Charity for New Hospital

The amount of debt that will be issued to build a new state hospital in New ­Orleans could be pared by $55 million to $100 million of expected additional federal reimbursements for hurricane damage to shuttered Charity Hospital.

The current financial plan for ­construction of the new $1.2 billion ­Louisiana State University hospital includes up to $500 million in revenue bonds and $475 million from the ­Federal Emergency Management Agency in ­compensation for the hurricane damage to Charity’s structure.

A three-judge arbitration panel awarded the money to the state in late January. FEMA had originally offered $23 million in compensation damages, but later raised the offer to $150 million.

The additional money would be ­compensation for the old hospital’s fixed contents, including medical equipment.

LSU is seeking to enhance the proposed bonds with mortgage insurance from the U.S. Department of Housing and Urban Development.

The debt would be issued by a newly created governing board that includes representatives of the governor and local medical schools.

The state hospital will be the primary teaching center for medical students and post-graduate residents at LSU, Tulane University, and other New Orleans-area universities. It would be one of 10 state hospitals that provide indigent care and medical education in Louisiana.

For reprint and licensing requests for this article, click here.
Higher education bonds Healthcare industry
MORE FROM BOND BUYER