Cost for new GMH records system more than doubles

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Getting a new electronic health records computer system remains the number one priority for Guam Memorial Hospital, but the cost to purchase that system has risen dramatically, and the current system used by GMH will expire next year.

During an oversight hearing at the legislature Tuesday evening GMH administrator Lilian Perez-Posadas explained that the current electronic record system is administered by Cantata Health under the brand name Optimum.

Cantata Health is phasing out its Optimum system and it must be replaced by next year.

The electronic health record system is vital to hospital operations. It’s needed to track patient care and ensure accurate billing.

“We have no option but to replace it,” said Perez-Posadas. “We’re in a time crunch because Optimum will sunset by next year, December 2020, and it might sunset sooner than that.”

Getting a new electronic health records computer system is a lengthy and complex process.

“We have timelines,” said Perez-Posadas. “We need to go through the process of procurement.” The GMH board must approve and time is needed to train staff on the use of the new system, she said.

GMH has already solicited requests for information and received 5 responses. The next step is to issue a request for proposals but “we cannot proceed with an RFP until we have the funding secured,” said Perez-Posadas.

Cost has more than doubled

In its 2020 budget request GMH estimated that the cost for a new electronic records system would be about $21 million.

However, “recent communication from different vendors indicates that the current price for a new system “ranges from $40 to $50 million,” over a period of 5 years, said Perez-Posadas.

Perez-Posadas referred to the $27 million in excess revenues collected in FY 2019. Sen. Terlaje has proposed allocating $10 million of that amount to GMH.

“If we could have at least the $10 million,” said Perez-Posadas “we can then begin the RFP.”

“Its such a jump,” said Sen. Telo Taitague “from $22, to $40, to $50 million now. What changed?”

Perez-Posadas explained that various regulatory agencies require manufactures to meet numerous standards which must be incorporated into their products and those requirements result in higher costs.

“It is costly,” said Perez-Posadas “and it has cost many hospitals large sums of money.”

Release from Sen. Terlaje:

FOR IMMEDIATE NEWS RELEASE (October 16, 2019—Hagåtña)- Senator Therese Terlaje Holds Oversight Hearing to Address Numerous GMHA Concerns

FOR IMMEDIATE NEWS RELEASE (Hagåtña, October 16, 2019)- Senator Therese Terlaje, Chairwoman of the Committee on Health convened an Oversight Hearing on the Guam Memorial Hospital last night to address an array of critical issues plaguing the Guam Memorial Hospital Authority. According to Terlaje, the hearing was necessary to review quality of care to patients in the 41-year-old facility and for accountability for funding given to GMHA for patient care. “I wanted a very clear and public record of Management’s priorities as to quality patient care, including staffing and facilities, and a record of exactly which issues GMHA management will resolve this year, and which they have decided to put on hold and why.”

Administrator Lillian Posadas, Associate Administrator of Operations,  William Cando, Assistant Administrator of Administrative Services, Don Rabanal and Rodalyn Gerardo, Chief Auditor and Acting CFO provided updates on the hospital’s elevators, boiler units, roof repairs, electrical panel, the sunsetting Electronic Health Records system, withholding tax debts and clarifications on public complaints of bloated staffing and physician salaries, amongst other issues.

GMH is continuing to prioritize improving quality of care and increase bed capacity through the recruitment of nurses. At the same time, it is dealing with long delayed facility repairs and management issues.

  • Elevators: According to Posadas, of the four Elevator units, two are currently functioning. Water leakage has damaged internal electronic components of. GMH has procurred passenger carriages for two elevators. However, in order to install the carriages, contractors are assessing the elevator shaft for leakage and rooftop repairs. They estimate it will take 3 to 4 months for each carriage to be replaced but will make sure that two elevators remain functional. The repair of the two elevators will cost a total of $500,000.
  • Boiler Units: One of two Boilers went down as of September 24th. Per Posadas, the contractor was onsite to conduct an assessment on the working boiler to ensure that it keeps running. The 30 and 20-year-old boilers were listed by GMH in its FY20 request for Capital Improvement funding. Although the focus, for now, is to repair the existing boiler, Posadas noted that the cost of replacing one boiler is estimated at $500,000.
  • Roof repairs: On June 26th, GMHA filed a claim with Moylan’s Insurance. A site inspection was conducted on June 28 and the cost estimate of $5 million submitted by GMHA last month is pending a response from Moylan’s Insurance.
  • Electrical Distribution Panel (EDP): A thorough assessment was done by GPA with infrared devices, several hotspots were identified and repaired or replaced. A 600-amp breaker was replaced recently. According to Posadas, based on the expertise of GPA, the EDP is in good standing. GPA will continue to do frequent rounds to detect hot spots and make sure things are in working order. Senator Terlaje asked Posadas if repair of EDP will still cost $6 million and if she was confident that the state of the EDP did not pose an eminent danger. Posadas stated that the bigger concern was the location of the panel to the water tank and that the plan is to relocate one of those items. Posadas further stated that the Army Corps of Engineers will assess and determine what to do. According to Cando the panel is also next to the boilers which poses multiple risks with all of these systems next to each other. Cando further stated that if the Army COE says the facility is not structurally sound, investment in a new panel may be put on hold.
  • The Army Corps of Engineers Assessment: The assessment of different components of the hospital will take place between November 18- 22 to determine structural soundness. GMHA expects a response to be complete in January, which will help determine if the present facility should be retrofitted or if there will be a need to rebuild a new facility at a different site. During the hearing Posadas stated that her personal preference is to build a new hospital at a new site in Mangilao, next to the University of Guam. Posadas stated that cost of retrofitting and to do so without interrupting operations will be challenging. Posadas prefers Mangilao next to UOG as an opportunity to be affiliated with UOG as a teaching hospital, bring in interns to build up professional pool and for closer proximity for people of the south. Senator Terlaje asked Posadas if she was making or working on a formal recommendation to which she replied no, that she was just being “straight and honest.” Cando reiterated that they were waiting on the Army Corps of Engineers assessment. Terlaje stated that it sounded like a decision had already been made and pressed the need for a truly objective assessment.
  • Electronic Health Records system: According to Posadas, the current system Optimum, will sunset in December 2020 and there will be no option but to replace it. A Request for Information (RFI) went out and GMH received 5 vendor packets. The project team has reviewed packets to identify how to proceed with an RFP. However, GMH cannot proceed until funding is identified. GMH has previously provided an estimate of $21 million to replace the current EHR but now says the price range for a new records system will cost between$40 to $50 million. Assistant Administrator of Administrative Services, Don Rabanal stated that the $20 million estimate was basically a figure from a particular vendor but a solid figure will not be available until the details of the RFP are compiled and vendors are allowed to quote. Rabanal further stated that the increased estimate is based on several indications from RFI packets and that total cost will not have to be paid upfront, but more likely throughout a 5-year period which amounts to at least $10 million a year. Senator Terlaje stated that the increased estimate was shocking and requested GMH to provide more concrete information on how amounts are calculated. Terlaje further stated that the goal of a new EHR system was to ensure CMS compliance. Senator Joe San Agustin stated that RFP details should coincide with CMS requirements.
  • Withholding Tax Debts: GMHA owes 4.9 million in taxes alone for 2018 (excludes interest and penalties) and interest and penalty fees for certain quarters for 2014 ($43,000), 2015 ($300,000), 2017 ($350,000). GMH has submitted a request for a waiver of interest and penalties to DRT estimated at $2 million. Posadas assured the Committee that payments have been made in recent weeks, and they are working towards paying off this debt within 6 months. Senator Terlaje questioned the knowledge and approval of past non-payment of withholding taxes by the Administrator and Board of Trustees and impressed upon Administrator Posadas, the need for procedures to ensure proper communication of such issues and prevention of such violations. Terlaje requested accounting of funds received by GMH, including the GMHA Trust Fund, the Healthy Futures Fund, and Department of Interior funding, and how these funds are being used.
  • Employment of Physicians, and Salaries: Senator Terlaje requested clarification on how some doctors are employed and paid by GMH. GMH assured the Committee that the process and methods of hiring physicians is under review and GMH is making efforts to ensure fairness and consistency. With an interest in long term solutions,

“The Hearing was informative, but there remain many issues requiring further follow up by the committee and by the Board. In many ways, we are only as good as our information.  I hope the Board will demand full transparency and accountability moving forward and be an active part of ensuring quality care and the best use of limited resources at the hospital. We’re dealing with short term and long-term issues, and it’s necessary for our entire community to have a realistic view of which issues will be addressed by GMH in FY 2020 and the issues we must look for other avenues to resolve. I believe if the public and local businesses can follow along, they can help in this regard.  With additional information that is being obtained, our community will also be able to build on prior studies and proposals towards a long-term plan.”

“We want to make sure that the goal remains quality patient care and value for the people’s investment.  The Board of Trustees must be actively involved and hold management accountable to these priorities. That’s the only way this is going to work.”