Molokai General
cuts staff to offset
budget deficit

The hospital has been operating
at a loss and yearly subsidies
won't cover shortfall

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By Helen Altonn
haltonn@starbulletin.com

Molokai General Hospital is eliminating six positions -- the first layoffs in its 69-year history -- to help offset a $451,000 budget deficit expected this fiscal year, said Dr. Emmett Aluli, medical executive director.

"This is a very difficult decision to make," he said, adding that the cuts reflect the financial problems plaguing other health care institutions in Hawaii and across the country.

He said Molokai's only hospital, a subsidiary of the Queen's Health Systems, is taking steps to become more cost-effective, reduce reliance on subsidies and ensure basic health care services.

"It is clear that if we just continue the way we are, MGH won't make it," Aluli said.

Operating at a loss, the hospital has depended on $2 million to $3 million a year in subsidies, with Queen's providing the largest amount.

But the hospital no longer can expect the same level of support from Queen's, the state or other sources, Aluli said, noting Queen's financial troubles and layoffs the past few years.

"All of the Queen's companies have had a difficult time in securing their projected budget," he explained. "Beginning this year, we didn't get the budget allotment. Every company had to look at cost containment. The last thing we wanted to do was cut any patient services."

A strike by five of the hospital's six registered nurses did not affect its fiscal situation, Aluli said. The nurses went on strike May 12 and returned to work June 13.

He said the hospital has received a $700,000 annual state subsidy for operations the past three years, but it will not cover the shortfall. A larger amount will be requested in the next legislative session, he said.

The layoffs, effective Sept. 12, involve service support positions, such as laundry, maintenance, groundskeeping and housekeeping. Four are in the United Public Workers bargaining unit; two are nonbargaining positions.

Another job that will remain vacant is that of Dr. Phillip Reyes, former co-medical executive director of the hospital with Aluli. Reyes left earlier this month to head Kamehameha Schools' health care facilities, Aluli said.

Patient services at the hospital will not be affected by any changes, Aluli emphasized.

He said the hospital was built by the Episcopal Church in 1932 in Hoolehua. It was transferred to Kaunakakai and operated by the community after the present hospital was built in 1963. In 1987 it became part of Queen's Healthcare Systems.

It has the only emergency room and urgent-care clinic on the island, with 96 full- and part-time employees.

It averages fewer than one patient per day in acute care, has 10 to 12 patients daily in its emergency/urgent-care center and 12 long-term residents. The hospital also serves as a clinic for visiting specialists and houses many community health programs.