Senate launches own probe of troubled healthcare giant that runs Miami hospitals

The CEO of Steward Health Care System, which runs several Florida hospitals and is in the midst of Chapter 11 bankruptcy, may have to testify before Congress over the healthcare system, which is also under federal investigation for possible corruption.

Two U.S. senators, Bernie Sanders of Vermont and Ed Markey of Massachusetts, are planning to ask the Senate’s Health, Education, Labor and Pensions committee, which Sanders chairs, to vote next week on whether to subpeona Dr. Ralph de la Torre, CEO and founder of Steward Health Care System, which owns hospitals across the country and in Florida, as part of its own probe into the healthcare giant’s finances.

“Time and time again we have invited Dr. de la Torre to come before Congress to testify about the financial mismanagement at Steward that led to one of the largest health care bankruptcies in our nation’s history. And time and time again, he has arrogantly refused,” the senators said in a joint statement Thursday. “Enough is enough. It is time for Dr. de la Torre to get off of his yacht and explain to Congress how much he has gained financially while bankrupting the hospitals he manages.”

Steward Health Care, considered to be the largest physician-owned healthcare network in the U.S, with 31 hospitals in the country, including five in South Florida, filed for bankruptcy protections under Chapter 11 in May with $9 billion in debt.

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The senate committee’s subpoena plans come as federal prosecutors are investigating Steward Health for possible violations of the Foreign Corrupt Practices Act, which prohibits U.S. citizens and companies from committing bribery and other corruption overseas in order to obtain or retain business. A similar criminal investigation is happening overseas in Malta, an island in Southern Europe, where Steward managed some state-run hospitals.

Steward Health last week told the Herald that it was “cooperating with an investigation by the U.S. Department of Justice.”

It also stated: “As a matter of policy, Steward will have no further comment on this investigation as it remains ongoing.”

The Miami Herald has contacted Steward Health about the senate health’s committee’s subpoena plans. They declined to comment.

The healthcare giant is in the process of trying to sell its national physician group (the initial sale to Optum fell through) and all of its hospitals to thin out debt, including Palmetto General Hospital in Hialeah, Coral Gables Hospital, Hialeah Hospital, North Shore Medical Center in North Miami-Dade and Florida Medical Center in Lauderdale Lakes. Its other Florida hospitals are Melbourne Regional Medical Center, Rockledge Regional Medical Center and Sebastian River Medical.

Scrutiny over Steward Health’s operations — and its CEO — has grown throughout the bankruptcy process.

Recent court filings show that the healthcare giant paid nine of its executives more than $1 million each a year before the company declared bankruptcy, with de la Torre’s salary topping $3.7 million, according to the Boston Globe.

Steward’s CEO has also faced scrutiny for his lavish lifestyle while his healthcare empire sunk.

The U.S. senators, in their joint statement, went so far as to call de la Torre the “poster child for the type of outrageous corporate greed that is permeating through our for-profit health care system.”

The CEO has two yachts, a Dallas mansion and two luxury private jets, though he has previously denied allegations, in emails to the Globe, that he allowed Steward’s community hospitals to whither to support his lifestyle.

Meanwhile, Steward’s hospitals are languishing.

At its hospitals, doctors and nurses have long complained about lack of supplies and broken equipment. In South Florida, North Shore Medical Center, which has seen cutbacks and layoffs this year, is ground zero of Steward’s financial crisis.

Earlier this year, the North Miami-Dade hospital, 1100 NW 95th St., closed its critical but costly labor and delivery, neonatal, and behavioral health units to try and stop its financial bleeding.

In March, another blow for patients: the U.S. Food and Drug Administration ordered North Shore to stop performing mammograms and notify patients that they might have received inaccurate results after a review found images taken in the past two years did not meet standards.

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