Projo Biz Blog

The lawyer overseeing financially troubled Landmark Medical Center is contesting the amount of an annual licensing fee the Woonsocket hospital must pay the state.

Jonathan N. Savage contends in court documents that the hospital does not have to the full $3.5 million fee because Landmark fell into receivership before the payment was due July 14.

Landmark petitioned the court in late June to clear the way for a potential merger with another hospital. The Woonsocket facility has been losing money for many years and at the end of the last fiscal year was $7.2 million in debt. In the petition, Gary Gaube, then chief executive officer and trustee of Landmark, cited the facility's provision of more than $8.5 million annually in uncompensated care to the uninsured and the underinsured as a key reason for its troubles.

On June 26, Superior Court Michael A. Silverstein appointed Savage, of Shechtman Halperin & Savage, temporary special master of Landmark. A month later, Savage's appointment was made permanent.

Savage is functioning as the hospital's president, chief executive officer and chairman of the board, deciding on all expenditures, hiring and other issues.

One of the first decision Savage made was to dispute the licensing fee, which he contends should be halved because of the receivership filing. In response, the state threatened to deduct any unpaid portion of the fee from the more than $6 million the state owes Landmark for provided uncompensated care to patients at the Woonsocket hospital.

As the result of a court order signed by Silverstein last week, the state agreed to pay Landmark about $2.5 million and deposit another $3.5 million into an escrow account until the dispute is resolved.

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