For a moment, let’s put aside the unconscionable greed of Ralph de la Torre.

For now, imagine if you will there being a group of individuals who were bound by law to oversee de la Torre and ensure that none of this ever happened.  That he acted at all times in a manner consistent with the system’s stated purpose of “revolutionizing the way health care is delivered – creating healthier lives, thriving communities and a better world.”  These stewards of the health system did actually exist in the form of the corporation’s board of directors.  And despite Steward’s financial demise being eminently clear during the past few years, not only did these individuals do nothing to stop the ongoing pillaging by the company’s CEO, they benefited from it.

Of course many have argued that Steward’s fate was already sealed when it brought in Cerberus back in 2010.  In retrospect, it may not have been the best idea to link your fate to a private equity firm named after a vicious three-headed dog who guarded the gates to the underworld in Greek mythology.  At least that decision, however, was at the time grounded in the belief that it could (in theory) benefit the struggling health care system.

Comparatively speaking, that decision was not as bad as the one by Steward’s board to ignore, intentionally or otherwise, de la Torre turning the company into his own personal piggy bank and jeopardizing the care of millions of patients. As the company’s majority owner in the wake of the Cerberus exit, de la Torre was purchasing corporate jets and paying himself enough of a salary to afford a $15 million fishing boat and a $4.7 million home.  The failure by the board to take action against de la Torre exacerbated the system’s demise and all but guaranteed its eventual collapse.

There are seven members of Steward’s board, including de la Torre and two other members of his executive team (both of whom were benefiting from de la Torre’s ATM approach to “creating healthier lives”).  The four independent members included: John Boehner; former Fluor CEO Carlos Hernandez; local real estate developer James Karam; and Sister Vimala Vadakumpadan of the Dominican Sisters of Presentation. A politician, two executives from outside of healthcare, and a nun.  What could possibly go wrong?

Unfortunately, these independent board members continued to ignore Steward’s dire situation and even stood by as de la Torre reportedly siphoned an additional $111 million out of the company in 2021 as a “dividend payment” to himself and the other physician owners.  De la Torre used the payment to purchase a $40 million yacht.

As Steward limped to its bankruptcy, de la Torre continued to ravage what was left.  According to bankruptcy filings, he drew a salary of $3.7 million this past year and eight other executives at the system received more than $1 million in compensation.

Why didn’t the board do anything?  At the very least, they could have resigned in protest on behalf of the system’s employees, providers and patients.  They could have gone to the regulators. They could have held a press conference with any number of the politicians who are now trying to take front and center on this crisis.  But they didn’t.  Perhaps a clue for their silence can be found in Steward’s bankruptcy filings. During the past year, at the same time medical instruments were being repossessed from the system’s hospitals endangering the lives of patients, Steward’s independent board members received payments for their board service of between $253k – $326k. For point of reference, the independent board members of General Electric were paid $275,000 last year. Starting to see the picture?

Of all the injustices which have been perpetrated against the system’s patients and staff, it is important to not overlook the silence and inaction by the so-called stewards of Steward Health Care System.

Mark Rogers is the CEO of BoardProspects.com, the world’s largest board recruitment marketplace.

Steward CEO Ralph de la Torre (File)