By Carla Anderson
April 8, 2014
Consistent with the federal marketplace and most state-run exchanges, Hawaii Health Connector is allowing consumers who started applications by March 31 extra time to complete them. Enrollment for MedQuest, Hawaii’s Medicaid program and Children’s Health Insurance Program (CHIP), continues throughout the year.
About 7,900 Hawaiians selected a private health plan as of March 31. Based on the March 11 U.S. Health and Human Services enrollment report covering the period Oct. 1 to March 1, Hawaii had lower private health plan enrollments than any other state. Hawaii’s Medicaid program enrolled more than 28,800 people between Oct. 1, 2013, and March 31, 2014.
Hawaii has about 11,000 pending applications, and just 35 percent of applicants qualified for financial assistance compared to 83 percent nationally. The Connector’s eligibility system is not integrated with the state’s Medicaid system. That lack of connection has 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.
Two insurers, Hawaii Medical Service Association and Kaiser Permanente Hawaii, are offering 95 plans through the marketplace.
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.
Given Hawaii Health Connector’s status as a nonprofit, state government has limited control over marketplace finances and operations. A bill under consideration in the House for a time proposed making the marketplace a state agency. However, with some legislators worried about taking on the marketplace’s revenue problems, the bill has been modified. HB 2529 now calls for more Legislative oversight, new advisory groups, and changes to the board of directors.
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.
Let your Hawaii governor and legislators know how you feel about the state’s proposed health insurance exchange.Hawaii Governor Neil Abercrombie