The largest private, physician-led health care network in the country is floundering in Massachusetts, reportedly considering the sale of four facilities. Elected officials say that Steward Health Care has to provide answers— and soon— as they fret about a potential decline in quality of care for patients and impacts to the system’s over 16,000 employees in the Bay State.
In Boston, two councilors are demanding a public hearing to assess the “financial challenges” facing Steward Health Care: Councilor Liz Breadon of Allston-Brighton, where Steward’s St. Elizabeth’s Medical Center is located, and Councilor John Fitzgerald, who represents Dorchester where the 159-bed Carney Hospital is based.
“We’re worried not only about the population that the Carney serves, being a low-income population, but as well as its local impact,” Fitzgerald said. He said there are also restaurants and stores in the area who rely on people working and visiting the hospital will no longer have that economic benefit.
St. Elizabeth’s is reportedly one of the four facilities that could soon be closed down. Breadon said continuity of care is essential no matter what happens at Steward facilities, especially for elders and more vulnerable residents.
“If all of these patients all of a sudden don't have access to health care —I think the big question is, well, where else can they go? Boston Medical Center, which is our safety-net hospital, is already at capacity,” she said.
Steward operates Carney Hospital in Dorchester, Good Samaritan Medical Center in Brockton, Holy Family Hospital in Haverhill and Methuen, Morton Hospital in Taunton, Nashoba Valley Medical Center in Ayer, New England Sinai Hospital in Stoughton, Saint Anne’s Hospital in Fall River, St. Elizabeth’s Medical Center in Brighton, and Norwood Hospital, which is being reconstructed after a flood closed its doors in 2020. The Dallas-based company operates more than 30 hospitals in Arizona, Arkansas, Florida, Louisiana, Massachusetts, Ohio, Pennsylvania and Texas.
Steward told GBH News in a statement late Wednesday that it has “no plans” to close either Carney Hospital or Holy Family Hospital but did not comment on the other hospitals it owns. A spokesperson for the health care system wrote that it remains committed to the community and its patients.
In Norwood, Steward still owns the flooded facility that is still under construction since operations shut down in 2020. Residents already know what it’s like to get by without a local hospital.
“Although most people’s lives and work is based around working in Norwood, they unceremoniously found themselves having to work somewhere else,” said Tony Mazzucco, general manager for the town, recalling the abrupt 2020 closure.
He said there was “significant impact” on public safety because ambulances that traveled a mile now have to go to Needham or Boston, making transport times increase “by a factor of 10 or more.”
In early January, Steward’s landlord Medical Properties Trust Inc. wrote in a news release that the company owes millions had only been paying partial rent since the summer. Medical Properties Trust Inc said its worked closely with Steward to “develop an action plan.” Part of this includes the “potential sale or re-tenanting of certain hospital organizations,” it wrote.
Mazzucco said this is playing out locally with Medical Properties Trust office buildings that house Steward facilities. He said the vendors are struggling to get paid.
“This has gone on for at least six months, if not longer,” he said. “It’s not much of a surprise to us at the local level that this is — that they've had some trouble paying their bills.”
Hospital construction, he said, has slowed to a “crawl,” with often no one on site.
The state is in talks with Steward Health Care, saying that protecting public health and safety is a top priority of the administration.
“This means maintaining safe and high-quality care in hospitals throughout the state, and supporting the healthcare workforce,” said a spokesperson for the Executive Office of Health and Human Services. “When healthcare facilities or services close, we are always concerned about any potential disruption to patients, healthcare workers, families, and communities. [The state’s Department of Public Health] will continue to closely monitor and work with Steward to protect patients, preserve jobs, and maintain quality.”
On Jan. 26, Healey was asked about whether Steward Health Care would get a bailout from her administration on WBUR’s Radio Boston. She said no.
Fitzgerald said that, while the Boston hearing will be a “fact-finding” mission, a lot will rest on the state.
“A lot of the tools we could have going forward will rely on state approval” — like another hospital or nonprofit taking Steward facilities over, he said.
Worries have even reached the halls of Congress.
“Families who receive care at Holy Family Hospital and Nashoba Valley Medical Center — both owned by Steward — were recently notified that their care is now in jeopardy because of the corporation’s gross financial negligence that’s seeing the company try to shutter four of the nine hospitals they own in Massachusetts,” said U.S. Rep. Lori Trahan, who represents Ayer and Haverhill, where those hospitals sit.
Trahan said Steward executives have pointed to low Medicaid reimbursement rates as the cause of their financial distress, as the health care system did in comments to the Boston Globe earlier this year.
Sen. Elizabeth Warren and the Massachusetts delegation wrote to the Steward CEO Dr. Ralph de la Torre on Jan. 23, demanding answers and urging that Steward Health Care brief them on their finances and plans.
Steward employs more than 16,000 health care workers in Massachusetts. The letter pointed out that Steward Hospitals are part of Massachusetts’ network of safety net hospitals, with a high mix of Medicaid and Medicare patients, leaving those impacted by closures to be cost-burdened.
There have been signs of Steward’s financial struggle, particularly in a harrowing recent Boston Globe story about an immigrant mother treated at St. Elizabeth’s who died shortly after childbirth. Steward hadn’t paid the bill on a key piece of hospital equipment that might have saved her life.
Breadon called the death “tragic” and a “totally avoidable situation.”
She said she’s been made aware of attending doctors and other hospitals saying they can’t work in Steward hospitals “because they don't have an assurance that the equipment they need is will be available. It’s a very difficult situation.”
David Seltz, the Health Policy Commission’s executive director, also worries about Steward’s noncompliance with state regulations by failing to submit financial reports to the state. Health care provider organizations have been required to report an overview of financial information to the Health Policy Commission and Center for Health Information Analysis for more than a decade so the health care market’s stability and performance of hospital systems can be evaluated.
“The ongoing refusal by Steward corporate leadership to provide legally mandated reports is a disservice to the workers of that system, to the patients that are served by Steward, and the public and policymakers who are concerned by reports of financial challenges,” said David Seltz, the Health Policy Commission’s executive director.
“The future viability and stability of the third-largest hospital system in Massachusetts will have significant impacts on health care costs, access, patient care and the workforce in eastern Massachusetts,” he said.
Nashoba Valley Medical Center, Carney Hospital, Holy Family and St. Elizabeth’s Medical Center all showed negative operating margins in partial data submitted to the Center for Health Information Analysis through Sept. 30, 2023.
In December, Steward said it would close its New England Sinai Acute Long-Term Care and Rehabilitation Hospital in Stoughton by April 2024 due to “chronic low reimbursement rates” from services for Medicare and Medicaid patients.