UMC: We were kept in dark when it came to true financial picture of El Paso Children’s Hospital

Editor’s Note: Below is the full statement from University Medical Center of El Paso responding to El Paso Children’s Hospital filing for bankruptcy.

A new relationship between University Medical Center of El Paso and El Paso Children’s Hospital is underway after the El Paso Children’s Hospital today announced its filing for bankruptcy protection from its creditors.

“This is a very difficult time for all of us who have worked to present alternatives to Children’s Hospital over the last year, in an effort to ensure the financial health of this important institution,” said Steve DeGroat, UMC Board of Managers Chair.

“UMC acted in good faith. Today, EPCH announced its intention to file for bankruptcy protection. Their filing states that their board authorized bankruptcy as early as February 11. All this while, EPCH gave us the impression that an agreement might be acceptable to them. It seems that their intent was never to come to an agreement or to pay what they owe UMC or other creditors,” said DeGroat. “It never had to be this way, and that is a tragedy for our community.”

UMC, since the inception of El Paso Children’s Hospital, has acted in good faith in all its transactions with EPCH.
UMC is an excellent steward of its resources and understands how to manage the operations and financial stability of a hospital.
EPCH says its billings to UMC were unfair, yet they were based on contracts signed by EPCH and UMC. At the end of the day, EPCH chose to pay nothing but demanded services continue for free.
EPCH failed to take advantage of important reimbursement programs that would have improved its financial condition.
At no time did UMC cease services it provides EPCH.
At no time did UMC cease ANY critical care services.

“It is especially appalling for Children’s Hospital to blame its lack of payment to UMC based on the agreements they executed with UMC,” he added. “EPCH leadership stated today that UMC’s billing processes, based on agreements signed by EPCH, were unfair; that EPCH was charged too much for services. All the while, throughout the last year, EPCH continued to receive services and use of a county-owned building but saw fit to pay nothing. Not a single penny in the last year was paid by EPCH for services it readily accepted.

“For more than a year we have offered proposals that could potentially bring El Paso Children’s Hospital much needed financial efficiency and operational support to avoid the current financial crisis that Children’s Hospital finds itself in,” added DeGroat.

None of the proposals were ever formalized into a final agreement.

“Instead, we were kept in the dark when it came to reaching the true financial picture that is El Paso Children’s Hospital,” added DeGroat. “We can only hope that the bankruptcy court will find a solution that benefits the many families and children affected at Children’s Hospital – as well as El Paso’s tax payers.

“All El Pasoans need to be assured that we have, throughout this process, offered a hand up, and not a handout for Children’s Hospital,” he said. “It is a pity that Children’s Hospital was not willing to accept a solution for all parties outside of bankruptcy including Texas Tech.”

The UMC Board of Managers will next consider the filing by EPCH and review legal counsel opinion regarding its options.