The Rehabilitation Hospital of the Pacific is closing two of its four outpatient clinics on O'ahu and is working to sell two of its three Neighbor Island locations to its physical therapists there, company president Clair Jones said yesterday.

The downsizing will not affect operations at Rehab's 100-bed facility in Nu'uanu, the state's only inpatient, acute-care medical rehabilitation hospital, Jones said. He said the changes will allow the company to refocus on its core mission of providing therapy for "those whose severity, acuity and complexity are much more severe."

Rehab's 'Ewa location at Hawaii Medical Center West is scheduled to close April 24 while its Mililani Town Center branch will close May 22, Jones said. About 25 of the company's 450 employees will lose their jobs as a result of the two closures.

Jones said he is "pretty confident" that Rehab will be able to sell its locations in Kihei and Kona to its physical therapists there as private practices and that service for patients at those two locations will not be affected.

Rehab's outpatient clinics at Pearlridge and Nu'uanu will remain open, as will its location in Hilo, he said.

Each of the outpatient clinics serves about 100 to 120 patients at any given time, Jones said. About 60 new patients are accepted each month, and they typically have therapy sessions two to three times a week. The average patient has about 12 visits, he said.

Jones said he does not believe the closures of the Mililani and 'Ewa clinics will have a big impact on the people who use them now. Existing outpatient physical therapy clinics, including Rehab's remaining locations, should be able to absorb the patients, he said.

Rehab's board of directors decided in February to undergo the downsizing, he said.

Rehab's Web site said it "treats more than 8,000 patients recovering from strokes, brain injury, spinal cord injury, orthopedic injuries, sports injuries and those individuals requiring general rehabilitation."

EFFECTS UNCERTAIN

Exactly how much of an impact the closures will have is unclear.

Jones said a 2006 survey paid for by Rehab determined that the company held a 12 percent to 13 percent market share of outpatient rehabilitation services on O'ahu.

Rich Meiers, head of the Healthcare Association of Hawaii of which Rehab is a member, said it's difficult to gauge what kind of effect the closure of the two clinics will have.

"I'd like to think that if there is a need in the community, somebody can pick it up," Meiers said.

Dr. Scott McCaffrey, chief of staff at Hawaii Medical Center West, is also founder and chief executive officer for Workstar Injury Recovery Center, which has its offices across the hall from Rehab's 'Ewa clinic.

McCaffrey is also the owner of PT Hawaii, a Rehab-like physical therapy clinic that has locations in Kapolei and Waipahu.

HMC West and Workstar routinely refer people for outpatient therapy to the PT Hawaii and Rehab locations, as well as others in the area. The decision is largely based on convenience for the patient, he said.

He said he was surprised by the closures, noting that Rehab had spent the last few decades building up the clinic.

The situation is not dire in West O'ahu, he said, although people may need to travel farther to receive the services they need. "Those of us in the physical therapy community will do everything possible to pick up the slack," he said.

McCaffrey said he has been talking to key parties "trying to figure out a way to keep the facility open across the hall ... but we can't do it without physical therapists," noting that there is also a shortage of physical therapists in the state.

Ann Frost, president of the Hawai'i chapter of the American Physical Therapy Association, said she believes the impact of the two clinics' closures may not be too bad. "There are outpatient PT clinics pretty much all over the island," said Frost, a physical therapist at The Queen's Medical Center Women's Health Center.

There may be a more significant impact if the Kihei and Kona clinics do not survive, she said. "O'ahu, obviously, is a lot better source of PT clinics than the other islands," Frost said.

REIMBURSEMENTS

Jones said the existing "healthcare environment" in Hawai'i along with the sagging economy are the key reasons the board made its decision on the clinics that have been subsidized by other operations.

"Over time, we don't see our reimbursement for the services we provide increasing," Jones said.

Meanwhile, the company's costs and regulations are increasing, he said. "We can no longer subsidize the scope of services we currently offer," he said.

Besides being hard-hit by the recession on the operations side, Rehab has also seen a significant decline in its investment portfolio, Jones said.

Given that, he said, Rehab's board felt it best to focus on its core mission. "What we're looking at doing here is strengthening, enhancing and expanding our inpatient rehab services," he said.

Other outpatient rehabilitation clinics and providers can deal with the most common orthopedic rehab cases while Rehab focuses on more complex conditions resulting from strokes or injuries to the brain, spinal cord, heart or lungs.

"We really provide a unique niche in the healthcare continuum in Hawai'i," Jones said.

Meiers, McCaffrey and Frost said they understand the reasons why Rehab is downsizing.

Meiers said a national study has shown Hawai'i ranks last among the 50 states when it comes to monetary reimbursements for medical costs through Medicaid, Medicare and private insurance.

Over the past 15 years, other medical facilities in Hawai'i have also had to eliminate some of the services they've provided in the past to stay viable and Rehab is doing the same.

"When the money situation gets worse, they're not able to provide the same range of services," he said.

Jones said smaller physical therapy clinics have less financial headaches than an organizations as big as Rehab.