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Lifeline thrown at clinics
By JUAN ESPARZA LOERA / Vida En El Valle
(Published Wednesday, July 2nd, 2008 09:00AM)
KERMAN -- When state budget talks dragged on last year and the Tulare Community Health Clinic did not get its Medi-Cal reimbursements, Graciela Soto-Pérez was able to use reserves to meet payroll, doctor payments and other operating expenses that that eat up almost $1 million a month.
This year, those reserves -- which were used to open a pediatrician clinic in a new building -- do not exist.
Soto-Pérez does not want to think about the possibility of shutting off service for the 19,000 patients who use the clinic had Health Net of California Inc. not stepped up with an interest-free loan.
"If it weren't for Health Net, I don't know what we were going to do to keep our doors open," said Soto-Pérez.
Her clinic will receive a $400,000 loan from Health Net, part of $5 million in interest-free loans the organization is making available to the Central Valley Health Network. The network is a coalition of 13 health clinics that operate 118 sites in mostly rural areas.
Last year, Health Net made $500,000 in loans available to help clinics that rely on MediCal reimbursements from the state to stay in operation.
"With no spending plan in place, Medi-Cal payments won't be reimbursed," said David Quackenbush, chief executive of the Central Valley Health Network. He hopes the state will have a budget in place by the end of July.
The network's clinics, said Quackenbush, employ a total of 3,000. Having those people lose their paychecks, he said, would spell bad consequences for their communities.
"A two-month interruption of Medi-Cal payments will disseminate clinics," said Quackenbush, who has seen some clinics reduce their hours of operation or shut down completely because of funding shortages.
Soto-Pérez welcomes the loan, but is also applying for a $3 million bank loan with a $15,000 fee and interest higher than the current 5.5 percent prime rate.
"I have a July 3 payroll of $200,000 to meet," said Soto-Pérez. "And, once a month we have doctor payments of $300,000."
Luisa Medina is chair of the Fresno County Children's Health Initiative. She welcomes the Health Net help.
"When clinics have no choice but to shut down, entire communities are put at risk," said Medina, who sees rural clinics as serving a vital health need for many.
"The safety net will have a huge hole left in it, large enough for many to fall through," said Medina.
If rural clinics are forced to close, said Medina, people will be forced to drive to other places or go to hospital emergency rooms for health needs. The Health Net loans, she said, "are essential to keeping our safety net intact."
Many clinics were forced to seek loans during last year's state budget stalemate. Lawmakers have already approved one round of Medi-Cal reimbursement cuts.
The Central Valley Health Network includes clinics in Fresno, Madera, Porterville, Merced, Livingston, Bakersfield, Shafter, Tulare, Kerman and Parlier.
