Clarification

Healthcare Financial Management, Nov, 2004

The August 2004 "Capital Finance" column discussed a rural hospital financing that was characterized as the first critical access hospital (CAH) financed with bonds enhanced by HUD FHA-242 mortgage insurance. The hospital in question was Rio Grande Hospital, Del Norte, Colo. It should be noted that the HUD FHA-242 program was accessed to insure the hospital's loan, and not a bond issuance, per se.

HUD and HHS both were involved in the financing. HUD notes that its Denver Multifamily Hub "closed the $10 million FHA Section 242 insured loan for the new hospital," and describes the case as "the first critical access hospital to be insured under a cooperative effort between the two federal departments." HUD goes on to say, "Unlike most not-for-profit hospitals financed through the issuance of tax-exempt bonds, Rio Grande Hospital was financed through Ginnie Mae mortgage-backed securities."

An October advertising supplement to hfm incorrectly attributed the source for the financing. The financing was provided by PNC Multifamily Capital, San Francisco.

For more information about the HUD FHA-242 program, call HUD toll free at (877) 263-0763.