Healthcare privatization row in Saipan comes out in the open

By Lori Lyn Lirio

Commonwealth Healthcare Corporation Chief Executive Officer Esther Muña

AS the Commonwealth Healthcare Corporation privatizes health care in the Marianas, it stressed that it is not obligated to transfer assets purchased for Kagman Community Health Center, which starting yesterday has run as a private non-profit entity.

According to CHCC Chief Executive Officer Esther Muña, the corporation is already communicating with HRSA and other authorities in regards to KCHC’s funds that it got from the granting agency.

In her conversation with HRSA officials, Muña said the grant agency confirmed two grants – the one they got five years ago, where KCHC was the co-applicant – and the other one – KCHC submitted a grant application claiming to be independent of CHCC.

“HRSA specified in grant number H80CS28324, CHCC is not obligated to transfer assets purchased for KCHC – the new applicant, a private non-profit,” she said.

In a telephone interview, Muña explained that all assets purchased under the grant have to be called out.

“The grant has expired on April 30 and CHCC’s responsibility is with the grant awarded five years ago and one of those responsibilities is to ensure to follow federal regulations on the disposal of the fixed assets,” she said.

The CHCC, through newly-appointed KCHC executive director and CHCC chief financial officer Derek Sasamoto, started the liquidation process, including budget readjustment and project director change.

She said the assets – including medical equipment, computers and anything that were purchased under the grant cannot be transferred to KCHC.

“It specifically says it cannot be transferred to new entity.”

“Our obligation is to close it out. 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…,” she said in a statement.

In the same statement, Muña said CHCC is within its authority to fire KCHC executive director Vince Castro.

“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.

She pointed out that the Kagman board by-laws even stated what it can do with Castro’s employment and what they can’t do.

“Per their own by-laws, 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 Corporation.”

She said Kagman board chair Velma Palacios was correct in her statement that they have to approve the new selection.

“But 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 noted that the Kagman board gave the executive director a title of CEO, despite CHCC’s rejections as it would cause confusion within the organization when there are two CEOs in CHCC.

In her case, Muña’s title was given statutorily.

In a separate interview, Gov. Ralph DLG Torres expressed support to KCHC’s decision to be independent from the CHCC.

“This is the decision by the Kagman board. They notified me,” he said.

Torres said the community healthcare board should be lauded for their effort for getting a competitive grant.

“It means additional healthcare services. I told them to use the money wisely,” the governor said.

“At the end of the day, are they providing healthcare? If yes, we should support it. If the answer is no, then we shouldn’t support,” he added.

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