Hawaii and the ACA’s Medicaid expansion

Medicaid enrollment up 21%; Uninsured rate down to 3.5%

Medicaid expansion helped cement “healthiest state” status

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Hawaii has a long history of supporting initiatives to make health insurance broadly available to residents. Hawaii was among the first six states that implemented a Medicaid program in January 1966, just six months after federal legislation authorizing the program was enacted. In 1974, Hawaii implemented its Prepaid Health Care Act, which mandated that most employers make health insurance available to employees who work at least 20 hours a week.

In conjunction with the Affordable Care Act (ACA), Hawaii initially implemented a state-run health insurance marketplace and adopted Medicaid expansion. The marketplace transitioned to a federally-supported state-run marketplace for 2016, and transitioned again to a fully federally-run exchange for 2017, largely in an effort to take advantage of the economies of scale that the federally-run exchange could bring to a state with low overall enrollment in the individual market (because of Hawaii’s Prepaid Health Care Act, nearly all non-elderly Hawaii residents get coverage from an employer, and relatively few need coverage under individual market plans). Nothing changed about Medicaid with the switch to Healthcare.gov though; the expanded Medicaid eligibility guidelines are still in effect in Hawaii.

Through its efforts, Hawaii consistently has low uninsured rates and high overall health scores. As of 2015, Hawaii was ranked the healthiest state in the nation according to the Gallup Healthways Physical Wellbeing Index, and the state consistently scores near the top in other ranking systems (number 2 the America’s Health Rankings 2017 survey, and number 3 in the Commonwealth Fund’s 2017 Scorecard on State Health System Performance).

A total of 347,439 people were enrolled in Medicaid/CHIP in Hawaii as of November 2017. That’s an increase of 21 percent since the end of 2013, largely attributed to the state’s acceptance of Medicaid expansion under the ACA.

Qualifying for Medicaid in Hawaii

Hawaii’s Medicaid eligibility levels for children are much higher than the national average and about average for pregnant women and parents.

  • Children ages 0-18 qualify with family income levels up to 308 of the federal poverty level (FPL)
  • Pregnant women qualify with family income up to 191 percent of FPL
  • Parents and other adults qualify with family income up to 138 percent of FPL

Hawaii also uses Medicaid funds to help cover premium costs for Hawaii residents who aren’t US citizens but who are citizens of states that have entered into the Compact of Free Association (COFA) with the US. There are roughly 3,500 COFA Hawaii residents who purchase coverage in the Hawaii exchange with the assistance of Medicaid funding.

How to sign up for Medicaid

Hawaii’s Medicaid program is called MED-QUEST (MQD); QUEST stands for Quality care, Universal access, Efficient utilization, Stabilizing costs, and Transforming the way health care is provided to recipients.

You can apply for MED-QUEST:

Medicaid expansion

Hawaii adopted Medicaid expansion through the Affordable Care Act, extending eligibility for Medicaid to adults with income up to 133 percent of the poverty level (138 percent with the automatic 5 percent income disregard).

Medicaid expansion took effect in January 2014. About 25 percent of Hawaii’s population had Medicaid coverage as of late 2017, with about 100,000 people having gained coverage as a result of Medicaid expansion.

According to the Kaiser Family Foundation, about 70,000 Hawaii residents were uninsured in 2015. With Medicaid expansion now covering low-income, nonelderly adults, 50 percent of Hawaii’s remaining uninsured population at that point was eligible for Medicaid – although they may not realize that they’re eligible. According to US Census data, only 3.5 percent of Hawaii residents were uninsured as of 2016, down from 6.7 percent in 2013. Although the state’s uninsured rate was reduced by nearly half from 2013 to 2016, it was already less than half of the national average uninsured rate even in 2013, before the bulk of the ACA’s provisions had takene effect. Hawaii’s Prepaid Health Care Act, which has been in place since the 1970s, had already resulted in nearly all of the state’s population having insurance coverage, even before the ACA took effect.

Significant developments in Hawaii’s Medicaid program

Hawaii implemented its Medicaid program in January 1966.

In the early 1990s, Hawaii implemented the State Health Insurance Program (SHIP) to cover people who weren’t eligible for Medicaid. Then, in 1994, CMS approved Hawaii’s section 1115 Medicaid waiver (one of the first in the nation) to wrap SHIP in with Medicaid in an effort to achieve universal insurance coverage (in combination with the state’s Prepaid Health Care Act). The result of the waiver was the creation of Hawaii’s MED-QUEST program, which initially covered low-income women and children, but has since expanded (as of 2009) to cover nearly all of Hawaii’s Medicaid beneficiaries. The MED-QUEST waiver is subject to renewal every five years.

Medicaid in Hawaii is separated into two different methods of providing services: the fee-for-service (FFS) program and the managed care program, called MED-QUEST or MQD. Under the FFS program, doctors and other healthcare providers bill Medicaid directly to be reimbursed for services provided to Medicaid beneficiaries. Under MED-QUEST, the state contracts with managed care plans who in turn provide healthcare services to Medicaid beneficiaries.

As of 2011, more than 98 percent of the people enrolled in Hawaii’s Medicaid program were covered through managed care. By March 2015, Kaiser Family Foundation reported that 335,007 Medicaid enrollees in Hawaii were covered under managed care programs. That’s higher than the August 2015 total Medicaid/CHIP enrollment count, but KFF notes that the managed care number includes people who are covered under Hawaii’s fully-state-funded Medicaid program, in addition to the majority of enrollees who are in regular Medicaid that’s funded partially by the state and partially by the federal government.

In August 2017, Hawaii submitted a waiver amendment to CMS in order to gain federal approval to use Medicaid funding to provide housing services to qualified Medicaid enrollees who are homeless and also have behaviorial health and/or substance abuse problems. That waiver request was still pending as of February 2018.

Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

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How to apply in HI

You can apply on-line at My Medical Benefits or by phone at 1-877-628-5076. Or, fill out an application.

Eligibility: Children with family income levels up to 308% of FPL. Pregnant women with family income up to 191% of FPL. Adults with family income up to 138% of FPL.

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