5 Things Hawaii: Sen. Hirono, proposed rates & reductions, Joy Barua

I think we’re all recovering from a little bit of whiplash following events in DC this July. While we’re looking forward to a (hopefully) quiet recess, we couldn’t resist giving a shout out to Senator Hirono for her work before looking at what’s been happening in Hawaii’s health care while we were watching Capitol Hill.

Here’s what we’re watching in Hawaii health care for August.

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1.  Senator Mazie Hirono on health care reform

A few days after Senator McCain’s impressive speech calling the Senate to return to its role as “the more deliberative, careful body,” Senator Mazie Hirono took the floor during the debate on “skinny” ACA repeal. Her comments got far less news coverage, but were perhaps the most dramatic of the debate as she drew from her personal experience and touched upon her recent cancer diagnoses.

To her Senate colleagues:  “Where is your compassion, where is the care that you showed me when I was diagnosed with my illness? I find it hard to believe that we can sit here and vote on a bill that is going to hurt millions and millions of people in our country. We are better than that.”

2.  DHS’ Community Care Services RFI

Hawaii’s Department of Human Services’ Med-QUEST Division has released an RFI in preparation of an RFP for the Community Care Services program. The CCS program is for Medicaid eligible adults that have a serious mental illness and need specialized behavioral health services. The DHS will be seeking vendors with the ability to provide quality comprehensive behavioral health services to eligible members receiving care through QUEST Integration.

‘Ohana Health Plan currently operates the CCS program, serving approximately 5,500 members. They were awarded the contract in 2013, which also had responses from APS Healthcare, Beacon Health Strategies, Health Plan Strategies, and ValueOptions.

3.  Insurers filed proposed individual rates

Preliminary rate requests filed in July by Hawaii’s carriers have an average increase of nearly 24.5 percent for the plans offered on the individual market. The two largest carriers, Kaiser and HMSA have average rate increases of 19.9 percent and 29.1 percent respectively.

Kaiser attributes the increase on claims costs exceeding premiums in the past years. HMSA attributes the increase to uncertainties in the market, including CSRs and the individual mandate. While these rate increases are for the relatively small individual market, affecting only 33,000 Hawaiians, these consistent year over year increases could undermine stability of the individual market.

The Senate has bipartisan hearings on healthcare reform scheduled for after Labor Day. If they are able to meet their goal of crafting a short-term proposal to stabilize the market before rates are finalized, insurers might lower their requested rates.

4.  Proposed DSH reductions

CMS released a proposed rule to reduce DSH payments by $43 billion from FY 2018 to FY 2015. These reductions were originally scheduled to begin in FY 2014 as part of the ACA, but were delayed three times.

The rule doesn’t include actual funding levels for FY 2018, but includes estimated levels for FY 2017.  Hawaii is classified as a low-DSH state, meaning it historically has received lower DSH allotments relative to its total Medicaid expenditures and will have a lower reduction in payments. In the FY 2017 estimate, Hawaii has a 7.56% reduction of roughly $808,000, lowering total state DSH funding to just under $9.9 million. Hawaii’s reduction is higher than the total low DSH state reduction of 4.64% and it’s unlikely that Hawaii will be able to maintain current DSH funding levels.

5. Video:  Joy Barua, Kaiser Permanente

Joy Barua is the Senior Director of Government and Community Relations and Community Benefit at Kaiser Permanente.  Barua represents Kaiser on legislative issues and guides its social mission.

He joins us in this edition of “What They’re Watching” to discuss the unique challenges Hawaii’s geographical location brings to health care and how Kaiser is approaching those challenges.  “Because we are isolated, care delivery is we’re talking about different, you know, if a hospital is not within easy access, then we have to look at how does transportation function as a cost determinant, even a health determinant?”