Massachusetts Governor Maura Healey Demands the CEOS of Steward and Cerberus Protect Hospitals, Medical Professionals and Patients
White Collar Crime by Private Equity and Corporate Hospital CEOs again requires American taxpayers pay for the harmful byproducts of greed | Madeline Ashley - February 22, 2024 for Becker’s
(Stephen Andrew Feinberg, known for investing in guns, is an American businessman and investor active in hedge fund management and private equity. He is the co-founder and Chief Executive Officer of Cerberus Capital Management.)
As Massachusetts lawmakers continue to express their concerns over Dallas-based Steward Health Care's fraud, negligence and White Collar Financial Crime, Massachusetts Governor Maura Healey has written a new letter to the health system's CEO, Ralph de la Torre, MD, pushing for financial documents to be disclosed.
"You and your team have not been forthcoming, truthful or responsive about what’s happening with your financial status, operating plans, and contingency strategies," Ms. Healey said in the letter. "Navigating this acute crisis, which is of your making, without complete transparency and real-time information, harms our ability to protect patients, our workforce and our state."
The governor's recent letter comes after state lawmakers sent a letter to Cerberus Capital Management, a private equity firm that founded Steward, demanding answers to their questions related to the health system's troubles no later than February 28. The letter was signed by the entire all-Democratic delegation.
It took six years for Cerberus CEO Stephen Feinberg to sell his AR-15 company after pressure from Common Sense Gun Laws activists. Known today as Remington and formerly as gun conglomerate Freedom Group, control was acquired in 2006 by Cerberus, named for the three-headed dog that guards the gates of hell in Greek mythology. Investors doing business as the Roundhill Group purchased the Remington-branded gun-making business, including operations in Ilionand Lenoir City, Tennessee for $13 million. Owners announced plans in 2021 to move the company's headquarters to Georgia.
Ms. Healey's recent letter ordered Steward to share its financial statements by February 23 for the state to review.
"We don't have enough to know what they've done, whether it's criminal or illegal, but to me it really smells, it raises a lot of questions," Ms. Healey told The Boston Globe.
Ms. Healey declined to comment on the consequences that Steward would face if it did not comply with her request for answers. She also reiterated to the Globe that the state would not give Steward "a dime to fix the problem they created."
Along with falling $50 million behind on year-end rent to Medical Properties Trust, the largest hospital landlord in the U.S., there have been concerns over the potential sale of four of Steward's Massachusetts hospitals.
"You and your team have not been forthcoming, truthful or responsive about what’s happening with your financial status, operating plans, and contingency strategies," Ms. Healey said in the letter. "Navigating this acute crisis, which is of your making, without complete transparency and real-time information, harms our ability to protect patients, our workforce and our state."
While the health system recently shared that it now has the ability to put a financial safety net around all of them, Steward is looking to sell one or more of its hospitals to other operators.
"The time has come to move past our many months of discussions and begin executing a safe, orderly transition of your seven licensed facilities in Massachusetts to new operators as soon as possible," Ms. Healey said in the letter.
"For years, you have refused to engage in the same level of basic transparency that every other system in Massachusetts offers by not releasing your audited financial statements," Healey wrote. "This information is essential to understand Steward's current financial status here and at Steward's hospitals across the country; how Steward has and is prioritizing its resources and protecting assets; and whether, as it seems, you and Steward chose to maximize profits and personnel and corporate gains at the expense of patients, workers, and the state and federal health care system."
Amid news that the health system's hospitals are struggling with staffing and supplies, Ms. Healey wrote to Dr. de la Torre, "we will take all actions necessary — in consultation with hospital leadership — to protect patients, including freezing admissions, closing beds, canceling procedures, and transferring patients to other hospitals."
Steward's struggles in Massachusetts also come as three separate Utah lawsuits are seeking a combined $40 million in damages from the health system after investors allege the health system took funding from five of its state hospitals to pay bills it had acquired across other states.
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