The County Commissioners Court is considering the extreme step of ceasing services to El Paso Children’s Hospital on Dec. 1 because of the hospital’s financial dispute with University Medical Center of El Paso.
Commissioners met Tuesday with the UMC Board of Managers to discuss the upcoming 2016 fiscal budget, which includes the continuation of services to Children’s Hospital.
County Judge Veronica Escobar said there is a consensus on the Commissioners Court to explore cutting the contracts with Children’s Hospital, which has filed for bankruptcy protection and may run out of money by November.
Commissioners on Tuesday requested that UMC officials to prepare a budget eliminating UMC’s expenditures to provide services to Children’s Hospital. UMC is the county’s tax-funded hospital district.
“That would mean that Children’s would need to find vendors and would need to engage in contracts with vendors, which I believe is something I encouraged them to do last year when they complained that UMC was overcharging,” Escobar said.
The Commissioners Court will make a final decision on cutting the services to Children’s Hospital in the next few weeks.
“We are under tremendous pressure on this budget, and the pressure comes from the timetable laid out for us in state law. If EPCH can come forward with a reasonable plan that the Commissioners Court and UMC can accept before we pass our UMC budget and tax rate, we can avert disaster,” Escobar said.
A meeting between the Commissioners Court and the UMC Board of Managers is scheduled for Sept. 21. Commissioners have until Sept. 28 to approve UMC’s budget, which becomes effective Oct. 1.
A financial dispute between UMC and Children’s Hospital started early last year when Children’s Hospital stopped paying UMC for rent and services.
Children’s Hospital then filed for bankruptcy protection under Chapter 11 of bankruptcy laws on May 19. Since then, Children’s Hospital pays UMC about $1.2 million a month for services such as housekeeping, payroll, food services and information technology.
The dispute on whether Children’s Hospital has to pay $860,000 monthly rent to UMC will be part of a bankruptcy hearing Monday.
A trial is set for Oct. 22-23 in El Paso in a lawsuit in which Children’s Hospital is accusing the county hospital of acting fraudulently and saying the pediatric hospital doesn’t owe as much as UMC claims is scheduled for Oct. 22-23 in El Paso.
Escobar said Children’s Hospital is expected to run out of money in November and won’t be able to give any payments to UMC after that.
“They need to wake up and come to the negotiation table in a reasonable way. If that happens, then we can all talk and hopefully there could be a joint plan. In the absence of that, we have to protect the tax payer,” Escobar said. “We gave them breathing room, we gave them time, we extended every opportunity and our generosity has come to an end,” she added.
Currently, UMC is proposing to keep the same tax rate as last year of 22.0682 cents per $100 property valuation and an expenditure budget of $590 million.
The proposed tax rate is different than what was initially proposed a few weeks ago at the first budget hearing between UMC and Commissioners Court.
UMC had initially proposed to adopt the effective tax rate for the new fiscal year, which would have represented an increase on property owners’ tax bills.
Michael NuÃƒÂ±ez, chief financial officer for UMC, said even though the adoption of the effective tax rate would have given UMC additional tax revenue of $384,000, officials decided to “do everything we can to find revenues in other areas.”
Also on Tuesday, a group of UMC workers and supporters called for a minimum $15 an hour living wage and the support of UMC officials and the County Commissioners Court to form a union.
Veronica Marquez, a medical laboratory technologist at UMC for more than 24 years, said the effort to form a union is to make sure that the employees have a voice and a better living wage.
She said there is a staff shortage at UMC and the demand for health care is overwhelming.
“We are working harder than ever, but we still can’t keep up and it’s not going to stop unless we make some changes,” Marquez said.
“We need to keep the great staff we have right now and we need to attract even more by ensuring that we have a voice on the job,” she added.
Perla Brown, a certified nursing assistant at UMC, said there are workers who have worked at the hospital for more than 20 years and they are still making under $15 an hour. She said the shortage in staff adds stress on everyone who works at the hospital.
Other workers said there are still people at UMC who make $7.50 an hour, or the minimum wage.
Hospital officials said that as part of the new budget, the minimum wage at UMC will increase to $10 an hour.
UMC President and CEO Jim Valenti said he does not believe in unions and that UMC has a record of promoting health care careers and treating its employees as family.
“We are all one family. We don’t need an outside agency to assist because we have a very good culture and values,” he said.
Paloma Martinez, communications director for SEIU Texas, a group that unites workers, said although the commitment to raise the minimum wage to $10 an hour is a good step forward for workers at UMC and El Paso’s health care industry, UMC workers will continue to work to have a union and a living wage of $15 an hour.