Lawmakers learned that the territory’s two public hospitals are moving into one coordinated system, but leaders were careful to say the effort is not a merger.
Instead, Dr. Jerry Smith, chairman of the Virgin Islands Government Hospitals and Health Facilities Corporation, told the Committee on Health, Hospitals and Human Services on Tuesday that Schneider and Luis hospitals are in the middle of “health system integration,” a process meant to align leadership, finance, workforce, supply chain and service delivery across both institutions.
“What is being done here does not meet those definitions,” Smith said, pushing back on the term merger. “Both facilities will remain separately licensed facilities.”
Smith said both hospitals will operate under the same territorial system, after years of what he described as fragmentation.
“Fragmented health care structures often lead to high administrative costs, inconsistent care delivery, and reduced operational efficiency,” he said.
The goal, he added, is to reduce duplication, improve coordination, strengthen purchasing power and put more resources toward direct patient care.
For residents, he said, that should mean “shorter wait times, more reliable services, better staffing stability, improved access to specialty care.”
But senators questioned whether the governing board had the legal authority to move forward with a single chief executive overseeing both hospitals. The concern stems from a legal opinion raised at the hearing that the board may have acted outside its authority by naming one chief executive to oversee both hospitals, despite the facilities remaining separately licensed.
Lawmakers pointed to existing statute that contemplates separate leadership for both hospitals, while officials said they received different legal guidance and maintained the change is an administrative restructuring.
Darlene Baptiste, who has been serving as chief executive officer for both hospitals, said the system is well into the integration process and already seeing structural changes. The consolidation began with a single CEO model and has moved into the alignment of key administrative roles, including chief operating officer, chief financial officer, chief legal counsel, chief human resources officer among others.
“This consolidation not only reduces the duplication of effort but also generates an estimated annualization of salary savings estimated now at $2 million, with further savings expected as non-clinical management functions are consolidated,” Baptiste said.
She said the hospitals are also standardizing policies and procedures and evaluating staffing and compensation across both districts. Further, the hospitals have already begun crossover work to include financial services, laboratory, pharmacy and nutribition.
“This effort is not about eliminating the identity or the independence of either facility but rather strengthening how we can work together,” she said.
According to Baptiste, the hospitals are drafting a single integrated handbook, which will replace separate district manuals and apply alongside nine collective bargaining agreements. She said the hospitals want a clearer and more uniform process for discipline and grievances.
Still, the operational problems are far from over.
Baptiste said emergency department wait times remain a major concern and are being driven by what she called a cascading set of problems, including supply constraints, staffing shortages in the emergency department and support areas such as the lab and radiology, limited bed availability and patients being held in the emergency department while awaiting placement.
Supply chain problems were another major part of the hearing. Baptiste said Schneider and Luis hospitals continue to face fluctuating demand, limited on-island inventory, vendor constraints, logistical delays and cash flow disruptions that affect the ability to get critical supplies on time.
The hospitals are also trying to improve equipment and infrastructure, and have submitted federal funding proposals totaling $1.5 million for key needs, including replacement of operating room equipment, upgraded anesthesia delivery systems and an MRI system for on-site imaging among others.
Financially, the picture remains grim.
Baptiste said Schneider Hospital carries about $49 million in accounts payable, including roughly $10 million in legacy debt from 2022 and earlier. She said the hospital is also covering 17 boarders costing about $450,000 a month in unfunded care and spending about $1.4 million a month on temporary staffing and contracted professional services. Government receivables at the hospital total about $1.17 million, she said.
At Luis Hospital, Baptiste said accounts payable total about $22.5 million, including $12.8 million in legacy debt, and is using a line of credit to help pay critical vendors and keep operations moving.
“Despite these challenges, the organization is actively working to strengthen its financial position,” she said.
Lawmakers also received an update from Daryl Smalls, executive director of the territorial hospital redevelopment team, who said his office is overseeing planning, design and construction and closeout for the redevelopment of Luis and Schneider hospitals as well as the Charlotte Kimmelman Cancer Institute and the Myrah Keating Smith Community Health Center.
Smalls said several enabling projects are already complete or underway, including “JFL North, the critical administration building and 5-acre development near the hospital and the St. Croix interim dialysis project. He said the 5-acre project is expected to be completed in May and will include more than 28 ADA-compliant parking spaces. The interim dialysis project is expected to be completed in the fourth quarter of 2026.
Earlier in the hearing, senators also heard from the V.I. Department of Human Services, which outlined Medicaid modernization, long-term care redevelopment, Head Start rebuilds, child care subsidies and plans for the Knud Hansen Complex. Commissioner Averil George said DHS is working on a Medicaid State Plan gap analysis, long-term care facilities for Queen Louise and Herbert Grigg and the rebuilding of six Head Start centers.
Original source: vi