Hospital CEO: Tough times may be ahead


By COLIN M. STEWART

Tribune-Herald staff writer

Hilo Medical Center and other public health care facilities across the state face having to resort to “painful choices” as they deal with diminishing resources, according to an editorial distributed Monday by CEO Howard Ainsley.

Attempts to ascertain what those choices could be were unsuccessful as of presstime.

The editorial comes at the start to a new state Legislative session, when members of the Senate and House will decide how much money will be allocated to Hawaii Health Systems Corp., the nonprofit charged with overseeing the state’s public health centers. It also comes on the heels of the public’s learning that the company has been in talks since July with Phoenix, Ariz.-based Banner Health, which seeks to take over operations of HHSC’s Maui, West Hawaii and East Hawaii regions, totaling eight hospitals.

In his editorial, Ainsley paints a grim picture of the health care landscape facing HHSC and the nation.

“… Hospitals nationwide are being pushed to the brink of collapse, given the new health reform law changes,” he writes. “Health policy experts and health care futurists claim that one-third of the nation’s hospitals are unlikely to exist in 2020, as a result of these federal government mandates.”

Among the challenges facing HHSC’s East Hawaii region are the the anticipated decreases this year in Medicare and Medicaid reimbursements, decreasing patient volume at HHSC hospitals as residents choose to travel to Oahu for care, state officials and residents seeking to decrease and eliminate annual subsidies for HHSC, and a lack of funding for equipment, renovations and other capital investments.

“This combination of decreased reimbursement, decreased volume, decreased capital, and the potential decreased state subsidy is a formula that will significantly erode our resources and the capability of HHSC hospitals to support our great doctors, nurses, and other health professionals,” Ainsley wrote. “This damaging formula will force us to make painful choices about which services we can and can’t provide, based on diminishing resources.”

Ainsley did not return a phone call seeking clarification of his editorial.

In a phone interview Monday afternoon, HHSC Board Chairman Avery Chumbley said that how the organization would handle declining revenues was the “million-dollar question,” but the possibility of making cuts to services would have to be on the table.

“As far as what services would you have to cut? I don’t know at this point,” he said. “That would be very painful.”

Avery said the editorial was in no way part of a “structured effort” to influence legislators on the subsidy question, or to set the stage for a Banner Health takeover. Rather, he called Ainsley’s piece “a personal effort to alert his community to what are going to be some of the significant challenges in health care as we go forward.”

Earlier this month, it was revealed that Banner seeks to lease the Maui and Hawaii Island properties from HHSC. Chumbley explained that the partnership would go a long way toward addressing many of the problems facing health care in Hawaii. The plan under discussion would make it possible for the state to gradually decrease its subsidies to zero, he said, while providing the capital needed to update facilities and their equipment.

“According to the American Hospital Association, many hospitals across the country are considering some degree of affiliation with larger health care systems given the state of affairs,” Ainsley wrote. “Mergers and acquisitions have steadily been increasing since the recession of 2007-2009. Nationally, there were 51 merger or acquisition deals in 2009, 75 in 2010, 86 in 2011, and considerably more in 2012. The consolidation trend is expected to continue as hospitals all over the country try to figure out how they can survive in this new health care reform era.”

Ainsley says that the Hilo community can help by being “acutely aware” of the challenges facing hospitals.

“Our community is at the heart of our efforts to provide quality health care close to home. We urge you to give us feedback on your experiences and the quality of services delivered. We also ask that you make our facilities your first choice for health care whenever possible,” he says. “And please support our legislative initiative this year to secure funds to move forward with our planned HHSC Primary Care Medical Training Program which is aimed at bringing more doctors to our community.”

Email Colin M. Stewart at cstewart@hawaiitribune-herald.com.

 

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