Lawmakers outraged at comments from HMSA’s CEO

A war of words has erupted between Hawaii’s largest health insurer and several state lawmakers. This comes after the CEO of HMSA declared in an interview that Hawaii should drop its troubled health care exchange.

HMSA fired the first shot when CEO Michael Gold said the exchange should be shut down, a system he says is financially unsustainable and
does not work.

In the beginning, people signing up for Affordable Care Act coverage through the local exchange encountered numerous technical problems and delays. In the end, fewer than 10,000 people signed up for coverage.

In a statement, HMSA said, “spending millions of dollars for the Hawaii Health Connector to act as a middleman for the business market doesn’t make financial sense.”

Those words ignited a firestorm of protest from key lawmakers afraid that dropping the exchange could mean losing the Prepaid Health Care Act.

“It is very, very disingenuous, disheartening, and disappointing to learn that the CEO of HMSA is now calling for the dismantling, shutting down and federalization of the Health Connector,” said Rep. Della Au Belatti, health committee chair.

“This is the first time I’ve heard from Michael Gold, period, about this or anything,” said Rep. Angus McKelvey, consumer protection and commerce committee chair.

“It’s a one size fits all,” said Sen. Roz Baker, senate health committee vice chair, of the federal exchange. “The federal exchange has no exceptions for prepaid healthcare — big companies, small companies, nothing.”

According to HMSA, Gold did not say he wanted Hawaii to opt for the federal exchange, just to have businesses deal directly with health insurance providers here in Hawaii

All this comes as HMSA is awaiting word from the state insurance commissioner on its latest proposal to hike insurance rates for business by more than 12 percent, a hike HMSA says is largely due to the expenses incurred by the Affordable Health Care Act.

Hawaii already had a relatively low number of uninsured people because of its Prepaid Health Care Act in 1974, which requires employers to provide subsidized insurance to employees.

The following is the full statement from Michael Gold, President/CEO of HMSA:

“Hawaii’s situation is unique. Thanks to our current insurance laws, which have been in place for more than 40 years, all Hawaii companies must provide health insurance for employees who work more than 20 hours a week. The cost to keep the Hawaii Health Connector open, as a place for businesses to buy health insurance, far outweighs the benefits.

“Hawaii can save significantly by having businesses go directly to health insurers. HMSA is set up to meet that demand. Efficiently and economically. Spending millions of dollars for the Hawai’i Health Connector to act as a middleman for the business market doesn’t make financial sense.

“We need the governor to seek a waiver from the federal government this year. Hawaii can make an excellent case why it doesn’t need the Shop (the online health plan marketplace for businesses). If we wait until 2017, when the Affordable Care Act says states can apply for waivers, millions more will have been spent unnecessarily.

“There are benefits to having an online marketplace for individuals because of the tax subsidy. If not the Hawaii Health Connector, then the federal exchange. The amount of individuals who signed up for a health plan through the Connector justifies the individual marketplace. The same can’t be said for the business side.”

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