Acute care hospitals Key Requirements:
The past three years’ average operating margin is positive*
The past three years’ average debt service coverage ratio is at least 1.25x*
No more than 50% of the adjusted patient days are attributable to chronic
convalescence and rest, drug and alcohol, epileptic, nervous and mental, mental
deficiency and tuberculosis (
) *Hospitals recently
certified as Critical Access Hospitals may recast the past three years’ historical financials pro forma for the Critical Access Hospital designation
At least 20% of the loan proceeds must be utilized for facility renovation, expansion or acquisition. Up to half the funds used for renovation and expansion may be applied to the purchase of new equipment. Up to 80% of loan proceeds may be used to refinance existing debt.
Not-for-profit, government-owned or for-profit hospitals
Maximum loan amount is 90% of replacement value.
Construction term plus 25-year fully amortizing permanent loan
Negotiable terms. Typically, five-year lockout with 5% penalty in the sixth year, reducing 1% each succeeding year.