When Gov. David Ige moved Tuesday to intervene in the legislative process that was about to yield a long-needed hospital privatization law, eyebrows went up. And among advocates, brows furrowed with worry. Their concern is well-founded: Could this critical effort to keep the state-owned hospitals running fail once again?
After years of debate, the House was poised to pass the Senate’s version of House Bill 1075. That measure would enable a private company, Hawaii Pacific Health, to partner with the state on the operation of three Maui County public hospitals, effectively transitioning them to private management.
If the governor wants to take the unusual step of jumping in at the 11th hour, that had better produce a result benefiting the taxpayers above all, not just something to mollify the bill’s union opponents.
The bottom line is that this bill must pass this session, in a form that will allow Maui Memorial Medical Center, Kula Hospital and Lanai Community Hospital to survive for the long term.
These comprise the Maui Region of Hawaii Health Systems Corp., the state agency that has been running public hospitals at a deficit for years. Maui County is the first to work toward breaking away, with previous discussions involving a potential mainland partner before HPH emerged over the past year, providing the genesis for HB 1075.
This week, Ige asked leaders in the House to postpone voting on the bill, never fully explaining his specific concerns. This is irregular action by the state’s chief executive, whose principal duty in lawmaking follows the legislative branch completing its work. Then the chief executive has a choice: Sign the bill into law, allow it to become law without signing it, or veto it outright.
Naturally, the governor in each administration, in every state, consults with lawmakers throughout the process, but at a certain point he or she backs off. The governor doesn’t get a vote on any bill, at least not until it comes to his desk.
Here Ige, who last year left the chairmanship of the powerful Senate Ways and Means Committee to seek the desk on the Capitol’s fifth floor, seems at least to be keeping a foot in the conference-committee door.
He has said the delay would enable the better crafting of a template that could guide similar privatization partnerships for the HHSC’s facilities statewide. But it seems more reasonable that developing a statewide framework would come over time as the pilot project in the Maui Region plays out. That process needs more time than the brief period spent in conference-committee reviews — it can start right after the Legislature adjourns.
The one saving grace for Ige’s intervention this week would be if the deal becomes more secure from legal challenges as a result, lowering the risk that private competitors of HPH would demand a chance to bid.
In fact, Wesley Machida, state director of budget and finance, has suggested as much. Machida has said that the governor may consult with lawmakers on whether the state procurement law obligates the state to conduct a competitive bidding process to select the company to operate the hospitals.
That seems prudent enough, but the state can no longer afford to wait to take action. The Hawaii Government Employees Association and United Public Workers still are arguing for financial and managerial audits first.
These are stall tactics, plain and simple. The unions are fighting tooth-and-nail to defend their memberships; there are nearly 1,400 employees working at Maui Memorial alone.
But the state already has conducted studies of the issue, by consultants who argue for the precise steps the state is poised to take. And it’s no wonder: The Maui board is ordering a $28 million cut in services and positions for the next fiscal year.
It’s time to slow the chronic flow of red ink.
Saving the hospitals for Maui County — and with them, most of these jobs — is essential. But the way to accomplish that is through enacting immediately the solid plan that’s already taking shape in HB 1075.
