"As with any change, it's going to be an evolution, not a revolution," said Maui Memorial Medical Center Chief Executive Officer Wesley Lo.

Senate Bill 1792 — one of the most debated bills in the 2007 Legislature — became law Tuesday without Lingle's signature but with the approval of both Maui Memorial administrators and managers at Hawaii Health Systems Corp.

Lingle's spokesman Russell Pang said the governor called the bill "one of the most difficult" this year, given the strong arguments for and against it.

"Everyone seemed to be in agreement it has its flaws, it's not perfect but it is going in the right direction," Pang said Tuesday.

The intent behind the self-governance legislation was to decentralize oversight by HHSC of the state's community hospitals — now up to 13 with the addition of Kahuku Hospital.

A primary provision of the legislation is the creation of five regional boards to oversee finances and operations of the medical facilities in each region and the formation of a new HHSC board. The Maui region will comprise Maui Memorial Medical Center, Kula Hospital and Lanai Community Hospital.

HHSC Chief Executive Officer Tom Driskill and his board opposed the initial versions of the bill, saying it could break up the "safety net" of small rural hospitals and could result in duplication of services and an increase in cost of operations for the state-owned hospitals. The result could jeopardize care in rural communities, he argued.

But Driskill said he would accept the amended version that moved out of a House-Senate conference committee in May.

In arguing for the decentralization of HHSC, Lo said HHSC "is not a true 'system,' it is another layer of management." He said the central board is not responsive to needs and capabilities of the diverse communities.

"Removing this layer from Maui operations will not cause the closure of other HHSC facilities, or jeopardize the safety net system, but it will allow for more directed focus of local issues by the community regional board of director," Lo said.

"In fact, we feel that it will actually result in improved collaboration between the regions and HHSC.

"We also believe that HHSC, if run properly, will continue to provide administrative support to rural hospitals in a more efficient manner."

On Tuesday, Lo commended Maui Sens. Roz Baker, Shan Tsutsui and J. Kalani English — sponsors of SB 1792 — for standing behind the bill and ensuring its passage. He also gave credit to Rep. Bob Nakasone of Kahului for shepherding the legislation.

"This has been an incredible year for health care for Maui," Lo said, referring to both the self-governance legislation and legislative appropriations for health-care improvements, equipment and facilities.

Since the legislative approval of 1792 in May, Lo and his staff have been talking about implementing parts of the new law, particularly the local board make-up and its operations.

On Tuesday, Lo said the Maui Memorial Management Advisory Committee had come up with a list of potential appointees to the regional board, but had not submitted the names.

Appointees will be named by Lingle, who has 30 days to act on nominations submitted to her from a variety of sources including the House speaker, the Senate president and physicians working in the respective regions.

"We're in sync so the timing of everything is done right," Lo said.

Regional boards will take office on Jan. 1. These panels would be self-perpetuating, meaning any new members coming in after the initial appointments would be selected by the active regional board members.

The restructuring of the HHSC board will involve increasing membership by two to 15 individuals. Ten members would be appointed by the governor from nominees submitted by the legislative leadership (two from each region), along with two at-large members. Two physician members will be selected by the HHSC board from nominations submitted by the Management Advisory Committees and regional boards. The state director of health will also be an HHSC board member.

The existing HHSC board members will be phased out, with terms to expire Dec. 31 and Sept. 30, 2008.

Lo said now that the bill has become law, Maui Memorial will solidify its plans for orientation of the appointed regional board members before January. The orientation sessions will cover such issues as quality of care and hospital financing.

"We want to make sure they hit the ground running," Lo said.

All boards meetings will be public, and Lo said part of the new board's challenges will be how to best use community input in its decision-making process.

"We're going to find better ways to reach out and engage the community," Lo said. "If we implement this right, we can give the hospital back to the community."

Lo said the new law merely provides the venue to break away from the cumbersome state bureaucracy and create hospitals that are operated by individuals who live in the regions they serves. Eventually, he said, the regional boards will assume responsibility for hiring and firing the chief executive officers for the hospitals they oversee.

"They've just given us the keys and now it's up to us to make things happen," Lo said.

Claudine San Nicolas can be reached at claudine@mauinews.com.