Calling out Steward Health Care and its chief executive, Dr. Ralph de la Torre, for bad behavior is the easy part. Now that she has finally done it, what is Governor Maura Healey’s long-range plan to protect the thousands of people who rely upon Steward’s troubled hospitals for health care and employment?
In a letter to de la Torre, Healey chastised Steward for its failure to share its financial data with the state and demanded that the company get out of the hospital business in Massachusetts. How, exactly, is that going to happen? What hospital system is going to pick up any of Steward’s troubled hospitals without significant support from the state? In the meantime, what are the consequences if Steward fails to provide the information Healey wants by Friday? And will Healey try to stop de la Torre from selling off Steward Medical Group — its physicians’ network and prime asset — and pocketing the money for himself?
“Bravo. It’s about time. Hope it’s not too late,” John McDonough — a professor at the Harvard T.H. Chan School of Public Health and a former state legislator who played a key role in the passage and implementation of the 2006 Massachusetts health care reform law — told me when I asked his reaction to Healey’s letter to de la Torre.
Within the health care community, there’s speculation that Optum Inc., another for-profit health care chain, is jockeying to acquire Steward Medical Group’s 1,700 providers — an outcome that would perpetuate the for-profit model that crashed and burned under de la Torre’s stewardship. “We’ve had some substantial intrusions into our state culture of out-of-state, aggressive, for-profit health care,” McDonough said in an interview that took place before Healey sent the letter. “Is Steward going to make a deal to sell the physician practice to Optum, and is there anything the state can do about it?”
McDonough believes there should be a pathway to keep Steward “out of the jaws of Optum” — and from going “into the jaws” of the two biggest hospital networks in the state, Mass General Brigham and Beth Israel/Lahey. That requires serious, long-range thinking about where health care in Massachusetts should be headed after the Steward debacle. Quoting from the Bible, he said, “Where there is no vision, the people perish. I don’t see any signs of vision out of the State House in terms of how can we take this crisis and create opportunity.”
Remember, Steward got to where it is today with help from three branches of power in Massachusetts — the Catholic Church, the business community, and the political establishment.
In 2008, de la Torre took over Caritas Christi Health Care, a troubled network of hospitals then affiliated with the Archdiocese of Boston. He was recommended for the job by Jack Connors, a legendary business leader and chairman emeritus of what was then Partners Healthcare and is now Mass General Brigham. In 2010, de la Torre engineered the sale of Caritas to Steward, a holding company for Cerberus, a New York-based private equity firm. That happened with sign-off from then-attorney general Martha Coakley and approval from the administration of governor Deval Patrick. In 2015, Healey, who was attorney general at that time, issued a report that flagged serious concerns about Steward’s financial health. As she wrote in her Tuesday letter to de la Torre, Healey and other state officials connected to the administration of then-governor Charlie Baker took Steward to court over its refusal to disclose financial data.
But no one in state government ever really sounded a public alarm about the financial crisis Steward was facing and how that might affect health care delivery in Massachusetts. Now that Steward is saying it does not have the money to stay in business, the state owns the crisis it helped to create.
How state leaders respond “will shape health care in Massachusetts for years to come,” said Ellen Lutch Bender, a Boston-based health care consultant advising nonprofit hospitals on the Steward crisis.
That means grappling with some difficult policy questions. Who gets the physicians’ group? Can the state stop de la Torre from selling it to another for-profit entity? Which of Steward’s nine Massachusetts hospital must close? Which hospital systems can take over the ones that remain open? What will it take to make that happen?
Healey has said there will be no bailout for Steward. But will the state increase Medicaid reimbursement rates to hospital systems like Mass General Brigham or Beth Israel/Lahey to make it more palatable for them to take over some Steward hospitals? Or should it instead extend financial help to second-tier players, such as Boston Medical Center, UMass Medical Center, Tufts Medical Center, or the Cambridge Health Alliance?
This week, Healey got the headline she wanted — that she’s turning up the heat on Steward. Now comes the hard part: Coming up with a plan that instills public confidence in a system that has lost it.
Joan Vennochi is a Globe columnist. She can be reached at joan.vennochi@globe.com. Follow her @joan_vennochi.