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Lawmakers consider $5 million infusion for Hawaii Health Connector

    The front page of the Hawaii Health Connector website

Hawaii lawmakers are looking for ways to prop up the state’s financially struggling health exchange, and they’re considering cash from the general fund.

All state-run insurance exchanges that are part of the Affordable Care Act must be financially sustainable this year. But the Hawaii Health Connector doesn’t have enough money for its operations. 

That leaves the exchange vulnerable to a partial federal takeover, a risk lawmakers say they’re not willing to take.

Jeff Kissel, CEO of the Hawaii Health Connector, had wanted to issue $28 million in state-backed bonds or loans, but that proposal fizzled after the Department of Budget and Finance expressed concerns about backing the exchange. 

“It would have been the first time for a nonstate agency that we would guarantee whatever was issued, so there would be a lot of issues,” said Wes Machida, director of finance. “We would prefer the general fund subsidy at this point.” 

Now lawmakers are considering a $5 million cash infusion from the state’s general fund, said Rep. Angus McKelvey, co-chairman of the conference committee working out the details on SB 1028.

“There’s no way that Budget and Finance could come up with a mechanism at this point in time, so we’re better off to just go back to what we did last year, which is a general fund appropriation,” McKelvey said. 

The state approved $1.5 million in general funds to keep the exchange going last year. 

Kissel has said the exchange could become profitable by 2022, but it would need up to $28 million for operations between now and then. The path to sustainability relies on enrollment targets, which the exchange has exceeded so far this year.

Lawmakers discussed the bills related to the sustainability of the exchange in a conference committee Thursday and deferred further action until Monday morning.

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