As the state convenes meetings to safeguard access to care at Steward hospitals in Massachusetts, U.S. Sens. Elizabeth Warren and Edward Markey are calling on the company's landlord to play a role in stabilizing health care operations.
In a letter Monday to CEO Edward Aldag Jr. of Medical Properties Trust, Inc. and CEO Karl Kuchel of Macquarie Infrastructure Partners, the senators said that Steward's "ongoing liabilities" to the two trusts pose "significant barriers to recovery."
Warren and Markey alleged that at least one of the firms had "plundered" the hospitals along with the Steward corporation, and urged the companies to "reconsider your aggressive posture" and seize "an important opportunity to help."
The senators suggested that MPT and MIP offer "long-term reductions in lease payments or early termination of leases to make it financially feasible for new operators to take over these hospitals."
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As Steward considers pulling out of the state, the Department of Public Health, the Mass. Health and Hospital Association, and the Mass. League of Community Health Centers on Thursday will hold the first of several closed meetings to discuss transition preparations with select people in communities most likely to be affected.
At a Public Health Council meeting Wednesday, Public Health Commissioner Dr. Robert Goldstein said the regional huddles will feature executives from hospitals and community health centers in areas where Steward Health Care operates, and they will be joined by representatives of the Mass. Senior Care Association "to make sure that we are keeping the post-acute care community engaged."
Initial meetings will focus on topics like "inpatient med-surg capacity, maternity care and services, and emergency and urgent care and capacity in the region," Goldstein said. In future weeks, meetings will dive into behavioral health and workforce issues along with plans to "take a close look at the impact on academic programs, including how we can preserve clinical rotation opportunities."
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"The purpose of these meetings is to engage in thoughtful and frank conversations with key health care stakeholders about what we know now, what could happen in the near future, and what we can do collectively to protect and preserve access to high quality care for individuals and families in the communities that will be most affected by any changes," Goldstein said.
Council member Stewart Landers referenced Markey and Warren's probe of the Steward crisis before saying, "Just want to make sure that we are thinking about our role as Public Health Council with respect to this crisis, and whether there is anything we might be able to do -- whether it's a statement, whether it's regulation, whatever. So I'm just putting that on the table."
Goldstein said DPH "continues to have monitors in the Steward hospitals to assess that they have the equipment, supplies, and staffing needed to deliver high quality care," and promised to keep the council "informed as the situation progresses."
To Dr. Edward Bernstein, an emergency medicine professor at the Boston University School of Medicine, the Steward predicament represents just one part of a "broader crisis."
"I think we have to take into account the [Emergency Department] boardings and the ED waiting time and the whole picture, as we try to resolve this crisis," Bernstein told his council colleagues.
Lawrence General Hospital's chief of medical affairs wanted to know what the state would be investing to support ongoing services.
"Clearly, we as a small hospital in Lawrence cannot absorb this whole financial burden that the Steward mess has created. But I think we all know that this is not going to be solved by market forces. Because it's not attractive, right? This isn't a money-making operation. And that's why Steward is leaving that market. So the question is, how much is the state going to invest to preserve this service, in partnership with others," asked Dr. Eduardo Haddad.
Goldstein replied that he "may not have the exact answer that you're looking for."
DPH's upcoming regional meetings are aimed at understanding hospital capacities, "not specifically to talk about the finances of continued operation of the Steward facility or the financial support that may be necessary," he said.
Questions on officials' minds will be ones like: "If an emergency room at a Steward facility were to no longer be operational, where would those patients go? And what is the impact of that on the care that would be delivered in emergency departments at other facilities?"
But, Goldstein told the council, there will be "a need for financial support that people are going to need to increase staffing and people might need to open up beds that have been closed for some time." He added, "We just need to understand what the scope of that situation may be. That's the purpose of these meetings."
Goldstein also challenged the premise that the hospitals cannot be profitable. Charging that Steward leaders made "errors and mistakes," the commissioner said another operator may be able to find "sustainability" for a former Steward facility.
Steward owns 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, St. Anne's Hospital in Fall River, and St. Elizabeth's Medical Center in Brighton.
Steward also owns Norwood Hospital in Norwood, which closed four years ago due to flood damage. Work to rebuild the Norwood facility halted recently -- because contractors said Steward had not paid them, the Globe reported.
Earlier this month, Steward permanently shuttered a ninth facility, New England Sinai Hospital in Stoughton.
Attorney General Andrea Campbell, speaking on GBH's "Boston Public Radio" Wednesday, called the Steward situation a "public health crisis."
"And you can follow it in the news, but if you're a patient at one of their facilities, or if you work at one of those facilities, you have stress right now. And rightfully so," Campbell said.
The attorney general said her office's work includes making sure providers are being paid, and working with the Healey administration "as they do their analysis on these institutions and possibly who might take them over, or who might not, et cetera."
Campbell said her team is also "looking at how we got here and that we don't get here again."
"And that for-profit role in health care -- absolutely a question that's on the table, and has been for the office for a little bit. But that will require possibly some legislative changes to give us more authority over for-profit versus nonprofit, where we have significant authority in these types of health care transactions, to bring about greater transparency, greater accountability," she said.
Warren and Markey in their letter called for a "thorough review of how we got here."
"There should be a detailed investigation of these matters, including a review of whether officials at Cerberus, Steward, and MPT may have breached their fiduciary duty under Massachusetts corporate law, whether the connections between Steward and MPT may have resulted in illegal self-dealing and conflicts of interest, and whether MPT accurately reported information on the financial state of Steward's hospitals to shareholders and the Securities and Exchange Commission," the senators wrote.
Neither real estate trust replied to the News Service's request for comment by deadline Wednesday.
In their Patriots' Day missive, Warren and Markey asked the leaders of MPT and MIP -- based in Birmingham, Ala. and Midtown Manhattan, respectively -- to reply to around a dozen questions each within one week (by Monday, April 22). The queries include total figures on rent and interest paid to them by Steward, total compensation earned last year by top executives at the trusts, and whether executives' earnings would be impacted by "any lease concessions to Steward's hospitals."
They also asked Aldag, CEO of MPT, about "working capital loans" his trust had offered to Steward.
The senators wrote, "Why did you report to investors in August 2022 that 'Steward expects a substantial and sustainable positive free cash flow run-rate beginning in Q4 2022' at the same time you were offering the company substantial 'working capital loans'? In previous years, MPT has offered Steward hundreds of millions of dollars worth of 'working capital loans.' Why has the company offered these loans rather than reducing required lease payments?"
The Bay State's U.S. senators reiterated the charge in their Monday letter. They said MPT's loans to Steward "have all the appearances of a Ponzi scheme."
