National health reform bills would exempt Hawaii


POSTED: Saturday, October 31, 2009

National health reform bills in the U.S. Senate and House would exempt Hawaii, protecting the state's 35-year-old Prepaid Healthcare Act, which has led to one of the lowest uninsured rates in the country and low premiums for workers.

The Senate version preserves a waiver under the Federal Employee Retirement Income Security Act that allowed the state law, enacted Sept. 2, 1974. It requires businesses to provide health insurance to employees working more than 20 hours a week.

The provision to maintain the exemption, requested in the Senate draft by Hawaii's Democratic U.S. Sens. Daniel K. Inouye and Daniel Akaka, “;acknowledges that Hawaii is way ahead of the game in legislating employer-mandated health care,”; said Jennifer Sabas, Hawaii chief of staff for Inouye.

“;It ensures that whatever the final reform is, Hawaii would not be rolled back as it relates to employers providing health care, that as the national standard increases, Hawaii would move forward with that standard.”;

Jesse Broder Van Dyke, Akaka's spokesman, pointed out that Hawaii has “;one of the highest rates of insurance coverage in the nation. We want to protect the system that exists for those that do have insurance, that they'll be able to keep it.


“;Hopefully, the final reform will widen the net of people who have insurance and prevent some of the abuses we see, such as pre-existing conditions and denial of coverage.”;

U.S. Rep. Neil Abercrombie, Hawaii Democrat, said, “;We have a waiver in the present (House) bill that if anything in the bill emerges that gives us less than what the Prepaid Health Care Act does in Hawaii, Hawaii law takes precedence. ... Hawaii law will trump federal laws in terms of giving us an exemption or waiver, if any element is less than what we have in Hawaii today.”;

Abercrombie said he and the late U.S. Rep. Patsy Mink tried for years to use Hawaii's Prepaid Healthcare Act as a national model. He said they urged Bill and Hillary Clinton to use the Hawaii law as model in their efforts to achieve national health care reforms when he was president.

“;It has gotten a lot more complicated and more players are involved,”; Abercrombie said. “;They would be well served by referencing Hawaii's prepaid law. It is so good, so ahead of its time. ... If the bill in Congress is any less than what we have in Hawaii, there is a waiver there. That is how much Congress as a whole recognizes Hawaii as being ahead of the game.”;

Hawaii stands out nationally for a unique health care system and one of the lowest uninsured rates in the country.

The Prepaid Healthcare Act's purpose, as described in a historical overview in 2004 by the Uninsured Project, was “;to provide a certain degree of coverage and protection against the high costs of health care for those employees who do not have access to adequate health insurance coverage.”;

But the law fixes employees' share of the cost to no more than 1.5 percent of their annual wages. That has not changed since 1974, forcing employers to pay a larger share of rising health costs. Many have reduced the number of full-time workers to hold down their costs.

Some health leaders, such as Richard E. “;Rich”; Meiers, longtime executive director of the Hawaii Healthcare Association who retired in August, have said employees should pay a larger share of the increased health costs.