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VGH hospital staff reveal spike in costs since concession

Suppliers confirm they have been forced into a corner because of the VGH deal

When Vitals Global Healthcare appointed Technoline to procure all of its medical supplies costs spiralled to unprecedented levels, according to staff at hospitals operated by VGH.

Hospital staff approached The Shift News following its investigation into VGH showing that taxpayers got a rotten deal to explain what they have been witnessing in the provision of healthcare services under the Public Private Partnership negotiated by Minister Konrad Mizzi.

VGH was granted a concession to run three public hospitals – St Luke’s, Karin Grech and Gozo hospitals – for up to 99 years. VGH forced all suppliers to go through Technoline to procure all of its medical supplies a few months after the company was suddenly bought by one of its managers, Ivan Vassallo.

This meant that the supply chain to VGH hospitals was controlled by one company – an extremely lucrative deal. Interestingly, the other director of Technoline – Yaser Ali Bader, also Pakistani – is registered at the same Tigné flat address as Shaukat Ali Abdul Ghafoor (Chaudhry) who has a stake in the Vitals deal.

Prior to the VGH move on the public hospitals, any purchasing matter had to undergo a strict scrutinising process of adjudication, the staff said. If a department needed to buy anything costing more than €40 euros, the Line Manager would need to find specifications for the items and then the specifications together with possible sources of purchase would be listed and put on a public accessible platform for any supplier to view. Each supplier would then place its bid.

The same Line Manager would then need to go through all the applications and check specifications and actual items. Some would be discarded as the specifications did not match. Others that made it to the end would be adjudicated according to the cost or quality.

“Even if this system was not flawless, it was done diligently and helped keep the process as unbiased as possible,” one member of staff said.

What changed since Technoline came into the picture? Around the end of 2016 and beginning of 2017, a carte blanche was given to all departments to list any equipment their respective departments needed.

“Of course, after decades of not receiving any help with regards to equipment, technology and even the basics, all of us were ecstatic,” the staff said.

Consultation with all senior members of staff was done and lists were drawn up. “Finally, we were going to be given the sip of water we had been asking for for decades. No previous administration or management or Minister had granted us such needed equipment. Little did we know that it would come at a huge cost to the Maltese taxpayer,” they said.

“Now this equipment is being slowly delivered to our departments. When Line Managers are being asked to counter sign for the delivered equipment, this is when we get the shock of our career. Items that we used to purchase for €15 now cost €60. Items that cost €150 are now purchased for €400. The list goes on and on. Technoline is invoicing VGH triple or more the cost of the items,” they said.

When VGH contracted Technoline for all its medical supplies, it forced all other medical suppliers to hospitals to enter their bid through one of their competitors.

The Shift News spoke to other medical suppliers who have to submit their bids through Technoline to verify whether this was the case. They confirmed, saying they may also be responsible for the price hike.

“When the government forces you into what is clearly an unfair and discriminatory deal, the context changes. You are no longer offering your lowest possible price to the government for a public service. If Technoline is going to make money off the goods you are offering, and it is the only channel through which you can offer that service, then you have to make sure that you survive and that your employees’ salaries can be paid. The only way was to increase our prices,” a supplier said.

Investigations by The Shift News have shown how the hidden interests behind the Vitals deal, and the links behind suppliers and the registered owners of Vitals, may mean that even though the company may pack up and leave, the lucrative contracts established may position them to earn profits off a deal they never delivered for years to come.

The Medical Association of Malta said it had one final meeting with the government today, but “it is highly likely that a strike will take place” tomorrow.

MAM’s General Secretary Martin Balzan made it clear in comments to The Malta Independent that the union was not against Public Private Partnerships, but it did not agree with the current model agreed upon with Vitals Global Healthcare.

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