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Friday, February 12, 2010
Malulani Hospital offers Maui an alternative to MMMC’s “downward trajectory”
By News Release @ 8:58 PM :: 14034 Views :: Maui County, Health Care, Labor

by Jim Foster
The healthcare facilities on Maui are in a dire state, according to the recently released
Stroudwater Report, and if you live on Maui or visit, this study is of critical importance to you and your family.

The Stroudwater Report may be read in its entirety >>>> HERE

The Stroudwater Report has serious implications for all of us on Maui on our ability for access to quality healthcare facilities on Maui.

Here are a few highlights:

Maui's only medical center, Maui Memorial Medical Center, is part of the Hawaii Health Systems Corporation, a public benefit corporation and the nation’s fourth largest public hospital system.

The Hawaii Health Systems Corporation (HHSC) is governed by a 12-member Board of Directors whose responsibility is to develop policies, procedures, and rules necessary to plan, operate, and manage the hospitals.

  • 1) HHSC is in a financial perilous condition. It’s liquidity is at dangerously low levels with barely enough current assets to meet current liabilities. It is far behind in its payments to vendors (80+ days). The age of its facilities, including Maui Memorial, and other physical assets are well above national averages. Its future viability is unsustainable unless the state is able to increase its already huge subsidies to HHSC. And everyone knows the state of the state of Hawaii. Current year subsidy to HHSC is $111.64M representing 10% of Hawaii’s $1B deficit. Over 16% of HHSC’s operating budget depends on State subsidies and there are no reasons to expect the downward trajectory of the system to change.
  • 2) Intrinsically, the HHSC model is flawed. It’s history of ‘fixes’ has been unsuccessful and the culture does not allow for focus on quality of care outcomes.
  • 3) MMMC lost $75 million on operations over the past four fiscal years combined. MMMC has lost market share and operating profits are 11% below budget. MMMC has over-relied on outside contracts and have not implemented industry best practices within the business office. MMMC has launched an undercapitalized cardiovascular program which is strategically flawed.

By sharing these facts (and other facts) in the Stroudwater Report, Malulani Foundation can open the door to the fact that Malulani offers solutions to the very serious problems faced by HHSC and MMMC. Our community can start fresh, with a new hospital and a new vision for healthcare on Maui.

Dr. Ron Kwon started the process for the original Malulani Group to bring a new hospital to Maui and was not successful. Dr. Kwon was very disappointed, left the island and is now affiliated with a major hospital in Boston.

In addition to my full time real estate profession, I have been working as a volunteer for about six years, first with Dr. Kwon’s group and now as president of the Malulani Foundation, a 501(c)3 non-profit corporation that has received it’s letter of determination from the Internal Revenue Service so any donations are now tax deductible.

The goal of Malulani Foundation is to bring a private, full service, state of art, 450 bed teaching hospital to Maui which will provide further needed diversity for economy to Maui and a source of jobs for our Maui people.

For those of us who live in the West Maui area, the new West Maui Hospital will not be complete until 2012 – 2013. It will initially be a 25 bed critical access care medical facility that will admit patients with trauma injuries that would be stabilized and subsequently transferred to a full service hospital.

So the patient, once stabilized would then need to be transferred to a full service hospital and the choices would be:

1) Maui Memorial;

2) a hospital on Oahu; or

3) a hospital on the mainland.

This frequently creates hardships for families who have to pay transportation for the patient and loved ones to accompany the patient, housing costs to be near the loved one, taking time off from work and other logistical problems. For these reasons, Maui needs a new high quality full service hospital so our loved ones have access to quality hospital care without leaving Maui. Malulani Health and Medical Center will provide these (and all) Maui patients a high quality choice for the care they need right here at home, near their ohana. Maui deserves full-service hospital choices and greater access to care.

At the Malulani Foundation, we have a great board and have been very busy. Check us out at  If you are not receiving our newsletters, please sign up to receive them by filling out the information online.

Malulani Health & Medical Center will reflect the original mission of the community hospital established over 70 years ago, namely serving the people of Maui with the best possible healthcare available with the true spirit of caring for the community.

It is our intention to build a state of art, full service, private, teaching and research hospital. We will build the best hospital in Hawaii.  We would like Malulani to be the type of quality hospital that will encourage high end medical tourism which will help the tourist industry associated with South Maui. Our intention is to build a hospital that will take care of all Maui County residents and tourists and diversify our economy. We need to think about our own families, friends and visitors.

Malulani Foundation recently announced our partnership with Crossroads Program Group LLC of Denver, Colorado, in pursuit of the development of Malulani Health & Medical Center.

Crossroads is very pleased to work with us as we are with them. We feel they will be a great fit for our needs. What Crossroads has proposed is a comprehensive approach detailing a sequence of stages, all which are necessary for a successful Certificate of Need Application (CON) process required by the State of Hawaii for any new medical facility in Hawaii.

The steps Crossroads proceed with are:

1) Elicit Community involvement by conducting a visioning process.

2) Detailed Market Assessment

3) Financial Feasibility which includes the development & construction plans

4) Full business plan which includes recommended project structuring including recommendations for strategic partnerships, joint ventures and financing/funding options

5) Coordinate a detailed hospital design

Chuck Denk and Tim Long, principals in Crossroads Program Group LLC, emphasized their philosophy of developing long term relationships with their clients.

Our intention is to involve our local contractors and other local workers help the struggling Maui and Hawaii economy. Part of the role of Crossroads is to guide us in the selection process of capable and appropriate contractors.

We would like Malulani to be built at the original Malulani site, in the technology center in Kihei. We do have available for purchase between 40 and 80 acres. There are beautiful views which will be good for patients trying to heal. The supercomputer is there and we hope to work with it for our medical researchers. We would like at least 60 acres, as we know we will expand in the future and we need room for students, employee housing, research facilities, and perhaps a Ronald McDonald house.

Please feel free to call me or email me with any thoughts or questions that you may have or if you want to know how you can help.


RELATED: Legislative Report: Convert HHSC to non-profit, dump civil service (full text)

The Stroudwater Report may be read in its entirety >>>> HERE

Jim Foster is with the Malulani Foundation.


More info:

Web Site for HHSC is


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