Steward Health Care emerges as Landmark buyer
PROVIDENCE – In a surprising twist, Steward Health Care System emerged as the buyer of the financially troubled Landmark Medical Center, after Superior Court Judge Michael A. Silverstein ruled that none of the other potential bidders were qualified.
The purchase price, according to special master Jonathan N. Savage, is between $62 and $65 million.
Steward, the Boston-based hospital division of Cerberus Capital Management, formerly know as the Caritas Christi Health Care System, previously had been engaged in negotiations to purchase Landmark and its affiliate, the Rehabilitation Hospital of Rhode Island. But those negotiations broke off in December 2010.
A hearing is scheduled for May 31, at which time Silverstein is expected to recommend that the Steward be chosen to move ahead with the next phase of the purchase agreement, compliance with the state Hospital Conversion Act.
The tentative agreement with Steward came about because of the intervention of Local 5067, the Northern Rhode Island Nurses and Allied Professionals, which represents about 600 workers at the two facilities, according to Savage.
The union met with Steward to urge them to consider making a new bid for the hospital in the aftermath of the April 27 hearing, when Silverstein asked each of the bidders to resolve outstanding issues, according to Christopher Callaci, the union’s general counsel.
Those negotiations with Steward took on a new urgency in the past two weeks, when two of the for-profit bidders, Prime HealthCare Services of Ontario, Calif., and Transition Healthcare of Franklin, Tenn., withdrew.
Negotiations between the union and a third bidder, RegionalCare Hospital Partners of Franklin, Tenn., had been stymied for months. The union had voted in early May to authorize a strike if RegionalCare were to be chosen as the buyer.
In a last-ditch effort to reach a potential agreement, the union scheduled a meeting with a federal labor mediator on May 24, but RegionalCare declined to participate.
Richard Charest, president of Landmark Medical Center, addressed the court, detailing the deteriorating situation of the community hospital. Charest reported that in the last two weeks, 15 key staff members in the Intensive Care Unit and Operating Room had given notice to leave, worried by the withdrawal of bidders. After the court hearing, Charest said that he hoped Landmark employees would be cheered by the announcement of a new tentative agreement.
Callacci praised the union workers for their willingness to stay with the process, despite so many ups and downs.
“They demonstrated extraordinary courage,” he said. RegionalCare, he continued, was never right for Rhode Island. “Any bidder that comes to a state and says that they are going to deliver on the promise for quality care without providing for the workforce is full of baloney,” he said. “When RegionalCare withdrew from our negotiations this week, they demonstrated their lack of commitment.”
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