Kaiser Permanente Hawaii plans to spend more than $50 million on three Maui County hospitals as the biggest privatization effort in state history finally comes to fruition following a one-year delay.
The health care provider said it will expand services, update technology and aim to improve patient care after the transition goes into effect on July 1.
Kaiser will assume control of Maui Memorial Medical Center, Kula Hospital & Clinic and Lanai Community Hospital, and pledges to inject more resources into the only acute-care facilities for about 200,000 residents and visitors on the Valley Isle.
PRIVATIZATION OF MAUI COUNTY HOSPITALS
>> What: Kaiser will take over Maui Memorial Medical Center, Kula Hospital & Clinic and Lanai Community Hospital.
>> When: July 1.
>> Losses: Under state control, the hospitals were losing more than $30 million a year.
>> Investing: Kaiser says it will spend $50 million to upgrade services.
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“The public is generally excited and anxious for this transition to take place, not necessarily because Kaiser’s going to become this great thing on Day 1 but because we’ve been in this process for so long,” said Avery Chumbley, Maui region board chairman for the hospitals. “This is a significant transaction. It’s transformational in many ways because this is the single largest move from public employees to private employees in the history of the state.”
Kaiser — both a health care provider and insurer — said it is committed to improving access to care in Maui County, so that patients have the ability to get care where they live instead of having to be transferred to Honolulu hospitals. It has also promised to keep the facilities open to the public, including non-Kaiser members and doctors, and operate as community hospitals, while significantly reducing the state’s burden to fund operating losses that have amounted to more than $30 million annually.
Hawaii’s largest health-maintenance organization is working to fill hundreds of positions left vacant during the recent uncertainty about the new ownership. The transfer of the hospitals was delayed for one year because of a series of setbacks, including lawsuits by employee union United Public Workers to stop the privatization because of existing collective bargaining contracts that run through June 30. A year ago, Maui hospital executives said the facilities had more than 400 vacancies. Many positions were left vacant in anticipation of the transfer, originally scheduled for July 1, 2016.
The HMO is recruiting trauma and orthopedic surgeons, critical care doctors and specialists including gastroenterologists and neurosurgeons, said Dr. David Ulin, chief medical director of Maui Health System, the operating company for the hospitals. “Recruiting on Maui is still very difficult,” Ulin said. “Maui has a shortage of about 100 plus doctors, about a 25 percent deficit in the amount of physicians we should have.”
The hospitals have relied on temporary or leased staff during the uncertainty of the privatization, but hired 35 new graduate registered nurses and nearly 30 RN graduates in 2016 to support the transition.
Kaiser also extended about 1,500 job offers to current hospital staff, 97 percent of whom have accepted the positions, said Jean Melnikoff, Kaiser’s vice president of human resources. “The hospitals in Maui and Lanai have a large number of vacant positions,” she said. “Several hundred positions we expect to be filling. Recruitment will be an ongoing process.”
Among the biggest changes patients will see is an integrated electronic medical records system intended to reduce duplication of tests and treatments to save time, money and resources. Kaiser said the electronic records system will help improve communication among health care providers, increase prevention efforts and reduce costly medical errors. The company said it also is investing in training programs to increase skills among staff and providers in the community.
In 2015, the state Legislature opened the way for a private operator to manage the Maui County hospitals, which were facing an uncertain future as operating costs continued to escalate.
“From an economic development point of view, quality health care is essential for attracting business into our community,” said Jeanne Skog, president and CEO of the Maui Economic Development Board. “There’s probably some nervousness about what this will really mean, but Kaiser’s been trying to allay those concerns in the community.”