East Hawaii’s financially strapped public health care facilities may have a potential suitor in California-based Adventist Health.
In a press release issued Wednesday, Hawaii Health Systems Corp.’s East Hawaii Regional Board announced it was “evaluating strategic alliance prospects” with Adventist, which operates Castle Medical Center on Oahu.
It’s still too soon to tell what kind of relationship the pair may choose to pursue, or if they choose to pursue any relationship at all, said HHSC East Hawaii Regional CEO Dan Brinkman.
“What we’re talking about right now is a preliminary conversation,” he said. “I was talking with staff, and it’s a little like when you’re dating and you decide you’re going to go for coffee. You go for coffee because you don’t really know if you want to have that full-on date and start heading down that road, but you want to have coffee and talk about things and decide if you want to meet anymore.”
Administrators sent an email to employees on Tuesday evening, stating that representatives from Castle Health, which is part of the Adventist Health network, planned a site visit at East Hawaii’s hospital facilities for later this month. However, Adventist Vice President for Marketing and Communication Rita Waterman clarified that the site visit would be performed by Bob Beehler, Adventist’s vice president in charge of its growth strategies.
“We’re just talking about some sort of relationship right now. It could take many forms,” she said. “This is a very preliminary discussion about what might be a potential working relationship.”
East Hawaii Regional Board Chairman Kurt Corbin said the initial talks “will allow us to exchange views on compatibility of our organizations’ missions and to identify resources and strengths that could potentially be shared to enhance the delivery of sustainable health care for our community. It’s much too early to speculate on the prospects of an outcome.”
Privatization of the Hilo Medical Center, Ka‘u Hospital and Hale Hoola Hamakua facilities has been a topic of interest for the past several years as HHSC has struggled to deal with the growing costs of health care and flagging reimbursements. In June, Brinkman announced that the hospital system would begin cutting some services and a total of 87 staff positions as it wrestles with a $9 million budget shortfall.
HHSC’s other public “safety net” health facilities across the state face a shortfall totaling $48 million. The health system requested nearly $150 million in funding from the state during the 2015 legislative session, but was appropriated only $102 million by lawmakers.
However, a Wednesday press release from HHSC reads, “Recent service cuts and staff reductions at Hilo Medical Center, Ka‘u Hospital and Hale Hoola Hamakua, while necessary in the short run, are contrary to the best interests of our patients, staff and community.”
Brinkman said that as long as the need is there, health services must be provided on the Big Island, one way or another.
“The question is, who’s going to be the provider? Is it a public-operated hospital or is it a private provider? … Who can provide it most efficiently and effectively?” he said.
Adventist Health could provide some of the “economies of scale” that it has at its command to provide health care services more cheaply and efficiently, Brinkman said. The not-for-profit health care organization operates 20 hospitals and more than 275 clinics throughout the western U.S., including California, Hawaii, Oregon and Washington, according to its website.
“They operate a lot of hospitals in rural and economically challenged areas,” Brinkman said.
Two years ago, Phoenix, Ariz.-based Banner Health entered into similar preliminary discussions with HHSC about taking over operations of its facilities across the state. The health network’s interest appeared to wane, however, after failed attempts to pass legislation allowing the privatization of the state’s health care facilities.
Earlier this month, the United Public Workers filed a federal lawsuit seeking to stop the governor from implementing a bill that would allow the privatization of three Maui hospitals.
Email Colin M. Stewart at cstewart@hawaiitribune-herald.com.