Press Releases

WASHINGTON, DC – Today, Congresswoman Lori Trahan (MA-03), a member of the House Energy and Commerce Committee’s Health Subcommittee, secured a commitment from U.S. Department of Health and Human Services Secretary Xavier Becerra, the nation’s top health official, to work with Massachusetts leaders as they continue responding to the Steward Health Care crisis.

CLICK HERE or the image below to watch Trahan’s full line of questioning.

“Steward is facing a ‘significant cash crunch’ because of blatant mismanagement by company executives who have rewarded themselves with multi-million-dollar salaries while accruing massive debts. Unsurprisingly, Steward has failed repeatedly – including in response to requests from myself and my colleagues in the Massachusetts delegation – to provide transparency regarding its intentions to maintain the operation of their nine hospitals in our home state,” Congresswoman Trahan said. “Mr. Secretary, many of the hardworking families I represent just want to know that their government is paying attention to this issue and taking action to keep their hospitals open. I’m hoping I can count on you to maintain a line of communication with Massachusetts leaders to ensure that every possible action is taken and resource is available to keep community hospitals like Holy Family Hospital open and serving patients.”

“Congresswoman, we will do everything we can,” Secretary Becerra responded. “We are ready to work with Massachusetts to make sure health care is available to communities.”

Last December, Steward announced plans to close Mt. Sinai hospital in Stoughton, the latest move by the company that also sold all of its facilities in Utah and closed Texas Vista Medical Center in San Antonio, Texas in 2023. A month later, the company it sold all of its Massachusetts properties to in 2016, Medical Properties Trust, announced that it would begin taking steps to claw back overdue rent payments from Steward, including the possible sale of some or all of its nine hospitals in the Commonwealth. In March, Steward announced that the corporation had reached a deal to sell its physician network to Optum pending regulatory approval.

Last week, the Massachusetts delegation wrote to the DOJ and FTC requesting that they scrutinize the proposed sale of Steward’s physician group to Optum. In February, Trahan led the introduction of bipartisan legislation to direct additional federal funding to local, nonprofit safety net hospitals that would be directly impacted by the closure of or service cuts at Steward facilities in Massachusetts. During a January congressional hearing, Trahan slammed Steward’s private equity business model citing its track record of acquiring community hospitals, maximizing profits and cutting services, and then closing or selling what is left of the facility.

---------------------------------

Congresswoman Lori Trahan

Remarks as Delivered

House Health Subcommittee Hearing on “Fiscal Year 2025 Department Of Health And Human Services Budget”

April 17, 2024

Trahan: Thank you, Mr. Chairman. It’s great to see you, Secretary Becerra. As you and I have discussed before, community hospitals around the country are facing significant financial challenges, and in my home state of Massachusetts, those challenges are being made worse by a private equity corporation that has prioritized profits over patients – and jeopardized the future of the nine hospitals it owns in the process.

Mr. Secretary, as we speak, Steward Health Care – the largest for-profit, private equity backed health network in the country – is creating a health care crisis in working-class communities across Massachusetts, just as it did when it drove Texas Vista Medical Center in San Antonio, Texas into closure last year, when it was forced to sell off its hospitals in Utah just months earlier.

Steward is facing a “significant cash crunch” because of blatant mismanagement by company executives who have rewarded themselves with multi-million-dollar salaries while accruing massive debts. Unsurprisingly, Steward has failed repeatedly – including in response to requests from myself and my colleagues in the Massachusetts delegation – to provide transparency regarding its intentions to maintain the operation of their nine hospitals in our home state. So instead, it announced the sale of its physician group to Optum, a subsidiary of UnitedHealth Group, while providing no insight into the future of the hospitals their physicians practice in or what the proposed sale will mean for vulnerable patients.

So Mr. Secretary, many of the hardworking families I represent just want to know that their government is paying attention to this issue and taking action to keep their hospitals open. I’m hoping I can count on you to maintain a line of communication with Massachusetts leaders to ensure that every possible action is taken and resource is available to keep community hospitals like Holy Family Hospital open and serving patients.

Becerra: Congresswoman, we will do everything we can.

This is actually a question more appropriate for me when I was Attorney General because we tried to take on some of these, I mean, they’re vicious investors that try to gut the assets out of an institution, and they just sort of run out of dodge. I can’t tell you that we have authority because we don’t govern the licensing of hospitals and so forth at the federal level. That’s all state.

But we are ready to work with Massachusetts to make sure health care is available to communities.

Trahan: I appreciate that, and I am encouraged by recent work your department has done in collaboration with the Department of Justice and the FTC regarding the effects of corporate ownership trends in health care, and my colleagues and I plan to submit comments as part of that process.

This year, I’m spearheading efforts to commission a GAO study on hospital closures in the last decade to identify the ownership models that have closed and assess the impact of those closures on their communities. This type of study has been conducted for rural hospitals but not on a broader scale.

If you could just speak a little bit to how improved transparency regarding hospital closures will help the agency to effectively address, respond to, and mitigate future community hospital closures, that would be great.

Becerra: Yeah we’re actually doing something similar to that with nursing homes. We are tired of seeing nursing homes that get bought up – usually they’re owned by mom and pop people who start them up for, you know, wanting to help the community. Then they get bought up, and before you know it, you can’t trace back who the actual owner is.

So, now we are requiring nursing homes to provide information on who the actual owners are, because they set up so many LLCs, so many different sham corporations, it’s tough to get to the bottom of it. Then when they run out of town after they gut the assets, people are left wondering what happened. So we would love to work with you on being able to have more transparency in the health care sector.

Trahan: Thank you. I do believe that we can agree that as we address closures and acquisitions that don’t benefit patients, that it’s crucial to distinguish corporate, for-profit hospitals from their nonprofit peers. I introduced bipartisan legislation with Congressman David Valadao to establish a federal designation for Essential Hospitals.

And I hope my colleagues on the committee will support this legislation. I hope to work with you Mr. Secretary to better support the essential health systems that all of our communities depend on for lifesaving care.

Thank you, Mr. Chairman. I yield back.

###