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Prime Healthcare Fined $1 Million by Rhode Island Department of Health

Tuesday, October 31, 2017


The Consent Agreement was release Monday, October 30. READ BELOW.

The Rhode Island Department of Health is fining Prime Healthcare -- which has operated Landmark Hospital in Woonsocket and the Rehabilitation Hospital of Rhode Island in North Smithfield -- $1 million dollars for knowingly giving false or incorrect information as it pertains to the Hospital Conversion Act.

According to the Department of Health, it is the largest fine issued by them "in at least the last 30 years."

About Fine

Prime Healthcare -- Prime's for-profit entity -- has a pending application with the state to transfer the two entities to the Prime Foundation, its not-for-profit entity. 

According to the Consent Agreement signed by all parties, Prime had led the state to believe it would change its status retroactively when the transfer was approved. 

The Department of Health then discovered Prime knowingly transferred the status in 2016, prior to approval. 

SLIDES: See the Consent Agreement BELOW

According to the agreement, $500,000 of the million is required to go to the state General Treasurer in the next three weeks. 

Latest for Prime

The Consent Agreement released Monday afternoon -- and signed by all parties -- comes just weeks after the sale of Pawtucket’s Memorial Hospital unraveled over the length of the agreement and Prime refusing to take over pension obligations; as a result, the Board of Care New England voted to close Memorial -- impacting hundreds of healthcare workers.

As GoLocal reported in May of Prime, "RI Healthcare System’s Key Player is Under Investigation by DOJ and Bonds Are Downgraded

One of the keys to stabilizing Rhode Island’s fragile hospital system is the acquisition by Prime Healthcare Services of Pawtucket-based Memorial Hospital from Care New England (CNE), Prime, however, is in the midst of growing financial turmoil and is facing a newly announced investigation by the U.S. Department of Justice. Prime’s financial scrambling is taking place across the country. 

“S&P recently downgraded Prime’s credit rating, calling the company’s management and governance “weak, reflecting a history of disputes with unions representing employees at certain hospitals, as well as the ongoing whistleblower investigation, partially joined by the U.S. Department of Justice, into the company's Medicare billing practices,” wrote New Jersey Business.


RI Dept. of Health - PRIME Consent Agreement 10.30.17


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