HEALDSBURG -- Healdsburg District Hospital is among 30 other rural hospitals that could be in line to receive significant funding for electronic health records through bond financing and grants from UnitedHealth Group.

The Minnesota-based group has identified 31 “critical access hospitals” in rural regions throughout the state that are in need of more modernized information technology systems and electronic records.

The funding will be made available through UnitedHealth Group’s California Health Care Investment Program, a 20-year, $200 million program for health care providers that serve a critical need. The same fund helped the Petaluma Health Center acquire its new, 53,000-square-foot building, which will become its base of operations, with a loan to the federally qualified health center of $5.87 million.

Of the 31 statewide hospitals identified, about eight to 10 will likely be selected for a $10 million bond offering that UnitedHealth Group will purchase at competitive rates, likely around 3 percent to 4 percent over three to five years, according to Steven Henry, director of UnitedHealth Group's California Health Care Investment Program.

Healdsburg Hospital has benefitted from the fund in the past, according to Evan Raynor, chief executive officer of the hospital and the North Sonoma County Healthcare District.

“It’s a terrific program, and we have been happy participants and recipients in the past when we aggressively restructured some finances at very attractive terms,” he said.

Other hospitals in the region that may qualify include Frank R. Howard Memorial in Mendocino County, St. Helena Hospital Clearlake in Lake County, both of which are part of the Adventist Health system, and Sutter Lakeside Hospital, also in Lake County and part of Sacramento-based Sutter Health.

Mr. Raynor said the hospital is pursuing multiple avenues in terms of financing electronic health records, and while it was too soon to say how much implementation may cost, the competitive rates offered by UnitedHealth Group are attractive and would likely be welcomed by the Critical Access hospitals.

“We’re exploring all opportunities that make the best sense, not just for the hospital but for the entire North Sonoma County Healthcare district,” he said.

In order to meet the requirements for funding, hospitals must prove a demonstrated financial need for implementation of electronic health records, while also showing that they have the proper level of infrastructure   for implementation.

The cost at each hospital has ranged between $500,000 and $2.5 million, Mr. Henry said, a number that was higher than expected.

“It’s a wider range than we had anticipated, and those kinds of things will impact how many hospitals we can help,” he said.

Mr. Henry also said United will foot the entire cost for bond issuance, at about $800,000.

UnitedHealth Group provided $200,000 in grants to the California State Rural Health Association, which is carrying out the assessments at the 31 hospitals. The assessments should all be completed within the next week or so, Mr. Henry said.

In determining which hospitals will receive the bond, Mr. Henry said some may already be in the process of acquiring electronic health records, and several are a part of larger organizations that may be better suited to implement the records.

“As the critical access hospitals step up, that’s when we’ll know more,” Mr. Henry said, adding that the bond may be split up as hospitals provide the needed information. “Our key is to impact the ones that are in greatest need.”

“While we may get three hospitals ready, maybe another two or three might be ready later,” he said, emphasizing that goal is to be flexible in its determination.

He added that electronic health records are greatly needed, particularly in rural areas that may go overlooked.

“I have been part of a couple of state task forces, and there are a lot of gaps to fill,” he said. “This one, though, seems like it was an especially good fit.”

CORRECTION, Sept. 8, 2010: Steven Henry is the director of UnitedHealth Group's California Health Care Investment Fund, and UnitedHealth Group is the parent company of UnitedHealthCare. The story "Healdsburg among hospitals in line for health record funds" [p. 1, Sept. 6] contained incorrect information.