Private-equity backed Steward Health Care has been acquired by a group of Steward Health Care physicians led by the company’s CEO, Dr. Ralph de la Torre, making it the largest physician-owned healthcare system in the country.
The system, which threatened to close a hospital in Pennsylvania during the COVID-19 pandemic, operates 37 hospitals in Malta and nine states in the U.S., employing 42,000 people. Earlier this year, the system told employees to expect furloughs due to the impact of the virus and drop in elective surgeries.
“This is a transformational moment for the health care industry, with new realities in a COVID-19 world that must be addressed with an equally transformational, patient-first approach,” said Dr. de la Torre via release. He will be the company’s chairman and CEO.
De la Torre said the organization would look to integrate long term clinical and community needs and short term patient needs, emphasizing the importance of physician ownership and health system deficiencies’ impact on underserved communities.
Cerebrus first backed the company in 2010, acquiring six hospitals in Massachussetts. This week, Cerberus’ controlling interest was exchanged for a convertible note of an undisclosed sum. The physician group will control 90 percent of the company, and Medical Properties Trust will maintain the 10 percent it already owned.
“For nearly a decade, we have partnered with Steward Health Care to build an industry-leading company that provides access to affordable, high-quality, community-based care across the United States,” said Brett Ingersoll, Senior Managing Director and Chairman of the Private Equity Investment Committee at Cerberus via release. “We believe this transaction will ensure that Steward Health Care’s transformative, accountable care model will continue to drive innovation as a physician-owned and integrated health care system.”
Dr. de la Torre thanked Cerberus for their work to grow Steward into a national system. “We look forward to achieving the next level of patient-centric care, through a doctor-owned structure that unites all aspects of care delivery and prevention in ways never before contemplated.”