Officials: Layoffs at Kaua‘i’s state hospitals not in immediate plans
by Blake Jones – The Garden Island
As state-run hospitals in Hawai‘i face layoffs and service cuts due to chronic budgetary shortfalls, at least one lawmaker says it’s his mission to reform the system.
Speaking to health care professionals at a meeting of the Kaua‘i Rural Health Care Alliance Friday, Big Island Rep. Josh Green, D-District 6, talked about what he calls the “great Hawai‘i health care impasse.”
The former emergency room physician and current state House of Representatives chair of health is a champion for accessible health care and a fierce critic of HMSA’s insurance monopoly in Hawai‘i. Green said the answer to an underfunded system is not for hospitals to cut services, but rather to pass health insurance reform.
He attributed the problems with today’s state health care system to under-reimbursement for services from both insurance companies and the government, and to “regressive” taxes.
Green’s talk came on the heels of layoffs at Kona Community Hospital, which let go 10 percent of its staff.
The Big Island hospital is part of Hawaii Health Systems Corp., the state subsidized network of 15 hospitals serving mostly the Neighbor Islands and rural areas. Hospital officials said the cuts were needed because of a $7.6 million deficit for the West Hawai‘i region.
But it’s not just the Big Island facilities in trouble, the entire HHSC system is expected to lose $62 million this year, and the hospitals’ regional boards have been asked to trim deficit spending.
Public and private hospitals alike are suffering as private insurers and government programs like Medicare fail to pay them the full cost of the care they provide patients.
They are also burdened by rising costs, bad debt, and the growing cost of treating those without health insurance and the means to pay for their care.
Hawaii Health Systems takes in about $450 million in annual revenues from Medicare, insurance companies and patients, but it is also supported by about $58 million from the state’s general fund.
HHSC Kaua‘i Region Chief Financial Officer Michael Perel said the corporation will likely ask the governor for an emergency loan and the Legislature for more money to cover expenses, just as it has in past years.
Perel noted that Kauai Veterans Memorial Hospital is currently one of HHSC’s best performers, but it’s still losing $5 to $6 million per year. Nonetheless, both Green and Perel feel that Kaua‘i’s two state-run facilities, KVMH and Mahelona Medical Center, are faring slightly better than Big Island’s because of a strong public-private hospital relationship, which helps to keep patients on-island.
“We’re trying to provide as much care locally and work with Wilcox (Memorial Hospital),” Perel said.
As for job cuts, Perel doesn’t see them on the horizon.
“That will be our absolute last resort,” he said.
In response to these financial woes, Green said he’ll enter the new legislative session with proposals to increase federal reimbursements through state appropriations as well as phase out the general excise tax to health care services.
He said he’d like to see those funds replaced with taxes on the state’s largest insurer, which has a nonprofit status and brings in $2.2 billion annually.
Green argues that HMSA does not meet the nonprofit status that exempts it from the excise tax.
“They are running a scam on the state of Hawai‘i,” Green said.
He says nonprofit insurers must earn their tax breaks by increasing reimbursements to doctors and hospitals, by providing affordable plans to the uninsured, and contribute to a state health care fund to provide care in underserved areas.
Green also advocates for medical malpractice insurance reform, saying lawsuits cost the system too much money and transfers the focus away from quality care.
Green is also working on initiatives to recruit new doctors to rural areas and invest in medical education.
The final piece of the puzzle, Green said, is prevention — not accepting that “we will be relatively lazy, relatively fat and over-medicated.
“If we don’t do these kinds of (preventative health measures), I think we’re going to be hit with a tidal wave that we won’t be able to afford.”
• The Associated Press contributed to this report.