Gov “cannot in all good conscience” submit LBJ’s proposed FY2015 budget

FY2014 budget for hospital submitted instead — for now

Gov. Lolo Matalasi Moliga has declared that LBJ Medical Center is “reaching crisis proportions” requiring greater scrutiny of the budget for the territory’s only medical center. The hospital’s fiscal year 2015 budget proposal has been kept by the governor at the FY 2014 ceiling level, saying he cannot in good conscious submit the additional $28.8 million requested by the hospital in its budget request.
This information was outlined in the governor’s July 14 cover letter of ASG's FY 2015 budget proposal received by the Fono yesterday. Lawmakers are in a mid session recess and are scheduled to reconvene Aug. 11.
Regarding the hospital’s budget, Lolo told Fono leaders, “All of us are concerned with the lack of appreciable improvements in our healthcare system.
“Regrettably, with the recent citations by CMS (Center for Medicaid and Medicare) of operating deficiencies at the hospital, the situation is reaching crisis proportions, which demand greater scrutiny of LBJ’s operation,” he wrote.
Lolo didn’t elaborate on the CMS citation but in a letter early this month to the U.S. Department of Interior, the governor said that on Jun. 16, the CMS had conducted a survey of the hospital and issued citations on “observed deficiencies, particularly in Nursing Services.”
“The Plan for Corrective action has been submitted to CMS and is awaiting review and approval,” said Lolo in the letter, which seeks DOI approval on revisions to American Samoa’s capital improvement project funding for FYs 2014 and 2015.
In his letter to the Fono on the FY 2015 budget, the governor said that he has yet to receive details of the hospital’s budget proposal and therefore he is only submitting LBJ’s approved FY 2014 budget level ($50 million) for consideration by the Fono for the FY 2015 budget.
Lolo says he will transmit for the Legislature’s review and approval at a later date any additional financial needs in excess of the fiscal year 2014 budget threshold when they are submitted to him for his review and support.
According to the governor, LBJ proposed a budget of $78.8 million in FY 2015.
However, Lolo says he “cannot in all good conscience submit” such a proposal “without first reviewing the justification for the additional $28.8 million requested for fiscal year 2015 which represents s 57.6% increase from the previous fiscal year 2014.”
Lolo went on to say that ASG is providing $6 million in local government subsidy to the hospital for FY 2015 — and this is the same amount for the current fiscal year.
Lolo said the quality of healthcare service remains one of the critical priorities for ASG and the subsidy qualifies the hospital for an additional $2 million from Medicaid funds thus yielding $4 million in new revenue to finance healthcare services.
Additionally, this funding by the government complements the work of the board and management of LBJ, who projected an estimate of $17 million, which could generate an additional $17 million in Medicaid Funds, according to the letter to the Fono.
(Samoa News is unaware of the source of the projected $17 million.)
LBJ’s summary budget details are only three pages and provide the same details as those found in the FY 2014 budget. For example, LBJ’s largest revenue source is $11.46 million under Medicaid and $7.8 million under Medicare; $7.9 million in DOI funding; and $3.5 million from the 2% wage tax.
During last year’s budget hearings, the administration submitted only a one-page summary for LBJ’s budget without any details. The LBJ board even showed up with their ‘own’ budget total, which was different than the one submitted by the Governor’s Office.
The Fono turned around and canceled LBJ’s hearing with instructions to the board to submit their revised budget through the Governor’s Office and the Fono will then hold the required hearings. The board complied.


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