AG Peter Neronha
Prospect Medical Holdings (Prospect) has informed the Department of Attorney General and the Department of Health today that proposed financial conditions from the Attorney General associated with an ongoing Hospital Conversions Act Application will jeopardize the future operations of Roger Williams Medical Center and Our Lady of Fatima.
The showdown, if it comes to a closure, would mean the loss of 2,800 jobs between the hospitals.
Prospect operates under the CharterCARE brand in RI and is a for-profit and pays the City of Providence $2.8 million in taxes and North Providence $875,000.GET THE LATEST BREAKING NEWS HERE SIGN UP FOR GOLOCAL FREE DAILY EBLAST
The owner of Roger Williams and Our Lady of Fatima hospitals on Thursday threatened to close the facilities if state regulators impose tough new financial conditions on them.
Prospect Medical Holdings, the California-based company that owns the hospitals, is seeking state approval for its private-equity investor to exit the ownership group. A decision is expected Friday.
In a news release, Prospect said it expects Attorney General Peter Neronha to require the company to place $120 million to $150 million in escrow for the ownership change to go through. The imposition of such an escrow is unreasonable, unacceptable, and unprecedented, Prospect spokesman Bill Fischer said in a statement. The demand for such an escrow as a condition to continue to do business in Rhode Island would leave Prospect with very little choice but to initiate a wind down of its Rhode Island operations. Everyone involved in this transaction needs to understand that there are dire consequences f
Proposed deal involving for-profit Rhode Island hospitals sparks sharp battle Published Thu Feb 25 2021 06:44:15 GMT+0000 (Coordinated Universal Time) As Rhode Island’s two-largest hospital groups pursue a merger, a fierce battle is playing out over the control of the state’s third-biggest hospital group. CharterCARE Health Partners includes Our Lady of Fatima Hospital in North Providence and Roger Williams Medical Center in Providence, which are among the largest employers and biggest taxpayers in their communities. by Ian Donnis
Back in 2014, a California-based for-profit company, Prospect Medical Holdings, was described as a savior when it acquired two financially troubled Rhode Island hospitals, Our Lady of Fatima in North Providence and Roger Williams Medical Center in Providence.
Private Equity Firms Are Piling On Debt to Pay Dividends
Dividend recaps, a kind of borrowing long condemned for loading up companies with debt for the benefit of their private equity owners, has surged.
Using borrowed money, the Blackstone Group of New York got about $200 million in dividends out of a company it controls, in a transaction called a dividend recapitalization.Credit.Bloomberg
Feb. 19, 2021
The initial public offering of Apria Healthcare last week was a $170 million boon to Blackstone Group, the private equity firm that is Apria’s majority owner.
But as lucrative as that payday was, it wasn’t as good as the one Blackstone extracted from the company just a few weeks earlier: about $200 million in dividends, paid with borrowed cash.
This story was originally published by Lookout content partner, ProPublica.
On Sept. 30, we published an article examining how Prospect Medical Holdings, a hospital chain, and Leonard Green & Partners, its private equity owner, had extracted hundreds of millions of dollars in profits for investors while patients served by their hospitals suffered from a litany of problems.
The article reported that on 14 occasions over a decade, government health inspectors had concluded that Prospect hospitals posed an “immediate jeopardy” to patients, defined by the federal government as problems that have caused, or are likely to cause, “serious injury, harm, impairment or death.” Other pervasive problems included everything from bedbugs and ceiling leaks in hospital buildings, to unpaid gas bills for company ambulances to shortages of medical supplies.