PROVIDENCE, R.I. — In a concerted effort to safeguard public health, a collaborative of senior hospital executives from Rhode Island are urgently advocating for the swift sale approval of two key hospitals to a foundation that would convert them back to nonprofit status. This push addresses critical needs within the state’s healthcare framework as the involved facilities currently face financial distress under their existing ownership.
A letter addressed to Chief Judge Stacey G.C. Jernigan of the Northern District of Texas Bankruptcy Court, penned by the leaders of nine Rhode Island hospitals and health associations, calls for expedited action. They are urging approval for the sale of Roger Williams Medical Center and Our Lady of Fatima Hospital, both operated by CharterCARE Health Partners, to The Centurion Foundation.
CharterCARE, which itself is a subsidiary of the financially troubled Prospect Medical Holdings, filed for Chapter 11 bankruptcy on January 11. The financial complications emerged starkly when reports disclosed Prospect owed upwards of $1 billion to more than 100,000 creditors, with available cash reserves summed at a mere $3.4 million. Thankfully, a temporary reprieve was granted with a $100 million line of credit that ensured the continuance of payroll for its 12,500 employees across the nation, including 2,500 in Rhode Island.
Hospital leaders emphasize the transaction has cleared the stringent review protocols mandated under Rhode Island’s Hospital Conversion Act, receiving necessary approvals, fulfilling strict conditions for the future operations of the facilities. This deal is seen as pivotal to maintaining essential healthcare services in the region, especially considering that Roger Williams and Fatima hospitals together host over 400 beds, which include 104 specifically dedicated to behavioral health—this accounts for over 20% of all such beds statewide.
The transfer of the hospitals’ ownership is pending, with the transaction slated to close in a transaction valued at $80 million, previously facilitated by conditions approved by both the Rhode Island Office of the Attorney General and the Rhode Island Department of Health in June with 80 contingent requirements.
Hospital executives argue that the potential closure of these facilities would not only compromise the regional healthcare capacity but also pose disproportionate risks to populations already contending with significant healthcare disparities. The reversion of CharterCARE to a nonprofit status by Centurion, as detailed in the correspondence, would essentially return local management and control, distancing the hospitals from previous corporate profit-driven dynamics.
This advocacy underscores the broader community stakes tied to the sale, highlighting fears of an overwhelmed healthcare system if these key facilities were to cease operations. Such a scenario was echoed by Dr. Jerry Larkin in court documents, where he expressed concerns about the potential systemic overload and barriers this would create for many relying on crucial services offered by these hospitals.
The advocacy by these hospital and health leaders reflects a crucial standoff in the battle to preserve and enhance healthcare access and sustainability in Rhode Island, as they await another court hearing scheduled on February 12.
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