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California delivers multimillion-dollar aid to distressed hospitals

For immediate release:

SACRAMENTO, CA— Two struggling hospitals in Assembly Speaker Robert Rivas’ district will receive immediate, multimillion-dollar financial assistance from the state, the result of an urgent and coordinated effort to bolster distressed hospitals operations and improve regional health-care services.

On Thursday, Governor Gavin Newsom’s office announced zero-interest loans for 17 state hospitals, including Hazel Hawkins Memorial Hospital in San Benito County and Watsonville Community Hospital in Santa Cruz County. As part of the Distressed Hospital Loan Program, the state allocated a total of $300 million to California hospitals most in need.

Democratic Assemblymember Esmeralda Soria of Merced authored legislation to launch the loan program in response to the closure of Madera Community Hospital in her district. Soria’s bill was quickly signed into law by the governor earlier this year.

“I commend Assemblymember Esmeralda Soria and Governor Newsom for their leadership, and I am grateful that two Central Coast hospitals will see immediate financial assistance,” Speaker Rivas said. “I’m also proud that our state has been able to provide a lifeline to many small, rural hospitals, which are closing at record rates in other states, but California has shown a commitment to maintaining access to care for all. We have a lot of work to do to ensure that our communities continue to have the best health-care services. I am very pleased we were able to quickly deliver this financial help to our hospitals that need it most.”

Hazel Hawkins will receive $10 million as part of the program, and Watsonville Community Hospital $8.3 million.

Madera Community Hospital closed its doors in January, and Soria quickly responded in February with legislation. The governor passed the bill into law this May. Distressed hospitals applied for $300 million in zero-interest loans, and Madera hospital is now eligible for the largest sum, $50 million in assistance.

The program created by Soria will strengthen hospital services across California and put Madera Community Hospital on the path to reopening.

“I’m proud to have led this effort, and am grateful the Legislature and Governor moved quickly to ensure vulnerable communities across California have health care access when they need it most,” Assemblymember Soria said. “We’ve delivered $300 million in immediate aid. And in the Central Valley, Madera Community Hospital is on the path to receive $50 million in financial assistance. This is tremendous news, and I’m hopeful Madera will reopen. We have more work to do, but this is a major step in the right direction.”

Central Coast lawmakers also celebrated the announcement as a crucial step in supporting hospitals in vulnerable communities.

“It brings me tremendous relief to know that Madera Community Hospital and Hazel Hawkins Memorial Hospital, in San Benito County, have received grant awards and will be able to ensure that community members can once again receive services in their own communities,” Senator Anna Caballero said. “When seconds mean the difference between life and death, we cannot afford to have hospital doors closed. Today is a great day for the region.” 

“I am deeply grateful that this additional funding has been authorized to support badly needed healthcare for underserved residents in Hollister and Watsonville,” said State Sen. John Laird (D-Santa Cruz). “The Watsonville Hospital board and staff have set a standard for accountability and transparency in their recovery, and I am hopeful that the Hazel Hawkins administration shows the same organizational determination to remain a sustainable force in the community.”

For more information regarding the loan program, visit here.