A state panel yesterday voted down a proposal for building a second hospital on Maui amid concerns that it wouldn't improve patient care or make enough money to survive.

But hopes for the $212 million, 150-bed Malulani Health and Medical Center are still alive. Another group previously approved the hospital, and a third panel will consider it later this week.

Opponents of the new hospital told the Certificate of Need Review Panel it would lower the quality of care on Maui by drawing doctors, nurses and money away from the state-subsidized Maui Memorial Medical Center.

"The doctors needed for the appropriate staffing level of services is incomplete," said panel member Karen Moriuchi, who raised the motion to deny the new hospital a certificate of need. "Maui's got it great. They have one healthcare system that's continuously being added to, and it's making money."

Maui Memorial officials have said their hospital would lose millions of dollars in revenue because of the increased competition for resources, personnel and patients.

The final decision on the hospital rests with Dr. David Sakamoto, administrator for the State Health Planning and Development Agency. He has until Sept. 30 to consider recommendations of the three panels.

"You have to make sure you have the resources to provide services to the community," said Wesley Lo, chief executive of Maui Memorial. "This (panel decision) made a statement from the technical people in the industry about what's really going on in the healthcare industry."

Supporters of the new hospital say it would offer more areas of medical care, give Maui residents a hospital choice and allow them to stay on-island more often when they need treatment. Currently, one out of eight people leave the island for healthcare.

"Obviously, I'm disappointed at the outcome," said Fred Langille, Malulani vice president. "We still want and intend to see a positive outcome."

Members of the panel also voiced concern over the partnership between Malulani and the Triad Hospital Corp. for financing it.

The Tri-Isle Subarea Planning Council initially approved the hospital earlier this month. A third group, the Statewide Health Coordinating Council, will give its opinion after hearings scheduled to begin Thursday.

Sakamoto has not overturned the majority opinion of the recommending panels' judgments in his three years as agency head.

Also yesterday, the Certificate of Need Review Panel approved a request for Maui Memorial to expand its services with a cardiovascular facility.