Senate HELP Chair Bernie Sanders and Ranking Member Bill Cassidy. Photo: Chip Somodevilla/Getty Images
A Senate HELP Committee hearing Thursday on the fallout from the Steward Health Care bankruptcy is spurring new calls for a broad policy response.
Why it matters: The collapse of Steward, which was previously owned by private equity firm Cerberus, has increased scrutiny of private equity's role in health care — including how it affects patient outcomes.
What they're saying: "The collapse of Steward Health Care is just one extreme example of the damaging role in my view that private equity is having on our health care system," Chair Bernie Sanders said at the hearing.
- "Private equity in health care is an issue this committee must look into," he added. "We cannot allow wealthy private equity executives to treat our health care system as their own personal piggy bank."
Yes, but: The focus on private equity is heavily tilted to the Democratic side of the aisle. Republicans largely focused on Steward's mismanagement without drawing more sweeping conclusions of private equity.
- The hearing was bipartisan in condemning Steward's management, but the parties differed over broader conclusions.
- Sen. Mitt Romney questioned whether federal or state regulators should have done a better job with oversight.
- "I regret we don't have someone here from the administration," he said, adding, "What should HHS be doing?"
Between the lines: Sen. Ed Markey, whose home state of Massachusetts is home to Steward hospitals where witnesses said patient care has suffered and patients have even died, has introduced a bill to crack down on private equity in health care.
- His Health Over Wealth Act would give HHS new power to revoke private equity investment licenses in cases where price-gouging or understaffing have been evident.
- It has only Democratic cosponsors, underscoring the difficult road to passage.
- In addition, Families USA led a letter to the HELP Committee on Thursday calling for a range of policies including strengthening health care price transparency requirements and enacting site-neutral payments as a way to disincentive consolidation.
- "What happened with Steward could happen in more and more communities throughout the country," the letter states. "Over the past decade, private equity firms have become increasingly involved in the U.S. health care system."
The bottom line: Steward CEO Ralph de la Torre declined to testify today despite being issued a subpoena.
- Sanders and Ranking Member Bill Cassidy announced that the committee will vote next week on a criminal contempt resolution against De la Torre.
- A De la Torre spokesperson told The Wall Street Journal it would be "wholly inappropriate for him to testify on matters related to Steward's bankruptcy while those proceedings are ongoing."
