By Michelle Marchante, Ana Claudia Chacin
Miami Herald
HIALEAH, Fla. — Palmetto General Hospital, a critical healthcare institution for the community, is currently facing an existential crisis and is described as being on life support.
With a drastic decline in patient numbers and a significant loss of specialists, the hospital, which has served the Hialeah community for over 50 years, is grappling with dire circumstances. Interviewing employees and union representatives revealed that this once-essential medical lifeline is desperately trying to navigate a path to survival.
A new operator has been appointed to manage the hospital, amid ongoing struggles to provide adequate care as its financially troubled owner, Steward Health Care, attempts to rectify billions in debt following its Chapter 11 bankruptcy filing in May. Despite this new leadership announcement, lingering doubts about the operator’s capability to revive the embattled hospital remain prevalent within the community.
Hospital employees have consistently voiced concerns regarding insufficient supplies, layoffs, ward closures, service reductions, and malfunctioning equipment. Delayed payments have plagued not only vendors but also staff members. In response to financial difficulties, North Shore Medical Center in North Miami-Dade was compelled to close its labor and delivery, neonatal, and behavioral health units earlier this year, while Florida Medical Center in Lauderdale Lakes was forced to divert ambulances due to an insufficient number of supplies and on-call clinicians, jeopardizing patient safety.
Steward Health CEO Dr. Ralph de la Torre recently resigned from his position. His departure came shortly after he faced scrutiny from a congressional committee pursuing civil enforcement and potential criminal charges against him for refusing to comply with a subpoena regarding the purported mismanagement of the health system’s hospitals nationwide. He is currently engaged in legal proceedings to challenge the validity and enforceability of the subpoena.
Meanwhile, the new operator of Palmetto General, along with four other South Florida hospitals previously owned by Steward, is a Nevada-registered company named Healthcare Systems of America. This new management is in the early stages of settling in to oversee operations.
However, restoring the hospitals to a standard of functionality and earning back the community’s trust is anticipated to be a formidable task.
Empty ER, shortage of staff elsewhere
Palmetto General’s emergency room, as well as its surgical unit, which are still operational, have been in a troubling state of disarray indicative of the ongoing crisis. Numerous employees have resigned, and patients have been transferred out of the facility located at 2001 W. 68th St. Medical personnel and union representatives have voiced deep concerns over the situation.
Although the hospital’s ER remains open for patient care, its atmosphere has drastically changed, with far fewer individuals seeking treatment than before. Mark Criswell, an administrative organizer for 1199SEIU United Healthcare Workers East, noted in a September conversation with the Herald that the emergency room is no longer the bustling environment it once was.
During an early September inspection, an appointed inspector observed a mere 12 patients receiving treatment in the 41-bed emergency room. A few weeks later, Criswell reported only four patients were present during his visit, with the remaining beds neatly made and unoccupied.
“It’s like it was abandoned. … I’ve never seen it like that,” exclaimed Criswell, reflecting on over a decade of experience navigating Palmetto’s halls.
Palmetto General was acquired by Steward Health, along with four other hospitals in South Florida, including Hialeah Hospital, Coral Gables Hospital, North Shore Medical Center, and Florida Medical Center, in a $1.1 billion deal from Tenet Healthcare in 2021.
Less than three years after this acquisition, Steward filed for bankruptcy in May, reporting staggering liabilities exceeding $9 billion. This total includes nearly $1 billion in overdue payments owed to medical vendors and suppliers and $290 million in outstanding employee wages and benefits.
The ramifications of the bankruptcy proceedings introduced heightened scrutiny into the operations of the affected hospitals. In July, inspectors noted that Palmetto experienced a significant downturn in both elective and emergency surgeries. Patient care ombudsman Suzanne Koenig, designated by the Justice Department’s U.S. Trustee Program to monitor conditions at Steward’s hospitals in Miami-Dade, acknowledged in her report that while all the inspected hospitals displayed disrepair, she did not believe that the safety or care of patients was currently at risk.
Staff at Palmetto General have reported that the operational issues at Steward’s hospitals severely impacted both staffing levels and patient visitation rates at the facility, presenting challenges the new ownership will have to address. Unions representing hospital personnel have articulated concerns about staffing shortages following a wave of resignations from essential staff members. Remaining employees are reportedly struggling to provide patient care amid limited supplies and malfunctioning equipment. However, the ombudsman recently stated that supply issues appeared to have improved across Steward’s hospitals during the ongoing bankruptcy proceedings.
Koenig indicated that the hospitals now had “adequate supplies,” asserting that supply rooms were sufficiently stocked to ensure “safe patient care.” Nevertheless, she acknowledged that most of Steward’s hospitals “are still in need of repairs and new or repaired equipment,” while recognizing a “marked improvement” since her initial report in July.
After Steward took over, fewer patients have visited the facilities this year, leading to registered nurses sometimes being instructed to work reduced hours or not report to work at all. According to Lazaro Garcia, a registered nurse in Palmetto’s ICU, he experienced canceled shifts in September. Nurses on duty were left juggling responsibilities due to a shortage of nursing assistants. In an effort to compensate for lost wages, some nurses have picked up shifts in other hospitals.
“The community should be proud of all the nurses of Palmetto that have stayed through the whole struggle,” Garcia remarked, highlighting their dedication to patient care amid challenges.
“Steward’s greed took a toll on nurses and patient safety. Nurses had to fight every day to get what everyone deserves,” Garcia continued. “We are hopeful that the new owners will focus on improving patient safety and will work to recruit and retain staff.”
Steward Health did not respond to the Herald’s inquiry for comment. In a statement to the Herald, Aimee Gill, a spokesperson for Healthcare Systems of America, emphasized that the new operator’s “number one priority is to provide stability and rebuild trust with the community.” The company did not provide further comment regarding the challenges faced under Steward’s ownership, as described by hospital staff.
The ongoing staffing challenges have created uncomfortable situations for the patients seeking care at the hospital. For example, in September, there were eight patients requiring open-heart surgery at Palmetto, a certified cardiac hospital. Dr. Erik Beyer, the cardiovascular surgeon who had served as chief of cardiac surgery for Steward’s Florida hospitals, resigned at the end of August. His successor was unqualified to carry out complex open-heart procedures, resulting in patients being transferred to other facilities — or, in some cases, leaving against medical advice upon discovering Beyer’s departure, according to an anonymous source familiar with the situation.
Koenig, the patient care ombudsman, noted the loss of a prominent cardiothoracic surgeon in a recent court report regarding the hospital’s condition following an early September visit.
“The senior leadership team shared that Palmetto recently lost a prominent cardiothoracic surgeon due to the restructuring; however, they remained positive knowing that other surgeons stayed and that Palmetto is actively recruiting new cardio-thoracic surgeons,” Koenig highlighted in her report.
Beyer is now entangled in legal proceedings, seeking a bonus of $848,550 which he claims he is owed after dealing with misleading promises surrounding his employment with Steward. The hospital system has argued against Beyer’s request, citing an ongoing external audit into physician bonuses and a contract clause stating bonuses are contingent on current employment status. The Herald attempted to reach Beyer through his attorneys, who declined to facilitate an interview.
Beyer revealed in a brief phone conversation with the Herald in early October that he is exploring the possibility of returning to Palmetto under new ownership.
Problems before bankruptcy
The challenges faced by Palmetto General were present long before Steward Health’s bankruptcy declaration, as highlighted by hospital staff. Beyer, the cardiovascular surgeon, detailed in his bankruptcy claim that he became aware of serious issues under Steward’s management when vendors started vocalizing their concerns over delayed payments, initially just sporadic but soon escalating to total non-payment.
“This was the first time I had ever heard of this happening at a healthcare company since this never happened at Tenet in the years I worked there,” the seasoned surgeon remarked in a declaration that has since been sealed. He expressed frustration over hospital administrators’ dismissal of employee concerns regarding vendor payment issues that were critical for securing equipment, supplies, and essential staffing.
Koenig, in her initial report, also noted that supply shortages contributed to the exodus of physicians from Palmetto, even prior to Steward’s bankruptcy declaration. Notably, a urologist was compelled to transfer patients to another hospital due to an inability to procure necessary implants, while cardiologists faced similar challenges acquiring essential catheter supplies. Additionally, other surgeons reported difficulties in accessing robotic supplies, according to Koenig’s findings in July.
The strain on supplies significantly impacted patient care, as shared by hospital staff members. In the fall of 2023, Steward struggled to secure anesthesia, leading to emergency-only operation days where no elective cases could be performed, creating evident stress for healthcare personnel. Beyer mentioned, “I would have to explain to patients that we lacked anesthesia or perfusion support, forcing us to postpone their cases.”
Moreover, in November 2023, due to concerns about potential liabilities, Steward granted Beyer and four other specialists the go-ahead to obtain privileges to perform surgeries at non-Steward hospitals when Palmetto or its counterparts lacked the necessary supplies for safe procedures, as stated in Beyer’s court declaration.
Beyer claims he performed over 500 surgeries in 2023, yet alleges that numerous procedures could have occurred, had Steward been able to compensate assistants, perfusionists, and anesthesiologists during the final two months of that year.
Identically, other hospitals owned by Steward Health have encountered comparable difficulties affecting care, including Hialeah Hospital, Coral Gables Hospital, North Shore Medical Center, and Florida Medical Center. The Boston Globe has thoroughly documented the decline of Steward Health’s national operations and the adverse repercussions on patients in Massachusetts and a facility in Melbourne, Florida.
An attending physician described a situation from several weeks ago when a patient arrived following a heart attack and required the placement of a heart assist device. Unfortunately, when the patient’s leg experienced loss of circulation, treatment from a vascular surgeon was necessary, but the relevant specialist was nowhere to be found, as they had resigned.
A different vascular surgeon had received emergency privileges at the hospital but was unavailable. Consequently, the assist device had to be removed, leading to the necessity of transferring the patient to another healthcare facility.
In September, a nurse who worked directly alongside the vascular surgeon that resigned faced abrupt termination due to a lack of cases necessitating their expertise, the nurse relayed to the Herald.
Due to insufficient staffing, numerous surgeries have faced postponements or cancellations, particularly because of the deficiency in perfusion team personnel necessary to operate the heart-lung machine while patients are under anesthesia. The drop in surgeries was significant, with one doctor reporting that previously, the hospital handled 40 to 50 cases daily, but this dropped to merely 10, exponentially increasing the number of medical personnel sent home without pay.
In September, the chief of the operating room was also terminated, a fact confirmed by the doctor who spoke with the Herald. Though these are just a few examples of the ongoing staffing crises, other departments across Steward’s South Florida hospitals are similarly grappling with a departure of employees due to inadequate resources.
Despite the chaos, Criswell, the 1199SEIU Florida organizer, maintained that Palmetto General still operates like a functioning hospital, in stark contrast to its sister facility, North Shore Medical Center, which resembles a “ghost town.”
As the transition to new ownership unfolds, unease persists regarding the situation.
“Our concern is definitely the quality of care for the community,” Criswell stated, illustrating the apprehensions surrounding the shift in management.
Transition to new ownership
Hospital employees and patients endured prolonged uncertainty about the fate of their facilities, with Steward’s hospitals slated for sale as part of a restructuring plan aimed at alleviating its daunting $9 billion liabilities.
The complicated relationship between Steward Health and Medical Properties Trust, the entity owning the land where the hospitals reside, further impeded the sale attempts.
In September, a resolution between the two entities culminated in appointing Healthcare Systems of America as the “interim manager” overseeing Steward’s hospitals in Miami-Dade and Broward.
The company has since received authorization to function as the permanent operator handling everyday operations at Palmetto General and other former Steward hospitals throughout South Florida.
Healthcare Systems of America, established in Nevada in August, is managed by the same leadership behind Los Angeles-based American Healthcare Systems, which touts itself as a community-centric hospital group with facilities in North Carolina and Illinois.
On September 30, Steward leadership issued a communication to Palmetto staff regarding the transition in management.
“I understand that the lack of communication has been a challenge around the transition causing a lot of anxiety, and we appreciate your extreme patience with getting through the daily water cooler or [Palmetto General Hospital] food mall rumor mill,” wrote Brian Debarge, director of management operations for Steward Medical Group.
Palmetto General President Alejandro “Alex” Contreras-Soto will remain in his position, having risen to market leader for South Florida, while the presidents of Coral Gables Hospital, Hialeah Hospital, and Florida Medical Center will retain their titles, as confirmed by the memo.
Physician contracts will continue to be honored, and no plans exist to terminate any additional providers or close existing practices, according to statements from Debarge.
Several medical professionals who departed the hospital may return, including Beyer, who is engaged in a legal battle with Steward over an unpaid bonus but has expressed his desire to come back under new ownership. He told the Herald earlier this month that while talks were ongoing, his return was not yet “officially official.”
“Well, the new owners are here,” Beyer conveyed. “It’s a whole different vibe, and I love this place, I love Miami. I was born in Miami, and I love Palmetto, and I love the people here. I would love to come back here.”
Lthcare Systems of America has expressed its commitment to restoring trust and improving operations within these facilities. They have asserted that their primary focus will be on stabilizing staff levels and enhancing patient care, which has been a significant concern during Steward’s tenure.
As the hospital transitions under new management, stakeholders are hopeful yet cautious. Both hospital staff and community members are advocating for improved conditions, particularly in regard to staffing levels and the availability of necessary medical supplies and equipment. The importance of a reliable support structure for healthcare professionals has been emphasized, as they play a critical role in ensuring the safety and satisfaction of patients.
In addition, discussions surrounding community trust and the ability of new management to meet the established needs have come to the forefront. While some employees remain optimistic that positive changes are on the horizon, the ghost of Steward’s past operations looms large, leading many to wonder if the new leadership will truly effect the significant enhancements required.
Employees are voicing their experiences, highlighting the increased strain caused by inadequate staffing and resource shortages. They collectively share a vision for the future—a hospital environment that not only prioritizes patient safety and care but also values the staff members who contribute tirelessly to the healthcare system. The hope is that with renewed focus and appropriate oversight, Palmetto General can reclaim its status as a robust community health resource.
the narrative surrounding Palmetto General underscores the essential interplay between hospital administration, staff welfare, and patient care—a dynamic that, if nurtured, could lead to substantive improvements in healthcare delivery within the community.
