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Hospitals in Hawaii report $150 million in ’07 losses

October 24, 2008
The Maui News

HONOLULU (AP) - Hawaii hospitals suffered operating losses of $150 million last year and expect the situation to worsen in the near future.

''This has been sort of a tough year and it looks like we're headed into tougher times,'' said Richard Meiers, head of the Healthcare Association of Hawaii. ''We've got a lot of challenges ahead of us.''

Hawaii's hospitals have been hurting as the federal government's Medicare program and the state's Quest program haven't been fully reimbursing them for the costs of providing service.

Hawaii Medical Center, which operates two former St. Francis hospitals on Oahu, filed for bankruptcy this year and cut the number of beds it offers.

The state's publicly subsidized hospital network, Hawaii Health Systems Corp., has had to request millions in emergency funding from the state to stay afloat.

Kona Community Hospital, part of the network, laid off 10 percent of its workers. Also on the Big Island, the privately run North Hawaii Community Hospital laid off 12.6 percent of its staff.

A Ernst & Young LLP report released Thursday, and prepared for the Healthcare Association, shows hospitals as a group have sustained operating losses for eight consecutive years.

Reimbursements from Medicare, which represent about one-third of Hawaii patient charges, only covered 77 percent of costs. Medicaid/ Quest payments covered about 71 percent of costs.

Payments from private insurers such as the Hawaii Medical Service Association cover slightly more than expenses, but they are not enough to make up for losses produced in providing medical services to Medicare and Medicaid/Quest patients.

''The payments that are coming in are still not covering costs,'' said Terri Fujii, Ernst & Young managing partner.

''On an operating basis the hospitals still have losses.''

The deteriorating economy is expected to exacerbate the hospitals' problems as the jobless rate climbs and more people lose their health insurance.

Hospitals also racked up $143.8 million in charity care and bad debt in 2007.

The Healthcare Association of Hawaii includes hospitals, nursing homes, home health care providers and hospice providers.

 
 

 

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