Attorney General Peter F. Neronha announced today that the Office of the Attorney General has conditionally approved a transaction allowing Prospect Medical Holdings to transfer ownership of Roger Williams Medical Center and Our Lady of Fatima Hospital to The Centurion Foundation. This decision follows a detailed review process under Rhode Island’s Hospital Conversions Act (HCA).
The Rhode Island Department of Health (RIDOH) is expected to issue its own decision on the transaction separately. The Attorney General’s review identified significant concerns with the proposed transaction, leading to stringent conditions being imposed to ensure the continued viability and operation of the hospitals.
“Our team was guided by the baseline principle that Rhode Islanders deserve quality, accessible, and affordable health care,” said Attorney General Neronha. “We also know that the future of these hospitals is critical to the collective landscape of health care in Rhode Island. This decision and the conditions we have placed on the transfer of ownership were only arrived at after careful consideration and strong scrutiny.”
“To understand our decision today, one must look briefly backwards. Prospect Medical Holdings is principally owned by two individuals, Sam Lee and David Topper (via trust). In 2018 and 2019, Mr. Lee and Mr. Topper, and their former joint and majority owner of Prospect, California-based private equity firm Leonard Green, deliberately placed our Rhode Island hospitals in a tenuous financial situation by lining their pockets, and those of their investors, with hundreds of millions of dollars at the expense of patients across this country. Leonard Green did not exit the situation it created in 2021 without meeting our strong conditions designed to safeguard healthcare in Rhode Island. Neither will Prospect and its sole principal owners, Mr. Lee and Mr. Topper.”
“The self-evident truth is that private equity does not belong in health care. Such firms don’t care about patients or providers; they only care about profits,” added Neronha. “That is why this Office made the previous sale of these hospitals in 2021 contingent on Prospect and Leonard Green putting $80 million into escrow to ensure the hospitals’ continued operations.”
The Attorney General's decision includes 40 unique conditions across seven areas aimed at ensuring system viability and hospital operations.
“Beyond the numbers, figures, and provisions that make up a transaction are the communities, patients, and providers that these hospitals serve and employ,” said Attorney General Neronha. “Our conditions aim to ensure that these hospitals continue to deliver quality, accessible, and affordable healthcare."
The timeline for this transaction began on May 26, 2023 when an HCA application was received by both Attorney General Neronha's office and RIDOH from Prospect Medical Holdings seeking approval for selling its assets to The Centurion Foundation.
Following initial rejection on May 31 due to incomplete submission status; a second application submitted November 14 was deemed complete December 14th by authorities.
Public comments were solicited through sessions held January-March before finalizing today's conditional approval announcement.