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Lolo proposes healthcare initiative funded with portion of 2% wage tax

LBJ hospital sign

Pago Pago, AMERICAN SAMOA — Gov. Lolo Matalasi Moliga has submitted proposed legislation which seeks to amend the current 2% wage tax law and establish by law, the Governor’s Healthcare Professional Succession Initiative.

In the cover letter last week to Fono leaders, the governor pointed out that American Samoa has “long depended on contract employees for our healthcare system” and while the territory is fortunate to have local doctors and nurses, “it is important that we continue to focus on developing the workforce in this field.”

He said local medical practitioners will play a vital role in improving the state of the local healthcare for years to come. To support this goal, Lolo said the submitted proposed legislation will create the Governor’s Healthcare Professional Succession Initiative, funded by a portion of the 2% wage tax.

“This Initiative will endeavor to assist local students in their pursuit of degrees in the medical field,” Lolo explained. “Through financial assistance, it will also create more opportunities for those interested in practicing medicine.”

According to current law, the wage tax is paid by all wage earners in the territory, with 50% of all proceeds collected earmarked for LBJ Medical Center operations while the other 50% goes to the LBJ off-island medical referral program.

Under the proposed measure, the Administration is keeping intact the 50% for LBJ operations, while the other 50% will go into a separate special account, to be established by the ASG Treasury Department for the Governor’s Initiative.

This account is to be administered by the Governor “to fund educational opportunities to expand the amount of local residents capable of providing healthcare services,” according to language of the proposed bill, which notes that redistribution of the wage tax “will help American Samoa develop and retain a strong workforce in healthcare services.”

The Fono is currently in a three-week mid-session recession and reconvenes on Feb. 10th.