“It’s like having a drug addict sibling and mom keeps telling the rest of the family to ‘support him.’ And then you find out that he’s having more kids and doing drugs.”
Speaker Benjamin Cruz used this analogy to suggest Gov. Eddie Calvo’s coddling of the Guam Memorial Hospital at the expense of the taxpayers and the entire government. “Unless you are willing to help yourself and take care of what needs to be taken care of, why should the rest of the family have to suffer just because you didn’t do the things that you have to do? You don’t even want to clean the house.”
Bill after bill has been docketed, debated, rejected and replaced in a desperate bid to find the ultimate treatment to the ills of Guam’s only public hospital. For decades, GMH has been diagnosed with many ailments, including operational and financial mismanagement, overcrowding and bed shortage, low supply, insurance disputes, unpaid debts to vendors, unremitted retirement contributions, poor billing and collection systems, questionable expenditures, outdated fees and low cash inflow. Each on the list is treated with first-aid kits or fleeting solutions that only relieve the symptoms. Over the years, the problems pile up and develop complications that leave GMH stuck forever in ICU.
The public hospital is always at risk of needing a taxpayer bailout. Efforts to find solutions are often greeted with public skepticism, policy disagreements and political suspicions.
“Through no fault of any one party or branch of government, a deep and disquieting mistrust has festered in our people. This mistrust—nourished by generations of bad decisions and empty promises—has made it so that our people believe government is the problem and not the solution,” Cruz said. “The only way I know to re-earn trust is to give it. That means GMH must bare its faults openly and honestly to the community it is now counting on for help.”
Last month, Cruz and Sen. Dennis Rodriguez, chair of the legislative health committee, hastily called a press conference to call out the administration for what they called a “misrepresentation” of the hospital’s accreditation status. Administration and hospital officials—while refusing to release the Joint Commission’s accreditation report — claimed GMH’s accreditation was in jeopardy unless senators passed the governor-proposed Bill 230-34 that would lift business privilege tax exemptions to raise funds for the proposed modernization of the GMH.
The senators eventually got their hands on a copy of the report. “It’s not an issue of funding,” Cruz said. The commission’s report had “nothing to do with any infrastructure plan that they want to implement.”
The commission found, among others, inadequate security cameras and a monitoring system, stained ceiling tiles, lack of biohazard labels for soiled surgical instruments at the decontamination room, stained patients bathroom and a dilapidated chair at the Emergency Room. “These are issues of basic standards of care,” Rodriguez said, vowing to “get to the bottom of this scare on accreditation.”
If the threat of losing accreditation is real, Rodriguez said, “then it means somewhere at GMH we have fallen below a standard of care when it comes to the health and safety of GMH’s patients and employees. I want to know exactly how.”
Gov. Eddie Calvo offered Bill 230-34 as a replacement for his previous Bill 141-34, which contains his original proposal to borrow $125 million for the GMH capital improvement project. Senators voted 7-6 in favor of the bill, but according to the legislature's standing rules, the minimum requirement for approval is eight yes votes, which constitutes a majority of the total 15 senators. The Guam Supreme Court, acting on the governor’s request for summary judgment, ruled that “a bill can pass if a majority of the senators present vote in favor of the bill,” thus striking down the legislature's standing rule of at least eight votes. The administration and the legislature, however, hit a stalemate on Bill 141-34 when the committee on rules declined to transmit it to the governor’s office for signature.
Sen. Dennis Rodriguez and Speaker Benjamin Cruz hold a press conference to discuss options for GMH.
While expressing support for Bill 230-34 “in principle,” Cruz said “the rest of the Legislature must weigh GMH’s immediate need for help against the economic consequences outlined at during an eight-hour public hearing.” To do this effectively, he urged the administration “to demonstrate that money—not governance or policy—are at the center of this threat, GMH must allow a full and public review of the Joint Commission’s survey findings.”
The Guam Memorial Hospital, which was first constructed at Oka Point in 1956, represented a major transformation in the history of the local government’s role in the delivery of medical care to the community. For many years, the US government provided free hospital and health care services to the people of Guam. The U.S. Naval forces assumed responsibility for the island’s medical needs at the turn of the 20th century when the United States took formal possession of Guam. These services continued with the Navy’s delivery of care after World War II, and culminated with their donation of the 23-bed hospital facility to the Guam’s Department of Public Health and Welfare. In 1964, GMH was established as a line agency of the Government of Guam’s executive branch. In 1977,
GMH was created as a public corporation, and has since been operating as a governmental, nonprofit institution serving the people of Guam under the governance of a nine-member Board of Trustees. In 1978, the old GMH at Oka Point was eventually replaced with a new facility, which now stands at its current site in Tamuning.
While designed as a self-revenue generating corporation, GMH has not performed accordingly. A majority of its clients are self-pay patients and thus it continues to receive appropriation from the general and special funds including the Compact impact grant, as well as other legislated rescue funds.
Last year, Governor Calvo signed into law a bill that expands access to the Guam Medicaid program by establishing a managed care pilot program, to be known as “The Healthcare Para Todu Plan.” Introduced by Sen. Rodriguez, the Para Taodu Plan is designed to provide health coverage to least half of the more than 32,000 Guam residents who currently are uninsured.
In July 2013, the government of Guam began imposing a 4 percent tax on gaming activities by virtue of Public Law 32-60. The law levies the new sin tax on electronic gaming devices, bingo/lottery, cockfighting, and Liberation Day gaming activities. The revenue from this temporary tax was earmarked for payment of the hospital’s outstanding debts to vendors and for construction of Urgent Care Unit at GMH, as well as other government agencies.
According to the Office of Public Accountability, the 27-month period from July 2013 to September 2015 was supposed to have netted $3.9 million in gaming tax and $3.7 million in GMH Trust fund Fees, for a total of $7.6 million based on available financial records. “GMHA received $3.3 million of the $3.7 million in GMH Trust Fund fees,” OPA said. “GMH has not submitted quarterly expenditure reports required by P.L. 32-60. We found that the Department of Revenue and Taxation’s predominantly manual processes do not ensure that (limited gaming tax) and GMH Trust Fund fees are accurately collected and allocated to GMH, (Guam Department of Education), (Department of Parks and Recreation) and (Mayors Council of Guam).” While the Department of Administration reported to have collected $7.6 million, OPA said, “DRT reported $4.7 million, a difference of $2.9 million.”
Meanwhile, GMH has become a pawn in the constant political bickering between the executive and legislative branches of government. It has a revolving door for administrators, who have been subjected to policy frustrations and internal power plays. In 2015, Joseph Verga quit as GMH director. He was succeeded by Theodore Lewis, who stepped down unceremoniously in 2016. Both left GMH under unexplained circumstances.
At the Jan. 29 hearing on Bill 230-34, GMH management and staff came to the Congress Building in full force, wearing black arm bands, to testify on the bill. “This ribbon is a ribbon of remembrance. It will remind us of the faithfulness, or lack of, our political leaders to our only public hospital and safety net hospital to our people,” said Dr. Vincent Duenas, GMH medical director.
Dr. Kozue Shimabukuro, assistant associate director of Medical Services, lamented the raps lobbed at GMH. “I just wish they come and see our work what we have to do every minute of it,” he said. “I’ve seen it all, outpatient side and inpatient side I am so proud of people who work at GMH. It doesn’t take an experienced medical director like me, it doesn’t take a genius to figure it out. The dire need of a healthcare rescue bill is apparent in every single one of our eyes as health workers.”
How do you rescue Guam’s only public hospital? Business leaders, who oppose Bill 230-34, proposed solutions.
Frank Shimizu, president of Ambros Inc., and Frank Campillo, plan administrator of SelectCare Insurance, urged implementation of a 2-percent sales tax. "Start thinking about joining the 21st century, eliminate the GRT and replace it with a sales tax," Shimizu said.
Campillo said also proposed that the government collect internet taxes and revise the property taxes. "Let’s not band-aid the problems any longer. Let’s place long term and sustainable solutions to our community hospital. Let’s rescue GMH, but let’s do it all together,” he said. “We support initiatives that will also yield better efficiencies and better accountabilities at GMH."
Simon Sanchez, a member of the Consolidated Commission on Utilities, recommended a temporary increase in business privilege tax from 4 to 5 percent for three years. "This will give the Legislature time to study other alternate recommendations, but at the same time, will provide immediate revenues to GMH and Government coffers which will be affected by tax reform,” he said.
The latest in a series of bills from the governor’s office was to raise the business privilege tax from 4 percent to 6 percent, partially to cover the needs of GMH and make up for the $47 million revenue losses resulting from President Trump’s federal tax cuts.
But Sanchez acknowledged “there is no one single magic bullet.” It's going to take a thoughtful mix of solutions, some of them “will be painful.”
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