April 02, 2024

Warren, Markey Statement on Role of Private Equity Firm Cerberus in Creating Steward Health Care’s Financial Challenges

Senators Release Cerberus Response to February 2024 Inquiry

Response from Cerberus to Congressional Delegation’s February 2024 Letter (PDF)

Boston, MA – United States Senators Elizabeth Warren (D-Mass.) and Edward J. Markey (D-Mass.) released the following statement on the role of private equity firm Cerberus Capital Management (Cerberus) in creating Steward Health Care’s (Steward’s) financial challenges, following Cerberus’s reply to the Massachusetts congressional delegation’s February 2024 probe: 

“Cerberus’s response confirms the key points of this whole dirty saga: Cerberus looted Steward, failed to invest in Massachusetts facilities, and it appears that the company walked away with a profit of at least $800 million leaving Steward with massive, ongoing lease payments to Medical Properties Trust that are a major source of the hospitals’ financial distress. 

“However, Cerberus’s answers still don’t provide a clear answer for how much Cerberus made off of the people of Massachusetts. The information provided to Congress shows that the company may have made more. 

“We do clearly know this: Cerberus worked hand-in-glove with Dr. Ralph de la Torre and Steward executives to create complicated financial schemes that put health providers in impossible positions and actively undermined the public’s access to high quality health care. We need clear answers from the company to find out who at Cerberus received these huge profits – and claw them back from the private equity executives responsible for this mess.”

Senator Warren has been leading oversight on Steward and has repeatedly called out the impact of private equity ownership on health care costs and quality of care: 

  • On March 26, 2024, Senator Warren released a statement about Steward’s plan to sell its physician group Stewardship Health to UnitedHealth Group’s subsidiary Optum.
  • On March 26, 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.
  • On March 8, 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, which threatens to upend access to health care in Eastern Massachusetts communities and yank jobs from the health care workers employed at the company’s facilities.
  • On February 15, 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
  • On January 29, 2024, Senator Warren released a statement about Steward’s financial situation and allegations of patient neglect at Steward facilities.
  • On January 23, 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. 
  • On September 19, 2023, Senator Warren and Representative Becca Balint (D-Vt.) led lawmakers in submitting a public comment letter to the Federal Trade Commission and the Department of Justice in support of the agencies’ proposed merger guidelines, including the guidelines’ focus on serial acquisitions of small health care providers by private equity companies that drive private equity market dominance in health care.

###