CHCC to ‘inherit’ $17M medical referral deficit

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THE Commonwealth Healthcare Corp. will inherit the  $17 million deficit of the medical referral program if it is transferred to CHCC, its financial officer Derek Sasamoto said.

During the budget hearing in the House chamber on Monday, Sasamoto said the medical referral program is funded about $3 million each year.

“So every year there’s a deficit of $17 million or more. Essentially, they are transferring that deficit to CHCC,” Sasamoto added.

He said CHCC already has a deficit of over $15 million for uncompensated care, and does not have matching funding for Medicaid.

He said CHCC is also not getting paid by government agencies, such as the Department of Corrections, which incurred millions of dollars in obligations to the healthcare corporation.

“We really have to consider and really think hard about funding because you cannot fund a program for 40% and expect 100% execution,” he said, in reference to medical referrals.

Sasamoto said transferring the medical referral program to CHCC is “another mountain we have to climb.”

He added, “We are climbing the mountain already. We have gone from $30 million in revenues to $60 million. We have been doing our part to expand services, increase revenues and clean up our audit. But right now, we are battling so much from the past and more issues are occurring in the present, not to mention what’s happening with the cash flow and Covid-19.”

He said CHCC is operating on a $90 million budget. For fiscal year 2021, he added, they are requesting $33 million from the central government.

The administration can only propose $4.4 million for CHCC, but  “I am hearing that there might be a reduction of $2.7 million,” Sasamoto said. “Even at the $4.4 million level for a $21 million program, it is going to be at the $17.6 million deficit,” he added about medical referrals.

He urged lawmakers to properly fund the program. “Without funding support, it can be very difficult,” he added.

But he said CHCC  supports the proposal to transfer the medical referral program to the healthcare corporation.

CHCC Chief Executive Officer Esther Muna said community members “don’t necessarily want to leave the island to get tertiary healthcare or specialty care.”

She said “that is one of the reasons why we have actually expanded  to have a cancer center here at CHCC. We did reduce the budget in total spending for oncology services by having our own oncologist here.”

She said should the administration push through with its proposal to transfer the medical referral program to CHCC, Muna said they will have to form a task force.

“We want to get everybody involved and not just have the same burden that we had when we started the corporation,” she added.

Back then, Muna said the government provided CHCC with a small amount of “seed money” to deal with public health problems, and this cost the hospital its Centers for Medicare & Medicaid Services certification, she added.

“If they are going to transfer the medical referral program to us, then please help us,” Muna told the lawmakers.

Rep. Tina Sablan said it would be irresponsible on their part to transfer the medical referral program to CHCC “and then let them figure  out what to do. We need to support this corporation if this is going to be the decision of the government.”


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