WOONSOCKET – A veteran Providence litigator has agreed to serve as mediator in attempts to resolve some vexing legal claims between Landmark Medical Center and Blue Cross/Blue Shield of Rhode Island that could affect the sale of the teetering hospital.
William Dolan III is general counsel and chief legal officer for Brown Rudnick LLC, a firm with more than 200 lawyers in five U.S. cities and two more in Europe.
Dolan’s specialties include commercial litigation, bankruptcy and construction law, and he has “extensive experience as an arbitrator and mediator,” according to the Brown Rudnick homepage.
“I am pleased to have been chosen by the Superior Court to mediate the case and hope that I can assist the parties in resolving their disputes,” Dolan said in a brief statement.
Bill Fischer, spokesman for Landmark Medical Center, said lawyers representing the hospital and Blue Cross both agreed to the
appointment of Dolan by Superior Court Judge Michael Silverstein last week. The parties could sit down for the first time by the second week of April.
“From Landmark’s perspective we are certainly hopeful this is an avenue that will lead us to progress on a number of issues and we’re going into it in a spirit of cooperation,” said Fischer.
Silverstein ordered mediation after lawyer Jonathan Savage asked Silverstein to lift a freeze on Landmark’s lawsuit over reimbursements with Blue Cross. Savage, who holds the position of court-appointed special master for Landmark, similar to a bankruptcy trustee, has been running Landmark since the hospital filed for receivership in June 2008.
Savage’s principal challenge has been to find a financially sound health care provider willing to purchase Landmark, a task that derailed in December 2010 when the former Caritas Christi network pulled out of a prospective deal, citing unfairly low reimbursements from Blue Cross. A short time later Savage filed suit against Blue Cross, accusing the company of causing Landmark’s financial troubles by paying far less for the same medical procedures performed at the hospital than competing health care providers in Rhode Island, regardless of the quality of care.
Blue Cross responded with a countersuit alleging that Landmark owes the company some $3.5 million for healthcare coverage it had provided to employees of the Cass Avenue acute care hospital and its North Smithfield-based affiliate, the Rehabilitation Hospital of Rhode Island.
After the lawsuits were filed, Savage renewed the search for a hospital suitor and Caritas eventually returned to the fray in the form of the Steward Health Care System. Steward was created as the for-profit hospital branch of Cerberus Capital Management, a large private equity firm that acquired the Caritas Christi network, previously owned by the Roman Catholic Archdiocese of Boston. Steward now owns 10 hospitals in Massachusetts, including six that used to be part of the Catholic chain and four others it acquired later.
Steward’s bid for Landmark is now pending before state regulators who are required to review the proposed sale under the Hospital Conversions Act. Even if regulators approve the deal, Steward can still walk away if a number of other conditions aren’t met, including the legislature’s elimination of a provision of the HCA that would prohibit Steward from buying additional hospitals for at least three years after acquiring Landmark.
For now, Steward has agreed to take part in the mediation, even though it is not a party to any related litigation. Fischer said State Health Care Commissioner Christopher Koller has also agreed to take part, as suggested by Judge Silverstein.