Texas Vista Medical Center, formerly Southwest Hospital, closed Monday after four decades of operation in San Antonio.
The health care gap left behind highlights the risks of involving private equity in the sector and the enduring impact economic segregation has had on the majority-Hispanic population.
“To me it became less about people and more about profits,” Jessica Carrasco, a respiratory therapist who worked at the hospital, told CBS News.
With the hospital’s closure, the South Side, which is home to half a million people, will be left with a single, 110-bed hospital.
That means the area’s ratio of beds per 1,000 people is 0.2 beds. The national average ratio was 2.38 beds in 2021, according to the Kaiser Family Foundation. The ratio for Texas was 2.25.
Texas Vista, a 356-bed hospital, was purchased in 2017 by Dallas-based Steward Health Care with the help of private equity investors. Steward is one of the largest for-profit, physician-owned hospital systems in the United States, with 38 hospitals across nine states.
At the same time, the land and buildings were bought by Birmingham, Alabama-based Medical Properties Trust, a real estate investment trust. Steward then had to rent the property from the trust, paying $5 million annually from its operating budget. Medical Properties Trust also owns a stake in Steward.
Steward told CBS that rental costs were not the reason for the closure, but the network obtained a recording of Texas Vista CEO Jon Turton acknowledging that the company was “trying to get out of lease obligations.”
The University of the Incarnate Word and the Texas Institute for Graduate Medical Education and Research filed a lawsuit this month alleging that Steward Health Care System and Texas Vista owe $4.5 million for services provided by medical students, according to the San Antonio Express-News.
Taxpayer bailout sought
In a March statement announcing the closure, Steward cited financial pressures and the coronavirus pandemic. Officials also said Texas Vista was being “choked out by the well-heeled ‘public’ hospital competitor across town,” referring to University Health, the county’s public hospital system.
Bexar County officials responded at the time that Steward had sought a multimillion-dollar taxpayer bailout from the county.
University Health, which said it had no interest in taking over Texas Vista’s operations, plans to build a 140-bed hospital near Texas A&M University-San Antonio on the South Side, scheduled to open in 2027.
Texas Vista’s closure isn’t just a Southside issue, Councilwoman Adriana Rocha Garcia (D4) said during a committee meeting last week. “This impacts all of San Antonio.”
It will strain the entire local health care system, including emergency services response times, Rocha Garcia said. You can’t tell someone who is having a heart attack to “wait four years for it to happen when they open the new hospital,” she said.
After learning about the closure in March, Rocha Garcia invited Christine Drennon, an associate professor of sociology and anthropology and director of Trinity University’s Urban Studies Program, to present an overview of health care access in San Antonio to the council’s Community Health, Environment and Culture Committee.
San Antonio as a whole has more than five hospital beds for every 1,000 people, Drennon told the committee Thursday, but those beds are primarily on the more affluent and white North Side of the city.
Legacy of segregation
If one overlays maps of San Antonio’s poorest areas, low life expectancy, diabetes rates, low educational attainment and housing instability, Drennon said, the pattern remains the same: Northside neighborhoods fare well while residents in the East, West, and South sides of town are more likely to suffer.
“It’s a product of our economic segregation,” she told the committee. “These are centuries of policies that produce the landscape of luxury and a landscape of disparity — of stability and security and of vulnerability.”
The typical model of supply and demand does not apply to the private health care industry, she said. “By definition, private sector goods and services follow the money.
“… So the problem is the distribution of health care facilities, absolutely, but also the problem is the distribution of wealth in our city and the privatization of services,” she added. “If we weren’t as economically segregated as we are, [Texas Vista] hospital probably would not be closing.”
When it announced the hospital closing in March, Steward noted that nearly a quarter of the hospital’s patients “cannot and do not pay for the services the hospital provides.”
Experts say private equity has also distorted the health care industry, as it has in other sectors of the economy. According to reporting by CBS, Medical Properties Trust has bought up the real estate of nearly 200 U.S. hospitals, often in low-income communities.
Bloomberg reported that the sale of Texas Vista’s property to Medical Properties Trust enabled Steward’s private equity backers “to extract hundreds of millions in dividends for its investors.”
Rocha Garcia said the focus in San Antonio must remain on residents. She is looking at ways the city could play a larger role in health care.
“The hospital is closing and it’s not time to point fingers. It’s time to jump into action and figure out what we’re doing,” she said.
Medical emergencies will continue to happen on the South Side and they will now have to travel farther, she said.
“Those minutes, those additional minutes to get to that nearest hospital, could cost someone’s life.”
