Muña: We wish them the best

Commonwealth Healthcare Corp. CEO Esther Muña said Kagman Community Health Center’s announcement last week that it has decided to become independent and separate itself from CHCC doesn’t really upset her.

“We are not angry and not upset with the fact that they will be starting on their own. We were surprised but we wish them the best,” she told Saipan Tribune.

Muña, who last week also fired KCHC executive director Vince Castro and replaced him with CHCC chief financial officer Derek Sasamoto, said her immediate focus right now is on the hospital’s grantor, Health Resources and Services Administration.

“Right now, our concern is abiding by federal rules and closing out our obligations with our grantor, HRSA, because our grant with them which started in 2013 will expire on April 30, 2018,” she said.

Muña gave a brief background on how CHCC and KCHC acquired the HRSA grant as co-applicants in 2013 and how this became the genesis of the latter’s bid for independence.

“Five years ago, CHCC which was still then Department of Public Health did not have a board of directors. One of the requirements of HRSA was the grantee must have a board which KCHC had. What happened was we had the infrastructure but not a board and KCHC did not had the infrastructure but they had a board and this led to us being co-applicants to the grant,” she said.

“When the grant was given, we were already CHCC. The grant was to run for five years and the new grant to KCHC did not include CHCC because we did not know that they applied on their own… we don’t know what is in their application” she said.

Muña said that this grant application led to Castro’s termination because he did not have authority to deprive CHCC of the grant as he was hired by CHCC to ensure objective management and administration as a CHCC employee and as a KCHC executive director.

“CHCC is within its authority to act on Mr. Castro’s employment. Any grantee knows that while federal rules state relationships and authority, the grantee and its employees must operate within the rules of the overarching entity. That entity is CHCC,” she said.

“The Kagman board bylaws even state what the Kagman board can do and cannot do with Mr. Castro’s employment. As per their own bylaws, which we obtained from the first grant, the board does not have the authority to terminate the chief executive officer’s employment with the Commonwealth Healthcare Corp.,” she added.

However, Muña conceded that Velma Palacios, KCHC board chair, was correct in her statement that KCHC has to approve the new selection of the executive director.

“However, she needs to understand that Mr. Castro is no longer an option as he is no longer an employee. We can bicker about who they want to replace him with, but the Kagman board has a duty to be sensible as the closing of the grant is approaching within only a few weeks,” she added.

CHCC appointed Sasamoto last week as acting executive director to oversee closing out obligations and liquidation procedures.

“We appointed Sasamoto to facilitate liquidation process which includes budget readjustment and inventory of assets which includes medical equipment, computers which were acquired under the grant that cannot be turned over to KCHC because the grant specifically provides that no asset from the previous grant can be transferred to a private non-profit entity,” she said.

“One of our concerns is the KCHC employees hired under the old grant because their future is unclear and this has cultivated a certain fear among them… We cannot continue the work that we do with them because our grant is expiring and we cannot use the old grant to continue working with them,” she added.

Muña said that CHCC has already communicated with HRSA, the granting agency, and other authorities in regards to this matter.

“I’m sure, the Kagman board, on the other hand, is working on starting their project too. We wish them nothing but the best in their operations next month,” she added.

Palacios: Focus on new grant

Palacios said lost in the controversy that erupted from KCHC’s bid for independence from CHCC was KCHC getting a $1-million annual grant for three years.

“The focus should be on the grant awarded to KCHC,” she told Saipan Tribune in a separate interview.

“We have been in the news and to me this is really not the news that should be reported. The focus should be KCHC Inc. applying and being awarded a three-year grant of $1 million annually to operate independently which none of the other community health centers in our region like Guam, Palau, Chuuk, American Samao, Pohnpei, Kosrae, etc. have done,” Palacios added.

According to Palacios, KCHC is the only community health center in the region to receive a level 2 Patient Centered Medical Home standard of care certification and in fact, most U.S. community health centers are non-profit organizations.

The $3-million grant that was recently awarded to KCHC was from Health Resources and Services Administration. It’s the same grant CHCC and KCHC applied and acquired for as co-applicants in 2013.

“The existing grant which expires on April 30 has KCHC and CHCC as co-applicants. CHCC in this regard maintains the human resources and financial aspects of the community center. However, all the authority to make policies, approve the annual budget, select, dismiss, and review the executive director, among other things are vested with the KCHC board,” Palacios said.

“For this service area competition, the KCHC board voted to apply on its own without a co-applicant agreement. Any organization is free to apply for this competitive grant and it has been the KCHC board’s strategic goal to run independently and it has been no secret, it was a matter of time. The KCHC board decided that it was time since CHCC has a governing board now,” Palacios added.

Palacios also said KCHC disapproves Muña’s termination of its erstwhile executive director Vince Castro.

“The KCHC board did not approve of this action (Castro’s termination). As far as the KCHC board is concerned, he is [still] the executive director of KCHC,” she said.

Palacios also said that there can’t be two governing boards from CHCC and KCHC making decisions. As a community health center, the KCHC board has regulations and requirements it must follow.

“We have many goals and the KCHC board would like to carry them out and find ways to bring the community health centers to Rota and Tinian as well. Everyone’s goal should be the same which is improving health care access in the CNMI,” she said.

“We have not met with the CHCC board on this transition as their acting chairperson would like to meet when the CHCC chairperson gets back on-island,” she added.