HHSC and HMSA reach new 3-year contract agreement after extended negotiations


Nicole Pasia


Hawaiʻi Health Systems Corporation (HHSC) and the Hawaiʻi Medical Services Association (HMSA) have reached an agreement for a new 3-year contract, where HHSC will provide health care services for HMSA members. 


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HHSC is a public hospital system that operates 847 licensed beds in facilities across 3 different islands. It is Hawaii’s safety net for acute care (on neighbor islands) and long-term care, meaning it provides services to all regardless of an individual’s health insurance or the ability to pay.

According to a press release, HHSC has been negotiating in good faith with HMSA since March 2022, as the previous contract was scheduled to end June 30th, 2022. HMSA offered to extend the contract another 30 days to continue negotiating, which HHSC accepted. 

In a release prior to reaching an agreement, HHSC President and CEO Dr. Linda Rosen said the payment HHSC hospitals receive from HMSA are “far less than the national average and less than our private counterparts here in Hawaii.” 

Although HMSA has both commercial and Med-QUEST members, this contract will apply only to commercial members. The contract will affect HHSC facilities on Hawaii Island (Hilo Medical Center, Hale Hoʻola Hamakua, Kaʻū Hospital, Kohala Hospital, Kona Community Hospital) and Kauaʻi (Kauaʻi Veterans Memorial Hospital and Samuel Mahelona Memorial Hospital).

“We are pleased to have reached an agreement with HHSC, which allows for continued access to health care across the State of Hawaiʻi, especially on the neighbor islands,” Jennifer Diesman, HMSA senior vice president, Government Policy and Advocacy, said in a release announcing the agreement. 

Although the financial details are not publicly available, Rosen said the new contract “will help close the payment gap.” HHSC, which is funded by the state, requested approximately $753.8 million in its FY 2023 budget request to the General Assembly earlier this year. The finalized budget was signed by Gov. David Ige on July 7th, 2022.