AmbergrisCaye.com Home Forums About Belize Nation GOB bails out Universal Health Svcs for AC land?

Universal Health Services (UHS) will become a public hospital. According to a statement issued from the Office of the Prime Minister today, Cabinet met on Tuesday, December 5, and approved the purchase of a two-thirds stake in the private hospital.

How can the financially challenged Government purchase majority stake in the private hospital? GOB is not paying UHS any cash, but has, instead, decided to pay the hospital's multi-million-dollar debt with the Belize Bank. That also begs the question: how will GOB pay the Belize Bank? At press time, however, no details on the financial aspects of the transaction were forthcoming. Our sources say the Lord Ashcroft bank will receive extensive real estate on San Pedro Ambergris Caye.

According to today's Cabinet release, "Government proposes to enter an agreement to settle Universal's debt owing to the bank in exchange for two-thirds ownership of Universal."

UHS would have to repay GOB and also settle its existing debt with the DFC.

Despite numerous attempts, we were unable to speak with Minister of Health, Hon. Joe Coye, on the arrangement; however, Cabinet Secretary, Robert Leslie, elaborated somewhat. He said that Government wouldn't be taking on the full debt that UHS owes, but that UHS would still have to pay a portion. When we asked for the numbers, he said that the numbers would have to be clarified.

At the public hearing of the Commission of Inquiry into the DFC, it was revealed that DFC stood to lose $29 million in the event of UHS's total default, but the assets held as collateral were valued at $22 million. The Belize Bank has the first mortgage and the DFC the second mortgage.

According to UHS chairman, Dr. Victor Lizarraga, the UHS had originally applied for a DFC loan of $28 million, but because the DFC was not supplying the funds in a timely fashion, they had to go the Belize Bank for "bridge financing," which would have been a temporary loan until the DFC funds came through. This was why there was the DFC guarantee, he said, because the bank would only have approved the loan with a sovereign guarantee. But according to Dr. Lizarraga, the DFC funds never came through, and so the loan stayed with the Belize Bank, which capped it at $17 million.

He said that the whole cost of the project to build the UHS hospital, located in the Coral Grove area, was about $14 million: the building cost $8 million, equipment cost $4 million and surgical supplies cost another million. $3 million from that loan went back to paying interest, he added.

Last December Lizarraga had threatened to sue the DFC:

"I'm going to sue the 'frigging' DFC, I'm telling you," he had said.

"On what grounds?" we had asked

"Because they did not comply with the September 2002 agreement. It was not complied with," Lizarraga added. "And not only that, but they knew from April last year [2003], that there was a problem. I have correspondence to show that.

"They know that! This is not a joke! If they think they will take this make a joke, they will find out who will be responsible…"

The major shareholders in UHS are Lizarraga, Luke Espat and a group of over 20 doctors. Lizarraga declined to say what the stake of each shareholder is, but informed that he is the major shareholder, currently, in UHS.

We note that when we contacted the CEO of KHMH, Dr. Alvaro Rosado, and chairman, Israel "Pie" Marin, about the decision to amalgamate the services of UHS and KHMH, both of them said that they had not seen the proposal and are not aware of the details, but they had heard that a deal was being considered.

According to Dr. Rosado, he only learned of Tuesday's Cabinet decision during the lunch hour today when he was listening to the mid-day news.

http://www.amandala.com.bz/index.php?id=5206

Yet another example of the P U P bigwigs taking care of themselves and thier friends with OUR tax $.

Musa: Belize Bank Will Accept Land for Universal's Debt
posted (December 12, 2006)

By now you know of government's plans to amalgamate the Karl Heusner Memorial Hospital and Universal Health Services. Government will take control of two thirds of Universal and in so doing it'll be taking on the $32 million which Universal owes to the Belize Bank and on which there is a sovereign guarantee attached. Universal owes the Development Finance Corporation another $12 million. So how will the merger work? Well the information released so far has been vague and broad. The devil is in the details they say and today in his first interview about the merger - Prime Minister Said Musa said that Belizeans won't have to pay for the $32 million owed to the Belize Bank. Why not? Musa told Keith Swift that the Belize Bank has agreed to accept land to cover the debt.
Rt. Hon. Said Musa, Prime Minister
"The proposal, as I have seen it, will result in first of all the DFC getting back some of its money. The debt with the Belize Bank will be squared away by a land transfer which will involve that company or the company that they will be financing making a major investment in Belize of about $150 million."

Keith Swift,
Who will?

Rt. Hon. Said Musa,
"The Belize Bank. In other words the government will not have to pay out any money in order to acquire the Universal facility, two thirds of it anyway."

Keith Swift,
So you're saying that in place of the money that Universal owes the Belize Bank, government is going to give the Belize Bank land?

Rt. Hon. Said Musa,
"The government will take over the debt, if you like, and instead of paying cash for it, they will be a land transfer which will involve another major investment, private sector investment in the country of Belize. The advantage of the government doing it this way is that if we were to leave things to just fall apart and Universal went into bankruptcy, the Belize Bank would end up with Universal and the people will be no better off."

Keith Swift,
But won't concede that Universal should not have been given a sovereign guarantee?

Rt. Hon. Said Musa,
"Well you can go back over the past as much as you like. What I am saying is that we are converting a situation now into a positive. It will bring greater healthcare for the people of Belize."

Keith Swift,
But it could have been prevented.

Rt. Hon. Said Musa,
"Well you want to get an argument. I am telling you what is the situation now and where we are going with it."

Keith Swift,
So what is Belize Bank going to do with the land they will be receiving?

Rt. Hon. Said Musa,
"I am just saying that they will make a substantial investment, I am told it will be as much as a $150 million investment in a hotel project in Belize."

Keith Swift,
Where is the land located?

Rt. Hon. Said Musa,
"It will be North Ambergris."

Musa wouldn't state the size or value of the land on Northern Ambergris Caye. The medical staff at the KHMH have voiced their opposition to the plan and will be meeting with the Minister of Health on the issue later this week.

Find this article at: http://www.7newsbelize.com/archive/12120601.html

anyone here ever been a patient at Karl Huesner?

Did not social security get ripped off buying a large tract of land there as well a couple of years ago?

It is an outrage.

In the meantime, go to the San Pedro Daily http://www.sanpedrodaily.com/ page and scroll down the page to look at a letter about a subject that has got most thinking people hopping mad on the island. Seems like the government can take care of their hacks at our expense but can't do their jobs at our expense.

PUP = Pick Ur Poison

Rt. Hon. Said Musa, Prime Minister
"The proposal, as I have seen it, will result in first of all the DFC getting back some of its money."

I'M CONFUSED!!!!!

But according to Dr. Lizarraga, the DFC funds never came through, and so the loan stayed with the Belize Bank, which capped it at $17 million.

WHO'S LYING?

This is scary! Remember ministers in Belize have the power to 'dereserve' reserved land. That is to say that if the minister sees fit he/she can sell/trade/give lands set aside for nature reserves to private interest.
Or by comparison one could say, if the president of the United States wanted to sell Yosemite Park to The McDonalds corp. so they could erect a golden arch over Old Faithful to get sprayed ever hour by the Geyser he could not, but under Belize law the Minister could do something equally as vile. Remember that the North Ambergris land owned by GOB is called Bacalar Chico.

OMG...I wasn't even thinking of that...was thinking about those family plots that haven't been inhabited for long time.....geez..Bacalar Chico didn't even cross my mind.......

Yet another example of the P U P bigwigs taking care of themselves and thier friends with OUR tax $ AND the Sanpedranos birthrights!thievin buncha c@#k s#@$%^s!!!!!!!!!!!!!!!

Deal to merge public & private hospitals short on details
The deal approved by Cabinet under which Government will assume the private debt of Universal Health Services in exchange for majority ownership of the private hospital is an ambitious undertaking--both financially and in its implications for the nation's health care system. This morning Minister of Health Jose Coye met with the board of the Karl Heusner Memorial Hospital, the public facility that will presumably share responsibilities with U.H.S. as Belize's premier medical institutions. When the meeting was over the minister and key officials met the press. But if you are waiting to hear exactly how the new arrangement will work ... or how it will affect your pocketbook, then you are in for a disappointment, because if one thing is clear it is that the entire project is very much a work in progress.

Jose Coye, Minister of Health
"What the government is looking at is: 'How do we first settle the debt with the Belize Bank?' and that is in process. Once that has been done, then the government can look for a swap as a debt for equity into that entity. That entity then will be able to take on the responsibility to deal with the DFC debt and also to assume the debt that the government will have paid off to the Belize Bank. The two thirds is a position that has been proposed so far. It certainly will not be less, if anything it can be more, but that is given in exchange for debt so there will be a trading there of debt for equity. That is the position of the Cabinet and Government."

The debt in question to the Belize Bank runs in the neighbourhood of thirty million dollars ... with interest mounting every day. Government, envisioning the imminent expansion of National Health Insurance, had guaranteed that debt and is proposing to pay it off by giving the Belize Bank a quantity of land at northern Ambergris Caye. How much land has apparently not been determined, but history tells us that Mr. Ashcroft is no soft touch when it comes to negotiating. The other debt--twelve million dollars owed to the Development Finance Corporation--will continue to accrue to the U.H.S. account. According to Coye, that money will be repaid through profits generated by improved management.

Jose Coye
"Making a success of it and making it viable will depend on the type of management, and that will be key. Indeed, if the institution is to become the viable institution to continue to provide health services to enhance the health system and at the same time, to be able to honour its commitment with its debt, it has to have good management."

That management may well stay in private hands even though government will be taking a majority of the shares. Two thirds is the stated amount but today Coye said that fraction is a minimum and could go higher.

I am fairly certain the vast majority of Bacalar Chico "land" is privately owned. The reserve is mainly the sea, the reef etc. There are restriction on the privately held land that require that environmental impact studies are made and low density guidelines are observed.

GOB owns most of the Basil Jones area where Ashcroft already has large holdings. GOB doesn't own any east coast beachfront, but Ashcroft does.

I wonder if we will truly see a sister village on northern Ambergris Caye within our life time.

Elbert - don't give GWB any ideas!

i bet we will Elbert....

Not so fast, GOB! KHMH staff force taskforce to review Universal-KHMH proposal


(Posted: 15/12/06) The Government of Belize has had to take a humble step backward in its recent move to amalgamate the services of the Universal Health Services and the Karl Heusner Memorial Hospital. On Wednesday-eight days after Cabinet decided to accept a proposal from Universal Health Services for the Government to take over two-thirds of the ownership of the hospital, after UHS could no longer service its $30 million debt to the Belize Bank-Government decided to set up a task force to review the deal and give its advice on how to proceed.


The Government of Belize has had to take a humble step backward in its recent move to amalgamate the services of the Universal Health Services and the Karl Heusner Memorial Hospital. On Wednesday-eight days after Cabinet decided to accept a proposal from Universal Health Services for the Government to take over two-thirds of the ownership of the hospital, after UHS could no longer service its $30 million debt to the Belize Bank-Government decided to set up a task force to review the deal and give its advice on how to proceed.
The KHMH's staff only knew of the deal when they heard the announcement on the news, and now the media is being scolded for, allegedly, putting their own "spin" on the report and inspiring "fear" among workers.
But Government does accept that, in hindsight, it failed to properly consult the KHMH's board and staff before it went public with its decision. According to Minister Coye, he intended to communicate with KHMH personnel about the Cabinet decision the day before it hit the media, but he fell ill and could not do it.
Another hindsight wisdom, identified by KHMH chairman, Israel Marin, is that it could also be argued that Government should not have guaranteed the loan for UHS in the first place-that's where things began over three years ago, when Government guaranteed a $17 million loan for the private hospital. The loan has since racked up over $13 million in interest.
According to the UHS chairman, Dr. Victor Lizarraga, it was only a bridge loan until a loan from Development Finance Corporation of Belize came through-but it never did, and so the loan stayed with the Belize Bank, which had been financing interest until a few months ago.
UHS is also indebted another $12 million to the DFC - Development Finance Corporation.
Unfortunately for GOB, the Belize Bank has the first lien on $22 million worth of assets the bank held as collateral, and until Government clears the hospital's debt, it cannot take charge of the assets.
Government officials have said that Government would give the private bank, controlled by PUP financier Michael Ashcroft, a chunk of land on Northern Ambergris Caye to clear the UHS debt. That would then place the $22 million worth of assets in the Government's hands, but instead of foreclosing on the debt Cabinet has given the nod for Government to take two-thirds shares in UHS, and still require UHS to repay the full debt to Government.
According to Health Minister, Hon. Jose Coye, it's not a done deal, though, and Government has commissioned a task force to review the proposal.
KHMH's chairman Marin told us this evening that the task force would consult with all the stakeholders, including the KHMH, UHS, the Ministry of Finance and the Ministry of Health, and then recommend possible scenarios of how the alliance between KHMH and UHS would work.
Marin said that the idea is to take the best of both worlds, and he does not see how the new arrangement would negatively impact the KHMH.
The task force has until mid-January to report back to the Government.
Coye said today that the UHS deal comes under GOB's plans for an orderly liquidation of the DFC.
He also said that under the Government's health sector reform plan, this arrangement could open a window of greater opportunity for people who cannot afford to pay for specialized medical care.
Coye said that GOB did look at whether Government should sell off the assets of Universal Health Services once it gets control of them, but the decision was taken to keep UHS intact while Government takes controlling interest. He claimed that even after UHS clears its debt to GOB, the shares would still belong to the Government. The Minister said that the shares were not yet valued, but did not say how GOB could still keep the shares if UHS pays back the debt.
Minister Coye also claimed that the KHMH won't be adversely affected, but will be better off from the alliance with UHS. He said that the concerns of staff were borne out of uncertainty.
Marin said that there are no issues really, but staff was fearful because of the lack of information about the proposal, and the things that were being said by some sectors of the media.
He said that the taskforce would study the UHS-KHMH proposal and advise the Government on how best to proceed.
On Tuesday, the Nurses' Association of Belize wrote the newspaper, saying that, "The NAB believes that nursing input is pivotal in the support of the health system of the KHMH and this nation, and will leave no stone unturned to be proactive regarding the decisions that impact patient care and the socioeconomic welfare of nurses."
Dr. Jose Sosa, KHMH neurologist who also works privately out of Belize Medical Associates, issued a second press release to the media today, reiterating concerns over the proposal.
The release states that KHMH employees continue to have concerns, and don't want a picture to be painted which has them agreeing with the amalgamation/integration of UHS and KHMH.
The release said that UHS's $44 million debt is UHS's responsibility, and the cost should not be borne by the KHMH and the public.
The statement also said that, "…the Ministry of Health has previously proposed to enhance the KHMH service to tertiary level. We note that the key services we need to upgrade at KHMH include nephrology/dialysis, gastro-enterology, and radiology."
The Minister told us that the idea is not to expand tertiary level services at the KHMH, but to make it better at what it already does, because in the past the hospital's resources have been stretched too thinly.

Musa's $42 million headache:Ambergris land swap may be his way out! Print E-mail

Friday, 15 December 2006

By Angel Novelo - Staff Reporter

Minister Coye alongside K.H.M.H. Chairman Ismael Marin still has no idea how a K.H.M.H/Universal union will work.

The Musa government on Wednesday continued to scramble for answers on how it will get out of a self-inflicted $42 million headache for the failed private medical institution called Universal Health Services.

The Belize City private hospital five years ago received an unsecured loan from the Development Finance Corporation for $4 million.

A further $17 million loan from the Belize Bank with a GOB guarantee has accumulated a debt of $30 million. The $4 million borrowed from D.F.C. has increased to $12 million with interest. Therefore, GOB is in debtbt up to its eyeballs-some $42 million.

Now the government is hoping to strike a quickie deal with the Belize Bank by giving it some 8,000 acres of prime real estate land on northern Ambergris Caye in settlement of Universal's $30 loan.

The Belize Bank, according to government, will invest in a tourism development on the land.

The bank, through one of its companies, is proposing to invest $150 million, government sources say.

But our Reporter source says the bank plans to acquire the land for part of the $30 million and deduct the remaining balance through tax write-offs.

As part of the move to get something in return for covering the Universal loan, GOB announced on December 5, it will be taking a two thirds proprietory interest in the hospital.

That news has sparked a heated debate, especially over reports that government would be pumping more tax dollars into the ill-fated venture.

Staff members at Belize's state- owned Karl Heusner Memorial Hospital wasted no time in expressing disapproval for the deal.

Medical staff there are strongly opposed to the government pumping of more tax dollars into the debt-ridden hospital.

In a press release dated Friday December 8, the medical staff at the hospital stated the proposal to amalgamate Universal with the Karl Heusner Memorial Hospital was done with "without all parties concerned."

The release went on to say such move to amalgamate the two institutions "is not in the national interest." Any new investment in hospital services should be directed at the Karl Heusner, not Universal.

Health Minister Jose Coye, amid public outcry and an angry medical staff on Wednesday met in emergency session with board members and the staff of K.H.M.H. to discuss government 's position on Universal.

Coye's meeting came two days after the staff took to the airwaves to express concern at what appears to be government's decision to take over the debt-ridden medical institution.

Coye is reported to have told board members and senior managers his government's takeover of Universal is being viewed as a two- pronged approach.

The Ministry of Health, Coye said, will be responsible for looking at new ways to improve the management of Universal.

Government's priority, according to Coye, is to settle the $30 million debt with the Belize Bank as soon as possible since interest continues to accumulate every day.

The accumulation of interest on this loan is already in excess of $100,000 a day.

During Wednesday's meeting it was agreed a task force be set up to study the best way forward for Universal and how the management aspect of the take-over could be handled.

Coye noted the focus should be on secondary and tertiary level health care and how the strengths of Universal, can best be utilised to provide services in these areas.

Services provided by Universal could enhance the Karl Heusner Memorial Hospital he said, especially with respect to secondary and tertiary health care services.

Coye conceded that the assets of Universal is nowhere close to the $42 million the hospital owes.

The Karl Heusner has a big role to play in what happens to Universal's assets, Coye said.

If this deal were almost anyone else's beside GOB's, scores of people would be jumping off high bridges to their death to get out of the pending turmoil.

Amanda,
Bacalar Chico Park is 12,000 acres of terrestrial reserve and 15,ooo of marine. You might feel like it's privately owned from a realtor's prespective, because almost all of the beachfront has been sold to private ownership.( Amanda I mean that respectfully).
The shrimp hatchery is a good example of how Government has the power to 'Dreserve' this happens in the rain forest also when powerful lobby forces need logs or would like to dam up the valley, and flood rare pristine habitat.
But I think i hear Marty saying this isn't a concideration any more with the debit to Belize Bank.

Elbert, the property in Bacalar Chico park was privately owned before it was declared a reserve. The privately owned property, of which Ashcroft has substantial holdings already, will be developed, with some density restrictions; possibly along the same lines as the privately owned property in the Hol Chan reserve. The reserves were declared but the government did not own the land in the reserves, therefore the lands are still privately owned and will be developed, with regard to the existing zoine restrictions.

All of us wish to maintain our reserves, but unless the govenment offers restitution to the private land holders, it is limited in its powers of dictation of how the privately owned land will or will not be developed.