Without a discussion, Palomar health directors approved the borrowing of $ 20 million to UC San Diego Health on Friday, in a decision which, according to the two parties, aimed to support the finances of the trigger of the public health care district.
In a press release, the university health system said that the loan expresses solidarity with another public entity.
“Palomar Health is a long -standing community partner of UC San Diego Health, and this loan strengthens our continuous collaboration while we are working together to meet the expansion of high -quality health services needs in the region,” the press release said. “As a public institution, UC San Diego Health serves as a safety net health care net for the region.
“If we allow a health system to fail, access to patients will suffer and our staff and our facilities will feel the pressure. Ensuring stability on a community scale while planning for the future is the only way to continue to provide exceptional care for patients, generate revolutionary research and inspire the next generation of health care providers. »»
Financial aid is particularly important because the university, like all public institutions, is faced with significant financial insecurity with the financing of subsidies, and perhaps reimbursements of Medi-Cal, the continuous objective of federal budget cuts. Palomar is an important medical care provider for the county of Inland North, as a trauma center in the region. Its main hospital in Escondido represents an investment of $ 500 million that residents who live within the district limits pay through property tax levies.
Asked after the short special meeting of the Palomar board of directors on Friday to explain the reason for the loan, Diane Hansen, chief executive officer of Palomar, was more succinct.
“It’s simply to strengthen recovery,” said Hansen.
Palomar is currently engaged in a recovery effort, its executive told bond investors at a recent meeting on its debt of more than $ 700 million in a income obligation according to which the operation is halfway the target of $ 150 million in savings necessary to regain financial stability. The organization’s financial statements show that it has suffered a loss of $ 165 million during the year 2024 and that the trend has continued in the last six months of the calendar year.
Friday’s vote was not the first time that Palomar recently borrowed money from his neighbors. An abstention agreement that the County Health System of Inland North recently signed with its lenders after breaking its income bond clauses indicates that $ 25 million in Palomar in 2024 are announced at the end of August, without mentioning the loan, which they will associate with certain aspects of their operations. This announcement, according to the files of the Board of Directors, was preceded by Palomar and approving the loan and an “exclusivity agreement” in May 2024.
The specified term of exclusivity between Sharp and Palomar is not specified in the documents of the agenda. Sharp refused to comment on the arrangement.
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