Hawaii health insurance exchange
Hawaii Health Connector ranks last in 2014 open enrollment
By Carla Anderson
May 29, 2014
The open enrollment period to purchase health insurance for 2014 through Hawaii Health Connector, Hawaii’s state-run health insurance marketplace, has ended. People who get married or divorced, change jobs, have a child or experience another qualifying event may be eligible for a special enrollment period. Enrollment for MedQuest, Hawaii’s Medicaid program and Children’s Health Insurance Program (CHIP), continues throughout the year. Individuals who don’t have health insurance that provides “minimum essential coverage” may have to pay a penalty: $95 or one percent of income, whichever is greater.
Open enrollment for 2015 coverage through the marketplace begins Nov. 15.
Through the 2014 open enrollment period — which was was extended through April 30 — 9,785 Hawaiians selected a qualified health plan (QHP). Two insurers, Hawaii Medical Service Association and Kaiser Permanente Hawaii, offered 95 plans through the marketplace for 2014 coverage. Hawaii had the lowest QHP enrollment in the nation. Hawaii’s Medicaid program enrolled more than 28,800 people between Oct. 1, 2013, and March 31, 2014.
The Connector’s eligibility system is not integrated with the state’s Medicaid system. That lack of connection caused big delays, as the enrollment process used in Hawaii requires that all consumers seeking coverage through the marketplace first be screened for Medicaid eligibility. Those deemed ineligible for Medicaid continue through the enrollment process toward selecting private health insurance.
In addition to low enrollment, Hawaii is confronting financial concerns. Federal funding for state-run marketplaces runs out at the end of 2014. Hawaii Health Connector planned to use a 2 percent fee on premiums to fund its ongoing operations. Given low enrollment, the premium fee isn’t generating enough revenue to meet projected annual expenses of $15 million. While resolving technology and process problems will eventually lead to increased enrollment on Hawaii Health Connector, the revenue shortfall will persist unless the funding mechanism is modified. Hawaii has about 100,000 uninsured residents — about 8 percent of the population. (The low uninsured rate is largely the result of the Hawaii Prepaid Health Care Act, which was enacted in 1974 and requires most employers to provide health insurance to employees who work more than 20 hours a week.) About half are expected to qualify for Medicaid — meaning the market for the Connector is about 50,000. Marketplace officials are looking for alternative funding models as well as ways to cut expenses. The state’s request to use grant money that was awarded, but not yet spent, as bridge funding to get through 2015 was denied.
The Hawaii Health Connector is a nonprofit organization and overseen by a 15-member board. Tom Matsuda was named interim executive director of the exchange in December 2013. Matsuda replaced Coral Andrews, who resigned.
A bill considered by the House proposed making the marketplace a state agency as a way to address the poor performance of the Connector during 2014 open enrollment. However, with some legislators worried about taking on the marketplace’s revenue problems, lawmakers eventually passed a bill that maintains the Health Connector as a nonprofit and provides $1.5 million in funding. That is much less than the $4.7 million requested.
Hawaii health insurance exchange links
Hawaii Health Connector
State Exchange Profile: Hawaii
The Henry J. Kaiser Family Foundation overview of Hawaii’s progress toward creating a state health insurance exchange.