Is Steward Health Care Private Equity Owned?
Steward Health Care
Includes Steward Healthcare, Caritas Christi
hospitals · Dallas, TX
2010
“Cerberus bought a Catholic hospital system, drained $800 million, sold the buildings out from under the patients, and walked away before it all collapsed.”
What Happened
- •Cerberus bought the six-hospital Caritas Christi system for ~$895 million in 2010, then extracted roughly $800 million over the next decade — nearly the entire purchase price back in profit
- •In 2016, Steward sold its hospital real estate to Medical Properties Trust for $1.2 billion in a sale-leaseback deal, using the cash to pay a $484 million dividend to Cerberus — the hospitals no longer owned their own buildings
- •When Cerberus exited in 2020, the system paid one final $111 million dividend on its way out the door — total extraction by Cerberus and management: approximately $1.3 billion
- •Filed for Chapter 11 bankruptcy in May 2024 with over $9 billion in liabilities — the largest hospital system bankruptcy in U.S. history
The Damage Done
- ▸Five hospitals have closed since the May 2024 bankruptcy, including Carney Hospital in Boston and Nashoba Valley Medical Center — approximately 2,400 employees laid off across the system
- ▸A new mother died at St. Elizabeth's Medical Center after medical devices needed to stop her bleeding had been repossessed because the hospital couldn't pay the bill — doctors confirmed she was transferred too late because they didn't have the equipment
- ▸Boston EMS reported a 20% increase in transport times after hospital closures, as ambulances had to drive further to find open emergency departments
- ▸A Boston Globe investigation documented at least 15 patient deaths linked to equipment shortages and staffing failures caused by Steward's financial deterioration
Sources
- The Pillaging of Steward Health Care — PESP(2024-05-01)
- Steward hospital closures: 'Nothing that the state can do,' Healey says — Axios Boston(2024-07-29)
- Lessons from the collapse of Steward Health Care — Brookings(2024-09-01)
- Steward's medical devices were repossessed. Weeks later, a new mother died. — Boston Globe(2024-01-25)
Also owned by Cerberus Capital Management
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Frequently Asked Questions
Is Steward Health Care owned by private equity?
Not anymore. Steward Health Care was formerly owned by Cerberus Capital Management starting in 2010, but the firm has since exited. The effects of PE ownership often linger.
What happened to Steward Health Care after the acquisition?
Five hospitals have closed since the May 2024 bankruptcy, including Carney Hospital in Boston and Nashoba Valley Medical Center — approximately 2,400 employees laid off across the system A new mother died at St. Elizabeth's Medical Center after medical devices needed to stop her bleeding had been repossessed because the hospital couldn't pay the bill — doctors confirmed she was transferred too late because they didn't have the equipment
Who owns Steward Health Care?
Steward Health Care is owned by Cerberus Capital Management, which acquired it in 2010.