US Senate probes Steward Health bankruptcy, subpoenas CEO
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 [July 26, 2024]
By Dietrich Knauth
NEW YORK (Reuters) - A U.S. Senate committee opened an investigation
into the bankruptcy of privately owned hospital network Steward Health
on Thursday, voting to compel the company's CEO to testify at a public
hearing in September.
Steward, which filed for Chapter 11 protection in May, is attempting to
sell its 31 hospitals in bankruptcy.
In issuing a subpoena, Senator Bernie Sanders, chair of the Committee on
Health, Education, Labor and Pensions, said on Thursday that Steward's
owner and CEO, Dr. Ralph de la Torre, had made "huge sums of money"
while the company cut medical services.
"Perhaps more than anyone in America," de la Torre "epitomizes the type
of outrageous corporate greed that is permeating throughout our
for-profit healthcare system," Sanders said.
De Le Torre had purchased a $40 million yacht, a $15 million fishing
boat, and two corporate jets while hospitals under his management shut
down, eliminating hundreds of jobs and reducing access to medical care
in rural areas, said Sanders, an Independent who caucuses with the
Democrats.
De la Torre could not immediately be reached for comment. Steward did
not immediately respond to a request for comment.
The committee voted 20-1 to issue a subpoena to de la Torre after he had
declined previous invitations to testify about Steward's downfall.
The committee intends to ask about risks to U.S. patients as well as
Steward’s ill-fated expansion into Malta, which spurred a U.S.
Department of Justice investigation into possible violations of the U.S.
Foreign Corrupt Practices Act.
Steward was awarded a contract to operate publicly funded hospitals in
the Mediterranean country, but Maltese prosecutors have pursued bribery
and corruption charges over the privatization effort.
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U.S. Senator Bernie Sanders (I-VT) holds up a vile of insulin while
speaking as Senator Bill Cassidy (R-LA) sits next to him during a
Senate Health, Education, Labor and Pensions Committee hearing on
Capitol Hill in Washington, U.S., May 10, 2023. REUTERS/Leah
Millis/File Photo
 The committee's top Republican, Bill
Cassidy, said the committee had never issued a subpoena to force a
witness to testify, and that the step was not taken lightly.
"Patients lives are at risk," Cassidy said.
"Americans deserve answers."
In one example of what Cassidy called "shocking" mismanagement, he
said a Massachusetts woman died after giving birth because doctors
realized mid-surgery that supplies needed to treat her had been
repossessed due to Steward's financial troubles.
Sanders also blamed Steward's former private equity owner Cerberus
Capital Management for the company's downfall, saying there could
not be a clearer example of private equity owners loading a company
with debt and leaving it to fall apart after their exit.
Cassidy said Cerberus should not be blamed for the company's
missteps, noting that it had exited its investment in 2020.
(Reporting by Dietrich Knauth; Editing by Bill Berkrot)
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