Unionized employees turned out in force at a public hearing Tuesday to oppose the proposed sale of two Rhode Island community hospitals by Prospect Medical Holdings to an Atlanta-based nonprofit.
Nurses, lab technicians, social workers and other staff of Roger Williams Medical Center in Providence and Our Lady of Fatima Hospital in North Providence filled several rows of seats on one side of Rhode Island College’s Alger Hall during a packed public hearing Tuesday. Physicians, hospital managers and executives, many of whom testified in support of the sale, sat on the other side of the hall.
None of the people who testified had anything positive to say about the hospital’s current owners, Prospect Medical Holdings. State regulators and union leaders say the Los Angeles-based private equity firm has so severely under-funded the hospitals that elective surgeries have had to be postponed and vendors have demanded cash payments.
The disagreement centers on whether the prospective buyer, The Centurion Foundation, has presented a workable plan to shore up the hospitals and sustain them for the future.
Some of the hospitals’ top doctors in oncology testified in favor of the sale, saying that returning the hospitals to nonprofits will expand opportunities for research funding, save on drug costs and attract more medical staff. And as a nonprofit, hospital leaders said, revenues will be reinvested into the hospital.
But Chris Callaci, general counsel for the United Nurses and Allied Professionals (UNAP), which represents 1,000 workers at the two hospitals, testified that Centurion actually is not investing any of its own money in the deal. “This is a no cash deal, he said, “one-hundred percent debt financed.’’
Centurion would have to go to the bond market to raise $133 million that they’d pledge to repay, presumably with revenues from the two hospitals. “Those bonds come due in 10 years,” he said, “add another $93 [million] in interest.’’
The hospitals, not Centurion, he said, will be taking on that debt. Why would anyone think that Centurion would be able to find “untapped savings,” he said, that none of the other hospitals’ owners over the last 15 years have found?
Cindy Fenchel, a medical secretary at Fatima and president of UNAP Local 5110, said that “too much” of Centurion’s merger application was redacted and the lack of transparency leaves too many unanswered questions. “Of course, you like Centurion,” she said of the hospitals’ managers, “you have guarantees of jobs!”
Ben Mingle, Centurion’s president, said the company “understands their position” and “we will work with the unions.’’
But Callaci said that he has had a “half-dozen meetings” with Mingle since Centurion first expressed interest in the purchase in 2022 and they have not reached an agreement.
The state Department of Health and Office of the Attorney General have until June 11 to decide on Centurion’s application.
Prospect is in the process of trying to sell off its other hospitals across the country. In Connecticut, where the state has filed tax liens against Prospect Medical Holdings for $67 million in unpaid taxes, Yale New Haven Health has been negotiating since 2022 to buy three financially ailing community hospitals. But the state has yet to approve the deal.
Written comments on the proposed Rhode Island transaction can be submitted through the end of March at the following addresses:
Fernanda Lopes, MPH, Chief/Office of Health Systems Development/Rhode Island Department of Health/Three Capitol Hill, Room 410/Providence, RI 02908/fernanda.lopes@health.ri.gov
Julia Harvey, Health Care Advocate/Health Care Unit/Rhode Island Office of the Attorney General/150 South Main Street/Providence, RI 02903/Healthcare@riag.ri.gov
The Public’s Radio’s Jeremy Bernfeld contributed to this story.
