PROVIDENCE – Prospect Medical Holdings Inc. on Tuesday announced that it had reached a settlement with St. Joseph Pension Fund to purchase the remaining 15% minority interest in Prospect’s Rhode Island hospitals held by CharterCARE Community Board.
The agreement includes a $27.25 million payment and resolves litigation related to the pension fund provided by the previous owner of the CharterCARE hospitals. The settlement agreement does not involve acknowledgements of liability by the parties, Prospect noted.
The pension plan became insolvent soon after the 2014 purchase of St. Joseph Health Services of Rhode Island Inc. by Prospect Medical Holdings and CharterCARE Community Board, putting the benefits of about 2,700 current and former employees of Our Lady of Fatima Hospital and Roger Williams Medical Center at risk.
The settlement is still subject to approval from both the R.I. Superior Court and the U.S. District Court for the District of Rhode Island.
“We are pleased to reach this agreement, which furthers our investment in the CharterCARE hospitals and Rhode Island,” said Jeffrey Liebman, CEO of CharterCARE Health Partners, the corporate parent of Our Lady of Fatima Hospital and Roger Williams Medical Center. “Prospect and CharterCARE remain committed to Rhode Island and we will continue to ensure that residents of the state receive exceptional quality care and the best and most personalized patient experience at the best value.”
Stephen Del Sesto, a partner at Pierce Atwood LLP and the state-appointed receiver and administrator of the retirement plan, confirmed that a settlement had been reached.
Del Sesto said that, if approved, the settlement would end litigation against both Prospect Medical Holdings and its related defendant parties, as well as claims against Angell Pension Group Inc.
“If approved, these settlement funds will be a substantial benefit to the plan and its participants who dedicated their lives to caring for the health of others and rely on the pension benefits to live,” Del Sesto told Providence Business News.
Del Sesto expects to present the settlement in state court before the end of January. If approved there, the agreement would then be presented in federal court. He said the process is likely to take six to nine months.
He also noted that litigation remains unresolved against the Providence Diocese and related defendants.
Chris Bergenheim is the PBN web editor. You may reach him at Bergenheim@PBN.com.
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