LBJ CEO says LBJ Finances not Critical

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When he discussed the status of the LBJ Hospital at the cabinet meeting this week, CEO Taufetee John Faumuina, said hospital finances were at a manageable level.

He didn’t seem to think that the LBJ’s financial woes were as serious as they have been described, and certainly not a crisis.

Taufetee said he understands Treasury’s problem of trying to allocate available revenues throughout the whole government,.

The CEO’s statements seemed to contradict financial reports from the LBJ Financial Office submitted to the Fono.

As of two months ago, ASG’s IOU to the hospital in unpaid monthly subsidies and the 2% wage tax was at $6.2 million.

And unpaid bills for LBJ self paying patients, Medicare, Tricare and ASG covered patients was $4.4 million.

Since Taufetee told the cabinet meeting that hospital finances were not at a critical stage we wondered if the sitatuion had improved and whether ASG has paid up what it owed LBJ.

The CEO replied, “Of course we have a cash flow problem when the subsidies from ASG do not come in timely for us to meet our financial obligations to our vendors and suppliers, but with the assistance of Governor Lolo, the Treasurer, and the Task Force, it brings relief knowing that help is coming our way.

“This is what I mean, financial assistance is coming but we have to do our part by controlling spending and apply cost containment measures, stop waste and abuse of supplies, etc.”

KHJ News pointed out that some of LBJ’s  managers whom we’ve talked to have said the cash situation is critical and we asked him to explain the basis of his statement that the situation is not critical.

The CEO said, “I am glad that our managers are very conscientious now with our financial situation. As I said  good management of our resources plays a major role.”

So has LBJ been able to pay down accounts receivable?  And what is LBJ’s current accounts receivable and accounts payable?

Taufetee didnt have the figures but pointed out since he returned to head the hospital he’s been trying to pay down accounts receivable.

Asked if  the hospital  still has to pay orders of medical supplies and pharmaceuticals in advance, the CEO said they have to do this with some vendors and not with others…it all depends on the amount LBJ owes them.

He added this is also a mechanism they instituted to help control inventory because of over stocking and spending.

When asked how much ASG owes LBJ,  he said he’ll  have to double check with the Chief Financial officer because they are still working with Treasury in the reconciliation process.

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