There are few things more fundamental to the health of our state, our communities and our residents than having a network of quality, accessible hospitals. That is why, for the past 60 years, the Rhode Island Health and Educational Building Corp. has provided the tax-exempt bond financing our state’s hospitals need to invest in their facilities, operate efficiently and provide the critical care that Rhode Islanders depend on.
The health of Rhode Island’s hospital system has been severely tested recently by the financial challenges faced by Roger Williams Medical Center in Providence and Our Lady of Fatima Hospital in North Providence. These two institutions are far more than just hospitals; they are critical safety-net providers for our entire health care system. Between the two hospitals, they manage approximately 50,000 emergency room visits every year and offer specialized care in cancer, behavioral health, geriatrics and rehabilitation. They are integral to the health and safety of our communities, and the ripple effect of their potential closure would have been devastating for every other hospital and patient in Rhode Island.
Simply put, Rhode Island could not afford to let these hospitals fail.
That is why on March 6, we successfully closed on a $101 million bond transaction providing Roger Williams Medical Center and Our Lady of Fatima Hospital the operating capital they need to remain open and serving Rhode Islanders.
Getting this deal done was a challenging journey that required navigating a national bankruptcy of the hospitals’ former ownership group, shifting market headwinds, and complex regulatory hurdles. As traditional financing paths became blocked by fiscal challenges facing community hospitals nationwide, we had to find a new way forward. This success was only possible because state leaders came together with the recognition that keeping these hospitals open was a top priority for our state’s well-being.
Gov. Daniel J. McKee and Attorney General Peter F. Neronha proposed legislation, and the General Assembly – led by Speaker K. Joseph Shekarchi and Senate President Valarie J. Lawson – took decisive action by swiftly passing legislation in February creating an $18 million supplemental debt service reserve fund. This fund provided the credit enhancement needed to attract private investors and close the $101 million transaction. This collaborative effort demonstrated a shared commitment to protecting the health of Rhode Islanders.
The completion of the sale of Roger Williams and Our Lady of Fatima hospitals to The Centurion Foundation marks a new beginning for these institutions, transitioning them to a locally governed, nonprofit model known as CharterCARE Health of Rhode Island Inc. This new structure removes the influence of private equity and allows for a renewed focus on medical quality and patient care.
Finally, I want to express my deepest gratitude to the 2,400 dedicated health care professionals and staff at Roger Williams and Our Lady of Fatima. These men and women remained focused on their patients, continuing to deliver high-quality, compassionate care despite years of uncertainty and financial instability.
With this transaction now closed, we have secured a stable and sustainable path forward. RIHEBC is proud to have partnered with our state leaders to ensure that these two vital safety-net hospitals remain open and operating for the generations of Rhode Islanders who depend on them.
Dylan Zelazo is the executive director of Rhode Island Health and Educational Building Corp.
