(Above) HHSC officials testify on Monday before the State House Health Committee.

Video by David Corrigan

HILO, Hawaii – The State House Health Committee held a hearing in Hilo on Monday regarding the struggling Hawaii Health Systems Corporation. Lawmakers were briefed by HHSC board members and executives on budget shortfalls that impact hospitals in Hilo, Ka’u, and Honokaa.

For fiscal year 2014, the state run hospital system requested $150 million in financial assistance from the legislature, and was appropriated $111.4 million. The shortfall in funding forced HHSC to begin cost cutting measures and re-evaluate its initiatives on all islands.

In June, Hilo Medical Center announced the elimination of 30 positions in light of a $9 million budget shortfall. There are also concerns about the future of Ka’u Hospital.

The system’s Regional CEO Howard Ainsley has announced his resignation. The board has selected Dan Brinkman as the interim replacement.

The series of briefings will continue on Maui in August before returning to Oahu for the remaining meetings.

“Our goal is to have public hearings across the system to understand what the operational plans and budgets are and how they’re going to address the shortfalls within each region and to facilitate community conversations about what a public-private partnership might look like,” said House Health Committee Chair Rep. Della Au Belatti in a media release issued prior to the hearing. “There is a realization and a recognition that the HHSC is a statewide safety net system, especially for rural communities and the neighbor islands, and we need to understand what the true costs are and then have the political will to sustain that subsidy going forward.”

Video Excerpts: HHSC testimony

Kurt Corbin on “Essential Services” (w/ transcript)

Essential services: Those which offer a clear health benefit. And the lack of access to these essential services result in a significantly negative impact of the well-being of all members of that community.

When we analyze the core services, it becomes very very difficult to say “let’s pull this one out or let’s pull that one out”. Often times they are so interrelated that you can’t separate them. But what happens if you stop doing orthopedic surgery? Those cases will go to Oahu and those people who can afford will go. And again, you end up with a two-tier system of delivery. We try to provide basic services.

What we know here is… most people would argue that labor and delivery is an absolute core, essential service. What we know here in Hilo is that close to half of our newborns are c-section. The national average is about 32%, 33% percent. And one begins to ask the question why. Is it because those mothers are at high risk because they didn’t get prenatal care? Are they high risk because they are young mothers? Do physicians choose to deliver by c-section because it’s safer for both the mother and the child? But also because we don’t have a neonatal intensive care unit?

So we begin to look at all these critical services. It’s hard get to the point where you can make changes incrementally. So it becomes major changes in the configuration of our delivery. The services and the patients who migrate away from here … most of those are full pay… which further exacerbates the problem and sends us into a further spiral. It becomes almost impossible to cut our way out of and cut our way into sustainability.

So flips side is, once we get to the most efficient operation we can, we have to look for ways to grow our way out of this. Look for affiliations; working relationships with others. We have to look at opportunities to cross geographic and organizational boundaries to do what’s best for the members of our community.

Here’s what I think we know for sure: Our operating shortfall beyond June of 2015 is going to be something on the order of 15% to 18% percent. There’s just no way around it. An attempt to close that gap through streamlining inefficiencies will be insufficient to close that gap. We must have continuing subsidies from the state for this region. And to the extent that they fall short of closing that gap, we will have to implement service cuts. And I’ve talked about the implications of that.

Here’s what we also know and believe: That the ultimate solution will not be found in fixing HHSC, but in the restructuring and consolidation of overall health care delivery in the state.

Again, finding those relationships between different institutions and different organizations. The trends all across the country have demonstrated with clarity that managing the costs of care and providing reasonable access can only be accomplished by large, integrated systems. With a population of 1.4 million people Hawaii is a very small state. And one wonders if such a small state can support three major systems. Queens, HPH, and Kaiser. And where does HHSC and our facilities fit into that mix?

I will close by saying that the the quality of life in our community can be judged by the commitment we make to the education of our young, the health and safety of all our residents, and the vibrancy of our economy. We urge you to work with us to commit the resources and energy is required to accomplish these goals, not just for our local community, but for our larger statewide community.Kurt Corbin, HHSC