This morning marked a sad ending to my night shift. It was, or rather, had been, at a small community hospital in a tiny New England town, nestled in the backyards of where I was born and raised. But in just a few days, it will cease to exist as a hospital and morph into a stand-alone ER. Before I wrapped up my final shift, I sat down with a veteran doctor who had been working there for about twenty years and affiliated with the hospital for nearly thirty. When he was directly serving the community, he was more than just a physician, as he was part of the town’s fabric. It felt like a somber conversation with Grandpa, which I affectionately called him, as we sipped tea together and reminisced about how hospital services had slowly been stripped away. Patients were now being diverted elsewhere, and no matter how hard he had fought to keep the hospital open, his advocacy had seemingly fallen on deaf ears. So I drove off with one of my favorite Placebo songs playing against a backdrop of rain falling on a crisp morning. Leaves painted the roads in sterling colors, glowing with that unmistakable iridescence of New England fall. I had a surreal moment and a sense of disbelief which gnawed at me on the drive to a local diner. How did it come to this? How could a local institution with so much history vanish overnight? The entire community now teeters on a dangerous tipping point.
Wanting to understand more, I dug into the ownership behind this sinking ship: Steward Health Care. Formed in 2010, it was backed by the private equity firm, Cerberus Capital Management. That name immediately struck me. As a Greek mythology enthusiast, I couldn’t ignore the symbolism: Cerberus was the three-headed dog guarding the boundary between the living and the dead. With ironic predestination, this name became its own self-fulfilling prophecy. Cerberus formed Steward, which eventually drove eight of its hospitals into the proverbial underworld. This downward spiral reached its peak in 2020 when Steward filed for bankruptcy, a collapse that devastated health care access in multiple states, especially Massachusetts. Two of the hospitals were gravely affected, one of which had been open for more than 120 years and was even the site of the first abdominal surgery performed in the U.S. Both have permanently closed their doors.
The appeal of this private equity experiment was that it would be physician-led, specifically a cardiothoracic surgeon, who was presented as a beacon of hope, someone who could bridge the worlds of business and medicine. This was to be executed via a leveraged buyout (LBO), a type of acquisition that uses borrowed funds, often backed by the assets of the company being acquired, to make the purchase with a small amount of its own liquid assets. In essence, Cerberus bought hospitals with loans from banks, with high interest rates, and the hospitals were used as collateral, as they were seen as stable sources of income. The interest on the debt, all tax-deductible, created the illusion of financial genius. Or as Danny DeVito quipped in Other People’s Money: “It’s too late for prayers. We’re already dead. But we’re not broke yet.” For Cerberus, it was a high-yield strategy with minimal risk. For the hospitals? A slow bleed. Sadly, the grappling reality for most business-oriented types is that most of these facilities are in underserved or rural areas, where profitability was never the point. Hospitals, especially those in rural communities, face massive challenges: low reimbursement rates, smaller patient populations, and less financial flexibility. There simply aren’t enough admissions or discharges to generate the revenue that urban hospitals pull in, plus there is higher sensitivity to economic downturns, leaving fragile institutions operating with narrow margins. When rural hospitals close, the fallout is immediate and far-reaching: loss of access to care, worsening health outcomes, and an economic ripple effect that touches local businesses and families. If you get sick and no one can take care of you, you’re more likely to uproot your life and move to where one could potentially get care.
That’s why the recent One Big Beautiful Bill, which includes a $50 billion Rural Health Transformation Program is so important, even if imperfect. Critics rightly point out that the bill offers little direct protection for struggling hospitals. The funds aren’t allocated directly; instead, they’re distributed to states, with broad discretion given to the CMS Administrator. States may use the money to support rural hospitals, but they aren’t required to. It can just as easily be spent on chronic disease prevention or tech upgrades, which while useful, are not life-saving in the short term. Even more concerning are the permanent Medicaid cuts embedded in the bill: long-term damage wrapped in a five-year relief package, and like putting a Band-Aid on a gaping wound and praying for the best outcome.
If implemented thoughtfully, this bill could become a powerful tool for gatekeeping rising health care costs in rural areas. By allocating funds directly and on time to the facilities that need them most, it’s possible to prevent closures before they happen: preserving access, stabilizing services, and reducing emergency burdens on nearby hospitals. But that window is small, and time is not on our side. Without strict oversight, transparent timelines, and firm accountability, this bill could end up as just another missed opportunity, while another promise that came too late. As I continue walking through the halls of hospitals across the region, I think often about what we’re losing. The idea that health care must be profitable and that care should depend on its ability to generate revenue is a dark and dangerous path. The most troubling is the desire to serve has simply evaporated, from the core concept of delivering care to people who are in dire need of it. In critical access areas where it’s simply not feasible to drive for hours, a hospital isn’t just a building but rather a lifeline. If we continue down this path of financialization and neglect, the outcome is inevitable: poorer health, fractured communities, and a health care system that no longer serves the people it’s supposed to. Whether this new bill brings access or just more profit remains to be seen. But one can only hope that when the people who need care the most fall ill, they’ll find compassion, and not just balance sheets, waiting for them.
Dalia Saha is a nocturnist.
