Puerto Rico Economic Development Bank lending doctors up to $50,000
SAN JUAN – The Economic Development Bank will be offering emergency loans of up to $50,000 to help physicians reopen their practices after the damage left by Hurricane María.
Nearly 1,000 doctors’ offices where affected “directly or indirectly” by the major storm, and this loan could help medical professionals resume operations without having to wait until the insurance payout, argued Dr. Víctor Ramos, president of the Puerto Rico Surgeons and Physicians Association.
“Although the insurance commissioner issued an order stating that doctors were among the priority people for insurance, that [insurance companies] had 15 days to pay, the reality is that isn’t happening because of the avalanche of claims they have and the inability of the [insurance] industry, since it was all so much, to make [the payments],” Ramos stated.
This loans are expected to slow down the healthcare sector’s brain drain, which increased since the Category-4 hurricane it the island. “If before María there already was a talent drain, an exodus in the healthcare industry, the government needs to do everything possible to stop that problem,” EDB President Luis Burdiel said.
The loans will come from a $10 million EDB fund, although Burdiel expect the disbursement for the healthcare sector, not just physicians, will be of about $4 million. Said fund was created from the bank’s own capital after it sold several investment portfolios.
Burdiel explained that loan recipients could use the cash for “operational capital, payroll, structural repairs and acquiring equipment.” Another characteristic of these loan is that the first repayments are deferred for the first six months do not accrue interests.
Since this emergency loan is seen as a short-term bridge loan, Burdiel said the grace period will allow doctors to restart their practice before insurance companies pay. Said payout can be used as collateral for the loan, which recipients can use to later cancel all or part of the loan.
The EDB president stressed that the bank’s administrators are aware of the difficulties healthcare professionals face when trying to find funding.
“Commercial financing for doctors today is a bit uphill in private banking, in commercial banking, and that’s a gap the Economic Development Bank has a duty to fill,” Burdiel said.
As for the brain drain, the surgeons association president identified problems with medical insurance companies as the main issue doctors face on the island. To address their grievances, Ramos suggested the government increase regulation for healthcare plans, such as prohibiting unjustified cancellation of payments from health insurance companies.