SCR170 SD1

WHEREAS, in 2001, Wilcox Memorial Hospital and Kauai Medical Clinic merged with Kapi‘olani Health and Straub Hospital and Clinics to create Hawaii Pacific Health; and

WHEREAS, after six years of operation, there appear to be real problems with Wilcox Memorial Hospital and Kauai Medical Clinic; and

WHEREAS, concerned citizens, physicians, county leaders, and former hospital administrators have reviewed the Certificate of Need approval for the 2001 merger of Wilcox Memorial Hospital and its Kauai Medical Clinic with Hawaii Pacific Health and found inconsistencies with what was stated in their Certificate of Need merger application versus their current operations today; and

WHEREAS, in order to attain a certificate of need approval, the applicant must ensure access to all patients regardless of their ability to pay; and

WHEREAS, Hawaii Pacific Health has apparently instituted new practices that seek to reduce access to care for uninsured and underinsured patients on Kauai, including those covered by Medicaid and Medicare, which is contrary to statements and projections in their Certificate of Need application; and

WHEREAS, the Certificate of Need approval criterion requires that the population served include the elderly, low income persons, racial and ethnic minorities, women, persons with disabilities, and other underserved groups; and

WHEREAS, there is evidence that suggests Hawaii Pacific Health has changed its operational structure and thereby the commitment to care for the disadvantaged, the elderly, and other underserved groups has changed; and

WHEREAS, Hawaii Pacific Health included in their Certificate of Need application financial and management models that detailed how the merger would operate in order to achieve mutual financial goals, shared management input, and a meaningful liaison with physicians on Kauai; and

WHEREAS, the current financial model, management structures, and procedures for physician liaison with management are no longer reflective of what was promised in their Certificate of Need application; and

WHEREAS, chapter 323D-12, Hawaii Revised Statutes, authorizes the State Health Planning and Development Agency to conduct studies and investigations as may be necessary to determine the causes of health care costs; and

WHEREAS, further, the State Health Planning and Development Agency is authorized to monitor the implementation of Certificates of Need approved by the agency; and

WHEREAS, the State Health Planning and Development Agency stated in its Decision on the Merits that approved the Hawaii Pacific Health merger with Wilcox Memorial Hospital and its Kauai Medical Clinic that "Non-implementation of a project as described in your application may result in a fine and/or withdrawal of the Certificate of Need"; now, therefore,

BE IT RESOLVED by the Senate of the Twenty-fourth Legislature of the State of Hawaii, Regular Session of 2007, the House of Representatives concurring, that the State Health Planning and Development Agency is requested to immediately investigate and determine whether Hawaii Pacific Health/Wilcox Memorial Hospital/Kauai Medical Clinic has violated the 2001 Certificate of Need agreement and as necessary, impose fines, withdraw the Certificate of Need approval, or investigate and mediate other remedies; and

BE IT FURTHER RESOLVED that the investigation of this Certificate of Need agreement and implementation include, but not be limited to:

(1) The current audited financial statements of all entities involved in the merger;

(2) The current management matrix and structure of Hawaii Pacific Health, Wilcox Memorial Hospital, and Kauai Medical Clinic;

(3) The current by-laws of the organization;

(4) The statement of revenues delineated by payor mix of Wilcox Memorial Hospital from the year before the merger to the current year;

(5) The ratio of specialty care physicians to primary care physicians from the year before the merger to the current year;

(6) The current level of charity care provided as well as a copy of the organization's current charity care policy;

(7) Imposing fines should the implementation of this Certificate of Need be found to vary from what was contained in its application;

(8) The impact to the healthcare system of revoking the Certificate of Need approval for this merger should the implementation of this Certificate of Need be found to vary from what was contained in its application;

(9) Interviews with physicians to investigate alternative solutions to complete revocation; and

(10) A minimum of one public hearing on Kauai; and

BE IT FURTHER RESOLVED that the State Health Planning and Development Agency is requested to report findings and recommendations to the Legislature not later than twenty days prior to the convening of the Regular Session of 2008; and

BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Governor, the Director of Health, the State Health Planning and Development Agency Administrator, Hawaii Pacific Health, the Kauai County Mayor and County Council, Wilcox Memorial Hospital and Kauai Medical Clinic Physicians, Hawaii Medical Association, and the Hawaii Nurses Association.

Report Title:

Certificate of Need; Hawaii Pacific Health; Wilcox

THE SENATE	S.C.R. NO.	170
TWENTY-FOURTH LEGISLATURE, 2007		S.D. 1
STATE OF HAWAII