title: Recycling pool provides innovative financing for an integrated system.
abstract: Not-for-profit integrated delivery systems require innovative financing mechanisms to compete effectively with expanding for-profit systems. The Massachusetts Health and Educational Facilities Authority (Mass HEFA), in collaboration with Partners HealthCare Systems, Inc., Boston, Massachusetts, developed such a mechanism--a capital asset recycling pool funded through a $150 million bond issue. The recycling pool gives Partners flexible access to tax-exempt capital to fund routine capital expenses across the system and has enabled the system to centralize control of capital resources. Over the pool's 30-year life-span, Partners will be able to issue tax-exempt loans from the pool to any of its affiliates or, with Mass HEFA and insurer approval, transfer the funds to outside organizations. When the loans are repaid, the funds remain available and can be recycled at no additional cost to fund further capital projects. Creation of the pool was made possible by Partners' outstanding credit, strong market position, expanding primary care network, and substantial unrestricted net assets.
authors.affiliation: Massachusetts Health and Educational Facilities Authority, Boston, USA.
authors.forename: R J
authors.initials: RJ
authors.lastname: Ciolek
authors.forename: P A
authors.initials: PA
authors.lastname: Fahy
mesh_terms: D001900:Boston; D002202:Capital Financing / Q000379:methods*; D003299:Cooperative Behavior; D019033:Delivery of Health Care, Integrated / Q000191:economics*; D004465:Economic Competition; D006077:Government Agencies; D008404:Massachusetts; D009936:Organizational Innovation; D009939:Organizations, Nonprofit / Q000191:economics*; D019464:Tax Exemption