System cuts costs by providing its own credit enhancement.
While many hospitals are facing increasing costs when obtaining letters of credit from commercial banks, one hospital system has found a way around those expenses. In a recent $35 million borrowing through variable-rate bonds, St. Joseph Health System in Orange, Calif., used its own strong cash flow and liquid investments as the underlying credit enhancement on the bond issue.
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D002140:California; D002202:Capital Financing / Q000639:trends*; D003363:Cost Control / Q000379:methods; D005377:Financial Management, Hospital / Q000639:trends*; D009096:Multi-Institutional Systems / Q000191:economics*