Calls for transparency in Steward’s US financials mirror those in Malta

Steward Health Care is facing calls for transparency from US politicians as its financial troubles, including debts of hundreds of millions of dollars, could lead to the healthcare system imploding, according to US media reports.

The company’s troubles in the US mirror those in Malta, as Steward Healthcare is facing a string of court cases over unpaid bills from service providers, as well as the government in relation to €36.8 million in unpaid tax. This is despite the company receiving some €400 million from Maltese taxpayers while managing not to deliver on a single term of the concession.

The Shift has previously reported on how Steward is being pursued in the US significant sums in unpaid rent, dialysis services, bodybag supplies, drug detox service, and security while also paying millions to the federal government to settle a fraud case.

The amount of money owned by some debtors is so high that it has impacted their performance on the stock market.

But now, the situation in the US is drawing political attention.

In Massachusetts, state authorities called for Steward’s CEO Ralph De La Torre to be more transparent with the company’s finances in a bid to minimise the public health damages of the company’s potential failure.

A report by the Boston25 news station detailed a request for De La Torre to present the company’s financial statements but expressed doubts that he would do so.

A news broadcast accompanying the report said the state was “figuring out how to keep the healthcare system from imploding.”

While touring a hospital left half-built by Steward, Democratic Congressman Stephen Lynch questioned, “What has happened to the $150 million that the government steered into the Steward system over the last few years?”

His comments echoed questions surrounding the circa €400 million passed on by the Maltese government as part of the scandalous 30-year public hospitals concession Steward took on from Vitals Global Healthcare (VGH).

Steward Health Care System LLC is a private hospital operator in the US and headquartered in Boston. It acquired the public-private partnership with the Maltese government from Vitals Global Healthcare and renamed it Steward Health Care Malta.

A Spanish company, Steward International, was then set up in Spain, owned not by Steward Systems but by de la Torre, which held the ownership of the deal. But investigations found that ultimately, Steward International can be traced back to Steward Systems in the US.

On Wednesday, the Boston University’s news station also reported that Medical Properties Trust, Steward’s landlord chasing them for $50 million in back rent, announced their fourth-quarter earnings. They said Steward’s real estate portfolio “will either resume its contributions to earnings or become additional sources of liquidity as the year progresses.”

While Steward missed deadlines, broke promises, and was accused of misusing public funds in Malta and the US, its CEO De La Torre bought two yachts – the $40 million 190-foot Amaral and the $15 million 90-foot Jaruco.

Reports by the Boston Globe revealing De La Torre’s yachts questioned whether the hospitals’ funds were funnelled to suit private interests rather than the public’s.

Last month, The Shift reported Steward may soon have to close down hospitals in Boston, Massachusetts, due to financial difficulties. The company faces a deluge of court cases over unpaid bills in the state.

In Malta, the healthcare company formerly in charge of St Luke’s, Karin Grech and Gozo General Hospital, similarly faces millions in unpaid dues to local suppliers and the outstanding VAT bill, recently placed on hold by the courts.

Following a watershed court ruling that found the Maltese government’s deal with Steward/Vitals fraudulent, the company packed its bags and left Malta last year.

The court of appeals confirmed the ruling, which called the deal an “instrument through which money could flow from the country’s pockets towards those of VGH and Steward.”

A magisterial inquiry on the deal is awaiting conclusion.