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Imperial Valley Hospitals receive $28 million from Distressed Hospital Fund


As Imperial County is moving into creating a single medical district, there was a ray of good news the morning of Aug. 24 as it was announced that El Centro Regional Medical Center and Pioneers Memorial Hospital received a $28 million loan targeted for hospitals in distress.

The Department of Health Care Access and Information (HCAI) is taking action to support community hospitals struggling financially by awarding close to $300 million in no-interest loans to 17 healthcare facilities under the Distressed Hospital Loan Program, announced earlier this year by Governor Gavin Newsom.

“Today we have provided much-needed assistance to community hospitals across the state that desperately need financial help to provide the care their communities need,” said HCAI Director Elizabeth Landsberg. “I’m grateful to the Legislature for spearheading this effort to help make sure these vital healthcare institutions are fiscally stable so they can continue to provide quality, affordable healthcare for all Californians.”

The program, established through Assembly Bill 112, offers interest-free, working capital loans to nonprofit and publicly operated financially distressed hospitals, including facilities that belong to integrated healthcare systems with less than three separately licensed hospital facilities.

The Distressed Hospital Loan Program is jointly administered by the California Department of Health Care Access and Information (HCAI) and the California Health Facilities Financing Authority (CHFFA) at the California State Treasurer’s Office. The two departments have notified the eligible hospitals what loan amounts they have been approved for, with the loans scheduled to be released in the coming weeks.

“The Distressed Hospital Loan Program extends a lifeline to economically underserved hospitals, like those in our rural area, struggling to keep their doors open. We are grateful that our legislative efforts have delivered resources to protect access to emergency healthcare services in our district and help save lives,” said Assemblymember Eduardo Garcia.

“We stepped up to create the Distressed Hospital Loan Program to ensure an eligible source of relief for our community’s urgent healthcare crisis. In partnership with the Governor and Legislators in districts experiencing similar challenges, we moved quickly to provide aid and prevent closures in underserved areas. We welcome this loan announcement as we continue other legislative initiatives underway to protect and improve access to medical care.”

ECRMC Board Chairperson Tomas Oliva said this was good news for Imperial County residents as this will assure the community that hospitals will continue serving the community.

“This shows that we will stay open and this money will help us free up money from our budget so we can provide services to our residents,” Oliva said.

The loan will be used to work on capital improvement projects for the hospital including the seismic retrofitting it needed.

“We are 92 percent complete and with this loan, we will be at 100 percent,” Oliva added.

Oliva highlighted that El Centro Regional Medical Center has once again been accredited by The Joint Commission’s Gold Seal of Approval for Hospital Accreditation by demonstrating continuous compliance with its performance standards.

ECRMC has been awarded its ninth consecutive hospital accreditation from The Joint Commission. The Gold Seal is a symbol of quality that reflects a healthcare organization’s commitment to providing safe and quality patient care.

ECRMC underwent a rigorous, unannounced onsite review on February 21-24, 2023. During the visit, a team of Joint Commission reviewers evaluated compliance with hospital standards spanning several areas including, infection prevention and control, emergency management, leadership, environment of care, and medication management.

LAFCO Meeting 

The announcement of this funding coincided with a Local Agency Formation Commission where an update on AB 918 was given although no action was taken. Blanca Elena Morales Grijalva, representing the citizens of Calexico, submitted a complaint against Heffernan Memorial Healthcare District for the gift of public funds and misuse of public funds.

The complaint was submitted to the Imperial County Grand Jury, Imperial County District Attorney, Attorney General Office, and California Fair Political Practices Commission.

“This District does not own or operate health facilities. The primary activity of this district is grant allocations rather than management of healthcare programs,” Morales said.

She questioned the proposed urgent care facility located at 400 Mary Avenue in Calexico. The property was purchased by the district in 2014. In 2020, the construction bid was $2.2 million. As of this month, the building is not complete.

“Has LAFCO calculated the purchase price cost; soft costs including architecture and engineering; cost of construction; fees; security services; permits, etc…… Does the District have a timeline? Where’s the transparency?” Morales stated.

Litigation Against El Centro

In a letter submitted by City Manager Cedric Ceseña, he explained the city was forced to file a lawsuit due to LAFCOs, with a pending injunction, for their non-compliance with the CEQA process.

“This pertains not only to its ownership of the property housing El Centro Regional Medical Center but also to the fact that the focal “project” involves establishing a countywide healthcare district. The LAFCO commission should prioritize adherence to this process. Conducting a feasibility study and related studies within the appropriate and required framework is crucial, as their validity could be subject to questioning otherwise. Apart from the CEQA concerns, Imperial LAFCO has displayed a consistent tendency to overlook legal obligations,” the city manager stated.

Ceseña said that attempts to contact their legal counsel have failed but are looking forward to working together and coming to a resolution.

For this reason, LAFCO allocated an additional $40,000 from their budget that will be used for this litigation.

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