November 14, 2024

Warren, Auchincloss Push Massachusetts Health Policy Commission to Hold Rural Healthcare Group Accountable for Protecting Steward Patients and Doctors

Rural Healthcare Group CEO set to testify at today’s Health Policy Commission Annual Health Care Cost Trends Hearing

“Today is a critical opportunity for Mr. Sloan – on the record and under oath – to address concerns about the clinical autonomy of Stewardship’s physicians, the potential for future price increases, and access to care for Massachusetts patients.” 

Text of Letter (PDF)

Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.) and Representative Jake Auchincloss (D-Mass.) sent a letter to the Massachusetts Health Policy Commission (HPC) ahead of its Annual Health Care Cost Trends Hearing today, at which Rural Health Care Group (RHG) CEO Benson Sloan is set to testify under oath. The letter urges the HPC Board Members to hold Benson Sloan and private equity-owned RHG accountable for its public commitments surrounding the purchase of Steward Health Care’s (Steward’s) physician group, Stewardship Health (Stewardship), and to seek clarification regarding RHG’s compliance with Massachusetts state law prohibiting the corporate practice of medicine.

“HPC’s public hearing on November 14, 2024, is a critical opportunity for Mr. Sloan – on the record and under oath – to address concerns about the clinical autonomy of Stewardship’s physicians, the potential for future price increases, and access to care for Massachusetts patients,” wrote the lawmakers.

In August, just three months after Steward’s CEO Ralph de la Torre, private equity investors, and predatory landlords drove Steward into bankruptcy, Steward announced that it had entered into an agreement to sell their physician group to private equity-owned RHG. Shortly thereafter, Senator Warren wrote to RHG to express concerns that the proposed acquisition could reproduce the very conditions that led to Steward’s demise. Specifically, the lawmakers warned that RHG executives – who have a troubling history of putting profits over patient health – may structure the deal to evade state laws designed to insulate medical professionals from corporate influence. RHG did not respond to the lawmakers’ questions.

Last month, following its review of RHG’s Material Change Notice, HPC announced a series of commitments from RHG’s executive team. These commitments included pledges to continue participating in MassHealth, comply with state transparency and market oversight requirements, and provide periodic updates on its operations to HPC over the next two years.

“While we appreciate that RHG has voluntarily made these commitments to HPC, we are concerned that non-binding commitments provide little, if any, assurances that this transaction will not adversely harm Massachusetts patients and providers,” wrote the lawmakers. “In addition, we remain deeply troubled by the concerns outlined in our September letter to RHG, and the company’s failure to provide written responses to the questions posed therein.”

Specifically, the lawmakers pushed the Commissioners to ask Mr. Sloan to explain how RHG plans to structure its “Friendly MSO-PC” model and whether it will use that model to impose pressure on Stewardship’s physicians, including by forcing them to pursue “growth in volume.” The lawmakers also asked the Commissioners to confirm RHG’s commitments under oath, including whether RHG will comply with state transparency and market oversight requirements, provide periodic updates on its operations over the next two years, continue its participation in MassHealth, and generate profit by cutting internal costs or services.

Senator Warren, one of the nation’s leading bankruptcy experts, has led congressional oversight of Steward’s failures. Warren has repeatedly called out the harms of private equity ownership on health care costs and quality of care and has fought to prevent companies from taking advantage of the bankruptcy system:

  • In October 2024, Senator Warren led colleagues in reintroducing the Stop Wall Street Looting Act, comprehensive legislation to fundamentally reform the private equity industry and level the playing field by forcing private investment firms to take responsibility for the outcomes of companies they take over, empowering workers and protecting investors. This reintroduction comes after private equity firm Cerberus looted Steward Health Care, leaving hospitals, patients, and workers hanging out to dry.
  • In September 2024, Senators Warren and Markey (D-Mass.), alongside Representatives Auchincloss and Lynch, sent a letter to RHG raising concerns over its proposed acquisition of Steward Health Care’s physician group, Stewardship Health.
  • In September 2024, Senator Warren urged the IRS to crack down on Real Estate Investment Trusts (REITs) squeezing the health care industry.
  • In August 2024, Senators Warren and Markey requested information from private equity firm Apollo Global Management (Apollo) on the company’s role in Steward’s bankruptcy, and urged Apollo to work in good faith to facilitate the sale of Steward’s Massachusetts hospitals. 
  • In July 2024, Senators Warren and Markey wrote to Medical Properties Trust and Macquarie Infrastructure Partners, owners of Steward’s eight Massachusetts hospitals, urging them to offer lease concessions to keep the hospitals open and viable.
  • In June 2024, Senator Warren, Representative Chu, and Representative Nadler urged CMS to increase oversight of artificial intelligence (AI) and algorithmic software tools used to guide coverage decisions in Medicare Advantage (MA) plans, citing the NaviHealth scandal as cause for concern. 
  • In June 2024, Senators Warren and Markey introduced the Corporate Crimes Against Health Care Act of 2024 to root out corporate greed and private equity abuse in the health care system, specifically preventing what happened with Steward from happening again. 
  • In June 2024, Senator Warren wrote to the DOJ, FTC, and HHS calling out high health care costs due to vertically-integrated insurers, private equity companies, and pharmaceutical companies that are driving health care consolidation.
  • In June 2024, Senators Warren, Brown (D-Ohio), and Markey wrote to the Director of the U.S. Trustee Program (USTP), calling for USTP to move to appoint a Chapter 11 trustee to run the company in place of Steward’s current management, and to monitor the hospitals’ bankruptcy proceedings to protect patients and local communities. 
  • In May 2024, Senator Warren sent a letter to the U.S. Department of Health and Human Services and the U.S. Centers for Medicare & Medicaid Services, urging them to support communities and health care providers affected by the crisis caused by Steward’s financial mismanagement.
  • In April 2024, Senators Warren and Senator Markey (D-Mass.) sent a letter to six private credit funds that are holders of Steward’s debt, asking them a series of questions about their loans and calling on them to offer loan modifications that could potentially help keep the hospitals afloat.
  • In April 2024, Senators Warren and Markey called out Medical Properties Trust and Macquarie Infrastructure Partners for exploiting Steward Hospitals, and urged them to help keep the hospitals open. 
  • In April 2024, Senators Warren, Markey, and the rest of the MA delegation urged the FTC and DOJ to closely scrutinize UnitedHealth Group’s proposed acquisition of Steward Health Care’s physician group, Stewardship Health.
  • In April 2024, Senator Warren delivered remarks at a Senate hearing in Boston titled, “When Health Care Becomes Wealth Care: How Corporate Greed Puts Patient Care and Health Workers at Risk,” which centered on Steward Health Care’s Massachusetts hospitals.
  • In April 2024, Senators Warren and Ed Markey (D-Mass.) called out private equity firm Cerberus Capital Management (Cerberus) for its role in creating Steward Health Care’s financial challenges, following Cerberus’s reply to the Massachusetts congressional delegation’s February 2024 probe. 
  • In February 2024, Senator Warren slammed UnitedHealth Group for leveraging NaviHealth’s unregulated artificial intelligence algorithm to unlawfully deny health care to seniors with severe injuries.
  • In March 2024, Senator Warren released a statement about Steward’s plan to sell its physician group Stewardship Health to UnitedHealth Group’s subsidiary Optum.
  • In March 2024, Senators Warren and Markey sent a letter  to Steward CEO and Chairman Dr. Ralph de la Torre, calling on him to testify at a congressional hearing in Boston.
  • In March 2024, Senators Warren and Markey sent a letter to Dr. de la Torre, blasting him for years of financial mismanagement, private equity schemes, and executive profiteering that have led to Steward Health Care’s financial crisis.
  • In February 2024, Senators Warren and Markey, along with all nine members of the Massachusetts congressional delegation, sent a letter to Cerberus seeking answers from the private equity firm for its role in creating the current financial challenges at Steward hospitals.
  • In January 2024, Senator Warren released a statement about Steward’s financial situation and allegations of patient neglect at Steward facilities.
  • In January 2024, Senator Warren led the Massachusetts congressional delegation in a letter to the CEO of Steward Health Care pressing the company to brief them on Steward’s financial position, the status of their Massachusetts facilities, and their plans to ensure the communities they serve are not abandoned. 

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