Medical Referral deficit at $300K

The former Medical Referral program, now known as the Health Network Program, already has a deficit of $3 million just a little over halfway through the fiscal year and that deficit continues grow.

The Commonwealth Healthcare Corp., who now handles the HNP program, has requested more than $3 million for operations for the second quarter of fiscal year 2023.

During a press conference last week, CHCC chief financial officer Perlita Santos shared that the HNP program has already incurred over $300,000 deficit in the first quarter of fiscal year 2023 alone and this deficit only continues to grow.

“As of March 28, 2023, we’re at a deficit of almost $300,000. Everyday we’re incurring costs, be it patient subsistence, hotel accommodation, or airfare and transportation. To date, we have not paid our vendors because we [CHCC] cannot afford to pay for that. We have been asking our vendors, politely, to wait for funding from our central government because we don’t want HNP to be another unfunded mandate,” she said.

Santos said the central government only appropriated $700,000 for the program for the first quarter of fiscal year 2023. To date, that amount has already been expended, as well as the over $11 million in federal funds (American Rescue Plan Act funds) that was appropriated to the program under the last administration.

“The original appropriation was $1. [When] we requested for more money, only $700,000 was allocated to the HNP program. $700,000 is way below our requested budget. At our current number of patients, we would be spending roughly $8 million only to cover airfare, accommodation, and subsistence and there are no other medical bills factored in here,” she said.

In a previous press release from CHCC regarding the program, CHCC informed the public that the HNP is facing a critical funding crisis.

CHCC shared that, as Public Law 22-33 requires, on Jan. 31, 2023, the CHCC administration requested $3,487,754 to operate the program in the current quarter. Since that request, however, CHCC has only received $700,000.

“The program must exercise caution in its expenditures while adhering to the regulations. Steps taken include clarifying ambiguities and updating the income eligibility, which determines who is eligible for benefits of the program—air transportation, accommodations, ground transportation, and subsistence,” said CHCC.

CHCC stated in its press release that it had hoped to receive two years of adequate funding to turn the program around and bring sustainability to the program, which helps provide access to necessary medical services for individuals in the CNMI.

“CHCC has already implemented cost reduction strategies which have contributed to a nearly 34% decrease—from an annual expenditure of nearly $17 million in 2019 to $11.2 million in 2022 while still providing benefits to over 1,000 residents. Initiatives implemented require time and continued funding to obtain tangible outcomes. Some of the cost savings measures taken by CHCC since 2021 include improved coordination of benefits with insurance plans, particularly CNMI Medicaid, capped airfare, use of a company credit card to book flights, minimizing blocked rooms, and the utilization of ridesharing platforms such as Uber Health,” said the press release.

“In the meantime, the CHCC urges the community to access primary and preventive care. Before requesting HNP support, know if you will qualify for HNP benefits and understand your options to access services. The HNP staff are available to answer questions and assist you with making appointments, which is open to all, even if determined to be ineligible to receive other benefits,” said CHCC.