Bill > H978

This bill expands the Distressed Hospital Fund, which is a fund established to help struggling hospitals, to also support a moral obligation bond program, which is a type of bond where the issuer has a strong ethical commitment to repay but not a legal guarantee. Specifically, it creates a new "Community Hospital Short-Term Loan Fund" that will be funded by up to fifty percent of the required debt service reserve fund amount for any new bonds issued for nonprofit community hospitals, with a maximum of ten million dollars. This new fund is intended to help nonprofit community hospitals that fail to repay the state for transfers made to replenish a capital reserve fund. If a hospital doesn't repay the state within six months, it can access the short-term loan fund, but must fully repay that fund within twelve months. If the hospital still fails to repay, the Secretary of Administration and Finance can direct the state comptroller to withhold any funds owed to the hospital to cover the debt. Additionally, contracts for health insurance paid for by the state will require third-party payers to withhold payments to hospitals or health centers that fail to reimburse the commonwealth, and transfer those withheld funds to the state, which will be considered as if the hospital or health center had made the payment.