Steward Healthcare US Vice President Michael Callum issued an ultimatum to the Pennsylvania Governor to cover all operating costs and liabilities for one of its hospitals during the coronavirus pandemic or he would close it.
And this move seemed to have gotten results as Pennsylvania offered eight million dollars to keep the hospital open throughout the month of April.
“The private equity playbook, with its focus on profit, has sometimes proved an odd fit with health-care companies dedicated to saving lives,” a Bloomberg article reported.
And in another twist, the New York Times reported that Cerberus, the private equity fund manager that owned Steward Healthcare in North America, sold 90% of its investment in the Steward Healthcare group to a group of Steward physicians.
This comes after reports that the Maltese branch of Steward Healthcare, which runs three former state hospitals – Karin Grech, St Luke’s and the Gozo General Hospital – met with Prime Minister Robert Abela to request additional government funding after falling behind on its debt.
This led to Steward Health Care and the government to hold meetings to discuss and find solutions to the 30-year concession made by the two parties.
It was reported that Steward had argued that the government has not kept up its side of the bargain and that it had forked out several millions of euro to settle the matters. However, nothing more has been heard about these meetings since.
In April, the government derailed a motion in parliament filed by the Opposition to cancel an agreement that gave Steward Healthcare a payout of €100 million, even if kicked out for its failures.
Steward Healthcare took over a concession of Gozo General Hospital, Karin Grech and St Luke’s Hospital from Vitals Global Healthcare for €1. While taxpayers lost over €50 million, the once-secret owners got paid millions. The hospitals are being run by Steward Healthcare at a cost to the public purse of €188,000 daily, or €70 million per year.
During the pandemic, Steward Healthcare has been at the receiving end of criticism on several occasions. The Shift had revealed that the private company was sending patients in Gozo who tested positive for COVID-19 to Malta’s public hospital Mater Dei, which is managed by the government. President of the Medical Association of Malta Martin Balzan told The Shift that the medical sector was still waiting to see the €200 million investment in health services promised by Steward Healthcare materialise.