HONOLULU (HawaiiNewsNow) - Gov. David Ige intervened Tuesday just as a controversial bill was set to pass the State House that would allow privatizing the financially struggling Maui Memorial Medical Center and two other smaller hospitals.
Lawmakers held off on a vote and the proposal is going to a House-Senate conference committee to work out details.
Maui Memorial Medical Center is predicted to be $28 million in the red this year, almost one-third over budget.
"We need to move forward with a new opportunity for public-private partnership in order for us to move our hospitals forward," said Ige at a news conference with House and Senate leaders just a half hour before the House was expected to approve a bill that would allow Maui Memorial and smaller hospitals on Lanai and in Kula to be privatized.
State House Speaker Joe Souki told reporters: "I'm very happy that the governor is involved and will be taking a leadership role in the pursuance of the transition from government to private nonprofit."
Lawmakers have agreed to work out differences in a House-Senate conference committee after Ige said he had "concerns" about the bill but refused to explain them to reporters.
"I don't think we want to get into the explicit details. We'll kind of work through it. And when we have the bill defined, we'll let you guys know," Ige told the news conference.
Ige said public unions have not asked him to stop the bill.
Randy Perreira, executive director of the Hawaii Government Employees Association, which represents 900 nurses and other public workers at the hospital, strongly opposes the deal.
"HGEA believes it is bad public policy to privatize the state's safety net hospital system. We continue to call for financial and management audits to improve the system from within," Perreira said in a statement.
Ige would not answer questions from reporters about whether there should protections from state workers from layoffs. A previous version of the bill guaranteed state employees their jobs at the facilities for six months after which time they would have to apply for jobs with the new private entity.
State Senate President Donna Kim said, "We want to make sure that we have a bill that we can defend, we want a bill that answers a lot of the issues and the questions and so that's where we deal with it, during conference."
Kim said she hopes legislative leaders can agree on something quickly, perhaps within the next few days.
The head of Maui Memorial said his hospital group is about 50- to 60-percent through its due diligence with Hawaii Pacific Health, owner of Straub and three other hospitals, which wants to take over Maui's operations.
"We're hopeful that people realize that we're trying to step forward with a solution. I haven't heard anybody else come out with solutions yet," said Wes Lo, Regional CEO of Maui Memorial.
Lo said he was concerned about the sudden delay in the bill, because if the privatization bill doesn't pass, he warned of dire circumstances.
"We would be forced to look at significant expense reductions which could mean cuts in staff as well as services," Lo said.
Hawaii Pacific Health released a statement that said it "remains committed to working with the Maui Region to create a sustainable health care system for Maui and Lanai. We have received very positive feedback from stakeholders on discussions held so far and support the bill in its current state."
Maui Mayor Alan Arakawa said "I don't know what Governor Ige's concerns are about the hospital bill. We are trying to find out but I don't want to speculate because we just don't know."
"What I do know is that HB 1075 is critical for Maui County residents because if it passes it will form a public-private partnership between Maui Memorial Medical Center and Hawaii Pacific Health to help deal with staggering fiscal losses of more than $800 million over the next 10 years," Arakawa said.
Key lawmakers said Ige had not detailed his concerns about the proposal with them before holding the news conference Tuesday, but they went along with his delay, hoping to strengthen the proposal.
Lawmakers have said the privatization proposal is not tailor-made for Hawaii Pacific Health and that other health organizations are welcome to bid to take over operations in Maui County.
In previous testimony to lawmakers, Ige's Attorney General's office said it wanted to ensure that all the state's dozen or so hospitals are eligible for privatization, not just those in Maui County.
The AG's office said it wants the governor to participate in final negotiations over transition to a private operator and wants the governor to have final approval of such a deal.