Feds open investigation into health company that owns several Miami-area hospitals
Federal investigators have opened an investigation into Steward Health Care System, which is in the midst of bankruptcy and is trying to sell all 31 of its hospitals, including eight in Florida.
The criminal investigation, launched by federal prosecutors in Boston, is zeroing in on possible violations of the Foreign Corrupt Practices Act, which prohibits U.S. citizens and companies from committing bribery and other corruption overseas in order to obtain or retain business, according to CBS News, which first reported on the probe. The law also requires companies to keep accurate records of their finances.
“Steward Health Care can confirm it is aware of and cooperating with an investigation by the U.S. Department of Justice,” Steward spokesperson Deborah Chiaravalloti told the Miami Herald in an email Friday. “As a matter of policy, Steward will have no further comment on this investigation as it remains ongoing.”
The U.S. Department of Justice declined to comment. The U.S. Attorney’s Office in Massachusetts said “we do not confirm or deny investigations.”
The U.S. investigation into possible corruption comes as the healthcare giant, which owns several hospitals in South Florida, including Palmetto General and North Shore Medical Center, is also embroiled in a criminal investigation overseas in Malta, an island in Southern Europe, where it manages some state-run hospitals.
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The Boston Globe in June reported that Steward Health’s founder and CEO Dr. Ralph de la Torre and Armin Ernst, the head of its international operations, were accused of being involved in a bribery scheme related to the Malta hospital deal. Maltese authorities, in a report, recently recommended the executives be charged with money laundering, criminal association, and corruption of public officials, though it is unclear if they will be charged, the Globe reports.
Steward Health, which filed for bankruptcy protection in May under Chapter 11 to thin out debt, has also had a long-standing dispute with Massachusetts officials for going against a state rule and keeping its financial information a secret for years. It’s held a similar practice in Florida, where it owns eight hospitals. They include North Shore Medical Center, Palmetto General, Hialeah and Coral Gables hospitals in Miami-Dade, and Florida Medical Center in Broward.
At its hospitals, doctors and nurses have long complained about lack of supplies and broken equipment. In South Florida, North Shore Medical Center, which has seen a series of cutbacks and layoffs this year, is ground zero of Steward’s financial crisis.
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Earlier this year, the North Miami-Dade hospital, 1100 NW 95th St. closed its critical but costly labor and delivery, neonatal, and behavioral health units to try and stop its financial bleeding. In March, another blow for patients: And the U.S. Food and Drug Administration ordered North Shore to stop performing mammograms and notify patients that they might have received inaccurate results after a review found images taken in the past two years did not meet standards.
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