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PHOTO: File<\/p>\n
GoLocal has received a copy of a memorandum outlining steps to\u00a0create a long-term solution to preserve CharterCARE hospitals’ functions and “stabilize” the Rhode Island healthcare system by merging Roger Williams and Fatima into existing Rhode Island hospital groups.<\/p>\n
The document was shared between Brown University Health officials and Rhode Island state leaders; GoLocal has confirmed its veracity.\u00a0\u00a0<\/p>\n
The future of the hospitals will be determined by a bankruptcy judge in Texas.<\/p>\n
GET THE LATEST BREAKING NEWS HERE — SIGN UP FOR GOLOCAL FREE DAILY EBLAST<\/a><\/p>\n \u00a0<\/p>\n READ: History of Financial Failure of CharterCARE Hospitals – Underfunded and Financial Schemes<\/a><\/p>\n \u00a0<\/p>\n The next hearing before Chief Judge Stacey Jernigan of the U.S. Bankruptcy Court for the Northern District of Texas may determine the fate of two of Rhode Island\u2019s hospitals. Presently, no hearing on the matter is scheduled.<\/p>\n The confidential memo outlines the cost and what are deemed to be critical steps needed to move forward.<\/p>\n \u201cHealthcare is an important service and economic driver for the state and region,\u201d says the memo. \u201cWe have a crisis in health care in Rhode Island and a CharterCARE bankruptcy and closure will make the situation even worse.\u201d<\/p>\n The memo states that state leaders needed to move quickly to ensure that Rhode Island is able determine its own fate.<\/p>\n The buyer of CharterCARE, Centurion Foundation, has been struggling for a year to close $160 million in bonds.<\/p>\n Centurion, an Atlanta-based non-profit that has never run a hospital, missed a critical deadline before the bankruptcy court when it failed to raise the capital needed to purchase the hospital.<\/p>\n Centurion recently claimed it was close to securing $85 – $90 million, but says it needs the State of Rhode Island to backstop between $18 million and $36 million.<\/a><\/p>\n There are strong concerns that even if Rhode Island provided Centurion the tens of millions it is requesting, and it was able to close some financing, that the amount of capital needed to sustain the hospitals is hundreds of millions, and, thus, the hospitals would again be in crisis in just months.<\/p>\n \u00a0<\/p>\n \n <\/p>\n View Larger + Roger Williams Hospital PHOTO: File<\/p>\n Framework Outlined in the Memo<\/p>\n In the proposed deal between Brown Health and the State of Rhode Island, Brown Health would acquire Roger Williams, and, potentially, Care New England would acquire Fatima.<\/p>\n The memo states:<\/p>\n – Convert of the other hospitals (most likely Fatima) to a behavioral health facility \u2014 potentially in partnership with Care New England [which operates Butler Hospital].<\/p>\n – Change Roger Williams into a facility with an emergency department and short-stay beds.<\/p>\n Then, over time, move Roger Williams’ surgical functions to Rhode Island Hospital and The Miriam Hospital, states the memo.<\/p>\n \u00a0<\/p>\n Proposed Financial Structure<\/p>\n The financial terms outlined in the memo are:<\/p>\n – The $50 million presently under the control of the Attorney General \u2014 monies negotiated from private equity firm Leonard Green \u2014 to Brown Health for capital improvement and recruiting.<\/p>\n – The State of Rhode Island would commit to $100 million for transition costs (transition services, IT, recruitment, and staffing).<\/p>\n – Rhode Island would provide a $150 million interest-free loan to finance the cash flow for the hospitals.<\/p>\n – The State would commit to inflation plus 1% on Medicaid rates for five years for all providers in Rhode Island.<\/p>\n There are other staffing issues that would need to be resolved \u2014 the unions would need to accept Brown Health\u2019s pay practices and benefits.<\/p>\n And, during the transition period\u00a0 \u2014 up to five years \u2014 the unions would agree not to strike.<\/p>\n Brown Health did not respond to GoLocal’s request for comment.<\/p>\n \u00a0<\/p>\n Related Articles<\/p>\n Bonds to Finance CharterCare Deal Did Not Sell Last Week, Hospital Expert Issues Warning<\/a><\/p>\n Judge Approves Closure of CharterCARE\u2019s Sister Hospitals in PA – 2,600 Expected to Be Laid Off<\/a><\/p>\n CharterCARE Bonds Aren\u2019t Selling, McKee Is Pouring in Millions to Try and Save Deal<\/a><\/p>\n New Deal Impacts CharterCARE\u2019s Future<\/a><\/p>\n With Bonds Not Selling, Neronha Changes Course and Releases Tens of Millions for CharterCare Deal<\/a><\/p>\n RI Financing CharterCARE $400M With Debt Service, S&P Rates Bonds \u201cNegative Outlook\u201d<\/a><\/p>\n Judge Approves Sale of CharterCARE; Buyer Seeks to Raise $138 Million to Finance Deal<\/a><\/p>\n Parent Company of RI\u2019s CharterCARE Is Selling More Hospitals in Philly<\/a><\/p>\n PA Attorney General Moves to Take Over CharterCARE\u2019s Sister Company<\/a><\/p>\n Neronha Pushes Sale of CharterCARE Forward, Centurion and Prospect Approve of AG\u2019s Changes<\/a><\/p>\n CharterCARE\u2019s Parent Company Files for Bankruptcy – Fate of Roger Williams & Fatima in Question<\/a><\/p>\n Stalled Bailout of Bankrupt CharterCARE Hospitals Gets New Financing Scheme<\/a><\/p>\n McKee Looking to Scoop Opioid Settlement Money to Fund CharterCARE Bailout<\/a><\/p>\n Prime Out of the Running for CharterCARE \u2014 Fate of Hospitals May Be Determined on Friday<\/a><\/p>\n Centurion \u2014 Trying to Buy Bankrupt CharterCARE \u2014 Financials Faltered in Recent Filing<\/a><\/p>\n CharterCare Hospitals Will Remain Open Until January<\/a><\/p>\n CharterCARE in Peril: Centurion Misses Deadline, Makes Demand for State Funding<\/a><\/p>\n History of Financial Failure of CharterCARE Hospitals – Underfunded and Financial Schemes<\/a><\/p>\n Private Equity Firm That Stripped Money Out of CharterCARE Takes Major Position in Topgolf<\/a><\/p>\n Bankrupt CharterCARE Hospitals Receive Poor Grades for Safety – See All the Hospitals<\/a><\/p>\n Chaos Hits CharterCare Sale, Petition Filed to Close Roger Williams and Fatima<\/a><\/p>\n Federal Bankruptcy Court Keeps CharterCARE Open for 60 Days<\/a><\/p>\n Prime: Bidder for CharterCARE Turned Around Landmark, and Has Paid $100M in Settlements to Feds<\/a><\/p>\n In Twist, Nurses Union Blasts State \u201cInterference\u201d on CharterCARE Sale<\/a><\/p>\n<\/p>\n
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