El Centro (Calif.) Regional Medical Center was one of 17 struggling California hospitals to receive zero-interest loans from the state; hospital CEO Pablo Velez, PhD, RN, plans to use the loan for a number of different hospital improvements.
The hospital has faced significant fiscal challenges. In April, El Centro Regional Medical Center released data showing that its operating income was $17.8 million under budget for the fiscal year to date as of March 31.
Earlier in the year, its CEO and CFO both resigned after the hospital accepted a termination notice from its management company. Dr. Velez was named CEO in April.
El Centro initially sought $40 million from the newly created Distressed Hospital Loan Program to keep its doors open. In August, the state awarded $28 million, one of the larger loans through the program to the hospital.
Dr. Valez told Becker's that the hospital will use $3.5 million of the loan to complete a long-delayed transition to a Cerner EHR system.
"The EMR project is needed to centralize data collection, sunset antiquated systems, improve patient scheduling, and enhance revenue cycle processes that would generate greater revenue and cash flow collections," Dr. Velez said.
Additionally, the loan will help the hospital meet state-mandated seismic requirements. El Centro will use $12.4 million of the loan for seismic construction and ancillary services building. The hospital will use $2 million of the loan for deferred maintenance capital projects.
Beyond capital expansion and EHR installation, the loan will also ease the financial burden on the hospital. El Centro plans to use $2.1 million for accounts payable and working capital and $8 million for bond principal and interest.