The goal of the Keiki Care Plan - providing free healthcare coverage for children whose parents cannot afford private insurance - is both forward-thinking and commendable. That is why this three-year pilot project won the support of Gov. Linda Lingle and the 2007 state Legislature.

Seven months after the launch of Keiki Care, however, the results show the program is not meeting its intended goal. It turns out that an estimated 85 percent of the 2,000 children enrolled in Keiki Care already had insurance. They simply switched from a health plan that their parents paid for to a health plan supported by state taxpayers.

In other words, for every one or two children benefitting from this program, eight or nine children from families who could afford insurance were getting free coverage at the expense of taxpayers.

Not only did Keiki Care fail to achieve its worthy goal of helping so-called “;gap group”; children who don't qualify for state Medicaid insurance and could not afford private coverage, but the program inefficiently utilized state funds by subsidizing families who did not need help. That is why the Lingle-Aiona administration decided to halt state funding for this pilot project, effective Nov. 1.

To provide some background, Keiki Care was designed as a public-private partnership between the state of Hawaii and Hawaii Medical Services Association. Under this partnership, the Department of Human Services paid HMSA $25.50 per child per month to provide a basic health plan at no cost to parents.

While state funding will no longer be available for Keiki Care, one option would be to allow parents who are not low income to pay $25.50 per month for each child enrolled. That way, the only change would be that parents - not the state - would share the premiums with HMSA.

House Health Committee Chairman Josh Green, the Legislature's only physician and one of the original authors of the Keiki Care bill, has organized a series of meetings which include HMSA (our private partner), the community and other statewide health leaders, to see how we can best move forward together on this issue given the current challenges of our economy. We are committed to working with Green toward a common goal of providing affordable health coverage for all of our children. Though we might not agree on every detail of any solution that is proposed, we will collaborate to do what is best for Hawaii's keiki.

Failing to cover “;gap group”; children is the Keiki Care Plan's major flaw, but it is not the only shortcoming. Another serious problem is its enrollment process, which does not assure that children are ineligible for Medicaid and its far superior benefits.

If parents enrolled their children in Keiki Care when they could have received free coverage through QUEST or other Medicaid programs, their family could be hit with severe financial hardships should their child fall ill.

Medicaid provides free and comprehensive health coverage, while Keiki Care has many costly coverage exclusions and co-payments. For example, hospital visits are free and unlimited under Medicaid. Under Keiki Care, hospital visits cost $100 a day with a limit of just five days a year. Therefore, if a child enrolled in Keiki Care required a lengthy hospital stay, the family would soon face staggering medical bills.

Rather than spending $50,000 of state taxpayer dollars each month for the Keiki Care Plan, which is not serving its intended purpose, the administration believes this money should be used to help people who have the greatest needs, especially our keiki, and doing so in the most effective and efficient way.

To that end, the state Department of Health provides $3.5 million to federally qualified community health centers each year to help cover the cost of treating uninsured and underinsured patients. Many low- income children and adults routinely turn to these centers for medical care.

The administration also expanded Medicaid eligibility for children by 50 percent in 2006 and by another 50 percent in 2008. As a result, families earning up to 300 percent of the federal poverty level now qualify for Medicaid. This means a family of four can earn up to $73,000 annually and receive free coverage for their children.

Medicaid expansion helped Hawaii achieve America's highest percentage of children and adults with health insurance, according to the latest data (2007) from the U.S. Census Bureau. And Hawaii gained this remarkable distinction before Keiki Care launched in April 2008.

Because of Medicaid expansion, greater outreach by DHS and other factors, more than 5,500 additional children enrolled in Hawaii's Medicaid programs during the past two years.

To make sure that truly needy “;gap group”; children have access to healthcare, a transition plan is being developed. The state will work with HMSA to contact the families of all Keiki Care enrollees and encourage them to apply for Medicaid, given the program's eligibility expansion. For those not eligible, we hope HMSA will allow families to pay the $25.50 share of the premium.

During this troubled economic time when our state government faces a projected $900 million budget shortfall, it is vital that we spend our money wisely, as we do by funding Medicaid with a combination of state and federal dollars.

Using state money to support the well-intentioned but clearly ineffective Keiki Care Plan simply does not make sense as the administration and Legislature work hard to balance the budget in a slowing economy.