Distressed Guam hospital to get $50 million government bailout
By Pacific Island Times News Staff
Acting Gov. Joshua Tenorio today signed into law a bill appropriating $30 million to Guam Memorial Hospital to settle its outstanding debts to vendors and cover the costs of emergency repairs to the facility.
The new fund, which will come from the prior fiscal year’s excess revenue from the general fund, will supplement the $20 million pledged by the administration from the American Rescue Plan Act for capital improvement projects.
“With GMH facing both fiscal and physical challenges, swift action is necessary to ensure our island's only public hospital is supported and has the requisite resources to continue providing necessary services to the people of Guam,” Tenorio stated in a message to the Guam legislature.
The appropriation measure, Bill 164-37 which is now Public Law 37-43, was introduced by Sen. Jesse Lujan. Senators quickly passed the bill during last week’s emergency session on the heels of an earlier oversight hearing that revealed the worsening crisis at GMH.
Hospital administrators told senators about the recurring problem with collections, constraining its ability to pay its vendors, while employees testified about the facility's continued deterioration and lack of essential supplies.
The oversight hearing was followed by the Office of Public Accountability's release of its audit showing GMH's dismal financial condition and poor fiscal management.
With a total of $50 million in fresh funds, the hospital's spending and financial management will be scrutinized by the fiscal review committee, which was created last week through Tenorio's executive order.
Tenorio said the enactment of the appropriation measure, combined with the creation of a watchdog, "is going to make a world of difference, making sure that the hospital will operate the way it needs to for the people of Guam and give us the opportunity to focus on much-needed repairs to this facility."
The quick fiscal rescue was also prompted by Sen. Frank Blas Jr.’s resolution urging the governor to declare a state of emergency for GMH and transfer funding into the hospital.
“While Bill 164-37 serves as a temporary solution to the current outstanding vendor payables problem, GMHA's financial situation demands a deeper fiscal examination,” the lt. governor said.
The lt. governor said the fiscal review committee will assist GMH in ensuring its future financial health, and monitor the proper expenditure of ARPA funds and legislative appropriations.
“Allowing GMH the opportunity to integrate best practices into a broader strategy for financial success will ensure the continuity of services,” Tenorio stated in his transmittal letter.
Tenorio noted that while the fund infusion provides a band-aid solution to the GMH crisis, government leaders now need to focus on securing adequate property to build a replacement hospital.
“Our administration continues to issue repeated warnings about the physical state and lifespan of GMH,” the lt. governor said, citing the U.S. Army Corps of Engineers’ 2020 report that “the current hospital site is unable to accommodate critical expansions, lacks the capacity to accommodate substantial construction projects, and ultimately, it will be more cost-effective to construct a new facility rather than repair the current hospital in an attempt to bring it up to modem medical standards.”