Steward Health Care and Dr. Ralph de la Torre may be deserving of this public thrashing, but it risks overlooking the much larger issues in Massachusetts health care: COVID funding masked structural funding issues for hospitals, especially the smaller ones relying more heavily on Medicare and Mass Health to pay the bills.
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The ills of the Massachusetts healthcare system seem to have found a villain to represent everything wrong about the industry. Steward Health Care’s CEO Dr. Ralph de la Torre may be the pinata of the month, but the high-profile woes facing the for-profit Steward risk overlooking the structural weaknesses in our entire system.
Steward is accused of not paying its bills and creating fears of service interruptions at its seven Massachusetts facilities – including Nashoba Valley Medical Center in Ayer – and de la Torre has been rebuked by Gov. Maura Healey for dishonesty and a lack of transparency. Investigative reporting from the Boston Globe called out de la Torre for his lavish lifestyle, including a $40-million superyacht, $15-million sportfishing boat, and a fleet of private jets paid for out of Steward’s finances.
While there is no defending the glitzy salary and outrageous perks of a healthcare executive, this narrative is all too commonplace: A company in a struggling industry hits an extended rough patch and makes ill-advised decisions to remain viable, causing service to further erode and public sentiment to shift against it, focused on its highly compensated leader. It's easy to argue jobs could have been saved and service interruptions avoided if leadership hadn’t been so greedy, or the financial pressure to deliver the bottom line so great.
Steward and de la Torre may be deserving of this public thrashing, but it risks overlooking the much larger issues in Massachusetts health care: COVID funding masked structural funding issues for hospitals, especially the smaller ones relying more heavily on Medicare and Mass Health to pay the bills.
For instance, providers like Heywood Healthcare in Gardner are delivering essential services to patients from poorer populations, but Heywood has struggled to make ends meet, with its bankruptcy reflecting that struggle. In contrast, the state’s larger hospitals who have more patients on private insurance can focus their efforts on higher-margin specialties. like cardiology, gastroenterology, and certain forms of oncology while nonprofit providers like UMass Memorial Health in Worcester are left with operations barely scraping by.
While de la Torre has earned the ire of Steward employees as well as public officials, Healey and the Massachusetts legislature should not react to the crisis with ill-advised reforms, like banning for-profit operators from the healthcare space. That would not solve the core challenge, as any healthy industry needs a mix of players with a variety of business models to meet consumer needs efficiently.
We need to focus on solutions to benefit the entire industry, especially supports for our smaller hospitals and those serving lower-income populations. Otherwise, the systemic struggles will be worse.
