Commonwealth Healthcare Corp. board chair Joaquin Torres believes it's high time the public hospital collect a fair fee for services it provides to patients and consider scaling back outpatient services to reduce the corporation's expenditures while improving revenue and collections.
Torres said at this time when local government resources are scarce, there's no way the corporation can guarantee that payroll at the Commonwealth Health Center will not be delayed again and obligation to vendors will be fulfilled.
He pointed out that the crises at the public hospital is a result of the “under-funding” situation it has since Day 1 the corporation took over in November 2011.
From then then-Department of Public Health's annual budget of $38 million for Saipan alone, the corporation took over its management with barely $5 million in appropriation that covered payroll and operations not only of CHC but the Tinian and Rota health centers as well.
Although the corporation receives reimbursement from the Medicare and Medicaid programs, the chairman describes these federal monies as “not enough” because of the lower local matching from the CNMI. In the case of the $5 million seed money, only over $200,000 is disbursed as biweekly allotment for the organization.
For Torres, the only immediate way the corporation can improve its present financial situation is to increase the fees collected from patients by updating the hospital's charge master. The charge master at CHC details each service codes and amounts billed to patient and this was last upgraded in 1982.
“In short, for many years, CHC has been providing almost free service to all patients and we need to do something now if we want to survive,” he told Saipan Tribune yesterday.
Health officials earlier disclosed that CHC has been implementing for 30 years, for example, a very low flat rate for confinement at the hospital's intensive care unit (ICU) which only charges $400 per patient per day. This amount is inclusive of all services and supplies. If actual rate will be used, a patient has to pay from $2,500 to $3,000 per night stay at the hospital.
Torres said that by also removing the outpatient clinics or services, this will reduce the expenditures of the corporation which can prioritize payroll and supplies.
“We can ask the private clinics to come in to cover for these outpatient services. With the present situation of the hospital, I think we should concentrate on the critical services [inpatient units],” he said, pointing out the need to sustain compliance with Medicare requirements.
The corporation has already enforced emergency workforce reduction that affected mostly personnel on non-essential units. It also combined some offices and eliminated others like the dental clinic. The corporation is also looking at suspending, if not terminating, the personnel's housing allowance.
The corporation was authorized by law to receive a $7-million line of credit from the Marianas Public Land Trust, but the loan has not been made available to date due to unsatisfied requirements. Before this line of credit, the corporation was first provided a $4.58-million line of credit by the same trust.
Torres acknowledged that once released to the corporation, the $7 million will help in meeting the immediate needs of the hospital such as payroll and supplies.