‘To ease your concerns…’

I write this to address my intentions in drafting House Bill 20-149 titled, “To abolish the Commonwealth Healthcare Corp. and return its functions to the Department of Public Health.” It is my hope that this letter eases some of the concerns you may have regarding this crucial piece of legislation. In case my statements fail to do so, I encourage you to reach out to my office for any further inquiries for which I will be happy to address with you personally.

What H.B. 20-149 seeks to accomplish

The findings section of H.B. 20-149 simply states that because CHCC has failed to meet the needs of the people of the Commonwealth, the corporation should be abolished, and its functions be returned to the Department of Public Health. This bill will repeal Public Law 19-78 and Public Law 16-51; thus, it will revive the laws that existed prior to their enactment. Further, the transition of the management of the commonwealth care facilities from CHCC to the Department of Public Health shall be coordinated by the Office of the Governor. Additionally, where separate appropriations currently exist for CHCC as a governmental corporation (as determined by Public Law 20-11), appropriations shall be made in accord with the Department of Public Health.

Public Law 16-51

On Oct. 1, 2011, CNMI Public Law 16-51 was enacted to establish the Commonwealth Healthcare Corp. Prior to the creation of this law, public health care services (the Commonwealth Health Center) remained a governmental responsibility chiefly reliant on the CNMI’s general fund for its day-to-day operational expenses. The original intent of P.L. 16-51 was to allow CHCC the opportunity to become a professionally managed, nationally credited, and financially self-sufficient public healthcare institution independent of the Commonwealth government.

Public Law 16-51, among other conditions, required CHCC to 1) establish an accounting system, 2) produce monthly financial statements, 3) establish required cash funds, 4) establish a fee structure, 5) develop a strategic plan, 6) prudently collect account receivables, and 7) develop annual budgets. As of today and over six years after the enactment of P.L. 16-51, CHCC has yet to achieve any of these requirements as reflected in audit reports directly from the Office of the Public Auditor for fiscal years 2012, ’13, ’14, and ’15 (FY ’16 and ’17 are pending).

CHCC presently

Despite P.L.16-51 requiring of the autonomous agency to become self-sufficient and its wide-ranging latitude to do so during the past six years, CHCC continues to place blame for its inability to provide quality healthcare services to CNMI citizens and residents on the CNMI government’s underfunding of the corporation. Notwithstanding, my colleagues at the Legislature and I, in consideration of the essentialness of our lone public hospital, have continued to prioritize the needs of CHCC and have appropriated tens of millions of dollars from the general fund for hospital equipment, supplies, and other expenses, including uncompensated care costs for indigent members of our community. Regrettably, because CHCC remains an autonomous agency, we have little to no say in how this funding is to be spent. Moreover, we are unable to access any documentation—post-expenditure—regarding how the funding was actually spent.

Still, the Legislature has eagerly extended communication efforts to CHCC in hopes of addressing the many concerns expressed to us by our very own citizens, in particular those who have been consistently disappointed with the healthcare services provided to them and their loved ones by CHCC. These efforts in no way have been intended to hinder CHCC’s growth as an autonomous agency, but rather to offer our assistance in attaining the needs of the hospital as we have seen very little progress within the corporation since P.L. 16-51’s enactment. These efforts, however, have been unsuccessful as CHCC’s management has persistently remained uncooperative in sharing information relating to the agency.

On one particular occasion following my review of CHCC’s fiscal year 2014 audit report and in my capacity as chairwoman of the Health and Welfare Committee of the Saipan Northern Island Delegation, I had noticed that an excessive sum of funding in the amount of $203,107,017 of Accounts Receivables was written off from CHCC’s books. In light of this discovery, I drafted a letter to CHCC’s CEO Esther Muña requesting that these funds be justified. Specifically, I requested for the following documents:

1. F.Y. 2016 Interim Financial Statements: Statement of Net Position, as of Sept. 30, 2016; Statement of Revenues, Expenses and changes in Net Position for the year ended Sept. 30, 2016, and Statement of Cash Flows for the year ended Sept. 30, 2016;

2. Aging of Accounts Receivables;

3. Unprocessed insurance claims;

4. Personnel Listing including their annual salaries from F.Y. 2012 through F.Y. 2018, as of Nov. 30, 2017;

5. Policies and Procedures in the following areas:

a. Personnel;

b. Procurement;

c. Healthcare quality services and safety;

d. Accounting System;

e. Information Technology System;

f. Revenue Cycle System

g. Off island medical referral;

h. Subsidy program for low income;

i. Center for Medicare and Medicaid Services

j. Financing (i.e. borrowed money from any private or public source);

k. Travel, and

l. All other operational policies (i.e., clinical, the Kagman Health Center, etc.)

6. Strategic Plan from 2015 to 2020;

7. A Business Plan

8. Types of Electronic commerce;

9. Latest Centers of Medicare and Medicaid Service Site Survey: cite problems cited and status of all citations;

10. Accreditation status of CHCC;

11. Schedule of CHCC’s rate fees from FY 2012 through FY 2018, as of Nov. 30, 2017;

12. Types of medical technologies acquired and implemented since the inception of CHCC;

13. Management of federal grants and calculation of the indirect cost rate;

14. Budgets for FY 2012 through FY 2018;

15. Lawsuits and Settlements from FY 2012 through FY 2018, as of Nov. 30, 2017;

16. Annual reports for FY 2015 and FY 2016;

17. Incidents of embezzlements, fraud, illegal activities, sexual harassment, conflicts of interest;

18. Issuance of public monthly financial statements;

19. An accounting of Healthcare Operation Fund since inception of CHCC;

20. Status of CHCC accreditation by national agency;

21. Assessment on the Multi-Year Strategic Plan;

22. Organizational Chart, showing the title and names of CHCC management team;

23. Types of Committees and task groups appointed by CEO;

24. Quarterly report in the quality of the delivery of healthcare;

25. Strategic Plan projection on the legislative appropriations for the next five years; and

26. Types of charitable foundations

Since my letter was transmitted and received by Mrs. Muña over a month ago, the only response I’ve received from CHCC regarding the matter is a short justification that the $203,107,017 writeoff was recommended by the public auditor. In my recent communications with OPA, however, I was informed that they could not find in their correspondence with CHCC any mention of this alleged recommendation.

Further, while I understand that my appeal to Mrs. Muña for this list of documents was lengthy, I find it unsettling that not even some of this information is readily available as many of these policies and procedures should already be in place, especially those relating to accounting, billing, and collections.

I must also share that, as a Basis for Disclaimer of Opinion reflected in FY ’12, ’13, ’14, and ’15 audit reports by Deloitte, CHCC could not substantiate general ledger balances due to inadequacies in accounting records. In addition, the report stated that Management is responsible for the preparation and fair representation of these financial statements in accordance with accounting principles generally accepted in the U.S.; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statement that are free from material misstatement, whether due to fraud or error. In corroboration with this information, OPA’s Audit of CHCC’s patient revenue cycle management in Report AR-17-01, which was issued March 16, 2017, identified 11 audit recommendations. The Report on CNMI Agencies’ Implementation of Audit Recommendations dated June 28, 2017, later reported that all of these recommendations remained unresolved.

Next, it is imperative that we reflect on the extreme amounts of money we have expended to refer our patients off island to seek medical service that our hospital cannot provide. In Dec. 2014, Mrs. Muña acknowledged that “for decades, the people who called the CNMI ‘home,’ have travelled off-island, sometimes to foreign countries, spending thousands of dollars for healthcare.” Leaving your family behind to seek care for medical or behavioral health is not only financially straining on the patient and his or her family, but the necessary emotional support is also limited when a patient must leave off-island. Since FY 2012, Medical Referral costs have more than doubled, from over $5 million for 645 patients, to close to $12 million for 1,557 patients in FY 2017. For this reason, we must continue to fight for affordable and accessible healthcare here at home, and this is the ultimate goal with the enactment of this bill.

Again, my only desire in attempting to acquire this information from CHCC was to gain some understanding of its financial status in order to properly assess ways in which to best assist them. CHCC’s unwillingness to work collaboratively, its refusal to provide relevant documentation of expenditures, its inability to showcase tangible progress in the six years of its autonomy (such as a forward-looking healthcare and business plan, or a working billing system in which is long overdue), and most importantly, the continued dissatisfaction and suffering of our sick and those in need of healthcare services, has left me to conclude that there is no other alternative but to revert CHCC back under the supervision of the CNMI government. In returning CHCC to its status as a line department, the legislative and executive branches will be better positioned to take the necessary steps to improve our hospital’s delivery of services so that quality healthcare and, nothing less, can be attainable to the CNMI people in the near future.

I want to make clear that this bill is not intended to impair our hospital or its employees or patients in any way. Where CHCC presently remains financially dependent on government funds, this measure will only allow for the Legislature to continue to ensure that our lone hospital remains adequately funded as well as to ensure that accountability exists in all hospital spending measures.

On Jan. 26, 2016, I pledged to prioritize the improvement of our hospital and the healthcare services they provide to the best of my ability. Today, a little more than two years later, this objective continues to be of the highest importance to me as a member of the CNMI’s 20th Legislature. Likewise, my colleagues in both the House and Senate have shared in these same sentiments. Therefore, I am confident that they will not hesitate to assist me in accomplishing this critical endeavor. (This includes addressing issues related to the procurement process and CMS among others raised during comments at the House session on Friday.)

As an elected official, my duty is not to assign blame onto others for the shortcomings of CHCC or any other agency, autonomous or not. Instead, it is to seek the necessary means to enhance existing deficiencies. Moreover, my duties require that I make tough decisions when necessary−always with the public’s best interests in mind. For this reason, I stand by my decision and intentions in drafting H.B. 20-149.

Lastly, and contrary to the belief of H.B. 20-149’s critics, I firmly deny any accusations that my drafting of this bill is in any way politically motivated. Just like many of you, CHCC is and has always been the primary healthcare provider for not just myself, but for my own children, grandchildren, and families. I have nothing to gain from bringing harm onto CHCC, nor do I wish to do so. I have drafted this bill with the sole purpose of allowing our lone hospital the opportunity to provide the best quality healthcare services achievable. It is my hope that in meeting this goal, the quality of life for all CNMI citizens and residents will also be achieved. If we want nothing to change, then we should change nothing. But where we choose to acknowledge our deficiencies and inability to correct them in our present state, we must also choose not be afraid to take a different approach.

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Janet U. Maratita is a Precinct 1 representative in the House of Representatives of the 20th Legislature.