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Health Care Finance

Miles & Stockbridge has an active and sophisticated practice serving the financing needs of health care lenders and health care providers throughout the Atlantic region.

Advising Health Care Lenders 

Because of our historically broad and diverse experience in counseling major national and regional banks and other financial institutions, our health care finance lawyers are particularly adept in providing legal counsel to health care lenders on the structure and negotiation of secured and unsecured loans and letters of credit for non-profit and for-profit health care organizations, such as:

  • Teaching and community hospitals
  • Health care systems
  • Physician and provider practices
  • Skilled nursing centers
  • Assisted living and long-term care facilities
  • Continuing care retirement facilities
  • Hospices
  • Ambulatory care centers
  • Federally Qualified Health Centers.

We handle the documentation and negotiation of loans, letters of credit, asset-based financing, special purpose financing and all other health care lending. We advise our clients on lender due diligence to evaluate risks and balance business, operational and legal needs. Although each lender has its own transactional processes and procedures, our work with a multitude of lenders enables us to suggest customized terms and provisions that benefit the lender and the borrower, as well as to build in safeguards that protect the lender's collateral in the event of default or bankruptcy.

Because we have worked on many transactions involving health care organizations, our lawyers are knowledgeable about the most complex deals, such as securitized financing for long-term care facilities. We also understand and advise health care lenders regarding risks unique to the health care industry, such as:

  • Loss of regulatory certification by acute care and long-term care centers
  • Valuation of Medicare and Medicaid receivables in a reorganization or liquidation
  • Lease costs of sophisticated and expensive health care diagnostic and treatment equipment
  • Potential compliance problems that involve federal and state fraud and abuse laws regulating kickbacks, physician self-referral and Medicare and Medicaid reimbursement investigations by the Office of Inspector General
  • New and expensive regulatory requirements, such as the costs imposed by implementing the HIPAA patient privacy restrictions.

Our in-depth experience with these and other issues results in more efficient and cost-effective service for our clients. We are able to isolate potential problems and construct safeguards in the financing documentation, enabling our clients to take advantage of business opportunities as they arise.

Advising Providers

We serve as borrower's counsel for health care providers in tax-exempt and taxable bond financing; advising these clients with respect to their overall financing needs and strategies that will help them reach their business goals.

In the non-profit arena, we regularly help tax-exempt hospitals and rehabilitation facilities satisfy their financing needs and have served both as lender and borrower counsel in financing transactions for FQHCs.

Our lawyers serve as borrower's counsel in public and private entity tax-exempt and taxable revenue bonds for hospitals and nursing homes, and in certificates of participation and lease/purchase obligations to finance hospital equipment. We structure each transaction to comply with complex tax laws and state law restrictions while enhancing value to the borrower by reducing lender risk and minimizing taxes. Our borrower's counsel services include recommending which issuer to use and evaluating underwriters' proposals. We have the ability to evaluate prospective debt issues for compatibility with our clients’ existing debt structures and to enable the availability of future financing options.