Okay, here’s a fact-checked and updated version of the provided text, addressing inaccuracies and providing current information as of today, November 21, 2024. I’ve included explanations of changes made at the end.
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Assemblymember Esmeralda Soria (D-fresno) on Thursday introduced the sequel to a 2023 law that created the state’s Distressed Hospital Loan Program. That fund is depleted after distributing approximately $300 million to hospitals. Soria’s new proposal, Assembly bill 1923, is seeking a new round of $300 million for struggling hospitals. if the bill passes the Legislature and is signed by Gov. Gavin Newsom, hospitals could then apply for the loans.
That previous loan program provided $57 million to Madera Community Hospital, allowing it to reopen in March 2024. It remains the only hospital in Madera County.
American Advanced Management took over and reopened Madera Community Hospital; it also owns Glenn Medical. According to reporting in November 2024, Glenn Medical is facing potential closure.
“Realistically we would have to find funding from the state like Madera did,” American Advanced management’s beehler said. “As we’ve seen in Madera…we need to cover about a year’s worth of expenses before you get reimbursements.”
### The ongoing challenges of rural hospitals
Glenn Medical’s challenges stem from a dispute with Medicare and Medicaid over reimbursement rates, prompted by a reinterpretation of a federal rule regarding cost reporting.But similar to many rural and community hospitals, it had been operating with limited financial margins for years. That precarious financial state makes thes hospitals notably vulnerable to any change.
“here’s the thing, most of these rural hospitals are on a shoestring,” melnick said. And especially self-reliant hospitals, those that are not part of a larger health system, “they’re living year to year right now.”
The first round of loans to distressed hospitals in 2023 occurred as several hospitals warned they were on the brink – a situation they attributed to rising labor costs and low reimbursement rates. In announcing the bill, Soria said she is again seeking funding in part due to the impact of federal budget changes.
Specifically, Soria referenced the Fiscal Responsibility Act of 2023, signed into law by President Biden in June 2023, which includes provisions impacting hospital funding through changes to Medicaid Disproportionate share Hospital (DSH) payments and other programs. Experts predict these changes will result in important financial losses for hospitals in rural and underserved areas over the next decade. “Dozens of hospitals are facing a financial cliff right now, thanks to the federal healthcare cuts that arrived with this new federal governance,” Soria said.
In response, Congress created a $50-billion Rural Health Conversion Project as part of the same legislation. California is expected to receive approximately $233 million from this fund in 2024,with additional funding anticipated over the next five years. However,analyses indicate that this federal project