A compounded tax policy, low reimbursement rates, and more are straining Hawaii’s health care workforce to the point where facilities, particularly on neighboring islands, are beginning to shut down. These gaps in care are contributing to otherwise preventable health disparities in Hawaii.
State of Reform spoke with Dr. Scott Grosskreutz, a Hilo-based physician, on the perfect storm of conditions that make Hawaii the most “hostile health environment to practice in.”
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Lack of access to care:
Access to a specialist is difficult for people living on neighboring islands due to traveling costs. Grosskreutz estimated a person would spend $1,000 on average to fly to a specialist’s office in Oahu.
“Unlike living on the mainland, you just can’t get in your car and drive to the next city or state to see your oncologist or your neurologist or find somebody that will help you take care of your diabetes.”
Access to providers on Hawaii’s neighboring islands is also difficult. According to a 2021 Nursing Education study, three of Hawaii’s five counties—Kauai, Maui and Hawaii—are among the top 15 counties in the nation with the highest primary health care worker shortages.
Health disparities, particularly in neighboring islands:
A study from the Journal of Breast Imaging, which Grosskreutz co-authored, found that 30% of cancers in Black, Hispanic, Asian, and Pacific Islander women in the U.S. occur before age 50. The research says breast cancer mortality rates are highest among Native Hawaiians. Grosskreutz attributed these poorer health outcomes to a lack of access to care.
“Much of that research is related to the ability to access health care, to be referred for a mammogram, or—once you’re diagnosed—[the ability] to be treated in a timely manner if you’re living on Moloka‘i, or Maui, or Kauai or the Big Island compared to Honolulu, or if you’re in Los Angeles or New York.”
High cost of living combined with a tax on health care
It costs nearly double the national average to live in Hawaii, according to World Population Review. Advocates estimate a family of four would need an average annual income of over $90,000 to afford basic necessities. Social determinants of health, such as housing and child care costs, are some of the most significant cost-hikers. Grosskreutz said current provider reimbursement rates don’t account for the high cost of living.
Earlier this month, the Centers for Medicare and Medicaid Services (CMS) released the 2022 final rule for provider reimbursement. Due to the expiration of certain 2021 payment increases and other cuts across the board, rates could decrease as much as 9.75%.
On top of that, Hawaii’s general excise tax (GET) translates into higher costs for providers, particularly for Medicaid and Medicare services. Grosskreutz said:
“With Medicare and Medicaid patients, often the margins on these patients are exceedingly thin.
When the state comes in and says, ‘We’re going to have a 4.5% general excise tax on your gross income,’ the margins are so thin, that actually translates into a 15-20% tax on the average family practice.”
A third of Hawaii’s providers—including Grosskreutz himself—are practicing past retirement age. At one point during the pandemic, he saw a doctor in his 80s—who recently had hip replacement surgery—on call late at night. Grosskreutz said the industry must focus on recruiting newer, younger providers who are coming out of training to practice in Hawaii.
However, recruiting more people into the workforce in the conditions outlined above is no small feat, and Grosskreutz worries that the shortages will permanently affect healthcare facilities across the state.
“Once you start seeing these clinics collapse, that sometimes took decades to build, you see [providers with] that level of expertise … leave. They lose their jobs, or they have to move to the mainland to find work. It is extremely difficult to rebuild those [clinics]. And once you lose those facilities … it becomes even harder to recruit because, say you’re a specialist and you have no endoscopy clinic to work at, then you’re going to have a much harder time recruiting those individuals.”
So what are we doing about it?
Grosskreutz and other workforce advocates have highlighted the workforce crisis for years. Some solutions include legislation. A bill that would exempt health care providers from the GET passed the Senate last year, and may have passed the House if not for a shortened session during the pandemic.
Advocates are also urging the state’s congressional delegation to follow Alaska’s Medicare reimbursement model, which accounts for providing care for patients in remote locations.
To support possible legislation, the Hawaii Physician Shortage Crisis Task Force is working to survey Big Island providers, residents, and other health care stakeholders to create a reliable database around the workforce shortage. Grosskreutz said the task force plans to replicate the survey on the other islands as well.
This post has been edited to correct the citation of the World Population Review.