After default, Lakeway hospital in survival mode
By Mary Ann Roser, Austin American-Statesman | |
McClatchy-Tribune Information Services |
The hospital is in default on its federally guaranteed mortgage loan -- which HUD officials called "an exceedingly rare" event. HUD is paying back the previous lender with money from an insurance fund that is financed by hospitals in its mortgage program, not with taxpayer dollars, officials said.
The hospital's board is examining various options to restructure. Those could include seeking more investors or a buyer for the hospital, Sossi said.
In 2010,
Investors who filled out the HUD application said that because
So have the patients.
"It's a big question whether there was a need for a hospital the size of LRMC," said
Nor did
Months after opening in
In September,
HUD officials say they step into the shoes of the lender, and the agency's responsibility is to ensure that the hospital has sufficient resources to operate until the note can be sold or its finances stabilize. They haven't set a deadline for the hospital to solve its financial problems.
On
Hospitals pay mortgage insurance premiums to cover lenders in the program in case of a default.
HUD officials emphasized that taxpayer money isn't involved, and that some losses incurred by the fund can be recovered if the note is sold.
Also, if the note gets sold, the hospital is no longer in HUD's program.
Asked why another lender would come in, HUD officials said it could be attractive to another lender, given that the hospital has value and insurance claims have been paid.
On"We are moving in the right direction; we're just not moving fast enough," MacLeod said.
Sossi said the board is recruiting more doctors, which should also bring in more patients. Asked about complaints the
"We are working with the community in trying to improve the reputation of the facility and make it a place people want to go," Sossi said. "It's a hospital in a good place doing good things."
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