Hawaii

SUMMARY

This legislative term, Hawaii has been relatively active in regard to healthcare price transparency, cost, and competition legislation. The state legislature passed HB 552, which established the Affordable Health Insurance Working Group to plan for and mitigate adverse effects of the potential repeal of the federal Affordable Care Act by Congress. Regardless of what happens on the federal level, the bill calls for the preservation of the primary provisions of the individual mandate. HB 552 has been referred to the Governor and has not yet been signed. The Legislature also passed a bill that establishes a Hawaii Health Savings Account, which allows local employees to open a tax-exempt account funded by employer contributions. The bill was referred to the Governor and has not yet been signed.

Hawaii also continues to use the Hawaii Health Information Exchange, the state’s private sector non-profit designee for the receipt of federal funds to create a statewide health information exchange that will ultimately feed into the nationwide eHealth Exchange technology network.

 

LEGISLATION/REGULATION

Legislative Calendar

Hawaii’s 2017 legislative session has ended.

 

Recent Legislative Developments

Healthcare Transparency

2017 SB 287

DISCLOSURE OF PRIOR AUTHORIZATION STANDARDS AND PROCESSES: Requires all health insurers, including health benefits plans under chapter 87A, HRS, to disclose on, or have accessible through, their public web sites any medical policies used for making preauthorization decisions.

Inactive – Died in Committee.

 

Healthcare Cost

  • None identified.

 

Healthcare Markets

2017 SB 403/HB 552

ESTABLISHES THE AFFORDABLE HEALTH INSURANCE WORKING GROUP: Preserves the ACA’s primary provisions, regardless of what happens on the federal level. Specifically, the bill calls for the preservation of the individual mandate; minimum essential benefit requirements;  dependents allowed on parents’ health plan until age 26; the ban on pre-existing condition exclusions and gender based premiums.

Additionally, the bill establishes the Medicaid Plus program which requires the Department of Human Services to provide insurance coverage to individuals and qualifying families whose income is between 138.5 percent and 250 percent of the federal poverty level in Hawaii. The Medicaid Plus program includes the following essential health care benefits: ambulatory patient services; emergency services; hospitalization benefits; pregnancy, maternity, and newborn care; laboratory services; preventative and wellness services and chronic disease management; and limited prescription drug coverage.

Inactive – Died in Committee.
HB 407

ALLOWING EMPLOYER-SPONSORED HIGH DEDUCTIBLE HEALTH PLANS IN CONJUNCTION WITH PRE-PAID COMPLIANT PLANS: Creates a Hawaii Health Savings Account that enables local employees to open a tax-exempt account funded by employer contributions which can be used to pay medical expenses. No income tax is paid on the portion of the employee’s income deposited to an HSA. Employers would be required to pay at least 80% of the deductible amount. Furthermore, preventative care is covered at 100% and is not subject to the deductible.

Active – Enrolled on 4/11/17 and referred to Governor.

 

Key Statutes

We compile state statutes relate to healthcare price and competition, including healthcare transparency, markets, and costs. For a complete listing of all health related statutes visit the State Health Practice Database for Research.

 

Healthcare Markets

  • HRS §§ 323D-71 through 323D-83 states that prior to obtaining ownership of a hospital, the acquirer must seek and obtain approval from the state regulatory agency, with concurrent review by the state attorney general. In deciding whether to approve or disapprove the transaction, the agency shall consider whether the proposed acquisition is in the public interest; to wit, whether adequate safeguards are in place to ensure continued access to affordable healthcare in the affected community.

 

  • HRS § 323D-43 prohibits health care providers from acquiring, replacing, or adding to their facilities and equipment, except in specified circumstances, without the prior approval of the State Health Planning & Development Agency through the state’s Certificate of Need process. A Certificate of Need regime aims to reduce healthcare overheard by reducing unnecessary or duplicative services, but can be anticompetitive by increasing regulatory barriers for new entrants.

 

  • HRS §§ 431:14G-101 through 431:14G-112 applies rate regulation to all health insurance offered by managed care plans, providing that rates “shall not be excessive, inadequate, or unfairly discriminatory and shall be reasonable in relation to the costs of the benefits provided.” Managed care plans must file proposed rates with the commissioner of insurance for approval. Additionally, no manage care plan may attempt or actually monopolize an insurance market, engage in a boycott of an insurance market, or make an arrangement that has the effect of restraining trade unreasonable or of substantially lessening competition in the business of insurance.

 

  • HRS § 431:13-103 defines prohibited unfair methods of competition and unfair or deceptive acts or practices in the business of insurance.

 

2017-2019 BUDGET

The State budgets on a biennium basis with the Executive biennium budget submitted to the Legislature for action on odd numbered years and the Executive supplemental budget submitted on even numbered years. The State’s fiscal year runs from July 1st to June 30th. The Governor is expected to sign Hawaii’s 2017-2019 Budget in June 2017. To view Hawaii’s Department of Health most recent budget proposal, click here.

 

2017-2019 BUDGET

Hawaii enacts budgets on a two-year cycle, beginning July 1 of each odd-numbered year. Hawaii’s new Biennial Budget will take effect on July 1, 2017 and is valid through June 30, 2019. To view Hawaii’s most recent proposed 2017-2019 Budget, click here.

LITIGATION/ENFORCEMENT

  • None identified.

 

KEY RESOURCES

Hawaii State Legislature

Hawaii Office of the Attorney General

Hawaii Health Information Corporation