PROVIDENCE – The Centurion Foundation’s prospective purchase of CharterCARE Health Partners from Prospect Medical Holdings Inc. was paused by R.I. Attorney General Peter F. Neronha and the R.I. Department of Health for the second time this year on Aug. 11.
According to its plan, Centurion, an Atlanta-based nonprofit, would purchase the assets and operations of CharterCARE’s seven Rhode Island medical centers from Prospect Medical Holdings. If the transaction is approved, CharterCARE would cut its ties with Prospect and become a nonprofit health system under Centurion.
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Under the Hospital Conversions Act, health care groups must first submit an initial application to the attorney general’s office and RIDOH. The state agencies then evaluate the application for completeness before beginning the review process.
After signing an asset and purchase agreement last November, Centurion and Prospect submitted a joint HCA application to RIDOH and the attorney general’s office along with Change in Effective Control applications to RIDOH on May 26.
On May 31, the attorney general’s office and RIDOH announced the applications were not considered complete because the health care organizations did not use the correct application forms.
“The materials do not respond to the most recent, publicly available application form and do not include responses to transaction-specific questions,” RIDOH and the attorney general’s office wrote in a statement published on May 31.
The health systems then had the opportunity to correct their applications, which were resubmitted on July 12, said Brian Hodge, a spokesman for the attorney general’s office.
On Aug. 11, RIDOH and the attorney general’s office announced that they had sent a letter to the health care organizations notifying them the applications were again deemed incomplete.
“The letter outlined the application’s deficiencies, including the lack of detail surrounding the structure of the entities and how the parties intend to achieve the goals proposed in the Application,” RIDOH and the attorney general’s office wrote in a joint statement on Aug. 11.
The information in the letter is considered confidential at this point of the review process, according to the statement.
Propsect, CharterCARE and Centurion did not immediately respond to a request for comment on Tuesday.
The health care organizations have 30 working days, which is on or before Sept. 26, to correct their applications.
