Kahuku Hospital and the state have taken the first step to transfer the North Shore facility to the state hospital system.

Under a short-term management contract, the Hawai'i Health Systems Corp. will administer the 25-bed hospital as it seeks the licenses required to take ownership of the facility.

Established in 1996, HHSC serves most of the Neighbor Islands and rural communities statewide with both acute and long-term care.

Kahuku Hospital, the only hospital between Kailua and Wahiawa, was on the verge of closing because of financial losses.