2 Rhode Island hospitals owe $24M to vendors

A recently unsealed lawsuit revealed that the proprietor of Providence, R.I.-based Roger Williams Medical Center and North Providence, R.I.-based Our Lady of Fatima Hospital is indebted to vendors for an amount exceeding $24 million, The Providence Journal reported Nov. 17. 

The lawsuit, submitted Nov. 8, alleges that Los Angeles-based Prospect Medical Holdings neglected to fulfill payments to vendors supplying essential provisions, equipment and personnel for the two Providence hospitals.

According to the filing, employees have reportedly informed the attorney general that elective surgeries, including those for conditions like sleep apnea, are being canceled due to delays in ordering surgical supplies. Employees have also expressed concerns about the ongoing challenges in obtaining wound care supplies from vendors.

The attorney general also received a complaint from an HVAC vendor claiming nonpayment for work totaling $108,422 completed at the hospitals between late 2022 and October 2023.

The lawsuit contends that Prospect Medical Holdings is violating the conditions imposed by Neronha in 2021 when the hospitals changed ownership.

The attorney general is seeking a penalty of up to $2 million and a court order mandating Prospect to adhere to all conditions and promptly provide adequate funds to sustain the hospitals' normal operations.

A hearing regarding a temporary restraining order is scheduled for Nov. 28.

Otis Brown, a spokesperson for Prospect, told the Journal that the company refrains from commenting on ongoing litigation. However, he released a statement indicating that the Centurion Foundation aims to acquire the hospitals and restore them to nonprofit status.

Mr. Brown mentioned that the foundation submitted a revised application to the Department of Health and Attorney General Nov. 14. He expressed hope that the application would be deemed complete by both state agencies.

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