WAILUKU - Maui Memorial Medical Center's exclusive contract for radiology services has been awarded to RadCare, a national company based in Dallas.
The two-year contract is expected to save the hospital $600,000 per year, hospital officials said this week.
But the process for awarding the contract is being protested by Maui Radiology Associates, which has had the hospital's exclusive contract since 2004. (MRA's predecessor, Maui Radiology Consultants, held the contract from the 1970s until it went bankrupt around 2002 and reformed as a new business entity in 2004.)
Article Photos
Dr. David Heeney examines X-rays of a patient’s foot Friday at the Maui Clinic in Kahului.
The Maui News / MATTHEW THAYER photo
An administrative hearing has been scheduled for July 3 for attorneys representing Maui Radiology to argue that RadCare should not have been awarded the contact.
The hearing will be held at 9 a.m. at the state Department of Commerce and Consumer Affairs office in the King Kalakaua Building at 335 Merchant St. in Honolulu, according to David Karlen, senior hearings officer with the department's Office of Administrative Hearings.
As of Thursday, Karlen said his office had not received a response from Wesley Lo, Maui Memorial's chief executive officer and head of Hawaii Health Systems Corp.'s Maui region. Lo has been served with Maui Radiology's petition for a hearing, according to hospital spokeswoman Carol Clark. But she said the hospital could not comment on the petition.
The hearing is scheduled just two days before the hospital's new contract with RadCare goes into effect July 5.
Dr. David Heeney, president of Maui Radiology, said that the Maui radiologists protesting the contract awarded to RadCare are trying to maintain the high quality of service that they provide doctors and patients, and don't want to hurt the hospital.
"We don't want to give it a black eye or have the community think there's something wrong," he said. "There's nothing wrong. We're trying to prevent something from going wrong."
The award of the hospital's exclusive radiology services contract to RadCare has come over the objections of the hospital's Medical Executive Committee, which recommended keeping Maui Radiology as the hospital's exclusive provider of radiology services.
Maui Memorial Chief of Staff Dr. Colleen Inouye reported in a May 7 letter to members of the Hawaii Health Systems Corp. Maui Regional Board that members of the Medical Executive Committee were unanimous in opposing the award of the contract to RadCare.
"Although we still have concerns about the (request for proposal) process, we are equally, highly concerned about the uncertainty in quality of services, uncertainty in sustainability of services and the potential decrease of highly specialized interventional services that are currently established" at Maui Memorial, Inouye said.
In a May 26 letter to the regional board, Inouye listed the half-dozen doctors working with Maui Radiology, detailing their qualifications, accomplishments and experience.
Writing on behalf of the Medical Executive Committee, she said: "We feel this group is of excellent, unequal quality, highly specialized, long-standing permanent members of this community. . . . Patients will have continuity of care and having three interventional radiologists is difficult to replicate."
The Maui Regional Board considered the committee's input at meetings on May 24, 25 and 29, but on May 29 voted to overrule the Medical Executive Committee's recommendation in favor of Maui Radiology. Instead, the board voted to authorize the contract with RadCare from July 5 to July 4, 2014, with the possibility of four one-year extensions.
Hospital officials said that the contract was awarded through a request for proposal process, and that they expect radiology services to continue with RadCare at the same or higher level.
"We will continue our stroke program and do not expect any interruption of services," Maui Memorial officials said in a written statement. "We look forward to continuing to work with our medical staff to further develop our stroke program to ensure we provide the best health care for our community."
However, doctors with Maui Radiology predict an immediate drop in the quality of radiology services provided at Maui Memorial.
"The loss of talent for no good reason, to throw good doctors out for bad, it's outrageous," Heeney said this week.
In its petition for an administrative review of the contract award, the Honolulu law firm of Bronster Hoshibata argued that when Maui Radiology's contract came up for renewal with the hospital in November 2011, the incumbent radiologists submitted the only bid proposal "that included diagnostic and interventional radiologists who are board-certified, state-licensed and are available to render services on-site at the hospital."
Maui Radiology's attorneys argue that RadCare's lack of qualified staffing rendered its bid proposal deficient, and it "should have been disqualified."
Aside from RadCare and Maui Radiology, others submitting bids for the radiology contract were Tacoma Radiological Associates P.S. and AllegiantMD Inc. Hospital officials said the proposals were scored and finished with RadCare receiving the highest scores, followed in order by Allegiant, Tacoma Radiological and Maui Radiology.
The hospital's RFP committee did the initial review of the proposals. Then, because the proposals were for exclusive contracts, the hospital's medical staff bylaws required a review by the Medical Executive Committee, hospital officials said. The committee made its recommendation favoring Maui Radiology to the Maui Regional Board, which made the final decision May 29 choosing RadCare.
The 11-member board is chaired by R. Clay Sutherland. Other members include Zadoc Brown Jr., Grant Chun, Gina Flammer, Dr. Pedro Giron, registered nurse Karen Oura, Dr. Susan Stewart, Stephen Holaday, B.J. Ott, Howard Nakamura and Dr. Donna McCleary. Under the hospital's bylaws for the board voting on exclusive contracts, the physicians on the regional board were not allowed to vote when the contract came before the panel for a final vote.
Maui Radiology's attorneys contend in their petition for an administrative review that RadCare's proposal should never have gotten that far. They said that under the request for proposal, the regional system's procurement policies and relevant law, "RadCare is not a responsible or responsive bidder, and thus should not have been awarded the request for proposal."
RadCare spokeswoman Deborah Hileman said RadCare meets all the requirements in the hospital's request for proposals for the radiology services contract.
"RadCare has highly experienced recruiting specialists who are dedicated specifically to the specialty of radiology," she said. "We do not recruit physicians for a particular facility until a contract is signed. RadCare providers meet all of the qualifications set forth in the RFP, and we will be fully staffed and ready to provide services on July 4 at midnight."
Hileman said that since the contract was awarded, RadCare has been working with Maui Memorial's staff "to plan for and implement a seamless transition" of services from Maui Radiology to RadCare.
"RadCare's staffing model focuses on filling all necessary day, evening and night slots to ensure seamless coverage," she said. "Staffing patterns are closely monitored by the department chairman and RadCare's senior management team to ensure the delivery of efficient and timely radiology services."
Lo said that the contract's exclusive provision means that RadCare will, in effect, have a monopoly in providing radiology services at Maui Memorial. Such an arrangement is common nationally, he said, and the hospital also has exclusive contracts for physician services for anesthesia, emergency medicine and clinical laboratories.
"It is important for MMMC to periodically check to make sure that the quality, breadth and cost of services provided are the best possible services for the community," he said.
Lo said that he hopes the hospital and the doctors with Maui Radiology can part on good terms.
"We have had a long relationship with MRA and value all that they have done for the hospital and our community," he said. "They are a group of dedicated and talented physicians, and we wish them nothing but the best for their future endeavors."
* Brian Perry can be reached at bperry@mauinews.com.
