A Riverside County “strike team” composed of medical professionals, inventory specialists and those with expertise in healthcare finance will deploy Monday to bankrupt Palo Verde Hospital in Blythe to initiate a six-month assessment and stabilization effort to keep the doors to the emergency room open.
On Thursday, the Palo Verde Healthcare District Board of Directors approved a Management Services Agreement with the county that clears the way for staff from the Riverside University Health System to move forward with a 180-day support plan, with the long-term goal of maintaining emergency operations at the cash-strapped hospital. The county team is ready to start lending a hand on Feb. 23.
“This has always been about the people of Blythe,” Fourth District Supervisor Manuel Perez said. “Access to care in this region is essential, which is why my colleagues on the Board of Supervisors and I voted to support this hospital. This agreement allows us to protect emergency services while we study the best path forward for the hospital and the families who depend on it.”
Last month, the board approved a $1 million loan, drawn directly from the General Fund, to bolster the hospital, and additionally authorized formation of the strike team.
RUHS CEO Jennifer Cruikshank said staff from the RUHS Medical Center in Moreno Valley and clinics countywide are “ready to hit the ground running” next week in Blythe.
“We aren’t just here to manage a transition; we are here to support the incredible frontline staff and ensure that every resident has access to the high-quality, stable care they deserve,” she said. “We are diving in on day one with a clear focus on operational excellence.”
Last month, Palo Verde Healthcare District Clerk Joanna Gonzalez acknowledged that the county loan “does not solve every challenge the district faces, but it provides us breathing room to work on long-term solutions.”
Without emergency services at the Blythe facility, the area’s roughly 20,000 residents would lose access to “timely treatment for life-threatening conditions where minutes matter,” according to a county statement in January.
The monetary agreement specifies the county will have “first priority” status among the healthcare district’s creditors and will under no circumstances be liable for any of the district’s debts. The loan structure calls for a roughly nine-month grace period, during which no payments on the loan are required. However, starting in October, initial payment on loan principal will be necessary. A 3% annual interest rate will be assessed beginning January 2027, and the $1 million will have to be fully amortized by October 2031.
Without the hospital, the nearest option for emergency healthcare would be more than 70 miles away.
In a statement on Jan. 15, the Executive Office highlighted the likelihood of the loss of emergency medicine at the hospital after the California Department of Healthcare Services nixed a planned “voluntary rate range intergovernmental transfer” that would’ve extended $9.9 million in credit for remaining operations.
The Blythe City Council also has since approved a $330,000 bridge loan to help sustain emergency room operations.
At the end of September, the PVHD board voted to seek federal Chapter 9 bankruptcy protection while efforts were made to stanch ongoing financial losses.
Administrators noted the hospital had been struggling to remain afloat since the start of the current decade, with revenue streams withering while patient loads remained unchanged.
The California Health Facilities Financing Authority extended an $8.5 million infusion from the Distressed Hospital Program in 2023, but that turned into a short-term fix, according to the district. Administrators expressed frustration at the time about the inability to recruit a chief financial officer who would stay the course in sorting out possible solutions. Four CFOs came and went in an 18-month span.
Only the emergency room remains open. All other hospital facilities have been shut down.
The county loan will pay for staff salaries and benefits, pharmaceuticals, equipment purchases, utilities, billing operations and some legal expenses associated with Chapter 9 proceedings.
County CEO Jeff Van Wagenen emphasized that the healthcare district’s board is independent of the county, its members elected by voters in and around Blythe. Neither he nor Perez mentioned the possibility of a wholesale county takeover of the hospital’s emergency department, though that prospect may later surface as a long-term solution.