Possible Steward hospital closures in Massachusetts prompt concern

Emergency room entrance at night with ambulance

February 1, 2024 ­– As the Steward Health Care system faces a financial crisis that may lead to hospital closures in Massachusetts, experts are weighing in on the problem—and what to do about it.

Steward Health Care is a for-profit health system that serves thousands of patients at nine hospitals in Eastern Massachusetts, mostly in Boston suburbs and in underserved communities. According to recent media reports, state regulators are working to avoid hospital closures, which could lead to long wait times and could overwhelm other area hospitals.

Harvard T.H. Chan School of Public Health experts including John McDonough, Jose Figueroa, and Ray Campbell have been quoted in media outlets about the crisis.

In response to reports that Steward representatives are interested in transferring ownership of hospitals, McDonough, professor of the practice of public health, said in a January 19 Boston Globe article that there is concern over further consolidation of the hospital market. “But [the concern] has to be balanced with the other potential of losing all of these facilities, and the impact that would have,” he said.

In a January 25 Boston Globe article, Figueroa, assistant professor of health policy and management, noted that underserved communities would be most affected by any hospital closures. “Wealthier people are more readily able to find alternative options to get health care,” he said. “Lower-income populations with less education are more likely to have issues accessing the health care system at baseline. Even in their local area, they are going to be left behind.” He also noted that Steward and other hospitals that serve lower-income communities tend to be less financially stable because they rely heavily on Medicaid reimbursements, which pay less than private insurers.

McDonough and Campbell, instructor in the Department of Health Policy and Management, both raised questions in a January 25 WBUR article about the role of private, for-profit companies in health care—particularly those backed by private equity.

Campbell said that the state should be allowed to see Steward’s corporate financial data—which the company has long kept private—and should improve how for-profit health care facilities are regulated. “Private equity and for-profit investments in health care need to be scrutinized very carefully because the objectives and the dynamics aren’t necessarily the same,” he said. “It’s not clear that what private equity is really good at is what health care needs to be good at.”

McDonough concurred. “If there’s a lesson from this, it is that the entire state health system and state government need to be much more wary of all for-profit entrants—particularly of the private equity brand.”

Read the January 19 Boston Globe article: Steward Health Care’s financial issues could spell catastrophe for the state

Read the January 25 WBUR article: Mass. leaders scramble to plan for potential Steward hospital closures

Read the January 25 Boston Globe article: Brockton, other lower-income communities on edge as hospital chain faces financial crisis

Photo: iStock/sshepard