Queen’s Health
System wants out
of health plans

The system's four plans
cover 170,000 people

By Helen Altonn
Star-Bulletin

The Queen's Health System's board of trustees has decided to look for a means of easing out of the health plan business.

The system's four health plans, which cover 170,000 people, haven't been performing well, said Joel Kennedy, vice president of corporate communications for the Queen's systems.

Like hospitals, nursing homes and other health activities in Hawaii and the nation, health plans have been hurt by the the Balanced Budget Act's reduced reimbursements to cover costs.

Because of the federal law and other priorities, Kennedy said, "the board decided it is time to get back to basics and focus on direct patient care."

A statement from the Queen's Health Systems cited capital needs for these priorities: Queen's Medical Center renovations, opportunities to collaborate with other providers and the University of Hawaii's School of Medicine, and International Market Place redevelopment.

The Queen Emma Foundation owns the International Market Place, leased to WDC Ventures until WDC went into bankruptcy proceedings last year in Dallas. The lease reverted to the foundation, which now is managing the property, Kennedy said.

Revenue from the foundation's Waikiki property supports health care programs at Queen's.

Kennedy said the long-term future of the area is in question but there are no specific plans for it now.

Because of the board's decision, new health plan proposals weren't approved, including a merger with the Kapiolani Health Plan.

The trustees asked that jobs be preserved to the extent possible and that operations of Queen's Health Management and its employees be maintained "to continue to serve our community."

In exploring alternatives, they asked management to meet all provider and customer obligations and treat all major constituents "with fairness and sensitivity," according to their statement.

Queen's largest plan is Queen's Health Care Plan, a third-party administrator for mainland health plans and the military TriCare Program, Kennedy said.

The other plans are Queen's Health Care, providing QUEST coverage; Queen's Island Care, a health maintenance organization; and Queen's Preferred Plan, a mutual benefit society.

Kennedy said the plans have about 250 employees, and no layoffs are contemplated. "We don't have any preconceived answers. The decision is to look at this and decide how to do it," he said.

"We want to keep the plans as strong as possible, both for the people the plans serve and the people who work here."