Thompson already knows that the project is entirely feasible, based upon both internal and external projections. Initially, when the health system was applying for financing through HUD, the health system underwent a lengthy financial feasibility study. This study took into consideration a number of factors including population growth, the age of the local population, the payer mix, the age of and specialties among the medical staff, and predicted advances in technology. The conclusion was that Thompson will remain financially healthy through 2014 (the limit of the study), a conclusion that mirrored the findings of Thompson’s own Finance Department, which has conducted its own extensive feasibility studies.
Subsequent to HUD’s report, community lending practices among banks eased up and Thompson is now in a position to receive financing from a commercial bank. The terms are much more favorable than those offered by HUD, and Thompson will save hundreds of thousands of dollars on the closing costs and on the cost of refinancing existing indebtedness.