Hawaii Medical Center files for bankruptcy protection

Linda Rasmussen
Linda Rasmussen
Salim Hasham
Salim Hasham

By Zahid Arab - bio | email

HONOLULU (KHNL) - A nationwide trend of hospitals struggling to stay afloat hits home, as Hawaii Medical Center filed for Chapter 11 bankruptcy reorganization Friday.

Hawaii Medical Center's locations in Ewa Beach and Liliha are looking at reorganizing operations as one its lenders said it wasn't willing to front millions of dollars to keep the hospitals functional.

Officials are focused on getting the hospital's finances in order to get back in the black. A temporary solution, filing for chapter 11 bankruptcy reorganization.

"The lenders are caught in this cycle and because of the cycle we're in, it impacts us," said Hawaii Medical Center Spokesman Salim Hasham.

The hospital says it will use the 4 to 6 month bankruptcy protection window to reorganize, using a wide scope of solutions, like increasing its bed occupancy by nearly 20%.

"Change our payer mix, make sure we provide better quality of care, essentially provide a different range of services," said Hasham.

"It's a downward spiral and we're seeing this and it's going to continue," said Hawaii Medical Association Past President Linda Rasmussen.

Rasmussen says hospitals across the country are facing similar situations. She says the key for HMC to produce the $10 to $12 million dollars it will take to become profitable again, is balancing patient beds between those with insurance and those without. Rasmussen believes the state also needs to do something about liability reform and take into consideration our country's weak economy.

"Our gas prices have caused our electricity to go up and the hospital costs and the overall cost of doing things yet there's no increase in insurance premiums and reimbursement," said Rasmussen.

The hospital is feeling the pinch but the plan is patients will still get quality care. HMC says its reorganization reflects its will to be financially stable and secure in the future.

HMC bankruptcy papers show the company has enough cash to meet all of its employee obligations, and that means if things stay on course, officials don't expect any layoffs to be part of this reorganization process.