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Third appearance for approval of LBJ FY 2024 budget not a charm

LBJ CEO Dr. Akapusi Ledua (middle), CFO Sefanaiya Kaumautotoya and Executive Director Dr. Jean Anderson
“You have more chiefs in this budget than Indians!” declared one faipule

Pago Pago, AMERICAN SAMOA — Lawmakers were still not satisfied with the LBJ Hospital’s proposed budget for Fiscal Year 2024 when LBJ top officials appeared for the third time before the Budget and Appropriations Committee of the Senate and House joint hearing on Wednesday morning.

Testifying were CEO Dr. Akapusi Ledua, CFO Sefanaiya Kaumaitotoya and Executive Director Dr. Jean Anderson, who sat in for LBJ Board Chairman Dr. Malouamaua Tuiolosega who had told the Committee on Monday that he would be off-island due to personal and hospital reasons.

Dr. Ledua began his presentation by apologizing to Fono members for the delay in sending their budget due to unforeseen circumstances during this transition period in their administration.

The CEO stated that the total of their proposed FY 2024 budget is $97 million which is an increase of $27 million from last year’s budget.

He explained that the reasons for that increase and some of the changes in their proposed budget were:

  • Personnel, which has registered an increase of $4.5 million due to the 37 new positions they are adding in the new fiscal year, mainly nurses they have been recruiting to address the urgent and critical nurses shortage and also some positions for physicians they have added to expand the services they can provide for the public.
  • For the Material and Supplies category, there has been a decrease of $1.3 million because in the last two years they have spent most of the budget on Covid supplies.
  • For Contractual Services, there is an increase of $1.9 million because of the new ICU and new ER projects, community needs assessments, revenue cycle management and developing a territorial health care plan for the future.
  • Travel has an increase which totals $3.8 million because of the 37 new positions, most of which are nurses from off-island who are contract employees and more funds will be needed for their travel and relocation expenses. Ledua also stated that in the new fiscal year they were going to reinstate the doctors’ medical education that is required and the doctors have to attend a medical institution off-island to upgrade and improve their certification and knowledge and more importantly, their skills to perform their healthcare duties.
  • With Equipment, there is an increase of 77 percent and of that increase, about $6.6 million is for medical equipment, $3.5 million is for dietary equipment and about $8 million is for the ICU Emergency Room.
  • For Utilities and Communications, there is an increase of $856,000 because of the construction of a new project they are expecting in the new fiscal year.

“When you look at our revenue, about 70 percent of the expenses are directly related to patient care or clinical services while 30 percent is non-clinical to support our support services which in turn support direct patient care,” the LBJ CEO pointed out. “As far as revenue is concerned, about 70 percent comes from Medicaid and ARPA.”

Dr. Ledua stated that one of the changes is the ASG subsidy which was initially $6 million but they have put it back to $1 million as it was before, and taken $4 million from that and put it under the ARPA funds earmarked for medical equipment.

He requested that this $4 million be kept open so that if need be, it can be brought up again in the Supplemental.

The issue of Dr. Akapusi Ledua’s dual role as CEO and physician was raised by Senator Tuiasina Dr. Salamo Laumoli when the floor was opened to committee members.

“I am very proud to stand with you in what I think is right,” Tuiasina began. “I am also very proud to stand against you in what I think is wrong. First of all, yourself as a physician becoming a CEO. When I look at the situation, you are performing part-time as a physician and part-time as a CEO. There is no way your performance would justify the salary that is being proposed.”

Tuiasina expressed his concerns that the two roles would be undermined because he was not committed to one, and in the end, he would not be as effective in either role because of that.

“When I see the list of things you have given Dr. Jean Anderson to do in her new role as Executive Director, then I wonder what the CEO and the Medical Director are doing,” Tuiasina said. “This is primarily the role of a CEO, looking for nurses and doctors! There is clearly a problem with this, and to tell you the truth, your salary is the talk of the town and these chambers!

“I personally think that you would be of real value to the people of American Samoa if you were to remain a physician because your specialized medical skills would be utilized to the fullest for the benefit of our people. These are thoughts for you to think about and reconsider.”

Senate President Tuaolo Manaia Fruean questioned why some medical professionals who were not doctors were paid much higher than the doctors who were treating patients in the Emergency Room.

Tuaolo was referring to the Chief Medical Doctor in the ER whose salary was $102,000 compared to two Pharmacists who were paid $144,000 each.

“It doesn’t sound right to me,” Tuaolo said. “The doctors in the ER are dealing with patients everyday 24 hours a day, but all of them except the Chief Medical Doctor don’t even make $100,000! But look at these two pharmacists, they get paid $144,000 a year and they are career service! Our population is only about 50,000, why do we need two pharmacists with such high salaries?”

The LBJ CEO responded that they were working on reclassifying the physicians’ salaries so that they can be upgraded to a reasonable level. With regard to the pharmacists, Ledua said that there had been problems in the past in recruiting qualified pharmacists and when they came into office, it was difficult to reduce the salary of those who had been on that salary level.

He stated that he has referred the issue to the Board with his management team’s recommendations and the Board will make a final decision on the matter.

“Let me advise you Dr. Ledua,” Tuaolo said. “Without doctors, there is no business at LBJ. So you have to take care of the doctors. No doctors, no business there. When I look at your budget, some of those people there who are not doctors are making more money than the doctors! It doesn’t sound right to me.”

Faipule Luaitaua Gene Pan also brought up the issue of salaries but focused on employees on the lower part of the pay scale.

“It looks like you did a lot of research on the salaries of the higher echelon of the hospital,” Luaitaua stated. “But what about the employees who do the dirty work and work on graveyard shifts to feed their families. I’m talking about the nursing assistants, security guards, cleaners, housekeepers and laundry service employees.

“These employees are exposed to all kinds of germ, viruses and bio-hazards material from treating infected wounds, disposing and washing soiled sheets and so forth while performing their duties. Shouldn’t they be eligible for hazardous pay? What about training? Don’t they deserve a raise of at least $10 or $20? You have more chiefs in this budget than Indians!”

Faipule Larry Sanitoa expressed his concerns on the sustainability of the services and positions funded with ARPA funding saying that with the way ASG was spending, the funds may be depleted by next year.

He pointed out that in the first submission of the LBJ proposed budget, the CFO’s salary was $192,000 and on contract. However in the second submission, the CFO’s salary is $150,000 and is now on career service.

Sanitoa also recalled a memo from the LBJ Board chairman saying that after October 1, 2023, the CFO will be on contract and he asked Dr. Ledua if the CFO was on career service.

“He is on career service and we will be putting in next year’s proposal that he will be a contract employee,” Dr. Ledua answered.

“But how do you justify hiring a CFO which is by statute an appointed position by the Board so therefore, it should be on contract not a career service, and you’re increasing his salary,” Sanitoa pointed out. “I’m sorry my good friend Sefa but here we are at the Fono for the third time, because this budget proposal is completely full of errors, full of omissions and full of inaccuracies.”

House Vice Speaker Fetu Fetui, Jr. was incredulous at the increase of funding for travel in the proposed budget compared to last year’s amount.

“From half a million last year to almost $5 million this year, that’s ridiculous!” Fetui said shaking his head.“

He then asked Executive Director Dr. Jean Anderson for a detailed explanation.

Dr. Anderson clarified that the critical shortage of nurses has necessitated the amount of funds they are requesting to fund the hiring, travel and relocation expenses of the nurses and their families.

“One of the main initiatives of our administration is the elimination of that shortage,” she stressed. “By the end of the next fiscal year, we guarantee you that we will provide 50 nurses. We also plan to hire nephrologists to work in our Dialysis Unit which is why the amount we are requesting is so high.”

But Fetui was not convinced. He argued that the amount was too high and that government should not have to pay the airfares and relocation costs for the families of these nurses.

Senator Togiola Tulafono then asked Dr. Jean Anderson how much was she getting paid for her contract as executive director and she replied that it was $75 per hour “for fee for service,” which was the same rate she charged for any other consulting agency that requires her services.

She explained that depending on the priorities, she works for LBJ for 20 to 25 hours a week.

In the end, the Committee members were not satisfied with the proposed budget and asked Budget Director Catherine Saelua for her recommendation on what to do.

Saelua suggested that Fono approve the first quarter of the FY 2024 and demand corrections to be made by LBJ to their budget request.

However, lawmakers voted to approve the first quarter spending from the FY 2023 budget to the hospital and set a time frame for corrections to their proposed budget.