Director: Health sys­tem is us­ing ‘scare’ tac­tics

Dr. Ben­jamin Falit says Hawaii Health Sys­tems Corp. is mis­lead­ing public, try­ing to get ‘un­fair’ terms for lease

The Maui News - - FRONT PAGE - Staff Writer By CHRIS SUGIDONO

The Pa­cific Cancer In­sti­tute’s med­i­cal director Thursday ac­cused Hawaii Health Sys­tems Corp. of us­ing public “scare” tac­tics last month to pres­sure the in­sti­tute that pro­vides cancer ra­di­a­tion ther­apy into ac­cept­ing new and “un­fair” lease terms at its Maui Me­mo­rial Med­i­cal Cen­ter fa­cil­ity.

Dr. Ben­jamin Falit, who made his com­ments in a View­point to be pub­lished Sun­day in The Maui News, also em­pha­sized that his fa­cil­ity is not in jeop­ardy of clos­ing Feb. 1 — as claimed by the quasi-public agency that runs Neigh­bor Is­lands and ru­ral Oahu public hos­pi­tals in a Dec. 12 news re­lease. The HHSC also filed a law­suit against the in­sti­tute over the leases on that day.

“If the story ended as a land­lord­tenant le­gal dis­pute, I would likely not be writ­ing this ed­i­to­rial,” in­sti­tute Med­i­cal Director Dr. Ben­jamin Falit said. “How­ever, on the same day HHSC filed the law­suit, it also pub­lished two grossly mis­lead­ing press re­leases de­signed to scare Maui pa­tients and physi­cians.”

The in­sti­tute, which op­er­ates on 8,000 square feet on the emer­gency room side of the hos­pi­tal, leases land owned by the HHSC, Falit said. Both par­ties own and share space in the build­ing.

The in­sti­tute is the only provider of cancer ra­di­a­tion ther­apy in Maui County. Be­fore it opened in 1993, cancer pa­tients needed to fly off-island for treat­ment.

The HHSC filed the law­suit al­leg­ing that its two land leases with the in­sti­tute, which were signed by both par­ties in 2005 and 2012, were il­le­gal and should be voided to com­ply with fed­eral law. The HHSC al­leged that new leases were nec­es­sary be­cause the cur­rent ones vi­o­late two fed­eral laws.

In its law­suit, HHSC claimed that it had reached an im­passe on its 2012 ground lease ne­go­ti­a­tions that spanned over a year. The leases have an ini­tial 25-year term, with an op­tion to ex­tend for up to 15 years.

Falit ex­plained that HHSC raised con­cerns with the in­sti­tute in 2015

over cer­tain util­i­ties and other shared ser­vices that had not been fairly in­cluded in its monthly rent. The par­ties agreed to a set­tle­ment on those is­sues last year.

After the set­tle­ment, the HHSC asked the in­sti­tute to con­sider re­draft­ing the leases to fur­ther clar­ify the obli­ga­tions of the par­ties, Falit said. Us­ing the ex­ist­ing leases and the set­tle­ment as a start­ing point, the in­sti­tute agreed.

How­ever, ne­go­ti­a­tions “broke down” when HHSC de­manded new terms that were not in the in­sti­tute’s ex­ist­ing leases and would have made it “sig­nif­i­cantly eas­ier” for the in­sti­tute to be evicted in the fu­ture, Falit said.

“We be­lieve our cur­rent lease, along with the method­ol­ogy for pay­ment of util­i­ties and ser­vices es­tab­lished by the 2016 set­tle­ment agree­ment, is legally bind­ing,” he said. “None­the­less, we will gladly make higher pay­ments to HHSC if a court or gov­ern­men­tal agency with proper author­ity de­ter­mines we need to do so.”

The HHSC said that the al­leged vi­o­la­tions of fed­eral law in the leases were dis­cov­ered when HHSC of­fi­cials were re­view­ing con­tracts in prepa­ra­tion for the trans­fer of public hos­pi­tals in Maui County to Maui Health Sys­tem, a Kaiser com­pany.

The HHSC said it “self-re­ported” the vi­o­la­tions to the U.S. Of­fice of the In­spec­tor Gen­eral. That of­fice is re­spon­si­ble for over­sight of fed­eral laws and may as­sess penal­ties against HHSC as a re­sult of the non­com­pli­ant lease ar­range­ment, HHSC said.

In its news re­leases, the HHSC claimed the fed­eral of­fice “in­formed” them that it must ex­e­cute com­pli­ant leases with the cancer in­sti­tute or ter­mi­nate the cur­rent leases by Jan. 31. Falit said lo­cal me­dia out­lets pub­lished the listed dead­line, “osten­si­bly set by fed­eral reg­u­la­tors, as fact.”

“My cancer pa­tients were dev­as­tated,” he wrote. “Many of them will be re­ceiv­ing ra­di­a­tion around the time of the pur­ported dead­line. Many of them are elderly, ill, wheelchair­bound, oxy­gen-de­pen­dent and/or im­pov­er­ished, mak­ing it im­pos­si­ble for them to travel to an­other island for treat­ment.”

Falit said he spent the next two days field­ing phone calls from con­cerned pa­tients and fam­ily mem­bers. He as­sured them that the in­sti­tute would not be shut­ting down by Feb. 1 “or any point in the fu­ture.”

Falit said HHSC has been “dis­hon­est” about the dead­line and did not be­lieve the fed­eral of­fice, or any other gov­ern­men­tal agency, has de­ter­mined any­thing il­le­gal about the leases.

Falit be­lieves the fed­eral agency may have told the HHSC that if it be­lieves the leases are il­le­gal, then it should ex­tri­cate it­self from the agree­ments be­fore a cer­tain date. The Jan. 31 dead­line is not ref­er­enced in the law­suit, and Failt said the HHSC has re­fused to share any com­mu­ni­ca­tions from the fed­eral agency.

An of­fi­cial at the Of­fice of the In­spec­tor Gen­eral reached on Thursday did not have any in­for­ma­tion re­gard­ing com­mu­ni­ca­tions with HHSC. HHSC of­fi­cials did not pro­vide The Maui News with any emails, let­ters or cor­re­spon­dence with the Of­fice of the In­spec­tor Gen­eral to ver­ify the al­leged vi­o­la­tions Thursday.

While “deeply dis­turbed” by the news re­leases, Falit said he was as­sured by HHSC CEO Dr. Linda Rosen that ne­go­ti­a­tions would con­tinue in good faith.

“We are com­mit­ted to pay­ing fair mar­ket value for these ser­vices,” Falit said. “How­ever, we do not be­lieve that HHSC should have the right to force new terms into the lease that make it eas­ier for HHSC to take away our abil­ity to op­er­ate the cancer cen­ter.”

Rosen con­firmed via email Thursday that the state agency is ready to restart ne­go­ti­a­tions. A spokes­woman with Maui Health Sys­tem, which took over op­er­a­tions of Maui Me­mo­rial Med­i­cal Cen­ter and Kula and Lanai Com­mu­nity hos­pi­tals in July, did not pro­vide com­ment Thursday.

“HHSC will con­tinue act­ing in good faith and tak­ing all nec­es­sary steps to com­ply with fed­eral law,” Rosen said in a state­ment. “We self-re­ported to reg­u­la­tors the vi­o­la­tions in the lease ar­range­ment with PCI, and we have taken steps to end the non­com­pli­ant ar­range­ment. While we were dis­ap­pointed by much of what PCI had to say about the sit­u­a­tion, we are en­cour­aged that PCI wants to re­turn to the ne­go­ti­at­ing ta­ble.

“We wel­come that out­reach when­ever PCI makes it, and we look for­ward to achiev­ing the end goal of en­sur­ing con­tin­ued, un­in­ter­rupted ra­di­a­tion ther­apy ser­vices for pa­tients in Maui County.”

Chris Sugidono can be reached at csug­i­

The Maui News / MATTHEW THAYER photo

The Pa­cific Cancer In­sti­tute, shown here in a photo taken Dec. 12, and the Hawaii Health Sys­tems Corp. are en­gaged in a le­gal bat­tle over the in­sti­tute’s lease agree­ment. The in­sti­tute is the only fa­cil­ity pro­vid­ing ra­di­a­tion ther­apy on the island.

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