St. Luke's University Health Network recently paid off existing bonds that were becoming a hardship for Carbon County and hindering community efforts. The bonds, guaranteed by the county, were held by the Blue Mountain Health System prior to merging with St. Luke’s in 2018.
Andrea Andrae, director of finance, St. Luke’s Lehighton Campus, explains that Blue Mountain Health System issued $20,000,000 of bonds in December 2015. The proceeds from the sale of the bonds were used to fund a portion of the hospital’s outstanding pension liability, benefiting both past and current hospital employees who were vested in the benefit plan. “The bonds were secured by the county who pledged faith, credit and taxing power for the full and prompt payment of the principal and interest should there have been a default on the part of the hospital,” explains Andrae. “That means that if the hospital were to default on the bonds, the county would have had to make payments, which would have caused financial strain for the county.”
Carbon County stepped up to support Blue Mountain Health System in a time when its future was in question. When St. Luke’s merged with Blue Mountain, it was important for St. Luke’s to remove the liability from the county and work with the community to create a nationally-recognized system for quality, rural health care services and increase access to physician specialists.
“The Carbon County Board of Commissioners is thankful to St. Luke’s University Health Network for refinancing the Blue Mountain Health System bond,” says Wayne Nothstein, chairman, Carbon County Board of Commissioners. “The bonds were issued at a time when the Board of Commissioners felt that it was in the best interest of Blue Mountain Health System hospitals, employees and residents to continue to provide quality health care facilities here in Carbon County. We are grateful that St. Luke’s is partnering with us in assuming this liability and securing a new bond to continue to improve specialized health care and facilities in Carbon County.”
St. Luke’s is committed to keeping care close to home for residents in Carbon and surrounding counties. For many decades, people of the county were required to travel many miles for certain procedures or specialists, often leading to gaps in care or delays. “The county took a risk that gave the hospital time to seek a partner who saw potential in the county and the future of health care in the community,” says John Nespoli, president, St. Luke’s Lehighton & Carbon Campuses. “We see the community as our partner in achieving the wonderful vision of comprehensive care in Carbon County, where it will be rare to leave the area for services.”