Commissioners authorize UMC to take out $25 million line of credit
County commissioners unanimously voted to give the county hospital, University Medical Center, permission to take out a $25 million dollar line of credit.
Over the past few years, UMC leaders have asked for lines of credit to make sure day-to-day operations are covered while they wait for tax revenues to be distributed.
UMC leaders said these lines of credit have been necessary the past few years because of issues with El Paso Children’s Hospital, that hospital’s bankruptcy process, and the changes to state funding and uncompensated care.
The $25 million dollar line of credit is not a loan unless the hospital actually accesses the funds. Like a credit card with a huge limit, the line of credit guarantees funds would be available in case of an emergency.
The county hospital’s cash position has taken hits getting through the children’s hospital bankruptcy, and the line of credit gives it the ability to make sure it can pull down funds for uncompensated care.
That’s more important now than in previous years given the uncertain future of the Affordable Care Act.
“Communities like El Paso, we have a very high number of uninsured residents,” El Paso County Judge Veronica Escobar (D) said. “And especially without the expansion of Obamacare, and lord only knows what’s going to happen with the future of Obamacare, we may have more uncompensated care in the future.”
Escobar added that the line of credit has either been used little or not at all in previous years, but is still necessary to make sure there won’t be a shortfall this year.
