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Op-Ed: Health Care System: ‘Free’ Ideology vs Sobering Reality, Part 2

A Historical Overview, Implications & Recommendations

The period of 1961 to 1968 marked the modernization of Tutuila and Manu’a when Governor Rex Lee received Congressional and Presidential support and funding.

Revolutionary in nature was the change in the education system where a television education system was installed to broadcast lessons by stateside certified teachers from the television station in Utulei to elementary and high schools around the island.

During this time, a modern hospital was built in Fagaalu and staffed mostly with US board certified stateside doctors, and a viable DOH was in place. Komiti Tumama and village councils were active participants in carrying out DOH preventive health programs.

The school of nursing was situated across from the new LBJ Hospital in Fagaalu, and had generated much interest in the nursing profession among young Samoa women. The Fiji Medical School pipeline was already established and had graduated its first and second group of doctors, and had generated immense interest in the medical field (like the nursing program did).

A network of new outlying dispensaries was connected by a radio system to both LBJ Hospital and DOH. In short, the territory underwent a comprehensive makeover. Economically, it was a boom time. The two canneries were in operation, the new Tafuna International Airport and the new Inter-Continental Hotel were opened. The Fale Laumei became a conference center and a landmark, and the cable car was carrying tourists to Mt. Alava. The territory became once again the hub of the South Pacific. Euphoria abounded and at that moment seemed endless.

In 1968, the year the new LBJ Hospital in Fagaalu opened its doors, “free” medical care for residents of American Samoa was guaranteed by Fono statute. The decade of 1960 to 1970 could be characterized as the period Washington’s “expansionary” policy was implemented for the territory. The ensuing years to this day Washington has been implementing a “restrictive” policy- self-sufficiency became DOI’s new “buzz” word for AS.

In 1974, the health care budget (LBJ and DOH) was financed 80% US, and 5% ASG. In 1977, health care costs increased significantly and LBJ proposed a revised fee schedule; Fono rejected the proposal.

In 1978, DOI and OMB (Office of Management & Budget) sent a letter to Governor Coleman stating the need to implement and enforce a revised fee schedule for health services at LBJ. It was met with stiff opposition at the Fono again, with the Fono citing the “free” medical care law.

In 1980, the American Samoa Health Care System included LBJ Hospital, Public Health Division, and ASHPDA (American Samoa Health Planning Development Agency). ASHPDA was a federally funded program established to, among other purposes, finance and conduct research on alternative methods of financing health care in the territory. Mick McCuddin was the director of ASHPDA and the consulting firm of Siegel & Associates was contracted to conduct the aforementioned research.

ASHPDA via Siegel & Associates came up with a combination of options as a solution for AS policy makers’ consideration: a prepayment plan, with co-payments for inpatient services, that is administered by ASG and has mandatory enrollment for the entire population; a Medicaid component to finance health care for the poor; a tax on soda pop (and possibly on other similar discretionary purchases), and specific earmarking of these funds for the exclusive use by DOH and health care (not going into the ASG general fund); and consideration of the sliding scale for the prepayment plan when census data were available.

Several meetings with the policy makers — Fono and administration proved fruitless regarding the prepayment plan and the soda tax. However, all was not lost as DOH via ASHPDA pursued the Medicaid option and it was approved in 1983.

By 1980, the health care budget was financed 74% US, and 26% ASG. In 1981, the revised fee schedule was finally approved by the Fono- $5 per in-patient day for residents and $35 for all others.

In 1995, the first Board of Directors of LBJ Hospital was established by executive order and the concept of a universal health insurance plan was introduced and considered. This effort fizzled out at the board level as the Board dissolved a year or two later.

In 1997, with significant pressure from DOI and Congress, the LBJ Hospital was established as an ASG semi-autonomous authority by executive order; in 1998, it was established by law with due pressure from DOI and Congress again.

The pressure point nudging ASG to yield to establish ASMCA was that Congress would not release federal funds destined for the territory if ASMCA wasn’t established by law. Congress and DOI wanted funds allocated for the hospital to go directly to the LBJ Hospital and not the ASG general fund. I believe the Hawaii Congressional delegation weighed in heavily on the Congressional ultimatum as LBJ Hospital owed big time to Hawaii health care providers (off-island care program). Hence, Congress released funds only when ASMCA was established, funds paid to ASMCA, and agreement that Hawaii health care providers and other off-island vendors (drug companies and other suppliers) would be paid with the funds being withheld. In a nutshell, that’s how ASMCA came about instantly.

In 1999, LBJ Hospital was financed 70% US/AS, 17% Medicaid, and 13% self-pay. In the beginning of 2006, the breakdown was 48% US/AS, 17% Medicaid, and 35% self-pay. Government (US and ASG) share of the budget decreased over 30% and self-pay (Medicare, insurance reimbursements, and patient payments) increased over 100%.

It was during this period that ASMCA requested an amendment to the free medical care law to address the ever increasing cost of health care at LBJ Hospital. The administration acquiesced and the bill was submitted to the Fono. The “free” medical care law was amended to read “free” medical attention and allowance for “reasonable” increases in facility fees to help cover increasing costs of care.

During the same time, the US was (and is) addressing its broken health care system with 45 million uninsured people. Federal funds via US Department of Health & Human Services were made available to research and study ways to make health care accessible by all.

ASMCA took advantage of the opportunity and in collaboration with the administration and the University of Hawaii, funding was secured for the Coverage for All in American Samoa research project. The Project Report by the local team was submitted to the administration and the Fono in 2007, where it’s currently resting in peace.

Shortages continued in 2006 and ASMCA found it necessary to raise fees. The Fono and the administration approved some measures to help off-set the shortages and to try and stop ASMCA from raising fees.

Fast forward to 2011 and 2012, it’s déjà vu again — ASMCA is stuck between a rock and a hard place.

ASMCA was underfunded due to various reasons well publicized in the media in the past few months. ASMCA postponed its rate increase thrice thus far as the Fono and administration scrambled to avoid the rate increase by introducing bills for the necessary funding.

According to Governor Togiola Tulafono on his radio program on Saturday (February 4, 2012), he would not sign any of the bills being sponsored by the Fono for ASMCA purposes. Seemingly our two bodies of policy makers are in a deadlock, while the 300% to 400% rate increase is set to go into effect in two days (February 6, 2012). Moreover, Governor Togiola stated he would be submitting a bill to the Fono come Monday to dissolve ASMCA and return the LBJ Hospital back to ASG. According to the governor, it seemed obvious the board and management of LBJ Hospital could not resolve funding problems afflicting the medical facility.

(Keniseli Lafaele was the project manager of the “Coverage for All in American Samoa Research Project”, and says he is doing this because both the Administration and the Fono pretty much ignored the report as well as previous reports done since the early 1980s. He believes that in these reports lie the foundation of viable solutions to the health care problem facing the territory today.)

In Part 3 of this OP-ED to be published in tomorrow’s issue of Samoa News, Lafaele will discuss public policy implications and recommendations as stated in our Project Report. Further, he will express his opinion on the policymakers handling of the matter up to this point, including the Governor’s remarks regarding ASMCA on his Saturday radio program.

[Sources of information for CAAS Project summarized in this OP-ED: Shaffer, J.R., American Samoa: 100 Years Under the US Flag; Lutali A.P., My Samoan Journey; Governor's Reports and Annual Reports (Territorial Archives); Census Reports, Income & Expenditure Survey Reports (Statistics Division, DOC/ASG); Mick McCuddin & Andy Puletasi, ASHPDA Research Reports; ASMCA/LBJ Hospital Financial Reports; Preker, A. U Carrin, G., Health Financing for Poor People: Resource Mobilization and Risk Sharing (World Bank); Viglor, E.R. PhD., Social Costs of Uninsurance (HRSA/AcademyHealth conference presentation]



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