Short of saying the Commonwealth Healthcare Corp. should revert to being a government department, the CHC board of trustees handed yesterday a resolution to Gov. Benigno R. Fitial and the Legislature asking them to “properly fund” CHC in fiscal year 2013 to the tune of more than $40 million, but some lawmakers described the amount as unrealistic when the CNMI budget is only $114 million.
CHC chief executive officer Juan N. Babauta, CHC board chair Joaquin Torres, and chief financial officer Alvaro Santos met yesterday with House members working with their Senate counterpart on a compromise version of a 2013 budget bill.
Ways and Means Committee chair Rep. Ray Basa (Cov-Saipan) said they would have to work closely with the Senate conferees on CHC's request, which he said is impossible to give knowing that the CNMI budget is only $114 million.
During the meeting, the CHC officials presented a copy of the CHC board of trustees' three-page resolution “requesting the governor and the Legislature to properly fund” CHC for fiscal year 2013 “and ensure quality healthcare in the CNMI.
But in an interview after the meeting, Santos said they are asking for at least a $10 million “direct subsidy” from the government and the rest of the $40 million that CHC needs should come from hospital billing and collections and other sources.
Just the same, the board resolution stated a “proper funding” of $40,293,859.
This is 35 percent of the estimated $114 million revenue available for government operations in fiscal year 2013-from Oct. 1, 2012 to Sept. 30, 2013.
The Public School System is also asking for $33 million, or 29 percent of the CNMI's entire budget.
The CHC board resolution says if the governor and Legislature “fail to properly fund” CHC in 2013, the corporation “will be forced to reduce services far short of the minimum standards of accepted medical practice and healthcare in an attempt to maintain fiscal solvency, and, with the imminent failure of CHCC as an effective community health center, will be unable to achieve its mission as so stated in Public Law 16-51.”
That law created the corporation that was formerly the Department of Public Health.
In the resolution, the CHC board said its projected expenses would reach over $31 million, including operational and personnel costs.
It said CHC is also responsible for paying more than $3.396 million in past due obligations incurred and accumulated before it became a corporation on Oct. 1, 2011.
CHC is also responsible for some $5 million annually for unfunded, unsubsidized and uncollectible indigent care expenses.
All these, despite projected receivables of only $10.56 million in 2013, reported by the chief financial officer.
The governor's revised budget submission for 2013 allots $2.25 million for CHC, about the same amount that the House and Senate are proposing.
However, that amount will also be used as state share for Medicaid for a total of $5 million. That's the same amount of “seed” money that the administration gave CHC for 2012.
The CHC board said there is a potential $7 million of credit currently available from the Marianas Public Land Trust.
But it said it will not be able to retire the $3 million of credit it already owes MPLT that's due in March 2013 “and is in no position to accumulate more debt.”
The resolution is signed by six of seven CHC board members: chair Joaquin Torres, vice chair Pete Dela Cruz, members Anthony Aguon, Roy Rios, Daniel Lamar, and Juan N. Babauta, also the CEO.
The budget conferees from the House and Senate are now acing against time to come up with a budget bill acceptable to both houses, with less than three weeks to go before the Sept. 30 deadline.
If no budget is passed and signed into law by that date, the government will have another shutdown until a budget is in place.