State of emergency declared for CHC

Gov. Benigno R. Fitial declared a state of emergency yesterday, paving the way for the CNMI and the Commonwealth Healthcare Corp. to immediately strike a multi-million dollar loan agreement with the Marianas Public Land Trust so that doctors, nurses, other employees, hospital vendors, and other outstanding obligations including power and water services will be paid, among other things.

The governor’s emergency declaration comes in the midst of the Commonwealth Utilities Corp.’s decision to cut power to some CHC units and public schools because of outstanding utility bills.

“A state of emergency for the Commonwealth of the Northern Mariana Islands is declared due to imminent threat of the disruption of critical medical services in the Commonwealth and the danger that such a condition poses to the public because of the great increase in otherwise preventable deaths that would result,” Fitial said in his two-page Executive Order 2012-02.

This is the third time for CHC to be placed under a state of emergency. The first one was in 2009 and the second one was in 2011.

Some Senate and House members blamed each other for the power disconnections in some CHC units and the Public School System.

Senate President Paul Manglona (Ind-Rota) and Sen. Ralph Torres (R-Saipan) said that, had the House swiftly passed Senate-amended bills on an $11.58 million line of credit for CHC and a $5 million Medicaid state share, $3.5 million should have been made available to CUC for payment of PSS’s outstanding utility bills and $1.5 million in CHC bills.

“Those two bills could have helped everyone-CHC, CUC, PSS, and the central government,” Manglona told Saipan Tribune.

Senators said Lt. Gov. Eloy S. Inos had recommended to the Senate, as well as to MPLT and CHC, that the $11.58 million loan bill include payments to CUC because it was already on the verge of disconnecting power to PSS and CHC at the time. Inos said the line of credit bill will make readily available some $6 million to CHC and some $5 million to CUC.

Some House members, however, blame the Senate for not acting on the original loan bill that would have helped CHC right away, and the situation wouldn’t have gotten worse for both CHC and PSS.

CHC chief executive officer Juan N. Babauta reiterated yesterday that he still supports the House’s original $11.58 million line of credit bill rather than the Senate version.

“First of all, I’d like to thank the governor for taking swift action,” Babauta said. “This emergency declaration will help alleviate the financial situation we’re facing. We’re operating from $38 million to zero. I haven’t seen the $5 million. We’re pretty much relying on our collection. This [declaration] is going to be very helpful in our quest to have a line of credit agreement with MPLT. CHC requested $10 million line of credit and $1.58 million for our electronic health system.”

Press secretary Angel Demapan said yesterday that the governor decided to execute the order “when it became increasingly clear that the Senate refused to reconsider its actions on the CHC line of credit bill.”

“The governor had hoped that the upper house would put the health and welfare of people first, but when it became clear that the Senate would not agree, Governor Fitial was forced to declare a state of emergency to ensure that all in-patients, out-patients, and members of the community at large continue to have access to medical care,” Demapan said.

Executive order

Fitial invoked his constitutional authority to declare a state of emergency and mobilize available resources to respond to that emergency.

The emergency declaration will allow:

Entering into a loan agreement among the Commonwealth, CHC and MPLT;

Suspend all statutory or regulatory provisions as required; and

The reprogramming of funds necessary to meet this emergency.

MPLT chair Pedro Deleon Guerrero, in a separate interview, said MPLT at this time cannot go beyond $11.58 million, the amount it had agreed to in talks with CHC and the Legislature.

CHC’s Babauta said the corporation, MPLT, and some House members worked hard to reach an understanding on the $10 million line of credit and the $1.58 million loan for CHC’s health information system, only for that agreement to be changed by the Senate at the last minute.

“We would only draw down on whatever is critical to pay. These critical agencies are payroll for nurses, payroll for doctors, outstanding obligations for housing benefits and allotments, including retirement and federal taxes. Those are priorities, and money owed to vendors from Oct. 1 onwards,” he said, adding that CHC continues to work toward strengthening its revenue management section to generate revenues for its obligations.

The governor issued his executive order hours after meeting with House Speaker Eli Cabrera (R-Saipan), House Ways and Means chair Ray Basa (Cov-Saipan), and House Health Committee chair Sylvester Iguel (Cov-Saipan) on the CHC loan bill, among other things.

Iguel, in a separate interview, said there were two options on the table during that meeting: for the Senate to reconsider its action on the House line of credit bill and the emergency declaration.

CHC provides the bulk of critical healthcare in the CNMI, as well as providing all emergency medical services. Fitial said the disruption of the provision of medical services by CHC poses a direct threat to the health, welfare, and safety of the CNMI people.

He said CHC is currently in arrears in payments to vendors for services and equipment and is in arrears in salary payments to employees.

“CHC requires an infusion of funds to continue to provide medical services necessary for health, welfare and safety of the [CNMI] people,” the governor said.