Negotiations underway for Kaiser to run Maui hospitals

Local News

Negotiations are officially underway between the state and Kaiser Permanente for the health care company to manage and operate Hawaii Health Systems Corp.’s (HHSC) Maui Region facilities.

HHSC’s Maui Regional System Board announced its selection on Sept. 23 thanks to Act 103 (SLH 2015), which was signed by Gov. David Ige in June 2015 and authorizes the Maui Region to transfer operation of its facilities to a new entity in order to mitigate future budget deficits.

Current budget estimates anticipate that deficits will continue to grow exponentially and potentially threaten services and jobs in Maui County.

Negotiations officially began on Oct. 22, and are being led on the state’s behalf by State Comptroller and Director of the Department of Accounting and General Services (DAGS) Doug Murdock.

Others on the state’s negotiating team include the governor’s Deputy Chief of Staff Laurel Johnston, Attorney General Doug Chin; Director of Finance Wesley Machida, Director of the Department of Human Resources Development James Nishimoto, HHSC and Maui Regional Healthcare System (MRHS) staff.

“Our negotiating team’s first priority is affordable, accessible health care for the Maui Region. The state will negotiate in good faith to secure the best possible outcome for our citizens and for employees of the facilities involved,” said Ige.

The state hopes to finalize an agreement by the end of the year for Maui Memorial Medical Center (MMMC), Kula Hospital and Lanai Community Hospital.

“As a board, we were grateful for the opportunity to talk to staff, physicians, and our friends and neighbors about what kind of health care model we want moving forward,” said Avery Chumbley, Maui Regional System Board Chair. “Kaiser Permanente provided us with its vision and strategy for improved healthcare in the Maui Region. We felt Kaiser Permanente could best serve the needs of our community.”

Once negotiations are complete and a definitive agreement is executed, Kaiser Permanente will become the new operator of the Maui Region facilities. The Maui Regional System Board will serve as the custodial caretaker of the property with oversight over the performance of the terms and conditions of the lease.

Kaiser Permanente released the following statement Wednesday:

“Kaiser Permanente is excited and honored to be selected by the Maui Region of the Hawaii Health Systems Corporation (MRHS) to be the partner for Maui Memorial Medical Center, Kula Hospital, and Lanai Community Hospital. We are looking forward to successful contract negotiations.

We want to thank the community groups, health providers, local businesses, and the Maui Memorial Medical Center physicians and staff who have worked alongside us for 46 years with a shared commitment to providing quality, affordable care on Maui. We look forward to our continued collaboration to ensure a healthy future for the Maui Region.”

Kaiser has previously said that, in the event of a partnership, Maui Memorial Medical Center “would remain open to the entire Maui community, serving all patients, not just Kaiser Permanente members” and would accept a variety of health insurance plans.

“We have a responsibility to meet the health care needs of our community, and we believe this transition provides us the greatest path forward to continue doing this,” said Wesley Lo, CEO of HHSC Maui Region. “Act 103 was the culmination of years of hard work and dedication from our staff, physicians, past and current board members, and local leaders – our community will be better served thanks to their vision and determination.”

The Maui Region of HHSC serves over 11,000 inpatients and over 45,000 emergency room patients per year and employs over 1,500 people. Maui Memorial Medical Center is Maui’s only full-service, acute medical care facility and is the only hospital outside of Oahu that provides a full range of cardiac services, including open-heart surgery and angioplasty.

Founded in 1945, Kaiser Permanente currently serves more than 243,000 people in Hawaii, including over 55,000 on Maui. It has more than 10 million members in eight states and the District of Columbia.

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