Governor’s Campaign Manager Runs Governor’s Health Care Project

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BY JIM DOOLEY – The chairman of Gov. Neil Abercrombie’s political campaign is running a “public-private partnership” with Abercrombie’s office that is soliciting $1.3 million from health care companies for what the governor calls the “Hawaii Healthcare Transformation Initiative.”

The HHTI — recently re-dubbed the Hawaii Healthcare Project — is contemplating far-reaching changes to how health services are delivered here. Its work is being coordinated by the Hawaii Institute for Public Affairs, a non-profit organization headed by private attorney William Kaneko, a close Abercrombie associate who chaired the governor’s 2010 election campaign.

fundraising letter

Kaneko and HIPA have sent form letters to numerous health care companies soliciting specific sums of money to pay for the HHTI project.

Several of the biggest players in the local health care industry have responded generously to Kaneko’s requests.

According to HHTI executive committee minutes, Kaneko reported in April that he had secured a $200,000 donation from Hawaii Medical Service Association; $80,000 from Kaiser Permanente; $50,000 from Hawaii Pacific Health; and $20,000 from The Queen’s Health System.

A sample letter provided to Hawaii Reporter by Kaneko noted that health care issues have been studied numerous times before but the HHTI effort different because it is about “IMPLEMENTING the most pressing priorities to transform our healthcare system” (emphasis in original).

The letter referred readers to the goveernor’s website for additional information.

Executives of companies that were asked for donations said they were concerned about the requests given Kaneko’s connections to the government.

“It was uncomfortable for some people,” said one, who asked not be identified by name.

“Anybody that needed a favor from the state, I can see the perception that could be read into it,” the executive said.

“There’s this connection (to the governor) and there’s a very, very fine line because Bill directly was asking and naming amounts that he thought were appropriate,” the executive continued.

Another official whose company was asked to donate said, “It created a feeling that if you didn’t give what was asked, maybe your voice wouldn’t be heard.”

Beth Giesting, the governor’s healthcare transformation coordinator, and Andrew Garrett , a

Beth Giesting

HIPA employee who is “project manager” of the healthcare transformation initiative, said such perceptions are baseless.

When asked if a donor is granted “a bigger voice or a bigger say” in HHTI’s plans, Giesting said, “If people are contributing on that basis they’re going to be very disappointed, I suspect.”

Garrett said the transformation initiative “started long before a dime was raised. The whole structure was put in place first and the fundraising started after that.”

HMSA, the largest donor at $200,000 and the dominant health insurer in Hawaii, said its donation was entirely voluntary.

“We didn’t feel pressured to contribute, but rather view this as an obligation we have to participate in efforts intended to improve Hawaii’s health care delivery system and to make health care in Hawaii sustainable,” said HMSA spokeswoman Elisa Yadao.

Garrett and Giesting declined to discuss details of HHTI’s budget.

Giesting said budget documents are the confidential property of the private non-profit.

“I think some of the stuff around HIPA’s budget and its fundraising is probably as proprietary as any other private non-profit,” said Giesting.

Garrett said HIPA retains a portion of what it collects to cover its overhead but he declined to cite specific numbers.

Giesting and Garrett stressed that the $1.3 million budgetary target  would cover two years of expenses and said no HIPA-raised funds are spent on Giesting’s office or other parts of the public half of the public-private partnership.

Giesting’s salary is in the range of $130,000 annually, with half of that money drawn from a $1.4 million federal grant that is principally being used to meet requirements of the new federal Affordable Care Act, President Barack Obama’s national health care initiative.

The remainder of Giesting’s salary comes primarily from funds given to the Hawaii Community Foundation by a California non-profit called the California Endowment, said Giesting.

When Abercrombie took office, changing health care was “a very important function of the New Day plan,” the governor’s blueprint for social and economic changes in the state, Giesting said.

But there was no money available to fund the health care initiative, she said.

“The cupboard was bare,” Giesting said.

“That’s where HIPA came into it and we sort of came together in a public- private partnership,” she said.

HIPA had already been involved in projects that analyzed various aspects of the health care industry in Hawaii and other firms were also working toward transformation, said Giesting.

“HMSA was doing a whole lot of things in terms of innovation, Hawaii Pacific Health, Queens (Medical Center), other insurers, of course, and other parts of the health care system were already moving toward transformation,” she said.

“And so I think they came to HIPA. I know HMSA went to HIPA and talked about HIPA doing something in health care transformation. And I got to talking to Bill (Kaneko) also about how we needed to be working with the private sector because they’re really the people who deliver health care. So it just all sort of came together as a public-private partnership,” Giesting said.

Community activist Larry Geller, who heads Kokua Council, a senior citizens service organization, said the donation requests from HIPA smack of a “pay to play” system.

“It puts a price on participation,” said Geller.

He also objected to the make-up of the transformation executive committee and the larger, 60-member council.

”They’re all participants in the system we have now. They’re going to create the new system in their own image,” he said.

He noted the shortage of consumer representation on either the executive committee or council.

Giesting, when asked about consumer participation in the process, cited the membership of the American Association of Retired Persons (AARP) and the Hawaii Chamber of Commerce on the committee and Council.

“We of course are attuned to what consumers are saying out in the community. And we’re planning on more community outreach,” she said.

Geller also noted that the transformation project, like another important new player in the health care here called the Hawaii Health Connector, isn’t subject to state sunshine, open records, ethics or procurement laws.

The Health Connector is a private, non-profit corporation created by the Legislature to carry out mandates in the new national health care law known to many as Obamacare and formally called the Affordable Care Act.

The Health Connector came under sharp criticism from consumer groups earlier this year for its lack of public representation on its board of directors and its freedom to operate outside of the state ethics, sunshine and procurement codes.

The same problems apply to HHTI, said Geller.

“There’s no requirement for transparency,” he said.

Giesting and Garrett said HHTI is committed to transparency.

“We do want to be as transparent as possible,” Giesting said.

But Hawaii Reporter requests for information on the organization’s budget and on a public relations contract just awarded by HIPA were rebuffed.

The contractor is IQ PR, Inc., a San Francisco-based firm that is now posting news releases on the governor’s website.

Giesting said a main goal of the transformation project is to “address the fact that our health care system is fragmented and that we don’t necessarily pay for the rights things… that we don’t use health information technology effectively to make sure that physicians have all of the right information in a timely way.”

Other states have adopted new approaches to health care and those ideas are being studied here, said Giesting.

Vermont has “initiated community care networks and patient centered medical homes” and North Carolina’s “Medicaid program has a tremendous record in how they are providing care for chronically ill patients and saving their Medicaid program hundreds of millions of dollars.” she said.

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Jim Dooley joined the Hawaii Reporter staff as an investigative reporter in October 2010. Before that, he has worked as a print and television reporter in Hawaii since 1973, beginning as a wire service reporter with United Press International. He joined Honolulu Advertiser in 1974, working as general assignment and City Hall reporter until 1978. In 1978, he moved to full-time investigative reporting in for The Advertiser; he joined KITV news in 1996 as investigative reporter. Jim returned to Advertiser 2001, working as investigative reporter and court reporter until 2010. Reach him at


  1. Good work, Hawaii Reporter and Mr. Dooley. This stinks of Chicago-style political extortion (partner with us, or else!), which is not so surprising considering our governor’s White House mentor.

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