Steward Healthcare blasted at federal hearing as ‘the personification of an absence of morality’

Fourteen years ago, some hailed Cerberus Capital Management as “saviors” for funding the takeover of nine troubled Massachusetts hospitals owned by Caritas Christi. That acquisition led to the creation of Steward Healthcare, which has since grown into the largest, private, for-profit hospital group in the country.

But in recent years, profit has been harder to come by for Steward. The company blamed unfairly low Medicaid reimbursements and the COVID-19 pandemic as reasons for closing New England Sinai Hospital in Stoughton this week.

But critics say Steward engaged in a series of practices over the years that set the Massachusetts portion of the chain up to fail — most notably the sale of hospital real estate, which forced each institution to then pay rent to the landlord, Medical Properties Trust.

The sale of that real estate netted $1.25 billion in 2016. But at a U.S. Senate subcommittee hearing in Boston, Senators Edward Markey and Elizabeth Warren said those funds weren’t used to shore up local hospitals — but rather, in part, to pay Cerberus shareholders.

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