Lack of sick tickers saps hospital

An underutilized cardiac unit and an outpatient clinic that was vacant for four years contributed to the financial plight of Maui Memorial Medical Center, which must cut $28 million in the fiscal year that began July 1.

Maui Memorial’s cardiac services branch has floundered since its inception in 2007, according to figures provided to the Honolulu Star-Advertiser under the state Uniform Information Practices Act.

In 2007, arguing that high-end surgical procedures would generate more income as well as improve the likelihood of a healthier recovery for stroke patients, Maui Memorial received a state certificate of need allowing it to offer expanded cardiac services, including angioplasty and open-heart surgery.

The hospital, hoping to attract patients who went to Oahu for cardiac services, projected that by the third year of its new operation, it would have completed an estimated 194 open-heart surgeries and 450 intervention procedures.

Hospital officials planned to hire more than 20 additional employees, including surgeons and nurses, and it projected making a $9.5 million profit from the cardiac surgeries alone.

In the certificate of need proposal in 2006 for expanding cardiac services, the hospital said it needed $1.5 million in equipment and that it did not expect to incur any capital costs.

Since 2009, when its first cardiac surgeries and procedures began, it has never met its projections, hospital figures show.

Maui Memorial projected that in 2009 it would conduct 194 cardiac surgeries. It had nine that year.

Cardiac surgeries increased to 122 in 2013 but waned to 75 in 2014.

The hospital also projected it would carry out 450 intervention procedures, including angioplasty, by 2009. It had none in 2009.

Interventions eventually reached a peak of 163 in 2012 and slid to 139 in 2013 and 116 in 2014.

Wesley Lo, chief executive officer for Maui with the Hawaii Health Systems Corp., which oversees the hospital, said the numbers have been low because the hospital did not get as many referrals as anticipated.

"It was a very, very slow start," Lo said. "Physician referral patterns are hard to change."

Lo said he feels there is a demand for cardiac surgeries and interventions on Maui and that the current cardiac team has had good results and saved lives.

He said the cardiac services are among the most profitable operations at the hospital, but neither he nor other hospital officials provided exact figures. Lo said it was difficult to provide the figures because members of the cardiac team provide other kinds of services as well.

Randy Perreira, executive director of the Hawaii Government Employees Association, which represents 838 workers at Maui Memorial, said his union hasn’t been able to get information about the cost of such projects, either.

"We’ve sought information about costs," he said. "We’ve sought information about operations and the level of contracting for private services. We get nowhere."

Meanwhile, an $8.6 million building that now houses an outpatient clinic languished for four years because additional investment funds dried up when the financial markets crashed, Lo said.

As a result, he said, the building was unoccupied for four years, and Maui Memorial was charged $52,500 to $60,000 per month in rent during that time. Through negotiations the owner agreed to spend $2.3 million for additional improvements to the building, he said.

Maui Memorial remains the only acute-care hospital on the Valley Isle.

Once regarded as the flagship hospital for rural health care on the neighbor islands, the hospital posted $7.7 million in profit in 2002 — the only one among 12 hospitals under the Hawaii Health Systems Corp. to show a profit.

Last year the hospital lost $40 million.

In March the Maui board of the corporation voted to cut $28 million in services and positions at Maui Memorial in this fiscal year. Immediate cuts will be made to nonclinical and nonessential contracts that the Wai­luku hospital maintains, as well as 50 to 75 nonclinical administrative positions.

Perreira said he remains skeptical about the proc­ess.

"They’ve let the wolves into the henhouse as far as the decision-making proc­ess," he said, considering that those making cuts are the same people who put the hospital in a hole in the first place.

Perreira said he wanted an audit of the hospital’s operations but that state lawmakers failed to pass the requisite bill.

At the very least, Perreira said, the governor should seek advice from experts outside the Hawaii Health Systems Corp.

"I would certainly hope (that) a broader range of voices is brought to the table at some point for everybody to express their concerns," he said.