Delivery of Care

Will the health system crash and burn?

AG Neronha issues a dire warning of what awaits the future of RI’s health care delivery system

Photo by Richard Asinof

Attorney General Peter Neronha won his lawsuit against Prospect, the owners of Roger Williams Medical Center and our Lady of Fatima hospitals, with R.I. Superior Court Judge Brian Stern ordering Prospect to pay $17 million in the next 10 days to cover outstanding medical bills. A regulatory decision is expected in the next few days regarding the proposed sale of the two hospitals to the Centurion Foundation.

By Richard Asinof
Posted 6/17/24
Attorney General Peter Neronha and his legal team are the guiding light when it comes to attempting to prevent a crash of the state’s health care delivery system. The latest interview by ConvergenceRI identifies the risks and the opportunities, if anyone is listening.
How can Attorney General Neronha change the way that Medicaid dollars from the federal government are better leveraged in delivery care? Will the Attorney General’s idea of funding mobile dental clinics for the state’s disadvantaged children change the way that dental care is delivered? Is the legal team at the Attorney General’s office preparing regulations to better protect nursing homes from takeovers by private equity firms? Which national news reporter will consider doing a feature story about Attorney General Peter Neronha willingness to take on private equity financing of hospitals and nursing homes?
As we approach the longest day of the year known as the summer solstice on June 20, when the North Pole is tilted at its maximum direction toward the sun, with the full moon known as the Strawberry Moon arriving the next day on Friday, June 21, in combination with a scorching heat wave with “lows” in the mid-90s forecast, summer will have arrived in full force.
The R.I. General Assembly has concluded its budgetary business for FY 2025, but the political battles will continue. When it comes to health care in Rhode Island, when it comes to innovation and research, perhaps the most important step forward is to be able to walk a bit slower, to breathe in and breathe out, to pause long enough to observe the world around us and to remember that we can find rewards in the pleasures of taking the time to talk with our neighbors and to listen to the cacophony of birds singing their songs and fireflies illuminating a nearby meadow and changing it into a mysterious web of light. Stay tuned.

PROVIDENCE – The opening paragraph of Gravity’s Rainbow, a 1972 novel by Thomas Pynchon, begins: “A screaming comes across the sky. It has happened before, but there is nothing to compare it to now. It is too late. The evacuation still proceeds, but it’s all theatre.”

Pynchon’s apocalyptic prose bespeaks of a coming disaster, anticipating the destructive arrival of a V-2 bomb through the nighttime skies above London, during the last few weeks of World War II.

When R.I. Attorney General Peter Neronha finished his recent interview with ConvergenceRI, on Friday afternoon, June 14, responding to what has become a rote question in every interview conducted: “What question haven’t I asked, should I have asked, that you would like to talk about?”his somber answer warned about the impending crash of the state’s health care system, capturing a similar foreboding of disaster.

“We are in an enormous crisis,” the Attorney General began. “And no one, I think, really sees it. I said it at the summit [on May 28]. And I’ll say it again now.”

Attorney General Neronha paused, then he began again: “I believe it will take…” struggling to find the right tone of voice. “Either we are going to be able avoid the missile, without anyone knowing the missile is on its way, or really close to landing, or, we’re going to have spectacular failure, and it is only that spectacular failure that will get some people to wake up.”

The state’s number-one public health advocate continued: “But we need that wake-up call, unless we can pull a rabbit out of our hat. As every day goes by, our work as a magician seems less [and less] likely to succeed.”

Speaking words of wisdom.  
The ConvergenceRI interview with R.I. Attorney General Peter Neronha came during a time of intense legal scrutiny regarding the future of the state’s health care delivery system. Earlier in the week, R.I. Superior Court Judge Brian Stern had ruled in a lawsuit brought by the Attorney General that the private equity owners of Roger Williams Medical Center and Our Lady of Fatima hospitals had to pay $17 million in the next 10 days to cover unpaid medical bills.

At the same time, Attorney General Neronha and his legal team were preparing a regulatory ruling under the Hospital Conversions Act regarding the bid by the Centurion Foundation to buy the two financially troubled hospitals.

[Editor’s Note: Further, in Massachusetts, the private equity owners of Steward Health Care have declared bankruptcy and were seeking to sell off their Massachusetts hospitals and physician practices by the end of June.]

That is where the ConvergenceRI interview began, with a question about the pending sale of the two financially troubled Rhode Island hospitals to the Centurion Foundation, a nonprofit firm headquartered in Atlanta, Georgia.

ConvergenceRI: Has a decision been reached in terms of the pending sale?    
AG NERONHA: By Judge Stern? Yes.

ConvergenceRI: We will get to Judge Stern’s decision. My question was about the proposed sale of Roger Williams Medical Center and Our Lady of Fatima hospitals.    
AG NERONHA: No. But Judge Stern’s decision is very helpful.

ConvergenceRI: My understanding of Judge Stern’s decision is that they have 10 days from the date of the decision to come up with I believe is $17 million to comply with his ruling.    
AG NERONHA: Correct. Which addresses [unpaid] overdue bills through last December. So there additional amounts…

ConvergenceRI: Are they going to be able to come up with the money?    
AG NERONHA: Absolutely.

ConvergenceRI: So, they have enough cash reserves to do that?    
AG NERONHA: They have enough cash reserves somewhere in the system or within the ownership to do that, I believe. Now, they may give you a different answer. But my position is: There is no excuse for not having the cash.

ConvergenceRI: When the money comes in, assuming that it comes in, does it immediately go to pay the over-drawn accounts?    
AG NERONHA: It should. That’s what the whole purpose [of the lawsuit] was.

ConvergenceRI: There was a great phrase by Judge Stern that was quoted [in a number of news stories] about how Prospect was using [the hospitals’ finances] as their own private banking system. Is that accurate? Could you illuminate what was meant by that?  
AG NERONHA: What it means to me is, which is what I believe the facts show, the arguments in the case, and what Judge Stern found, these companies – Prospect – whether it is owned by Mr. Lee or by Mr. David Topper, as it is right now, or when it was owned by Mr. Lee and Mr. Topper in a 40 percent position, and Leonard Green in a 60 percent position, have long used these hospitals and their other hospitals as credit institutions.

They have mortgaged them where they can, but certainly mortgaged the system to put money in their pockets.

And, so, I don’t want to speak for Judge Stern, but I don’t have a lot of sympathy for owners who have looted these systems in the way that they have. Particularly, ones that said, three years ago, we want to run a health care system and agreed to pay the bills.

And here we are, three years later, and they don’t want to pay the bills.

I have said this to you before, Richard; you’ve reported on it, and I’ll say it to you again: But for our $80 million escrow, these hospitals would be closed. This company demonstrated over and over again that at least in respect to certain hospitals, in Pennsylvania, in Delaware, certainly here in Rhode Island, and in Connecticut, they have no interest in running hospitals or health care systems.

Perhaps they do in California, but they don’t here. And, as Judge Stern held, and wrote, prioritizing California over Rhode Island is of no [import] to me, other than creating even more incentive for me to go after them hard. Because they shouldn’t be making that value choice.

ConvergenceRI: Let’s move to what is happening with the Centurion Foundation, if I may. Will there be, when a decision is reached, consensus between the Attorney General’s office and the Department of Health?    
AG NERONHA: I hope so. I expect so. I will say that right now, we are talking on our own with Centurion and with Prospect. There are certain things for me that are non-starters. And, until we reach a place of agreement on those things, it doesn’t really matter to me what the Department of Health might be doing, or might be concerned about.

I imagine that they have similar concerns, from what I understand. But, there are things that financially I think are necessary for these hospitals to have a chance. I am not going to create any illusion that I think that our decision, if we reach one that allows for the sale to go forward, means that these hospitals have a long-term future.

I think these hospitals have less of a chance of a long-term future, even among Rhode Island hospitals. I think all Rhode Island hospitals are facing difficult, long-term futures.

When I say long-term, I really mean short- to mid-term. But, the sale cannot go forward unless we deal with some of those issues.

ConvergenceRI: Will those concerns be represented in conditions that the Centurion Foundation has to meet?    
AG NERONHA: Not necessarily. They may be things that Prospect has to do before they exit.

ConvergenceRI: You participated in recent Health Care Summit.    
AG NERONHA: Yes, I did [chuckling].

ConvergenceRI: There were a lot of people talking at each other… [See link below to ConvergenceRI story, “Bang the gavel slowly.”]    
AG NERONHA: There were a lot people talking and other people listening. Some of the speakers did not wait around to listen to what others said. Not everybody stuck around. Some people got up there, they said their thing, and then left. I’m talking about the speakers, the presenters.

ConvergenceRI: What I found was that there was a lack of comprehension. I used part of my reporting on the summit to talk about the problems with Optum [the for-profit division of United Health], which may hit Rhode Island sooner than people think. Because they have become both the health insurer, the pharmacist, and the doctor at the same time, which makes it very difficult to have any sort of competition in the marketplace. And, also, to challenge their decision-making. Is there any legal remedy to the role that they are currently playing? Are they in violation of any laws?    
AG NERONHA: You know, Richard, I cannot sit here and say that right now. I know that, for example, I came back from an elder abuse summit this morning, where I talked about health care.

We focused on elder abuse in terms of scams, financial scams and physical abuse, but if you go up to 50,000 feet, our health care system is endangering older Rhode Islanders, because we are handing them off to doctors like on a merry-go-round, there is no continuity of care, even under the best of circumstances. You can’t find specialists or you have to wait for a long time, or you go to the ER, you are sitting in there for hours upon hours. Which obviously impacts older Rhode Islanders in significant ways.

But one of the things, for example, that came up [in discussion this morning] was the role of private equity in nursing homes, for example. We are, obviously, I think it is obvious, it may not be obvious, so let me just say it: We are really deeply engrossed in [working on] some Prospect-related issues now. They are taking all day for the health care team and a lot of my day as well.

So, when I was talking with the health care legal team – Julia Harvey and Kate Sabatini and Adi Goldstein – talking about the status of things, on both issues, Centurion and Prospect, I mentioned this growing concern as expressed to me this morning about the role of private equity in nursing homes. And, what I was told is that “We have something in the pipeline coming to you.”

So, the team – how do I put this? – it is a two-way street, with myself and the health care team. They see things in their work that they what to work up and bring to me; and I see things from being out in the field, or reading them somewhere – I will read reporting like yours, and I’ll say, “What about this?” And they’ll tell me, “Maybe we should look at that.” Or, “That’s on its way to you.”

Do you want to go back to talking about the summit?    
ConvergenceRI: Just for a little bit. I assume you read my story.    

ConvergenceRI: I received criticism from some readers, saying that I jammed four stories into one story. I am frustrating by the lack of comprehensive media coverage about health care, although it seems to be improving. And, it is unclear whether or not people are listening.    
AG NERONHA: That’s why I try to use all of the tools at my disposal to talk about health care. It would have been very easy this morning just to focus on financial scams and physical elder abuse. But, I had 100 people out there that care about older Rhode Islanders, and care about their own health care.

So, I used it as a forum to talk about it. I use social media for the same reason. I agree with you. Health care coverage has been episodic at best. Sometimes it comes up. But Judge Stern had a hearing about [Prospect] a month, more than a month ago, in a sealed courtroom. The fact that the courtroom was sealed wasn’t an issue for the press, let alone what was going on behind the sealed doors.

When a hospital system is ordered to pay $17 million within 10 days, that’s a big deal. And, it says something about the system. But it really ought to worry us and wake us up.

ConvergenceRI: So, it’s not just something that came from a far-away “corner” to quote a reporter describing the decision by Judge Stern.    
AG NERONHA: Yes, “in another corner of Rhode Island life….” It isn’t in a corner, as you were alluding to, it’s like right here in the middle of the table. Or, it should be. What’s happening, Richard, is that the system is failing, but we are seeing it only in our individual silos.

We see it when we go to the ER; we see it when we are trying to find a doctor. We see it when we need medical care.

Look, someone has been treating me for some post-surgical pain, she has gone from Lifespan to her own practice. And, the challenge I have is this: How do I get my most recent MRI to the doctor who is no longer in the Lifespan portal? Shouldn’t we just have a portal that every doctor in the state can access, rather than going from portal to portal to portal?

[Editor’s Note: If the state finally moves from opt-in to opt-out for participation in its health information exchange, known as CurrentCare, access to medical data through electronic portals will no longer result in a traffic jam along the data informational highway.]

The answer is: bring your MRI results with you, which is fine; I can print them out and bring them along.  But what it means is that that doctor will be reading them in real time, as opposed to the 15 minutes before I go in there, or even the day before or the night before, which is how I prepare for things.

We have a long way to go in health care. And, the summit was, I think, perhaps helpful, in the sense that we had everybody in the room…

ConvergenceRI: [interrupting] Well, not everybody, some folks were not invited or allowed to attend.    
AG NERONHA: Well, we had a lot of the significant players in the room But I don’t feel like we came out of it with real action items.

ConvergenceRI: I would agree.    
AG NERONHA: Certainly no new action items that were not already being done, if they were being done somewhere.

Let me give you another example. One of the questions I got was: What about universal health care? And I thought about that, only for a minute in that moment, because I really hadn’t given it a lot of thought.

But, I have given it thought since, because it is a fair and good question. And so, universal health care is an interesting concept, but the question becomes: In what form? And, here, at least, it has usually been spoken of in the context of Medicare For All.

And so, what we don’t know, right, is if we took just Rhode Island, so our rate revenue structure is commercial, the most; Medicare, less; and Medicaid, way, way, way less.

What if everyone in Rhode Island was covered by Medicare, in a pilot program? Single-payer Medicare? What would that mean for our health care system, in terms of revenue?

In other words, would the hospitals have the revenue they need? Would it be more revenue than what they get now? Would it be less? Do you know? I don’t know.

It seems to me that we have an agency that might be able to crunch that, which is OHIC. Now, if I was somebody who controlled the levers of government, I would put someone on that project, or I would have them tell me why we can’t do it.

But it seems to me that that is worth knowing. How do we know whether Medicare For All would improve our situation, if we haven’t crunched those numbers?

ConvergenceRI: So, what appears to be missing is the data, the good data, to make the decisions?    
AG NERONHA: Is it the data? Or, is it the interest and the ability to crunch the data? Is the CMS [Centers for Medicare and Medicaid Services] data for Medicare really that hard to find or extrapolate for the entire population of Rhode Island?

ConvergenceRI: It is a question of political will.    
AG NERONHA: Yes, the political will to make it happen. Are we interested enough in knowing the answer to that question, and to know whether Medicare… If the Congress tomorrow passed Medicare For All, would that solve our problems? Because if it doesn’t, we need to come up with a different answer.

ConvergenceRI: I believe that the current health care delivery system is unsustainable.    
AG NERONHA: That’s true.

ConvergenceRI: And, it’s basically a hospital-centric system.    
AG NERONHA: True-ish.

ConvergenceRI: And, hospitals do good work, but there is limitation to what they can accomplish. All the research has shown that only 10 percent of what occurs in a doctor’s office affects the health outcomes for population health. What that means is that there are other kinds of interventions that could take place, but at what scale, and where?

To hear you talking about “convergence” in your speech at the health care summit, I was applauding. It is what I have been reporting about for the last decade.

ConvergenceRI: Are people in government doing a better job of listening?    
AG NERONHA: I don’t know, Richard.

ConvergenceRI: I sense that there has been a change of heart with the Senate President, now that he is a patient, rather than just a power broker. Giving him some insight into how difficult it is to navigate the health care system.    
AG NERONHA: He has always been very concerned about Roger Williams and Fatima hospitals, always, for years. At his request, I have given him regular updates about how things are going.

ConvergenceRI: You have a plan, or a plan in progress. At what point do you feel that the plan is in place enough that you can share that in a public venue, and lay out on paper: Here’s a road map.    
AG NERONHA: Richard, I don’t know yet. I think one of the challenges has been this life-or-death struggle over Roger Williams and Fatima hospitals that has my team bogged down.

We had to go to court; I had two lawyers in court for, you know, a couple of weeks, just trying to get this company to pay their bills.

And, I have another part of the crew, which is taking statements under oath, to determine whether we should agree with this transaction or not [to allow the Centurion Foundation to purchase the two hospitals].

But all of us collectively are trying to figure out if what they are proposing isn’t right for Rhode Island, what would work?

And getting them to do what it is we are asking them to do, which they may not willingly want to do. And that is no small lift.

And then, it will come out I think in the next couple of weeks, Brown has been talking to Lifespan [about a potential name change], and they need our approval, or at least they need to know from us that it is not going to trigger, whatever they want to do, the Hospital Conversions Act. So, we have been very involved in that.

And the team is working on other things, including this plan. And so, I haven’t seen the next step. But what I anticipate soon is, in the next step, very specific ways that we can leverage our Medicaid dollars to bring in more federal dollars – very specifically, what lines of reimbursement and care that we could be doing but we’re not. It will be granular. Look, it may be that there are some things that the state is doing, in large part, because we have been pushing, to advance the ball.

Take, for instance, the AHEAD program that Sen. Whitehouse is pushing. There is an application that is due in August. My understanding is that the state is trying to put together an application, meaning EOHHS is trying to put that together with OHIC. They need a hospital to agree to participate. Eventually, they are going to need insurers to agree to participate. I don’t think that their advocacy to date has been successful completely. They may be able to sign on one hospital, perhaps. We’ll have to wait and see.

That may be the foundations of beginning to address our Medicare problems. But we still have to address our commercial problems. And our Medicaid problems.

All three of those are components. But I have also become very concerned; I’ve been concerned about it for some months now, but the summit drove home for me the need for us here to do something about dental care among economically challenged children – children from economically challenged homes.

It is just inexcusable that [so many] Providence schoolchildren are unable to get any dental care at all, leading to some really horrific results. We think we may be able to access, through some litigation we brought, a substantial amount of money that would go a long way toward addressing that. That is a work in progress. That would be a huge win I think for Rhode Island.

ConvergenceRI: So, you would be able to take money from legal settlements and reinvest that into dental services?    
AG NERONHA: Things like mobile dental care. Bringing mobile dental care to schoolchildren on school grounds, after school.

ConvergenceRI: You may want to talk to Linda Hurley at CODAC who has created a mobile van to reach people where they are.    
AG NERONHA: Yes, I’ve seen it. I’ve been in it. It’s a great concept.

You see, Richard. If you have a really good policy team, as we do here [at the Attorney General’s office], I bring it to the team. I said to my team: “How do we fix this? Because, dentists don’t take Medicaid.”

One way to do it is what Massachusetts did – they raised Medicaid rates for dentists. But also required the dentists to do a certain amount of charity care. But if dentists are not taking Medicaid patients at all, we are not going to reach a third of our population.

And so, putting the carrot with the stick, and a requirement to make that happen. In Massachusetts, it is a policy concept. But we don’t have people here thinking that through in a way that it gets to the decision makers.

ConvergenceRI: What questions haven’t I asked, should I have asked, that you would like to talk about?    
AG NERONHA: You can take the long view. You’ve been doing this for a long time. I think that’s what you can do, and I hope that you continue to do so.

One of the problems that I see is that it is only three years since [our decision on Prospect]. No one remembers why we required the $80 million in escrow. But, how do I put this? Reporters are moving through the system at a very fast clip, particularly in television, lesser so in print.

There are some good reporters, but they just don’t remember. Even from three years ago. And that lack of continuity in the reporting I think confuses the public.

I was on with Gene Valicenti this morning [for Channel 10]. He’s a sharp guy. Sharp, sharp guy. Asks good questions. And he didn’t have it quite right. He didn’t have the current state of play [in health care] quite right. And, what that tells me is that whoever is prepping him didn’t have it quite right.

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