But it’s too early to say whether Steward’s model is more economical. The attorney general’s report found that while its hospitals are the low-cost providers in some communities, their prices are higher than those of competitors in other locales.
Steward also has had setbacks — grappling with high-level turnover, labor unrest, and financial challenges as it seeks to expand.
The company hired popular new presidents at its two Boston hospitals only to lose both after short tenures.
Neighborhood activist Bill Walczak left Carney in Dorchester after falling out with Steward leaders, while John Polanowicz, West Point graduate with a master’s of business administration from Stanford, abandoned his perch at St. Elizabeth’s in Brighton to become the Massachusetts secretary of health and human services. But Steward has pressed forward in building a business-savvy management team, hiring veterans of Health Management Associates — one of the nation’s largest for-profit health care chains — at its hospitals and corporate office.
Steward management has repeatedly clashed with the Massachusetts Nurses Association, which represents nurses at most Steward hospitals, over staffing levels and proposed pension changes. Nurses have picketed outside the hospitals, at Steward’s headquarters in Boston’s Back Bay, and at the Cerberus home office in New York. Nurses complain of an increasingly centralized management system that has stifled their voices.
“When we had an issue, we used to be able to sit down and discuss it” with hospital supervisors, said nurses association member Joan Ballantyne, a registered nurse at Norwood Hospital. “They now say, ‘We have to go to corporate.’ No decisions are made at the local level.”
Association nurses say 105 nursing jobs were cut between 2011 and 2012 at eight Steward hospitals. They filed more than 1,000 “unsafe staffing” complaints last year at the hospitals, a substantial increase over the number filed at the same hospitals in past years.
Last month , Steward eliminated the security staff at four hospitals, outsourcing about 50 jobs to a New Jersey contractor with ties to Cerberus.
According to Jacqui Fitts, a nurse on the medical surgical floor at Morton Hospital in Taunton, there are no longer enough nurses, nurses assistants, and security guards at night to monitor post-anesthesia or psychiatric patients. As a result, she said, “We end up moving our patients who are high risk out into the hallways so they can be near nursing stations.”
Conditions on the surgery floor at Quincy Medical Center are similarly crowded, said Ellen Donnelly, a nurse there. There is constant pressure to “accept more patients,” she said, even if it means moving others to areas where they are not monitored as often.
Steward officials won’t publicly disclose the number of layoffs or job reductions, but insist overall staffing levels have not changed significantly. The attorney general’s report said the number of full-time jobs increased 3 percent in Steward’s first year to 9,277. Steward officials also cite statistics showing the quality of care has improved since the company took control of the community hospitals.
While it has built its local health care system swiftly, Steward has stumbled in efforts to expand beyond Massachusetts — a goal of de la Torre and his financial backers.
In December, Steward officials said they broke off talks to buy Mercy Health System in Maine — which includes two Portland hospital campuses, and a dozen smaller sites — after concluding Mercy had misrepresented its finances, something Mercy denied. Steward earlier withdrew an offer to buy county-owned Jackson Health System in Miami and backed out of a deal to take over bankrupt Landmark Medical Center in Woonsocket, R.I.
De la Torre acknowledged Steward’s out-of-state expansion has been slower than anticipated. He blamed it partially on uncertainty over the fate of President Obama’s national health care overhaul — which promotes “accountable care organizations” of the type Steward is pioneering — delaying decisions by health care systems to put themselves up for sale. Another factor, he said, is that Steward has been focused on its growth in Massachusetts.
Steward expects the former Caritas hospitals — which in addition to St. Elizabeth’s and Carney include Norwood, Holy Family Hospital in Methuen, Saint Anne’s Hospital in Fall River, and Good Samaritan Medical Center in Brockton — to start generating profits in the current fiscal year, de la Torre said.
The community hospitals Steward acquired more recently — Quincy, Morton, Merrimack Valley Hospital in Haverhill, and Nashoba Valley Medical Center in Ayer — should generate profits within the next two years, he said.Continued...