CHCC deficit: $18.85M and counting

‘Uncompensated care makes up most of CHCC deficit’
Posted on Jul 30 2020


Uncompensated care makes up most of the Commonwealth Healthcare Corp.’s huge deficit that has now amounted to $18.85 million.

CHCC chief financial officer Derek Sasamoto disclosed during the budget hearing of the House Ways and Means Committee and in a board meeting with Gov. Ralph DLG Torres, Lt. Gov. Arnold I. Palacios, and Finance Secretary David Atalig that CHCC has managed to boost its revenue from $30 million to $60 million annually but, because of uncompensated care, the “huge deficit” of the hospital persists. In fact, uncompensated care is increasing and has reached $18 million in the current fiscal year.

“We have done a lot to grow resources, but the shortfall still exists,” he said.

Sasamoto also mentioned the unfunded medical services CHCC provides to government agencies, as well as the central government owing CHCC $9.6 million for fiscal year 2019 appropriations. This comes as Sasamoto also expressed concerns that CHCC has not been getting its monthly allotments.

According to Sasamoto, more than 90% of CHCC expenditures are for hospital services. “Over 90% of what we spend goes straight into services, straight into the hospital, and we can prove that. …So to take away from the services…it’s going to be a difficult decision, and those are the kind of choices we have to always make on a daily basis,” said Sasamoto.

Esther Muña, CHCC’s chief executive officer, echoed Sasamoto. “It’s very difficult for us when we’re dealing with health. It’s always unpredictable,” she said. “We may have patients that are really healthy one month, then the next month, we have very sick patients.”

Muña added that health care is not cheap, and it’s always been a “struggle,” since the hospital has to verify if they have adequate supplies such as medical, pharmaceutical, etc., as well as having a medical team, nursing team, especially with staff shortages, to render health care services.

Both Muña and Sasamoto pointed out that CHCC does not turn away patients. Sasamoto added that the Commonwealth Health Center keeps patients no matter their ability to pay, and that CHCC always asks for support every year because it’s considered a community issue.

Additionally, Sasamoto says that the $704,005.44 in local appropriations for fiscal year 2019 was spent on medical supply expenses, but he indicated that CHC’s medical supply costs for the first two months of fiscal year 2019 was over $1 million, which only covered about 1.5 months of its medical supplies that are needed.

“These are the services provided, costs incurred, supplies consumed and others with no corresponding return. It is a pure loss to CHCC,” Sasamoto said. “This condition alone demands high priority for appropriation support.”

At the House Ways and Means Committee budget hearing, Sasamoto said that if CHCC gets 50% of the requested allotment, it would “create a tremendous impact for CHCC in terms of meeting liabilities and obligations.”

Sasamoto added that CHCC provides services to the Department of Corrections, but DOC hasn’t paid. “We send the bills but, unfortunately, the department has not been able to satisfy its obligation,” which now amounts to over $1.8 million, Sasamoto said.

Additionally, CHCC attends to patients with social issues. “For example, patients who have no home to return to for various reasons. CHCC accommodates these patients who occupy bed space and need treatment, which also equates to lost revenue,” said Sasamoto.

Justine Nauta | Correspondent
Justine Nauta is Saipan Tribune's community and health reporter and has covered a wide range of news beats, including the Northern Marianas College and Commonwealth Health Care Corp. She's currently pursuing a bachelor’s degree in Rehabilitation and Human Services at NMC.

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