As a conflict flared last week over the future of two Rhode Island hospitals, CharterCARE CEO Jeffrey H. Liebman told employees that the company’s Los Angeles-based owner had a powerful ally: Gov. Dan McKee.

“In order to resolve this situation, Prospect needed to make statements addressing the seriousness of the situation,” Liebman wrote in an April 29 email obtained by The Public’s Radio. “But understand that Prospect and CharterCARE are on the right side of this issue. And we enjoy the support of Governor McKee who is working to facilitate an agreement between the Attorney General and Prospect.”

McKee’s office would not say if Liebman’s assertion that governor supports Prospect Medical is accurate.

“The governor supports both parties coming together to reach an agreement that is in the best interest of Rhode Islanders,” said McKee spokeswoman Alana O’Hare.

Prospect Medical owns 17 hospitals around the U.S., including the two CharterCARE hospitals in RI, Roger Williams Medical Center in Providence and Our Lady of Fatima Hospital in North Providence.

 Liebman’s email was sent the same day that Prospect Medical Holdings publicly objected to Attorney General Peter Neronha’s conditions for allowing two minority owners of Prospect to obtain full ownership of the hospital chain. A day later, Prospect withdrew its proposed change of ownership in the state.

Liebman’s email to the CharterCARE workforce is noteworthy for his characterization of Neronha, who served as Rhode Island’s top federal prosecutor before winning election as state attorney general in 2018.

Neronha repeatedly extended a financial review by his office of the proposed change of ownership at Prospect because, he has said, he wanted to ensure the financial stability of Fatima and Roger Williams.

According to Liebman, “Now keep in mind that what is really going on here is a tough negotiation with an Attorney General who does not understand the implications of the extraordinary condition he is insisting on; i.e. a demand that Prospect place more than $120 million into an escrow account for the next several years.”

Liebman continued: “We have been advised by legal counsel that the Attorney General does not have the regulatory authority to place such a burdensome condition on Prospect. Yet the Attorney General is steadfast in his mistaken belief...one that his own staff disagree with...that Prospect is on the verge of bankruptcy.”

Prospect maintains it is well capitalized and has the liquidity to continue to invest in its Rhode Island hospitals.

The company went to court last week in an attempt to block Neronha from releasing a critical report on Prospect and its finances. A hearing on that issue may take place next week.

In his email, Liebman said Prospect had also reached out to House Speaker Joe Shekarchi and Senate President Dominick Ruggerio.

United Nurse and Allied Professionals, which represents hundreds of workers at Fatima, offered a scathing response to Liebman’s email.

In a letter dated May 4 and sent by Laura McQuesten, an RN and president of UNAP, Local 5110, and Cindy Fenchel, support staff president, said that the $120 million in escrow sought by Neronha to allow Prospect’s change in ownership pales in comparison to how the company’s majority owner has paid hundreds of millions of dollars in dividends to investors, with millions going to the two minority owners Sam Lee and David Topper.

“[I]nstead of agreeing to return some of the $457 million they should never have taken in the first place, they threatened to close Roger Williams and Fatima,” the UNAP officials wrote. “In particular, Mr. Liebman sent us an email saying that Prospect ‘is prepared to initiate a closure plan including a wind down immediately of some services and ultimately the closure of both institutions.’ ”

McQuesten and Fenchel said the situation reflects “an obscene display of greed, recklessness, and corruption.”

“Here's the bottom line – the Attorney General rose to the occasion to protect our hospitals, our jobs and our patients,” McQuesten and Fenchel wrote. “Mr. Liebman, on the other hand, sided with the corporate greed of Lee and Topper instead of us. He should be ashamed of himself for carrying their water and doing their dirty work. And shame on Prospect for being the public disgrace that they have always been.”

The Public’s Radio reached out for comment to the attorney general’s office and a spokesman for Prospect, Bill Fischer. There was no immediate response.

Ian Donnis can be reached at idonnis@ripr.org. Follow him on Twitter @IanDon. Sign up here for his weekly RI politics and media newsletter.