Boston (April 19. 2024) – As Steward hospitals in Massachusetts remain in danger of closure due to high debts rung up by CEO Ralph de la Torre and other top executives, and the hospitals’ previous private equity owners, United States Senators Elizabeth Warren (D-Mass.) and Edward J. 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 the summer of 2023, a group of six private credit funds provided Steward with an approximately $600 million loan,and then, in early 2024, offered a second round of emergency bridge loan financing. These lenders have threatened to call the loan, potentially forcing Steward into further fiscal turmoil. The senators’ letter describes how these lenders have the ability and the responsibility to help keep the Steward hospitals open.
“Steward’s financial ruin would be devastating for the people of Massachusetts, and it would be deeply troubling if private lenders were to continue squeezing Steward rather than assist in potential solutions to keep the hospitals open,” wrote the senators.
Steward’s Massachusetts hospitals are a critical part of the state’s health care system. Steward is the third-largest hospital operator in the Commonwealth, employing nearly 16,000 individuals and serving tens of thousands of patients each year. And Steward’s Massachusetts hospitals serve largely underserved communities, with a large proportion of patients enrolled in Medicare and Medicaid.
“As one of the largest holders of Steward’s debt, you have the power to help keep those hospitals open and preserve access to care for communities in Massachusetts,” the senators concluded. “Your company has an important opportunity to help Steward’s Massachusetts hospitals overcome this crisis by offering loan modifications that would make it financially feasible for new operators to take over.”
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