rent-not-veThe Texas Health and Human Services Commission filed an objection with the bankruptcy court yesterday in regards to the El Paso Children’s Hospital. As you know, today is the deadline the county commissioners gave the children’s hospital to accept the county’s proposal to have UMC take over the children’s hospital. The deadline is necessary because the county must finalize its budget tomorrow. The county needs to know how much money the children’s hospital will need to remain viable long enough to either be absorbed by UMC or have a financial suitor come to its rescue.

Because of the potential for an additional debt that the children’s hospital is facing due to the rent that wasn’t really rent, the opportunity for a financial rescue by a third party is near impossible. The children’s hospital is hoping a suitor can step forth if UMC, and by extension, the County, were to accept a significantly reduced rent.

The problem is that the budget deadline makes it almost impossible for the county to negotiate a rent adjustment before it must file its budget. It is possible, and something that Veronica Escobar’s court may consider, is to set a budget on the condition that it may have to be adjusted at a later date.

Remember that the court previously approved a taxpayer-funded credit line, also known as an anticipation line, to fund UMC operations while it waits for federal funds to become available.

Although not intended for that purpose, it is possible that the county commissioners may allow the new budget cycle to include a nebulous settlement for children’s. It is for the children, will be the rallying cry.

Veronica Escobar’s goal, from the onset, has been to take control of the children’s hospital for access to greater tax funds.

However, yesterday’s filing by the Texas Health and Human Services Commission has made it much more difficult for both children’s and UMC. Or, has it?

THHSC’s objections centers on the notion the lack of specificity by children’s on who could be the prospective “strategic partner” that it has neglected to identify.

The other, more serious objection brought forth by THHSC is that the plan filed by children’s attempts to impede THHSC from recouping any lost monies it may identify at a later date. Obviously, the lost monies would be the rent that isn’t rent that resulted in Medicare payments that children’s has already received.

The objection goes on to argue that not knowing who a potential financial suitor makes the plan invalid because Medicare/Medicaid programs require specific conditions for contractual obligations. In essence, the potential suitor may not have the capability to contract with the federal government to accept health dollars for services.

As you can clearly see, the state’s agency that administers the federal health dollars has identified a potential liability that would require children’s to refund federal dollars. At this point, no one knows the true dollar amounts.

Each new document points to the rent that wasn’t rent as being nothing more than a fraud.
Is this why Veronica Escobar is so desperate to get UMC to take over the children’s hospital?

As a department of UMC, children’s liabilities can be hidden behind creative budgets and shielded behind executive sessions that governments enjoy. As an added bonus for Escobar, a government agency would be happy to “wink-wink” the fraud away.

Martin Paredes

Martín Paredes is a Mexican immigrant who built his business on the U.S.-Mexican border. As an immigrant, Martín brings the perspective of someone who sees México as a native through the experience...