A peculiar private equity deal screwed over an already struggling hospital system while reaping profits for executives, according to the Wall Street Journalopens in a new tab or window.

Back in 2020, Steward Health Care System needed $400 million to dig it “out of a deep financial hole.” Instead of investing in the struggling health system, Steward’s owner, Cerberus Capital Management, reportedly convinced Steward’s landlord, Medical Properties Trust (MPT), to provide the cash infusion.

Cerberus also sold its majority stake in Steward to a group that included the health system’s CEO Ralph de la Torre, MD, WSJ reported.

MPT had to put up millions of dollars for its tenant over a series of financial deals, and recent Congressional inquiries uncovered more details about how that went down. The first part of the cash infusion came in $205 million from MPT to invest in overseas hospitals in a joint venture with Steward. The second half was covered when MPT forgave the mortgage for a Steward hospital and paid $200 million for two Utah hospitals.

In the end, Cerberus ended up with a whopping $800 million in profit while Steward filed for Chapter 11 bankruptcy this week, WSJ reported.

Oh, and de la Torre bought a $40 million yacht with the proceeds of a 2021 payout related to his ownership of Steward.