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The Honolulu Advertiser
Posted on: Friday, October 17, 2008

Slow-to-pay hospitals blamed for staff cuts

By Greg Wiles
Advertiser Staff Writer

Hoana Medical Inc., a Hawai'i-based medical device company, said it has laid off staff to address slower payments from hospital customers who are having a tough time because of the credit crisis.

The maker of wireless patient monitoring systems said most of the layoffs occurred among its Mainland staff, while fewer than five were let go in Honolulu.

Hoana had employed about 30 people on the Mainland and another 30 to 40 here.

"We're just kind of proactively looking forward," said T. Heather Herdman, Hoana's chief strategic officer.

Herdman said she didn't know the total number of positions that were cut, and a call to Patrick Sullivan, Hoana founder and chief executive, wasn't immediately returned yesterday.

Herdman said none of those laid off were in core or essential positions. She said although Hoana has exceeded sales targets for 2008, it anticipates some customers may be slow to pay because of the current economy.

"It's a time to batten down the hatches," said Herdman, who said medical companies elsewhere are taking similar steps. "There's an overall weakness in the healthcare market."

The company said the layoffs were unrelated to the success it is beginning to enjoy with its LifeBed Patient Vigilance System that allows hospitals to continuously monitor patients when nurses and doctors aren't in a room. The system uses sensors embedded in a mattress coverlet and detects when a patient's condition worsens or becomes unsafe.

The system doesn't require patients to be hooked up to monitors with wires. The company also recently began rolling out its LifeGurney Patient Vigilance System that is targeted at emergency rooms.

Herdman said the company has made its first sale in Britain and is in discussions with several distribution partners capable of increasing the visibility of the product in the U.S. and Europe.

Reach Greg Wiles at gwiles@honoluluadvertiser.com.