R.I. extends closing for Landmark deal again

The Rhode Island attorney general extended the deadline for Steward Health Care System's acquisition of Landmark Medical Center in Woonsocket, R.I., for the second time.

In an Aug. 27 letter addressed to a law firm for Steward (PDF), Attorney General Peter Kilmartin said he would extend the deadline for another month, with the new closing date set as Sept. 30. The Boston-based, 10-hospital system had requested an Oct. 31 closing date.

“By seeking this extension, we assume that Steward has committed to providing Landmark with continuing assistance, including financial assistance, through the new closure date requested,” Kilmartin said in the letter. “Candidly, an extension without such an assurance would make little sense.”

Steward had announced plans last year to acquire Landmark, a 133-bed hospital that has been in receivership since 2008. The original deadline for the deal was July 27.

Earlier this year, Steward amended the asset-purchase agreement to include a number of conditions, such as establishing a memorandum of understanding with Thundermist Health Center, a community health center serving Woonsocket, and ensuring that lawmakers changed the state's Hospital Conversions Act to allow for-profit companies to acquire more than one hospital in Rhode Island every three years. The law was amended in June.

However, negotiations between Steward and Blue Cross and Blue Shield of Rhode Island remain ongoing, and letters from Steward Chairman and CEO Dr. Ralph de la Torre and Kilmartin that were released earlier this month reflected the contentious nature of the negotiations.

“Your tone in both ending your efforts in this facilitation and reminding us of your deadline only underscored Rhode Island's unwelcome attitude to Steward,” de la Torre said in an Aug. 8 letter to Kilmartin.

According to Kilmartin's most recent letter, Steward had said the two companies are engaged in “ongoing and good faith negotiations and additional time is required to determine if an agreement can be reached.”

In addition, the attorney general said that Steward is required to provide an updated and current copy of the closing checklist by Aug. 31 and is also expected to contact his office by Sept. 14 if additional time is needed due to the negotiations with Blue Cross and Blue Shield of Rhode Island. At that time, Kilmartin will consider the Oct. 31 extension.

Steward did not immediately return requests for comment. A spokeswoman for Blue Cross and Blue Shield of Rhode Island said in an e-mail that it would decline comment “out of respect for the negotiating process we are currently in with Steward.”