Hawaii Medical Assurance Association, also known as HMAA, received a 90-day termination notice in May of its participating provider agreement with Hawaii Pacific Health, the state’s largest hospital system.
HMAA, the state’s third-largest health insurer, and Hawaii Pacific have been trying to negotiate a new contract for at least six months, according to Arnie Baptiste Jr., president of HMAA’s third-party administrator, Hawaii Western Management Group Inc.
If a new agreement isn’t reached, an existing contract that’s been in place since 2008 will expire Aug. 15, meaning Hawaii Pacific’s facilities — Straub Clinic & Hospital, Kapiolani Medical Center for Women & Children, Pali Momi Medical Center and Wilcox Memorial Hospital — would be out of HMAA’s network, forcing the health plan’s 42,000 members to pay higher rates when using the hospitals.
Both HMAA and Hawaii Pacific said the notice is a standard procedural requirement that, in many cases, simply sets a deadline for contract negotiations, which both parties hope to resolve soon.
"If we don’t reach a deal, then that would be the final result," Baptiste said. "(However), I’m expecting to wrap it up, it’s just a matter of some very minor issues. The amount they want for an increase and the amount we’re willing to increase is literally just a few thousand dollars off."
A Hawaii Pacific spokeswoman said the company is "confident that an agreement will be reached before the Aug. 15 deadline."
Last October, Hawaii Medical Service Association notified its 691,000 members that they could potentially pay more for medical services if a new contract wasn’t reached with Hawaii Pacific by a Jan. 31 deadline. That contract was resolved in May, after a public dispute ignited when HMSA posted the notice on its website.
That contract focuses on payment for quality outcomes, known as a "pay-for-performance" reimbursement model, which was implemented for the first time this year at HPH facilities.