AG seeks to hold Prospect in contempt for unpaid bills at Fatima, Roger Williams

Rhode Island Attorney General Peter Neronha is seen speaking at the Rhode Island Health Care Summit on May 28, 2024, emphasizing the importance of Our Lady of Fatima and Roger Williams Medical Center to the state’s health care network. (Alexander Castro/Rhode Island Current)

The state’s top prosecutor remains locked in battle with the owner of two urban safety net hospitals over $17 million worth of overdue bills.

Rhode Island Attorney General Peter Neronha is now asking a state Superior Court judge to hold Prospect Medical Holdings LLC in contempt for failing to pay $17 million in overdue bills to hospital vendors by the court-ordered deadline. Neronha’s motion, filed in Providence County Superior Court on Friday, is the latest in an escalating legal battle over the company’s alleged failure to correctly manage the operations and finances of Our Lady of Fatima Hospital in North Providence and Roger Williams Medical Center in Providence.

“The only thing more reliable than Prospect’s inability to manage these hospitals is our Office’s commitment to holding them accountable and protecting Rhode Islanders’ access to health care,” Neronha said in a statement Friday.

Neronha’s motion was not immediately available because it first requires a confidentiality review, Neronha’s office said in a statement.

The L.A. company has come under increasing scrutiny, including by the U.S. Department of Justice, as financial woes put its hospital assets across the country at risk. 

In November, Neronha’s office sued Prospect for violating conditions of a 2021 agreement, including owing $24 million in past-due bills to vendors for its Rhode Island hospital. Providence County Superior Court Judge Brian Stern sided with Neronha, ordering the company to pay $17 million — the amount overdue by more than 90 days — within 10 days of June 26.

A top company executive submitted a sworn affidavit days later, confirming the company was “in compliance,” with the promise of financial proof when its second-quarter reports become available at the end of July.  

That’s not good enough, according to Neronha’s office, which is now asking the court to demand Prospect provide “sufficient evidence” that it has paid its bills and will continue to do so.

Otis Brown, a spokesperson for Prospect, maintained the company had already fulfilled its court-ordered obligations.

“We have complied with the judge’s order and do not understand the Attorney General’s motion,” Brown said in an email on Monday.

Information on when or if Stern will rule on Neronha’s request to hold Prospect in contempt was not immediately available.

Paying off overdue bills is only one of the 85 conditions state regulators attached to their approval allowing Prospect to sell off its two Rhode Island hospitals and affiliated physician groups, home care and hospice agencies and offices to a new nonprofit owner. The $80 million sale to The Centurion Foundation cannot proceed until all conditions are met.

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