As part of the ongoing Chapter 11 proceedings, following a robust and active bidding process, Steward Health Care is pleased to have reached an agreement with Rural Healthcare Group," Steward Health Care president Mark Rich said in a Monday statement. "Kinderhook has over 20 years of experience investing in mid-sized healthcare businesses that serve the nations' most vulnerable populations."
"Kinderhook's investments are focused on protecting access to high-quality healthcare in communities that are truly underserved," Rich added. "Rural Healthcare Group is a well-respected group of healthcare professionals that specifically focuses on underserved and underinsured areas. We are confident that Stewardship Health will continue its stellar treatment of the patient population as a result of this transaction."
According to the Globe:
In an attachment to an overnight filing with U.S. Bankruptcy Court in Houston, the company listed the purchase price as $245 million in cash.
That price is subject to change, the filing indicated, depending on several factors still to be determined, including whether U.S. Family Plan at Brighton Marine, a Boston health insurance agency, is included in the transaction. The filing listed the buyer as Brady Health Buyer LLC, a company set up by New York-based Kinderhook to purchase Stewardship.
The newspaper noted that "the sale to Rural Healthcare is subject to the approval of U.S. Bankruptcy Judge Christopher Lopez at a Houston hearing scheduled for Friday. It's also subject to regulatory approval in Massachusetts and other states."
As Common Dreamsreported last month, Sen. Bernie Sanders (I-Vt.), chair of the Senate Committee on Health, Education, Labor, and Pensions (HELP), led the panel in bipartisan votes to authorize a probe into the bankruptcy of Steward Health Care (20-1) and subpoena CEO Ralph de la Torre (16-4).
The same day, Sen. Ed Markey (D-Mass.), a committee member, and Rep. Pramila Jayapal (D-Wash.) introduced the Health Over Wealth Act, which would increase the powers of the U.S. Department of Health and Human Services to monitor and block private equity deals in the healthcare industry.
"Private equity firms buying up healthcare systems are simply bad news for patients, leading to worse health outcomes and higher bills," Jayapal said at the time. "We have a duty to protect patients from greedy corporations that are prioritizing their bottom line over patient care."
In response to news of the doctors group deal, Markey said Tuesday that "private equity did to Steward what it will keep doing to hospitals and physician networks across the U.S.—unless we put guardrails on them. We need to pass my Health Over Wealth Act to get corporate greed out of healthcare for good."
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