Prospect Medical Holdings has declared bankruptcy but assures the sale of two Rhode Island hospitals will proceed as planned amid financial struggles.
They filed for Chapter 11 bankruptcy in Texas, and honestly, it was kind of expected given their financial troubles. They’ve missed payments on several properties across the country, and it’s been a rough ride for them. But they’re pushing ahead with selling the hospitals to The Centurion Foundation, which is good news for the community.
The sale is worth $80 million and was supposed to close in January. It took a while to get the green light from state regulators, but they finally approved it with a bunch of conditions. The Attorney General, Peter Neronha, reassured everyone that the hospitals will keep running normally for now, even with the bankruptcy hanging over them.
Neronha mentioned that they’ve been preparing for this situation, so it’s not a total shock. He wants folks to know that the hospitals are crucial for Rhode Island’s healthcare system, and they’re ready for whatever comes next.
CharterCARE, the local branch of Prospect, confirmed that everything is still operational. They’re treating patients and providing services just like before. The Centurion Foundation, the nonprofit looking to buy the hospitals, is still excited about the deal and plans to work through the bankruptcy process to make it happen.
The CEO of CharterCARE also sent out a message to employees, saying they’re working hard to finalize the sale and return to nonprofit status. It’s a tough situation, but they’re hopeful.
Prospect has a lot of creditors to deal with, but luckily, no Rhode Island entities are among the top ones. There’s been some scrutiny on how private equity firms like Prospect manage healthcare facilities, and some local leaders are concerned about the impact on patients and staff.
The union representing the hospital workers is worried about the sale too, mainly because they think Centurion lacks experience in running hospitals. They’re calling on state leaders to ensure the hospitals stay open, as closing them would be a disaster for the healthcare system in Rhode Island.
Neronha is committed to looking out for the interests of Rhode Islanders during the bankruptcy proceedings. There’s a hearing coming up soon to discuss financing for the hospitals, so we’ll see how that goes.
