California lawmakers OK emergency loans to failing hospitals
California lawmakers have agreed to loan $150 million to financially distressed hospitals
SACRAMENTO, Calif. (AP) — Alarmed by the closure of a rural hospital earlier this year, California lawmakers on Thursday voted to loan $150 million to struggling medical centers in the hope of preventing a cascade of similar failures across the state.
The only hospital in Madera County closed in December, leaving the community of nearly 160,000 people with no medical center within a 30-minute drive. The closure was a startling reminder of the plight of many community hospitals in mostly rural areas of the country that have struggled to stay open during the coronavirus pandemic.
Since then, hospitals in El Centro, Montebello, Hawkins and Visalia have all teetered on the brink of collapse, with one declaring bankruptcy and another being taken over by a state university to prevent its closure. A report last month paid for by the California Hospital Association warned that 20% of the state's more than 400 hospitals were at risk of closing.
California lawmakers typically don't approve new spending until June following months of debate and negotiations with the governor's office. But the crisis is so severe that legislative leaders and Gov. Gavin Newsom agreed to go ahead and spend this money now, pledging to do more later in the year when the budget is finished.
