The Board of Supervisors on Tuesday OK’d a $1 million loan and assistance from Riverside County agencies to keep the only emergency room in Blythe open at bankrupt Palo Verde Hospital.
Without access to emergency care at the Blythe facility, the nearly 20,000 residents in the city and nearby areas would lose access to “timely treatment for life-threatening conditions where minutes matter,” according to a county statement. The nearest hospital with emergency capability is over 70 miles away.
“This represents the county’s effort to preserve emergency medical care in the Palo Verde Valley,” county CEO Jeff Van Wagenen said prior to supervisors’ 5-0 vote. “The county provides safety net services across all of the county. We hope to stabilize the emergency department and make an assessment regarding next steps, then bring recommendations back to the board in the very near future.”
The loan agreement with the Palo Verde Healthcare District “does not solve every challenge the district faces, but it provides us breathing room to work on long-term solutions,” district board Clerk Joanna Gonzalez told county supervisors.
Van Wagenen and Supervisor V. Manuel Perez, whose 4th District includes the hospital, proposed the rescue loan earlier this month. They also called for a county health care “strike force” to come up with a plan for solving the hospital’s fiscal crisis.
Palo Verde Healthcare District administrators immediately accepted the county’s offer.
The district has only a few days’ cash on hand to fund operations, officials said. The district will be able to access loan funds as soon as it establishes a dedicated bank account for the $1 million, which will come from the county’s General Fund.
The strike force will consist mainly of staff members from the Riverside University Health System to do evaluations and identify practices focused on fixing shortfalls to, at minimum, make the emergency department solvent.
The financial deal specifies the county will have “first priority” status among the health care district’s creditors and in no way will be liable for any of the district’s debts. The loan agreement contains provision for an approximately nine-month grace period, no loan payments required.
Beginning in October, however, initial payment on loan principal is required. A 3% annual interest rate would apply starting in January 2027, and the $1 million principal must be fully paid by October 2031.
In a Jan. 14 statement, the county Executive Office noted the likelihood of the loss of emergency services at the hospital after the California Department of Healthcare Services canceled a planned “voluntary rate range intergovernmental transfer” for $9.9 million in credit for remaining operations.
The Blythe City Council approved a $330,000 bridge loan Jan. 9, which will keep the hospital’s emergency department running until the end of the month, officials said.
The state Healthcare Services Department did not respond to a request for comment.
At the end of September, the Palo Verde Healthcare District Board of Directors voted to file for federal Chapter 9 bankruptcy protection amid efforts to reduce ongoing financial losses.
Administrators said the hospital had been struggling to stay financially solvent since the beginning of the decade, as revenues diminished and the number of patients remained unchanged.
In 2023 the California Health Facilities Financing Authority provided $8.5 million from the Distressed Hospital Program, but that turned out to be a short-term fix, district officials said, expressing frustration at the time about the inability to recruit a chief financial officer who would stay the course in sorting out possible solutions. The district had four CFOs within 18 months.
“Chapter 9 is the last tool left while we work to fix the financial management challenges that have so drastically impacted the hospital during the past several years,” PVHD Board President Carmela Garnica said in an October statement. “Our community deserves a functioning hospital. We are doing everything we can to keep it open.”
Currently the emergency room is the hospital’s only open department.
The loan from the county will cover staff salaries and benefits, pharmaceuticals, equipment purchases, utilities, billing operations and some legal expenses associated with Chapter 9 proceedings, according to the loan agreement.
The health care district’s Board of Directors is independent of the county, with members elected by voters in and around Blythe, Van Wagenen said.
