Bonds Issued For Wyoming Medical Center; Hospital To Save $373,000 A Year
The Wyoming Medical Center will save about $373,000 a year on its debt service until 2032 after the approval Friday of the issue of $12 million in bonds to refinance the remainder of a $20 million bond.
What this means for patients' bills remains to be seen.
"Wyoming Medical Center continues to look for ways to be good stewards of our financial resources and cut health care costs wherever we can," hospital spokeswoman Kristy Bleizeffer said in an email.
The refinancing comes six years after 2011, when the three governing boards related to the Wyoming Medical Center authorized the issuance of $20 million of bonds to partially fund the $38 million project now known as the McMurry West Tower.
The WMC has paid down about $8 million of that.
Meanwhile, bond interest rates became favorable for investors.
Last month, Michael Persichitte, vice president of the Denver office of George K. Baum & Co., outlined the advantages of the refinancing to the Natrona County Commission, which gave a tentative approval to the refinancing.
Friday, Persichitte said the market improved since that meeting. "So interest rates went down a little bit which helped us achieve more savings, honestly."
The hospital has strong debt service coverage, a low debt load, a lot of liquidity and cash-on-hand, which is good for a hospital given the uncertainties in health care, he said.
The Moody's Investors Service rates the Wyoming Medical Center as A3, which is highly rated for a hospital of this size, he said.
Working with the hospital's bond trustee, the Denver branch of the Salt Lake City-based Zion's Bank, Persichitte offered the bonds for sale on Thursday, he said.
The offer attracted $31 million orders in prospective buyers, and he obtained commitments to sell the $12 million in bonds, he said. "Overall, it was a very successful day."
But the deal couldn't become formal until a special meeting of three groups.
But first, some history.
Until 1986, Natrona County government operated the 75-year-old Natrona County Memorial Hospital.
That year, the nonprofit corporation Wyoming Medical Center, Inc., was created. It leased the brick-and-mortar hospital assets mostly in the 1200 blocks of East Second and East Third streets. The WMC has its own board of directors with representatives from the community at large and the hospital's medical staff.
In exchange for providing health care, the Wyoming Medical Center's lease requires it to care for indigent -- unable to pay -- patients and prisoners at the county jail, and to maintain the physical plant. The 10-year lease was renewed in 2015.
A five-member board of trustees of the legal entity known as the Natrona County Memorial Hospital (the name of the original hospital) oversees the lease.
The five-member board of trustees of the Natrona County Memorial Hospital is appointed by the elected Natrona County Board of County Commissioners.
All three boards must participate when the Wyoming Medical Center needs to finance a bond.
The Board of County Commissioners is the only entity that can authorize the sale of bonds because it owns the hospital assets, and it needs the support of the intermediary Memorial Hospital board of trustees.
To start the process on Friday, the board of trustees held a public meeting and passed a resolution authorizing the nonprofit Wyoming Medical Center, Inc., to ask the Natrona County Commission to issue the bonds.
The Wyoming Medical Center board of directors then held a brief meeting to pass a resolution to authorize the refinancing.
The Natrona County Commission then held a meeting and voted to approve the bond issue.
The county is not liable, nor does it pay for the bonds. The bonds are paid from the Wyoming Medical Center's revenues.
When the paperwork is finished, the bonds will be sold, Persichitte said.