Senate Standing Committee on Commerce and Consumer Protection

Good afternoon. We are here for the first joint Health and Human Services, Commerce and Consumer Protection committees on informational briefing. And present with me is Chair Jarrett Keohokalole for the Committee on Commerce and Committee on Commerce and Consumer Protection.

We are here to talk about the MedQuest issues after Obba and the more recent problems with the ACA premium tax credits not being, you know, Congress's failure to pass the extension of the ACA premium tax credits and our. Thank you. And what is occurring, what will happen to Hawaii consumers because of that.

So first up we have Department of Human Quest administrator and let me make sure that I have all of my ducks in a row here. This meeting is being streamed live on YouTube.

To facilitate this info briefing a timely manner, we may be enforcing potential time limits, especially since we want to make sure that our viewers are able to view this timely. And we have heard that people tune out after a couple of hours.

So you want to make sure that they have all the information they need because we're looking at a potential problem with approximately 6 to 7% of Hawaii population potentially being uninsured because of the combination of the ACA premium tax credits not being extended as well as the OBBA problems. Not problems, but new work requirements on Medicaid.

So first up, Medicaid Med Quest, we have Dr. Judy Mohr Peterson and Meredith Nichols, and please proceed.

Thank you. Thank you so much. Did you want to do the slides from there or do you want us to do the slides. Slides from you?

Thank you.

Awesome. Thank you. Just let us know when you have it up and running. Thank you very much for having us today. Again, I'm J. Mohr Peterson, I'm the MedQuest administrator and with me. Joining with me is Meredith Nichols, the assistant administrator for Med Quest.

Yeah, been watching the news a lot lately. So sorry about that.

So today we have. We're going to be reviewing, as was noted, some of the impacts of the OBA and we're going to move along to the. Yeah, let's go to the one there. Thank you. And I'm going to turn it over to Meredith.

Sure. So just briefly to demonstrate, starting with where we are right now, we thought it would be important to understand how many people are currently enrolled through MedQuest. This slide will show you that as of this week we have 390,766 people enrolled.

The chart that you're looking at demonstrates that before COVID we were at about 327 pretty regularly. 327,000 and then with the public health emergency, we know that the enrollment went up and up and up. And at the end of that we started to do our annual renewals again.

And so that's when we learned like some people didn't need anymore, some people were okay, they had other insurance. And so we see a gradual decline at first a steep decline and, and then now it's sort of balanced out. We're at about 390.

We go a little down each week and then it comes back up with new enrollment. So but wanted to start with that number of 390,766. So still nowhere near the pre number. Next slide please. This is that same data county by county just so we can take a look at where the enrollments are.

The blue numbers are of course the current. So if you want to know how many people right now today are enrolled per county, that'll be the blue numbers in front of. And then next slide please. This slide breaks down that information in a way that's going to be relevant to what we're discussing today.

So again about 390,000 people total, which is about 27% of our population, about 180,000 are non disabled adults. And that breaks down in two ways. In our data here, the highlighted Affordable Care act expansion adults, that's about 128,000 today. And then parent caretaker relatives is about 52,000. So you add those together to get the 180.

And then Keiki, we have about 151,000. So lots and lots of Keiki get their insurance through MedQuest. But an age of blind and disabled is about 58,000. We want you to focus right now today on the expansion adults. That's the population that's being impacted by HR1. So that's why we're calling it out.

And then with that I'm going to turn. Next slide. Sorry, I'll turn it over to Judy to talk a little bit about the beginnings of the HR1 impacts.

So with the, with the HR1 or OB3 as equivalent of each other, we've included a comprehensive timeline of when all of the impacts will take place, all of the major impacts. However, we are not focusing on all of them.

We are only going to focus on the impacts that largely on the community engagement or the work requirements along with the change in the frequency of enrollment. But we wanted to make sure that you did have, you know, all of the information so that you would be able to reference that in, in the future.

Oh and the little star there was just where, where we are right now, as you can see it it there's quite a bit that is yet to come that some of the most major ones are happening in October and then in January line of 2027.

So one of the first things that we're going to review on the next slide is regarding the impacts on immigrant eligibility. These are several different changes. If you're thinking about public insurance, you're thinking about there's Medicaid, there's Medicare, which is insurance for individuals who are over the age of 65.

And then, and then we have the marketplace coverage as well. And the OB3 made changes to each of those in the areas of immigrant eligibility by increasing the restrictions limiting far fewer categories of non citizens will be able to qualify for any of the public insurance options, including in Medicare or Medicaid.

So prior to HR1, there was a broad group including yes, like well, actually quite a broad group. And then starting in October 1st of 2026, within Medicaid, the individuals who they they currently have coverage, they're currently allowed to they currently can qualify for Medicaid.

And we do have individuals who currently qualify, but the categories are refugees, humanitarian parolees, domestic violence victims, human trafficking victims. All of them will lose their Medicaid coverage. We've begun to estimate what that impact will be. It's between 1200 to 2,400 individuals who we will be notifying will no longer qualify.

Thankfully, we do have a small program, but it's an important one in which we use state funds only to provide coverage for those individuals who would qualify for the age blindly disabled categories, except for their citizenship status. And we estimate there's about 200 of those between the 1200-2400 individuals who will be covered under that.

The rest would be likely only covered for the emergency services only. Next slide.

And sticking on the topic of immigrant eligibility because it is one of the primary impacts we're seeing now, we wanted to call out, and I'm shifting a little bit now in the discussion from Medicaid and to talk a little bit about the marketplace, Obamacare, what's going on with the Affordable Care Act in terms of immigrant eligibility?

So what's happening right now in our communities is the law changed so that marketplace eligibility for those people who are under 100% of the federal poverty level, they're no longer able for this next year starting January 1st.

So like in a week or so, they're no longer going to be able to access subsidies on the marketplace is a big shift from what it was. So what it was is, you know, if you haven't met your five year bar yet, you're not eligible for Medicaid just yet.

But those people have been able to go to the marketplace for their coverage. And now most of the those folks who haven't met their five year bar yet, they can still go to the marketplace this year for coverage. But if you're very poor, if you're under 100% of the federal poverty level, you're no longer getting subsidies.

So this is an initial big gap we see in people being able to access coverage. They're not eligible for Medicaid because they haven't met the five year bar. They're now not eligible for subsidy on the marketplace. So we're starting to see this gap emerge.

We don't know the numbers yet, but this will be something that I think we all want to pay attention to. And then, so that's happening again January 1, 2026 and then the next year, January 1, 2027.

Just looking ahead, that lack of subsidy will be expanded to people, that same group of people who are not eligible when they change the requirements. So the asylees, the parolees, the only people that will remain eligible for subsidy on the marketplace will be the more limited, the green card holders.

If you're part of a freely associated states that the COFA population will still be eligible and Cuban or Haitian folks will still be eligible. But all the other people that Judy called out earlier starting in 2027 won't be eligible for subsidy on the market.

All right, so expansion adults. All right, so the primary, the population that's most impacted on Medicaid by OBA are the expansion adults. These are the individuals who are between 0 to 138% of the federal poverty level.

Single, except if single with no dependent children, over 100% of the federal poverty level, they could have children, et cetera. And there's two major changes that will have a significant impact on this population. One is increasing the eligibility renewals from its current 12 months to every six months. So every six months we will have to.

That population will have to go through a renewal process that's doubling it. Right. If you think about typical health insurance, it's usually every, you know, 12 months, or that's for state employees. You have open enrollment, you know, once a year. So 12 months is the standard.

However, this decreases that and requires individuals to go through that renewal process every six months. At the same time, it actually also increases their requirements for which population they must meet. So they establish work and community engagement requirements. And we'll have a bit more details on that in just a moment. That becomes effective December 31st.

So those individuals who are coming up for renewal in January 1, 2027 will need to meet these new requirements and then they'll have to be renewed every six months after that. Next slide.

All right, so community engagement. And this is a slide that we took directly from cms. So we wanted to make sure we were displaying exactly what the Centers for Medicaid and Medicare Services is sharing. So these are the ways that people can meet the community engagement requirements. You can work at least 80 hours in a month.

You can complete at least 80 hours of community service. You can participate in a work program for at least 80 hours, or you can be enrolled at an educational program at least half time. And this next one I think is one we all in our community want to pay attention to.

This is the one I talked to my neighbors about. The other way you can meet it is if you meet the federal minimum wage, which is currently $7.25 at that times 80. So the 80 hours equals $580. So if you can demonstrate that you have income 580 or above, you meet the work requirements.

So our minimum wage is $16. So somebody would have to work far less than 80 hours to make the work requirements. So that's something we want to pay attention to and think through with community when we're talking about how we can help people know that they have access to meeting these requirements.

The other thing is for seasonal workers, we have farmers seasonal workers. So in those cases we have the opportunity to take an average of their income to show that they meet that 80 hours or that that financial standard.

It's a combination of any of those activities. So it could be a combination of both. Could be work, education as well as community service. It's any combination of those 80 hours.

Yeah, work 40 hours, community service 40 hours. But we do think one of the things that might be low hanging fruit for our community is the $580 income for some people. Next slide, please.

There's a laundry list of quite a long list of exclusions and exceptions to individuals to meet the community engagement requirements. It ranges everything from former foster care youth to veterans with rated disabilities, pregnant women, individuals who are who meet the snap work requirements. Next slide, please.

And that's, here's some additional ones we actually also have if they're under the age of 19 and if they're enrolled in Medicare Part A or getting benefits in Part B or if they are in one of the other eligibility groups, if they have a child who's a dependent child under the age of 13 and under.

So some of these are similar to the exclusions and that SNAP has, but many of them are, are different. We're just slightly slight variations of it. Which where our concern is of course that can lead to some confusion.

Just as one small example under SNAP that parents who have a child who's 14 years old or younger are exempted from participating in the work requirements under, under SNAP. But currently, but for Medicaid they made that limit 13 or under. So just the one year difference. Provider.

Okay we, we noted that there's a number of, you know, providers etc so that we thought that we would just outline a few things of what the impact will be.

I think that the main thing that we want to emphasize here is that when you have an increase in the number of people who are uninsured, it leads to individuals forgoing their care. They don't come in until it's an emergency, until the situation is quite acute.

And so the overall, what you tend to see is that the overall acuity levels for individuals will go up but with less ability to pay because either they're uninsured, they're self pay, et cetera. And so you start to see uncompensated care increase. Hospitals must also screen and stabilize all individuals who come into the emergency room.

They're required to do that by federal law. It's called emtala.

What do you mean by screen and stabilize?

So when it, when someone comes into the emergency room, then they must be screened and stabilized. They don't necessarily have to go, you know, get, get treated. The majority of hospitals do beyond that. But the federal law requirement is that they screen them for whatever situation it is as to why they showed up in the emergency room.

This is access to emergency services. So they, they screen and make sure that they are stabilized. And if they're most do also provide treatment.

And we do have FQHCs who are going to be. That's the binary.

We also, yeah, we also have the community health centers also must serve everyone they can. They, they do have a sliding scale but they, they must, they are there to serve the entire population and community. So what happens is when you have an increase in uninsured, you have increases in uncompensated care.

And that leads to rising costs for the entire insured population. That kind of cost shift into the private and commercial. So it leads to, it leads to increases for everyone. Some providers, you know, especially if they're on the edge, you know, on the, on the margins, they have no way to cover it.

So you can go to them.

Okay. All right.

So I. So this slide, and it is small, so I'll read it. This is just giving, giving us a sense of what do we think our impact is going to be here in Hawaii to our Med Quest program. So we believe. We don't know. Right.

It's a bit of a crystal ball, but we think a fair estimate is that are the uninsured, based on community engagement requirements, we could have between 19,000 to 38,000 additional people who, from the original slide I showed you, who now lose their insurance. And this, this also tracks with the Congressional Budget Office estimate.

And then based on the fact that we're doing six months renewals instead of annually, we think there could be another 6,000. That every time we do a renewal, we create vulnerability. Right. A notice gets sent out. Sometimes people don't respond. So there are issues there too.

So these are the things we're worried about and, and paying close attention to. I'm going to skip the next one because I know we're short on time and it doesn't really apply. And then this is a visual, a graphic. Sorry, next slide. Sorry, we haven't been. Thank you.

This graphic is basically backing up the other slide we just showed you by color band showing you our current population separated by aged, blind, disabled, in the light green on top, children and then other adults. And then when you go to the blue, we're looking at the expansion population that's subject to the, the continuous eligibility requirements.

So that dark blue band, the 6K community engagement. Yeah, yeah, yeah. Zero, did I say continuous eligibility? Yes. I'm working in two fields. Yes, yes, thank you. Same acronym. Same acronym, yeah. And then I'm going to switch us over to the last column. The outcome type, the dark green.

These are people that we anticipate on a low level. So these two slides with the green, the dark green, the light green and the yellow, we're doing a high data matching scenario where if everything works great, this is what we hope for.

And then to the right of that is the low data matching scenario where if things go badly and we cannot match up. So you see, with the dark green, if things go well, hopefully of the 81,000 who are vulnerable low income adult expansion population. Hopefully 52,000 are ex parte.

That means we can renew them just by checking data sources. We don't have to send them a letter. So hopefully 52,000, but could be as low as 28,000 depending on the data sources we can use. The middle is manual verification.

So maybe we couldn't do it automatically, but we would have, you know, do 10,000 on the high data match scenario. Do a manual verification, meaning we hear back from people, they send us their pay stubs or whatever helps them be eligible and we can keep them eligible.

Or on the other side, there's more manual work because there was less automated work. So about 15,000 is a prediction. And then so we see at risk of losing coverage anywhere between 19,000 on a high data matching scenario or up to 38,000 on a low data matching scenario. Again, these are just.

This is modeling and we're being predictive here. And then in the meantime, doing all we can to think through how we can avoid mass loss of coverage for people.

Okay, thank you.

So we do have some information on the, you know, Medicaid and the ACA marketplace impacts. But we're. If, if we're short on time, we're happy. We can just. Yeah.

And we do have Kaiser and HMSA here actually giving us figures on their impacts. Okay. We have been hearing. Yes, please, fear. Yeah, yeah, it's only gonna be us. We're gonna be asking questions. Yeah. Okay. Yeah. Yeah. Okay. All right. You have questions? I have a whole bunch. Okay.

Okay. The. On the exclusions.

Yeah.

Individuals who are medically frail or otherwise have special needs. Yeah. As defined by the Secretary. What are we talking about there?

Well, the Secretary is still in the process of defining.

They include severely mentally ill individuals.

They do. There are some exclusions for individuals who are severely mentally ill. What's the, what's the.

Do we have any idea on how or how they will determine who.

Right now they've started. Yeah, they, they've started to provide us with the, the Secretary and CMS has started to provide us with initial guidance or recommendations of. You should be looking at this. You should start looking at that. But there's no, no hard, fast details around that.

They're giving themselves until June of next year to provide those details to the states. That's too, that's very far away. Yeah, but that's what the law. That's the deadline that they have in the law. They're, they've communicated and signaled. They hope to get us those kind of details sooner than that, but we haven't received those specific details.

So part of that, that's not admin rules, those, that's just guidance that they're going to independently draft without any sort of formal, they do have to do rules. They do have to do eventually.

Yeah. By June of next year.

They have to do rules by June of next year.

Yes.

So rule, federal rulemaking is normally a long time, an 18 to 45 or more month process.

So that's why they're pretty, they, they recognize that and that's why they're putting out, you know, initial guidance etc and it will most likely be like the interim proposed rules which they can, they.

Can implement almost because in the rules you can comment, the states can comment, can make comments like the expectation that severely mentally ill individuals, many of whom might be on the street. Yeah. Should not be expected to fulfill a six month annual or a six month work requirement.

Right, that's correct. And then I think, I think the other thing that, that CMS is looking at, and of course we have to take into consideration as well is the fact that these requirements have to be met before someone, for any new applicant.

So before they even sign up, they have to meet these requirements or we have to determine whether they're exempted or not. And so we're not going, if they're a brand new person, not going to have any kind of claims history, medical history, et cetera, to be able to demonstrate that.

We'll have to use a different sort of process in order to figure out if you're medically frail, if you have some of these other, if you're seriously. Mentally ill to know that you meet one of those. Exactly right.

But then after they're enrolled, then the expectation is, is that we'll be using our own data sources, the claims data and other other forms of verification in order to see whether those individuals continue to meet the exclusionary criteria or if they need to meet the work or the community engagement requirements, whether they're meeting those.

So we'll have to do a lot of data matching, etc.

My understanding is that, keep me correct on the terminology, please. But severely or persistently mentally ill. My understanding is that we have 21,000 in Hawaii.

I don't know. I, I, I don't have that. Something like that. Yeah, we, we can. And so to our sister agency.

Okay. And because I think the assumption is that a very high percentage of those individuals are on Medicaid.

I think, I think that's probably accurate. Yeah.

And I think it's fair to have A lot of confidence that those, a very high percentage of those folks will not be able to meet the initial work requirement or likely maintain a six month work requirement.

Yes. I think one thing we didn't dig in on is to know that at point of application you have to, like Judy just said, you have to demonstrate the month before you met these requirements, which will be very, very difficult for this population or we demonstrate exemptions. So we need to figure out how to do that.

I also want to say then at renewal, so it's every six months, you only have states have options of what to do. So what we're opting for is you only have to demonstrate that you met the work or community engagement requirements during one of the preceding six months. So it won't be every month.

And I'm just, I'm saying that out loud because I realized it wasn't baked into our presentation and I didn't want to leave the impression that it has to be every month. And we're checking this every month.

So at the point of application it's the direct month before and then at renewals it's, we look back and as long as you've met it during one of the previous six months then you're good to go. Oh, so that's a big important kind of distinction.

It doesn't though address your very good point that you're making about no matter how many months you have to demonstrate, if you're in this population it's going to be equally difficult.

But we're hoping that the rules, and we're commenting, we're telling CMS right now that for the for example, for these really vulnerable populations, for the individuals are seriously mentally ill or in active substance use treatment etc, that the, the, the bar needs to be low on what they need to do in order to be able, or what we need to do in order to demonstrate and verify that those individuals meet that criteria.

Because we, the simple, it's like by the simple fact of requiring an action on the part of those individuals to demonstrate something that they're seriously mentally ill etc will lead to them not know, turning the paperwork or not meeting it. And we, none of us want that. Right.

What about intensive case management? I don't see that. I see substance abuse and then this medically frail or otherwise special needs designation. But you know, I mean that's sort.

Of from OBA. That's what's written in the law. The law, it included active substance use treatment. It did not include other, you know, it's a Seriously mentally ill. It doesn't include other, other aspects.

Yeah. When you mean combination. Okay. Because a lot of the mentally anyway, the ones I run into who are disabled do have like ssd, you know, Social Security disability. They may not be able to reach the 580 though.

So when you mean a combination, will they be able to use like if they get 400 and the other $180 be the equivalent in hours if they're getting a community service and, and the.

Like and yeah, if they're getting SSDI, then they would be in that excluded group. They would, yeah. So no need.

But if I don't have any of those if I don't have any of those other like I'm single, I'm relatively healthy, I'm over the age of 1965 and below 65 and I'm subject to the community engagement requirements.

What that combination means is it could be a combination of the work, the education or the community. The community service and the work programs.

You're talking about could also include the state ones like the Hale program and internship.

Correct.

And when you're talking about monthly income or seasonal worker, you will also include gig worker. That's correct. In Hawaii that would be the equivalent of showing GET tax returns. Yeah, correct. Okay.

How is all of that gathered and reported out for compliance?

So CMS, big sigh there. There's, there's gro. There's a lot of, yes, a little of that. There's a lot of, A lot of IT companies that are coming forward with, with that capability.

CMS themselves have had a product and they have it tested in a couple of states right now which that's collecting information on gig workers, et cetera.

There's some companies that have, you know, they, they sweep all the, all the ADB wage services from around the country and they aggregate all that data and then they do the bumps, et cetera.

So those kind of companies, and that's where we are in the process right now is sort of evaluating like, okay, these companies can do it this way, which is what's called consent based verification where I, as an individual, I'm driving Uber or Doordash or whatever and I say, I sign up with this, with this company, I say, okay, I consent to giving you, allowing you to share the records with the state so that it can bounce out there and grab that information and provide it automatically to us.

Others are just general sweeps or we already do some matching with DLNR. We're looking to see how it might expand that, et cetera.

Okay, so when we talk to. And we did not have an info briefing, but when I talked to Scott Morshige regarding the SNAP work requirements, he implied that there's like a runway, you know, you're not going to get dumped automatically. Like right now, is there a runway?

I mean are we looking at this at the six month renewal period as sort of a Runway to meet these community engagement requirements?

So for us, we. So one thing to know is that these, these don't all like hit us on January 1, 2027 and we don't run this rule through the entire population. It'll as people's individual renewal dates come up, that's when it'll apply.

So what we need to do in this next year, 2026 is really starting to step up an information campaign to help people know, hey we. According to our records it looks like you're in this vulnerable population. And so here are the rules and start to think about it and work that through.

So when they get to their renewal we'll already have it set up for them to pass. That's the idea. So if you're not due for renewal until April, then you won't, you won't have to worry about that until April of 2027 rather than an all at once sort of impact through the whole community.

But at April 2027 you need to be able to show at least one month. That is correct. That is correct.

Of the previous six months. That's correct. So we have some outreach requirements from CMS to in the about the middle of 2026 to reach out to our. Community even if it doesn't start until January 1st. That is correct. Give them the benefit of the heads up. We're going to be looking back at your.

Even during six?

Yeah, that's correct.

Okay, that's good to know. Yeah. Any other questions or not? Yeah, stick around.

I don't know if I just wasn't listening or I missed it. The coverage for emergency services. You know, I think the reason why I asked about assessments is whether the bill messed with the fact that emergency rooms just take all commerce.

It did not. It did not change that. It is all it is. It continues to be all comers that I cited the, the exact federal law that it is. It's called Emtala. The majority of our, I mean all of our hospitals do more than that, do more than just the assessment and stabilization.

All of them continue to write the treatment, etc. If they're if they're able to. That being said, that the federal requirement is, is assess and stabilize.

Right. We've been getting a lot of pushback, especially during the shutdown, about whether undocumented individuals will be getting access to Medicaid or not.

And I think one of the pieces of that conversation that was really confused was the fact that as a policy, the ambulance will take anyone who needs service and will not be checking their passport before they start treating them. And then the same is true for the emergency rooms.

That's federal.

We. Yeah, right. But that is, those are services that potentially come from Medicaid and go toward undocumented individuals.

That's actually also correct.

But it's because we don't want the emergency. We don't want paramedics checking passports at the emergency room, though. Okay. So that's not going to change.

That's not going to change. And they didn't change on the, on that. The Medicaid portion of emergency services also did not change. So it doesn't matter. Hospital.

If someone comes in, into the hospital there, regardless of their citizenship status, if they meet all the other requirements of Medicaid, low income, whatever, the hospital can have the individual essentially apply for Medicaid for just those services and then they send the bill to us and then we, we review it, review the, the eligibility for those individuals and then we, we pay for those services.

So an obvious place for some of these, and some of these folks that are going to lose their health insurance will be to potentially go get services at the emergency room.

That is correct. So the. I do want to note that, I mean, yes, they can get the services there on the, on the, in the Medicaid program. Our requirements are that those services have to be emergency services. They have to be, you know, life and limb, threaten threatening services before we pay.

So it's not the emergency rooms. Sometimes they provide services that aren't necessarily. So the emergency rooms will take in the chin if you guys don't pay.

So that's correct. That's the risk of it. That's correct. Because if people. Yeah, yeah. And. And in my community that happens all the time. Yeah. We use ERs.

Yeah.

Any. Any other questions? Thank you. And that's the reason we have eight FQHCs. Yes, correct. Also. Also. So next up, we were going to have Dr. Lewin. Is he available? Yeah. Can we get alongside? Thank you. As a possible solution.

Yep. Okay. Thank you. Go on in. Please. Stick around. Good job. Okay, thank you.

Okay? Dr. Lewin, thank you for being around. And do we have his slides? Dr. Lewin, could you identify yourself?

Yes. Hi. Jack Lewin, Administrator of SHPDA, State Health Planning and Development Agency. And in the context of this particular testimony I'm recalling something that was developed by the Department of Health when I was the Director back in 80s and 90s.

Okay. So to let the public know, Dr. Lewin and I were just spitballing possible ideas because we are starting to see we are super concerned about the rise of uninsured and primary care physicians knocking on my door.

Already feeling a lot of economic pressures before what is the tsunami of uninsured coming to them that I have asked Dr. Lewin to give his experience as to what occurred back during the Waihei Administration and possibly having that as a blueprint for 2027. We still have time, so please proceed. Good.

Thank you very much. Senator San Buenaventura. So in 1989 we passed a proposal. It was Public Law 378. The father subsequently the, the HRS chapter was 431N which provided health insurance to people who did not have access to health insurance because they were not eligible for prepaid health care Act.

That means they weren't, didn't classically meet the definition of being employed. They were not, they made too much money for Medicaid. They were not 65 on Medicare so they did not have access to insurance. And at that time those people were subject to buying insurance in something called the individual market which was prohibitively expensive.

So in order to try to get that that was about 5% of the population about then or 6% because the prepaid health care act ate into a lot of the uninsured and they all people had jobs now had health insurance.

So that's I just want to point out when you start adding up the potential population based upon all the testimony here, you're going to see that it's going to be about 5 to 6% of the Hawaii population that's going to be potentially uninsured. Yes.

So we're looking at around the same kind of scenario that was being faced back in 1989. So. Absolutely. I have to say. Next slide. Dr. Lewin.

Yes, next slide please. There's. That's the birth of the program and next slide. Thank you. Because I'm going to kind of wing it here a little bit but I'll the.

For those that have a chance to look at it, I'm going to cover these features for you in my comments but we can we can look at the slide if you'd like but I let me just sort of the overview being in the two first two years of the program, the state appropriated $14 million, 4 million for initial planning, 10 million for First Startup.

That money was spent on building a small insurance company. But there was some money left for subsidies for some low income people who were right on the verge of Medicaid eligibility, who and needed a little help to get the premium. But let me tell you how this worked. It was a very low cost insurance program.

It cost $20 for a kid a month, $60 for an adult and for a family, maximum $150 a month for health insurance. In today's dollars, that would be around between $550 and $600 a month for a family of 456 whatever. So it'd be quite a bit cheaper than the exchanges, even with the tax benefits.

But let me tell you what the program provided and benefits. It provided all prevention services Recommended by the U.S. public Task Force on Prevention. It provided and so that meant you got mammograms, you got if you needed a colonoscopy, if you needed all the vaccinations, well, child care, prenatal care, all covered.

It covered six additional visits to a doctor of the patient's choice. And those visits were fully covered as well. We didn't need those six visits, it turns out, because once the prevention visits recovered, patients used an average between two and three at the max.

But we did have six visits and then we had an attenuated visit for we had a legitimate emergency room was covered, but hospital was capped at three days per year per beneficiary. There's some reasons for that. Three days covers labor and delivery. It covers treatment for appendicitis for most injuries.

And the hospitals were paid fully for their three days. They were paid fully for the emergency Department visits. And the hospitals agreed to it sort of reluctantly because they knew some people would be there longer. Because for this very population of people who are uninsured, they weren't getting paid at all.

So they were now having a positive income stream for a population of people that they wouldn't have received much of any pay whatsoever. The program had limited drug coverage. It had insulin and diabetic drugs. It had antibiotics for kids and for common infections. And it did provide all the lab and diagnostic services.

But then the drug coverage was sort of attenuated. I'll explain a little bit more about that in a minute. The, the reimbursement for commercial was at commercial rates. So doctors and hospitals were happy with the payment because it was not a discounted payment whatsoever.

It was as high as the, any payment was in the state. HMSA and Kaiser Permanente agreed to be the insurers for the program. Kaiser took a fewer number of people, but sort of proportional to their, their presence in the state. And the reason we got them to participate was because the state was a guarantor.

If the insurance companies lost money on the, with the premiums that were being collected with the amounts that I described before, the way it worked was if the premium insurance company lost more than 3% of premium, the state made up the difference from there on.

However, if the insurance company made 3% margin, the state picked up all remaining money that was made after that. And so that, that worked. And the reason that was, you know, kind of worked out beautifully is that the state never paid any, any subsidy to the insurance companies. The program always had money left over.

And so we added benefits each year. During the years of its existence, I think it lasted around eight years and it was terminated in, in the Caetano Administration. So. Hold on. Yeah, next slide, please.

SHPDA results. This is just what you covered. 20,000 people signed up.

By year two, by maximum years, it was over 40,000 people who were participating. Almost all the people paid their entire premium themselves as if they were people on the exchanges. But there were some people that did have a subsidy in the program, but it turned out that most of those people actually became eligible for Medicaid or they got a job.

So the people in the middle, who were, who were they? They were gig workers. They were small business owners. They were not employees. Mostly they were, you know, independent employed people.

And you know, a lot of those folks on the Big Island in various places, those are the people there were realtors were in that mix because they were paid by commission. So they weren't classically employed and students were in that mix, but they were really generally healthy people. I would.

So this program is something to consider the downside of it. It was very successful in terms of enrolling most of the people that we wanted. We Got up to 98.

Go to the next slide to what happened.

Yeah, okay. Yeah, sure. And I can't really see the slide there, but basically Governor Caetano, I think, with really good intentions, folded the program into the MedQuest program, adding benefits. Yeah. And what happened was the program became way too expensive for the beneficiaries. Well, actually, the Federal Government required maximum benefits because that's what MedQuest was.

The Medicaid agency required full benefits coverage and the cost went way higher than the beneficiaries could pay. So they dropped out over time. And the idea was somehow that the Federal Government might make up some of the difference and put money in. And that really didn't turn out to. To happen. So.

So basically the program died about eight years after it was created. It did have though it did cover most of the uninsured in the state. We got up to about 98% insured. And that's why the Clintons in California and all the other states came out to find out how Hawaii had made so many gains.

It was the Prepaid Healthcare act that Senator Inoue resuscitated after it had been declared null and void by the Supreme Court. I know I got an exemption. We can't ever let that exemption go because we'd never get it back again if we ever lost it.

But it did require, it did allow every worker and their families to have health insurance in Hawaii. That plus ship got us to full coverage when you added Medicaid and Medicare in. So it was a great program.

You know, there'd be still squawking if we went back and said we're only going to give people three days of hospital coverage from, from the hospitals. And we'd have to go through a whole big process of explaining all this. And it's a piecemeal program, but it did work and it did provide great care.

And because it was focused mainly on prevention and primary care, it actually had great effects on avoiding unnecessary hospitalizations and it did save a bunch of money. So I bring it up to you only because it's something the state did back in the day.

And if we think we, if we get into desperate straits, it's an opportunity for us to consider again.

Okay. Okay. So it seemed to me, let. Let's make sure the original ship covered only about six clinician visits. And you found out eight years. That less than three visits per year was. Yeah. Was the average anyway. Yeah. Three days of hospital use which covered most, almost all inpatient needs. So you didn't even need to.

For this population, very little additional hospitals didn't lose money on the program at all.

Okay. Which if we have these uninsured population and without ship, as previously testified by Meredith and Judy, they may end up having to lose money on. Yeah. Okay.

The one thing that I have to mention though is this program at that time did not have the extensive mental health services, benefits and social determinants kind of support that a lot of these people might need. And that wasn't available at the time of this program.

It did provide just good health care, focused on prevention and the prevention of primary care was, you know, for some of these people enough. They didn't even need a sick visit with the doctor, but they had six of those if they needed them.

I think if we did this again, we could do with fewer visits and still have a great deal of success with the program.

Okay. Okay, thank you. Any questions? The only question is going to be, I'm going to point something out which is basically I have asked the Governor to see whether or not a representative would be willing to testify.

And because there has been a press release, as you folks probably know, as late as I think yesterday or so, where the Governor did say he was going to ask for $16.5 million in the budget to cover any ACA premiums. But that would only cover a portion of the potentially uninsured.

And so with the potential investment in a skinny ship like the original ship, maybe it's something that we should all consider to cover the entire 6% uninsured. Okay. I'm just putting it out there.

Oh yeah, it's something solution. It would just be my suggestion, Senators, that we look at all the numbers, we, we, you know, and run through those and look at the options that are there. But you know, obviously we, we'd like to have full Medicaid coverage, we'd like to have the tax subsidies back in the, in the exchanges.

And really long term, we all know that the whole, the whole thing we have even right now is a patchwork.

We need to move toward a whole, completely, much more streamlined system that doesn't waste billions and trillions of administrative dollars because we really have a giant non system when you put all the different insurance types and you know, administrative costs that doctors and hospitals have to navigate. Thank you.

And I also want to make a statement that I have also invited insurance commissioner Psyche to be available to talk about, you know, a lot of the website health insurance that's being offered like Costco, Amazon, whether or not. Because when we start looking at Star Advertiser did a series about gig workers being uninsured.

Okay, what those are going to seem, especially with Facebook and social media, those are going to seem very enticing to them. And the reason he's not here is because the insurance commissioner has basically determined that none of those are eligible for Hawaii insurance. Okay.

So we are limited to the insurance companies that are here today for our sources. Unless we have a resurrection of ship. Okay, thank you.

Let me, let me just say real quick that to your point about insurance, you know, Hawaii consistently ranks at the top or near the top of every national health metric, including coverage. But that's really hard to explain to people in our districts who don't have access to health care.

And so to a lot of folks who can't get a doctor's appointment or can't get a behavioral health appointment for their mother or their grandparents, you know, the metrics don't mean anything.

And so, you know, we're not, we, there's, there's no way to know whether Congress will take some sort of action to close the hole that's been opened on this. And we have time between now and the close of the session, the opening of the session to see.

But in the absence of some action, I think your presentation is intriguing.

Yeah.

Senator, I would just say that back in the day when we made this presentation and I was previous to being Director of health a practicing physician on the island of Maui, we had better access to physicians and nurses and others in those days than we have now.

So having insurance doesn't guarantee you access with our workforce shortage, really so many people have insurance but they can't get healthcare. So we really have some major problems to resolve.

I also like to point out in the audience we do have state representatives Shimizu. So thank you very much and you can raise your hand if you have any questions. Thank you. So next up, if you could stick around that would be great, Dr. Lewin, but I understand you have to go.

No, I can stay around. I'm just going to in and out. Go outside and jump on my my Committee council meeting. I'll be right back.

Okay, thank you. And next we have Aloha Care and we have Paul or Cena and John. Mike, when so we have your slides, Aloha Care slides.

And I'm just going to point out it was Aloha Care's entreaty to me about their super concerned of the rise of potential uncompensated care that's going to be befall their FQHCs that has given rise to this informational briefing. So please proceed. Are you sharing screen or will I?

Okay, okay, I will get out of this Administrator. Good afternoon. Chair San Buenaventura, Chair Keohokalole. Mike Nguyen, Public Policy Director for Aloha Care. Thank you for having us. And this is Paula Arsena.

Paula Arsena, Vice President External Affairs Aloha Care.

Next slide please. Oh, just one. So Our presentation today will focus on Medicaid and HR1. As you heard the Medicaid Director Judy Moore Peterson call it OBBA. It's also being called the Working Families and Tax Cuts act by CMS. So there's lots of different names out there.

But we'll be focusing on Medicaid and our particular objective around advancing health and wellness and also promoting and continuing to protect access to care. And then for our agenda today, we plan to cover some of the programs that we have offered in the space of community engagement prior to HR1.

We will also share some of our prior related experiences, whether that is the Covid unwinding our activities during the Maui wildfires. And then we'll ultimately drawing from those lessons learned.

We'll double down on what we learn in the third section around collaborating with the state and also community partners through outreach, education, you know, data testing with the state and all of these things to make sure it's a smooth implementation. So with that, Paula will give a brief background about Aloha Care for folks on online.

Yeah, just two quick slides on Aloha Care. So we were founded back in 1994. So we're going on year 31 of serving the Medicaid and dual eligible Medicaid population in Hawaii. We support individual wellness and pro promote community access to quality care.

And we make collaboration with our partners, the FQHCs as well as others who are serving similar populations a big part of our business model. We are currently at about 66,000 Members across the state on all islands.

We serve members of all ages from birth all the way to Kupuna and again in partnership with those who are serving the same population on their individual islands.

All right, and then I'll go into the our our programs around community engagement so you can go to the next slide. You give me a moment, I can try to share from the Zoom online. Sorry. Sorry, I got out of the Zoom so I have to re enter it. But while I'm pulling that up, I'll just share.

You know, we acknowledge and understand the political and the the budgetary motive motivations of HR1. But as a local safety net health plan, as a community health plan, Aloha Care has been resolved to have a whole person approach to providing care which includes looking at things like social determinants of health and socioeconomic barriers.

So as soon as the slide loads.

Hypoletmia. Okay. So you know, as I was mentioning, we've always had an approach of addressing social determinants of health, looking at social deter socioeconomic barriers. So back in 2021 we launched a number of programs. One is a Promise of Hope that offers individualized career advancement training and navigation.

It offers a high school equivalency program for folks that don't have that. Currently we have an English language acquisition program and these programs, you know, we know that having a high school education can open a lot of doors. It can obviously help you find a job and it can even have impacts on your health.

There's studies that show the impact on agency and self determination, addressing social isolation and how integration into the community, connectedness and purpose can actually impact different aspects of your health. Your mental health, your physical health, your heart health. And so we have offered those programs and we will continue to offer those programs.

We're planning to expand those programs in the context of HR1. What that would do is to help meet the community engagement requirements. Also we have a platform around called Unite US or Unite Hawaii. There's over 200 CBOs in that network with over 500 programs offering different services, whether that's food, housing, insecurity, legal services.

We plan to add volunteer opportunities into that so that you know any of our Members that might be impacted or community Members potentially.

We're looking to expand this beyond Aloha Care Members so that they can find pathways to accessing these services and then being able to verify that they meet the requirements if that's something that they have to do. And then finally we offer a scholarship program to our Members and the family Members of our Members.

And we have offered over our found since our founding, $400,000 in scholarships for folks pursuing, whether it's healthcare careers, social care, social, social services careers. And that obviously is an investment for folks to in the workforce and pursuing education here. So I can give you back the slide because I don't know what happened, sorry.

But that's basically what we're doing around the community engagement space prior to HR1 and we'll continue to expand and leverage that to help communities be able to meet the requirements.

So in addition to the programs that Mike just mentioned, we've also launched different campaigns and we plan to use that experience in helping Medicaid beneficiaries to meet the HR1 requirements, which is whether to either make sure that they have the documentation that they need to verify that they are exempt from the work requirement or to help them connect with a work opportunity, volunteer opportunity or educational opportunity so that they can retain their Medicaid coverage.

And so some of the experience that we've had has been, you know, doing redetermination when at the end of the pandemic, all Medicaid beneficiaries had to be reverified for eligibility.

We worked in partnership with MQD and community based organizations to launch a campaign of public awareness to make people aware that they needed to act upon that pink letter that they get in the mail that they need to. It's important that they do that. They stay in touch with MQD with their current contact information and the like.

And if you could see our slides, you would see that we had some examples of activities we did in the community. Everything from, you know, online zoom meetings to get the word out to different organizations, to community events where we did tabling to help meet people, understand what they needed to do to retain their coverage.

As well as multi language messaging, we launched communications in Olelo, Hawaii. Hawaii, as well as other languages on multiple platforms. And, and it's also noteworthy that during that period, during the 2425 period, that's when we also began to see that costs of Medicaid beneficiary care was beginning to outpace the rates that were being paid.

So one thing to be aware of going forward is, you know, we're concerned that with this HR1 implementation, we are again going to see enrollment shedding, healthier beneficiaries and remaining in the program will be people who need more care. And so that'll be a bit challenging as far as finances.

And we just need to make sure that the rates are set appropriately. Another example would be the Maui Wildfire, when people had to, you know, leave their communities very quickly and they lost their health insurance cards, they lost connection, they didn't have their phones anymore.

We launched a program to help help connect people with those so they can get their health insurance card back and a duplicate. And we worked in partnership with the other health plans as well to do that. And then the Child Wellness Incentive Program where parents could get a $50 incentive for taking their child in for an exam.

We helped to publicize that. We also utilized multi language postcards and messaging for that campaign.

Okay, next slide please. Thank you. So, as Paula shared, we've deeply embedded in the community and across different communities, regardless of the language that they speak. And we continue to plan work. We continue to plan to work hand in hand with trusted community partners as we embrace the policy changes ahead.

But collectively, we know, as Judy also mentioned, regardless of whether folks have coverage or not, there are going to continue to be medical needs and those needs and those costs are still born in the system somewhere. They're not lost.

And so we know that people will delay care and conditions will worsen, whether that's acuity, whether folks show up at urgent care, the emergency room at our federally qualified health centers, folks may incur medical debt and there's going to be increases in uncompensated care and charity care.

So we also want to note too, with the expansion population in particular, we want to help protect the loss of federal dollars to the state for the expansion population. There's a 90% federal match. So every 10 cents that the state puts up, the state draws down 90 cents to provide care for these expansion members.

So that's something that we're particularly trying to also see what we can do to mitigate losses for not only the state, but for the Medicaid program and coverage. And then finally, we'll work with our community health centers, the Native Hawaiian health systems trusted CBOs to address this trio of goals that we have here.

To date, we've done things around establishing a healthcare safety net coalition, which Senator, you've been a part of and spoke at to share some of the policy solutions. And so we'll continue to do that.

We're having a town hall in January for community based organizations and providers so that they can start to understand what these policy changes are, when things will become implemented. You know, as their patients show up and they have questions like do I need to show my W2 or my pay stub?

So we want to be able to help folks navigate those questions and we'll again, similar to unwinding, we'll do materials, we'll make materials, we'll translate them and we'll work with partners to get out the word. So ultimately, you know, we'll draw on those partnerships.

And then the slide with the logos is just an example of some of the partners that we worked with during unwinding and we'll continue to expand that.

And then the last slide that we have here is, you know, we understand MedQuest has a lot of work already and this is going to be a huge lift for them and we want to be able to support them throughout this process.

There's lots of policy decisions that the state still has to make and there's a lot of guidance that CMS still needs to come out with that.

As you heard, we haven't heard all of the decision points yet, but we have the same goals that MedQuest does of keeping eligible folks covered, protecting access to care and making sure that the systems and processes that are developed work well and have the beneficiary in mind, which we know that they will do.

But we want to be a thought partner and a thought leader on that as well with them. So with that, if you have any questions, we're happy to answer them. But thank you for having us.

Thank you for being here. And I want to note that AlohaCare is one of the three Med Quest insurers in our state, along with Ohana plans and United Healthcare. And I really appreciate what Aloha Care and Ohana Plans and United Healthcare have done regarding going beyond just providing.

I want to note that Ohana Plans has been providing supportive housing, which in our last informational briefing was a problem with State Hospital and their patients not being able to provide supportive housing.

They came to me right after that informational briefing saying they came to a partnership with State Hospitals, Hawaii State Hospital, so that there will be supportive housing for those who are released.

What my concern is and wasn't addressed was whether or not these programs you have like four Ohana plans would be the supportive housing with you folks would be the education and the social determinants of health programs. How will that be affected because of HR1, do you know?

Yeah, we don't expect there to be an indirect impact on those programs. Yeah, not yet. We don't see anything yet that that makes us think there's going to be an impact.

Maybe the population base may be changed to be mostly those who are and the ones who are, I guess, aged, disabled and the ones who are not. Who are not in the ACA expansion. Right. Except for the people.

Yeah. I think ideally we want, you know, a good mix of beneficiaries. You know, there are those who are going to need more services and there are those who need less. So that's helpful for us to have that kind of mix because then we have more resources to work with.

You know, we're collecting payments for all of those members. And if we need to reallocate resources to address, you know, a high need population, we can do that. Our options become less when we lose that healthy population and we're receiving less revenue because we have a smaller enrollment and that enrollment requires more services. So that's kind of the.

So your programs may shift.

Yeah, it could be.

Yeah. We have to think about that more deeply, though. You don't know right now. We don't know. Right.

And if I may, are you talking, you're talking about the Promise of Hope program and unite us like the social, like social determinants of health. Right.

Those, they're going to be indirectly impacted to the extent that those are not directly reimbursed through our, the payment that we receive, that we, we provide those as, as part of the extra benefits or the value added services that we out of the margin. So.

Okay.Thank you very much. And one last question. You talked about IT support and it's obvious that there's going to be like potential AI IT requirements because of HR1. What kind of collaboration have you for. And I'm going to hear from them at least next week or so the budgetary requests because of HR1. Okay.

Which I'm sure will be significant, but what kind of collaboration do you, do you have or do you foresee regarding the HR1 requirements?

Yeah, we're going to work very closely with MQD to understand what the requirements are so that we can support, you know, beneficiaries to meet those requirements. But we're in the same position there and we're, you know, kind of waiting to understand what the expectations are from CMS. So it's a bit of a waiting game at this point.

Similar to the unwinding the redeterminations, there were data files going back and forth in terms of, and MedQuest is. They're going to have to figure out new data sharing agreements with entities that can certify volunteer hours or education. These are completely new pathways that haven't been established before.

So as they're developing that, we're happy to test whatever files like they're called enrollment files, but there's going to be additional information that will be sent across perhaps and so we'll be, we will be ready to troubleshoot those data files and make sure that we're working together.

And I know because of not only HR1, but because you've also had cutbacks from your federal grants and the like. Right. It's the first time you folks actually made a request to the state for.

Some money outside of the contract.

Okay, so do you folks expect more budgetary cutbacks because of the federal landscape? We don't know yet.

Certainly this is the biggest issue that I think we're looking at is the loss of folks losing coverage and therefore what's the impact to the MedQuest program and then.

From a legislator's point of view, frankly, any loss to the healthcare providers like you folks who provide more than just health care like Ohana Plan Supportive housing means more requests upon us to actually provide those monies for supportive housing. So if we could do it, other ways would be beautiful. Okay, Any other questions? None.

Okay, Stick around in case we have any questions. HMSA you're up. Okay, identify yourselves. Yeah.

Good afternoon, Chair San Buenaventura, Chair Keohokalole, Walden Au on behalf of HMSA and joining us is Jen Awakuni, our AVP for request programs and Medicaid.

Hey, could you put the mics closer to you folks? Thank you.

Thank you for having us. Can you hear me okay?

Please proceed.

Okay, so if you go to our next slide, what I'm here, what we're here this afternoon to cover is just a briefing of how what our ACA plans look like today. But I thought before we jump in there to just give a high level view of what HMSA's membership base is.

And so on the pie graph on the left you can see the proportion that make up our membership as of the start of quarter four. So October 2020, HMSA had about 760,000 Members that we cover. You can see that a majority is our commercial plan coverage. About our third is in Medicaid.

So we participate in Medicaid along with four other health plans and our ACA individual is about 3%. So it's that small sliver on the top of the slide.

And just to give you an idea of how our membership has changed over the past two years, you can see that to start the commercial, which is that blue line on the right, the line graph has been relatively stable over the last two years.

The green bar is our Medicare population and that peak in the first quarter is just an indication of open enrollment. So again, it's been relatively stable for quest our Medicaid lives.

You know, you can see the dip, the loss in membership that we saw in 2024 related to redeterminations which you've heard from Aloha Care but since then has been echoing what Judy and Meredith had shared. Has been relatively stable with slow losses experienced in 2025.

So I'm going to double click on the next slide into our ACA population, our individual market and what it looks like. So again, as of November 2025 we have about 21,000 members covered under the individual plan. We are one of two plans that are offered on the marketplace. You'll hear from Kaiser after us.

You can see that it is across all counties, Oahu, Hawaii, Maui and Kauai. We also have a breakdown of of those that are covered under the individual plan. How many of them have a subsidy. And you can see that a little less than 10,000 have a subsidy. About 47% of our total covered covered lives under individual.

Again, spanning across all of our counties here. And you can see the proportion in the table. One snippet, just to give another additional context, is about 13,000 of our 21,000 lives purchased their plan through the marketplace, the federal marketplace, which is the vehicle in which you can earn the subsidy.

So on the next slide, we're again double clicking on that 9,878 members that are in our individual plan that receive a federal subsidy. So there are a little over 7,000 individual subscribers, 2,500 dependents that make up that 9,878 members that are receiving a subsidy. On average, the per member per month subsidy per individual is around $560.

So to bring that out to our all the lives covered, it comes out to about 5.5 million monthly that make up our tax credits. On the next slide, just this gives you a view of what our premiums look like across all of our HMSA plans and comparing our 2025 rates to our 2026 rates.

You know, on average, across all of our plans we had a 12.8% increase. Our lowest percent increase was 10.5 and the high was 15.9 for our catastrophic plan. But you know, I will say to put that in context on the next slide, we have a view of how our percent rate increase for 2026 compares nationwide.

So the bar graph on the left shows of the 312 ACA Marketplace plans, how they make up, what's the distribution in terms of the percent increase. So the Min was reduction of 10% and the max was 59%. And you know, the 25th and 75th percentile ranges from 12 to 27.

So you can see that our 12.9 was around the 25th% percentile, really indicating that while it was a relatively high increase, when you zoom out nationwide, we are within the bottom quarter of the rate increases that our nation has experienced this past year or in the upcoming year.

The map on the right kind of takes a different look. It looks at the highest percent increase by plan, which for Hawaii was 12.9, and compares it to each state. And again, it tells the same story where Hawaii as a state is in the bottom quartile in terms of overall increase in our premiums from 25 to 26.

So with all of that being said though, I think the takeaway point that will end our briefing with is that, you know, this is a very big disruption with the impacts of the subsidies to our ACA membership.

And so this past year, and especially during open enrollment, we've been doing additional outreaches to our current membership, just trying to understand the impact that these subsidy changes will have and resources available and actions to take in preparation for 11 2026. Okay. Any questions?

Yeah. Can you explain why we are where we are and among the states?

I can't speak to that.

Well, maybe why the 13 percent?

I think it's largely in part due to the Prepaid Healthcare act and how we have covered lives through employer based and sponsored just big pool.

It just provides more coverage and you know, more opportunity for people who do hit the minimums of like 20 hours in the work requirements that otherwise in other states and other places in the country wouldn't have access to healthcare, that they would go through the ACA.

And so I think we are able to kind of spread that out to your point Senator, amongst a larger pool.

In hearing that, another addition that I would say is that, you know, our rate increases are reflective of the costs that we've experienced.

And so, you know, the population that is covered under our plans, you know, have access to care preventative services that overall, based off of the risk profile and the cost of that population that reflects a lower increase than that of other states.

Are there any sort of broad strokes that you can deduce now that we've, now that we've gotten to this end of the pool compared to it looks like there's a lot of hurt in the south and in the middle of the country. You know, is that a utilization situation? Is it the age of the pool?

I mean just some sort. Because you know, for some of these, I mean anybody who gets a 15%, 16% increase in their rate in one year is going to be pretty upset. But you know, like you guys point out, it's. We're not, we're not anywhere near the hardest hit. So it'd be interesting to understand why.

Yeah, I think we can definitely come back to the committees with a better, more succinct explanation as to that. But I do think it is largely in part due to the population base and how the impacts and efforts made by the Legislature and you know, our Executive branch to provide the preventative health.

Okay, thank you. Thank you.

Okay, so I have questions. Okay. If you could go back to the last slide of impact to HMSA federal exchange, three slides back. 1, 2, 3. Anyway, on that slide, if it ever comes up, it shows that the premium tax credits on average per month is 5.53 million for HMSA. Okay.

The governor's proposed budget request is 16.5 million, which would just be about three months and only of HMSA. So it won't actually cover the premium tax credits then? It doesn't sound like it. Unless he's going to focus only on HMSA and only for three months.

Yeah, I made that note down to myself as well. But I think the assumption is that everyone that's receiving a Subsidy that there are other options. For instance you can choose a lower costing plan because those that have subsidies so span across all of the metallic plants. So you could choose a lower costing. You're right.

You could also depend upon this 100% of the subsidy.

Second, can I have the next slide? So on this slide it shows all the different rates and we heard from DO Dr. Lewin on a super skinny ship plan. We may even not need a ship plan. If everyone goes into the HMSA catastrophic would that qualifies for federal. Okay. And is that, does that cover.

Do you know what that covers? Does that cover the six clinical visits, three hospital visits. Do you know your HMSA or is it only for if you. If you get a catastrophic illness.

Right. So I, I think all ACA plans have a set of preventative services that don't hit the deductible. So I think we. It's. It's a little complicated. We'll probably have to do a closer compare to understand. Okay. How the benefits compare.

So. So we may still need something like the ship plan for the basic. And if anybody wants a catastrophic then they can go into the. The bare bones. $289 per month or it may go up to 335. Yeah. With a.

It could be but I think it's worthwhile to do a compare to understand. Okay. Yes.

Okay. Thank you very much. Any other questions but be around, stick around. Thank you. Thank you. Cheers. Okay, next we have Kaiser. oh yeah, I think they're going to come in by. Hello Jonathan. He has been hit by Avian flu and we don't want him to infect the rest of us. So please proceed especially self Committee. Right.

I'm sorry. Yeah, I'm under the weather. Chair, Jonathan Chang for Kaiser Permanente. I appreciate chairs the opportunity to present to you at this info briefing. I believe the Committee Clerk. Monique, are you able to share and if not I can our slide deck. Just waiting for the slide deck to come up. I can't if not to.

Oh, there we go. So thank you Chairs. I appreciate the opportunity to test or to present some information regarding the impacts to Kaiser Permanente from the expiration of the enhanced premium tax credits. If you can go to the next slide please. I really did. I guess I wanted to start. I don't want to totally repeat.

I think Judy and Jen at HMSA helped share some of this but I wanted to distinguish I guess primarily first of all you know what the enhanced premium tax credits are. You know there's been a lot of press about these credits ending at the, you know, in a couple of weeks or next week actually.

But the enhanced premium tax credits were something that was passed by the Biden during the Biden Administration in 2021.

And what these did were to enhance the existing credits from the original ACA Bill in 2010 by expanding eligibility and making them more generous and also providing more coverage, particularly to middle class Americans who were earning over that 400% federal poverty level.

And then it enhanced that assistance to those who were eligible for those federal tax credits from the 100 to 400% FPL.

So you know what's being passed, what was passed by Congress earlier this year is not going to eliminate the original subsidies which were passed in the 2010 health, you know, health reform law that will continue to be available and it will. Right.

What that does is that limits that monthly payment for benchmark plans to no more than 10% of an enrollees household income.

But what is going to end which is, you know, the hundreds and hundreds of millions of dollars or sorry, not 100, not this state, but you know, our, I think the credits that we're looking at, it's over 100 million that the state is eligible as far as enhanced subsidies.

And what that will do is it's going to really help. And you'll see in my next slide, what it's really going to do is we really see that it will have some impacts on our consumers. So you can go to the next slide, Monique. So this is just a snapshot of where we are.

So I know HMSA shared they have about double as far as the ACA members we have, we have about as of November, we have about 12,700 members. The bulk of those do purchase their coverage on the federal exchange and that's what makes them eligible for the federal subsidies.

In addition, we have another 3,000 who purchased their ACA plans off exchange. And so those are a lot of times are these gig workers or people who aren't going to take advantage of the federal subsidies. So I just wanted to make that distinguishment.

And then for us we did file a rate increase across all of our metal plans that averages 10.4%. And really I know Senator Keahkolola, you asked that question about like why the rate increase? And I'll try to address that a bit. So right. That rate increase, it doesn't, it does account for the enhanced premium tax credits ending.

But in addition to that and you know why I think we're not, you know 2030% across all of our plans is for a variety of factors. So you know, the big one is we've seen higher volume in recent years, particularly for outpatient services. We know that's probably going to continue for 2026.

And then the other, I mean, two other things is, one is, excuse me, we're finding higher trends of cost in pharmacy and supplies. And then that big thing we look of like where are, how we kind of are doing those rates is like one is a member's age. So after, if it's a child, right.

If they're covering a kid after age 14, a member's rate changes every year based on their age bracket, the location. So some, you know, places the healthcare cost is higher than in others. And then obviously the choice of plan, which I think Jen alluded to.

And then the big one as I put in my slide, right, is the change in the subsidies. So a change in a member's federal or state subsidies amounts based on changes to their income could increase or decrease their share of our monthly, you know, the premiums that the members responsible for.

So you take that into totality and that's kind of how our actuaries help determine, you know, what we are seeking in a rate increase. So, you know, for that 10.4% rate that's across all of our plans. But to say that the next slide helps to distinguish. It's not, you know, it's not, it's not 10%.

I mean, you know, people aren't, aren't going to see it. So this, this isn't, this slide is not specific to KP members. This is from a source. It's called Keep Americans Covered. It's a coalition that Kaiser Permanent Entity is part of trying to advocate Congress to continue to extend the premium tax credits.

But this is data that was put together by that coalition and this is specific to Hawaii. So this kind of takes a look at, you know, both of the ACA, all of our ACA memberships.

So both us and HMSA, but this is kind of what the big, you know, kicker would be, right, Is, you know, for some 60 year old couple earning about, you know, a little less than $100,000 a year, you know, their premiums would increase, you know, close to $20,000.

And it's just really due to those loss of those premium tax credits. Right. You know, a family of four earning $153,000 a year would see a 76% premium increase. And then a family of four, you know, that's low income, right, would see, you know, a $3,000 percentage increase of, you know, 261%.

So, you know, it's real here in Hawaii. And my last slide, I think helps to, you can go to the last slide, Monique. The last slide just really helps to help distinguish, you know, what's going to happen with these premium tax credits not being extended. Right.

Premiums are going to go up and, you know, we're starting, you know, open enrollment right now. So whether they, whether people qualify for the tax credits or not, everyone's going to see significantly higher monthly payments.

You know, And I think Dr. Lewin alluded to it, but you know, with fewer healthier people in the risk pool, it makes the all the premium for everyone else to go in the market. I already alluded to that.

You know, we know that people are going to lose coverage, young people are just going to leave the market just because they're healthier. People with chronic conditions are set to become uninsured.

And then as we, as I think I showed at that last slide is, you know, there has been a lot of work, you know with people trying to older adults. Right.

And as a result of, you know, the things that Congress did with enhanced premium tax credits, with the premium tax credits setting to expire, we think that we know that older adults are also going to leave the market. So what does that mean? People will be uninsured or may choose to be uninsured.

And the result that will hit the hospitals and other healthcare facilities is there will be a huge increase in uncompensated care due to the increased number of uninsured. So that's my last slide. I think I wanted to maybe just preemptively address your comment or question, Senator San Buenaventura, regarding the governor's proposal.

You know, we haven't, we don't know the details of how that would be. But yeah, I think our initial assessment is, you know, the 15 million that the Governor is putting in his budget to help cover these credits would only be a portion of.

It would only offset really just a portion of, you know, what the state, you know, people who are getting these enhanced premium tax credits. There are other states that help provide eligible residents from, with additional state funded subsidies. I think there's about 10 states that do.

So I'll give one example though is like California, you know, put about $190 million to replace the enhanced subsidies. But you know, that doesn't come close. Right. It's only a drop. Right. Because they, you know, California receives two and a half billion dollars in federal enhanced Subsidies. So I think, you know, the governor's proposal.

Unless there's something else. Well, it will help to offset, but it won't completely solve the issue, you know, with regards to the enhanced premium tax credit. So that's all I had. I'm happy to answer any questions.

Okay. Any questions. Okay. I'm going to segue to what your last slide, John. And that's a $6.3 billion increase in uncompensated care because we're the next people are going to be the FQHC. So.

Where it's all going.

Where is who is going to pay the 6.3 billion? It's going to be basically the physicians, the hospitals, and I guess the consumers are going to see an increase in their hospital bills. Right. I mean, somehow other.

Yeah. So I mean, I think, I think that's the biggest concern right now. You know, our mission is to take care of our members and try to provide really affordable healthcare. But I mean, it's not hitting, you know, the effects of HR1 are not. It's. It's hitting the insurers, it's hitting the healthcare providers.

It would hit the, the big hospital systems as well. I think for the most part.

The 6.3 billion that. That was from your.

Yeah, that's. That's a stat we have internally that.

Or is that. Is that nationwide?

That's nationwide.

Oh, that's nationwide.

yeah. Okay.

So it's at least a little bit because right now achieve. If we include in the Medicaid this enrollment, which is over half of the potential 6% that I've added up so far, that's could be affected by all of this.

We're looking at a substantial increase that our physicians and FQHC are going to have to take on the chain. But thank you for that. Any other questions or.

Yeah, go ahead, John. I mean, so. Or maybe for judicate. We don't have a. We don't have that proportional number we. For the state of Hawaii, do we? We just have the, that range of individuals that we expect to be dropped from coverage.

That 38,000. Yeah. Is the, is the number of people. It would be. It would be.

Yeah. What that impact would be for the cost of uncompensated care. Right. Because we know the experience is going to be different in Hawaii compared to other states. And that's reflected by where we stand in terms of how much the rates are planning to increase next year. But that's only one piece of them.

The health committee's point of view also is the more uncompensated care, especially where the physicians are already disproportionately underpaid in this state compared to other states. We're going to see a flight of. We're going to have to see less physicians. Yeah.

Well, I think it's important here to make it clear that when we say uncompensated care, and I'd like everyone to keep me honest on this, but when we say uncompensated care in Hawaii, we mean that the taxpayers will be paying for those services. It doesn't mean that necessarily people will not be getting services.

It means that they're likely going to be getting services from providers that the taxpayers will have to cover or that.

The physicians will end up having to just not get paid. Employers. And that's why we have coming up.

Or the employers or the medical providers.

Medical providers, yeah, that.

I mean, yeah. So to take for example, all the hospitals have like a medical financial assistance, you know, where you just as all of the hospitals are in Hawaii, we don't have any for profit hospitals.

And I saw Paige was raising her hand, but you know, we want people if they, you know, when people can't afford to pay when they come in our doors. Right. A lot of times we write it off, you know, in our non profit status. Right. But it, it's good.

That's why I'm saying it'll still hit the backs of the hospitals. Right. So we want people to come in and get care. Sometimes if they can't afford to pay, we, you know, the hospitals will write it off as a loss. Right. But that affects hospitals. Bottom lines. I don't know. Paige, I saw you had your. Is.

Can Paige speak? I don't know. Okay.

Okay, first up we're gonna have YNI Health Comprehensive. They're gonna basically these people all the time and they're gonna take it on the chin regarding uncompensated care. So please identify yourself.

Aloha. I'm Lena Alakana, Vice President with Comprehensive Health Center. And this is Cindy Yee, I'm chief financial officer. Oh, thank you, thank you for having us today. We'll wait till our slide. Oh, there we go. Right, thank you. Next slide.

So we just wanted to start off by kind of just giving you an overview of, you know, who we are and I know you know, where we are, but who we are and the type of patients that we serve.

So we were established in 1972 as a community driven response to the lack of health care out on the Waianae coast. We are the largest FQ on the island of Oahu. And of the 14 community health centers, we are a community health center where we are part of the largest primary care network in the Nation.

And in 2024, we served just over 36,000 patients with through just under 200,000 encounters from our main campus and our satellite clinics, which are in Kapolei, Ewa, Nanakuli and Waipahu.

And the last bullet on here is just probably the most important bullet on this slide here is that we are the largest private employer on the Waianae coast, with nearly 700 employees, which most of our staff are residents of the West Oahu communities. Next slide. Thank you.

So with that context, it's also important to understand who our patients are. So nearly half of our patients that we serve are Native Hawaiians. Native Hawaiians are part Hawaiians. And we know that this population is already already experiences higher rates of chronic disease, housing instability, and economic vulnerabilities.

The chart on the right there, Sorry, apologies for the numbers being kind of small there, but the chart on the right shows our current payer mix as of October 2025. And our Medicaid rates kind of hover in between 57 to 59%. This really underscores how central Medicaid is to the health care of those on the Waianae coast.

And for Waianae, Comprehensive Medicare. Medicaid, sorry, not Medicare. Medicaid really is the backbone of the primary care services that we provide at our health center. I mean, 59% in that pie chart there, with 11% of Medicare and dual eligible and then 4% or 3% uninsured.

About 65% of the patients that we serve are 100% at or below the federal poverty level. You start to get an understanding of the socioeconomic factors that we are up against at our health center. Then the last point there just gives you an idea of where our patients live. The bulk of our patients live in Waianae.

The bulk of our patients are 100% at or below our poverty level, and the bulk of our patients receive Medicaid services. Next slide.

So with that understanding of who we serve, and I wanted to kind of turn your attention to the impacts that we believe that we will begin to see as the Medicaid eligibility changes start to take into effect.

So this year is just our preliminary numbers, and we estimate about 5,800 of our patients in the adult expansion group will lose their coverage. Now, how did we get to this number? So we took our entire patient population and we removed everyone that Judy and her team had discussed earlier.

So we removed the veterans, we removed the age blind and disabled, those that are in substance abuse treatment, those that are our average numbers of pregnant women and postpartum women a year. And we went down the list.

And what we did not take out from here is a topic that we've been, that you've discussed earlier and that is the medical frail population. Just because what you discussed earlier is we don't know the, we don't know the diagnosis just yet, as we'll be getting it same time in June of 2025.

But we estimate a good chunk of them, probably maybe one third of that 5,800 patients will be removed and then that's what we'll be left with. So this is a pretty significant amount, 5,800 or 4,800 or 3,800 is still a significant amount of patients that will lose their coverage.

And as that coverage is lost, we will see that uninsured rate increase, reducing that overall access to care, not meaning that our doors will shut or anything. But patients when they lose Medicaid, they often defer or seek emergency care services.

Tying up our emergency rooms, tying up our EMTs, our ambulances and our emergency room down the road, which is Queens. And that change creates also administrative burden on our staff.

More frequent eligibility redeterminations and documentations requirements will require us to reshift and refocus our staff to spend more time doing eligibility assistance, especially when it's now six months rather than one year like it is right now. That lower retroactivity is something that you folks had discussed with Judy earlier.

As you know, Waianae comprehensive operates a 24 hour emergency room on a leeward coast and that services the entire coast. When patients come into the emergency room, not all the time are we able to verify their eligibility. It really depends on how we can stabilize the patient.

Do we need to send the patient out to the nearest hospital or what have you? And so with that said, we'll need to really be more aggressive in verifying their eligibility because the patient will have a shorter time, a shorter retroactive period time to apply for Medicaid. Right now it's 90 days from the date of service.

That will be shortened to 30 days. That means if patient does not apply 30 days, it fallbacks, it'll fall on us and that becomes either a bad debt write off or a bill to the patient and a debt to the patient. And and then lastly is a reduced Medicaid revenue.

As you, as I shared in the earlier slide Medicaid makes up 59% of, of our health, of our health center patients. And just small tweaks in that percentage will start to strain our operations. We'll start first. It'll start to strain operations centered around our social determinants of health.

So things like our transportation program, our case management program, our food pantries, things that are not, I would say, things that are not our bread and butter, things that are not our meat and potatoes to keep our doors open. That's where the strain will start to feel in those types of operations. Next slide.

But we don't want to come with you with all the sad news of the impacts, but we come with opportunities note as well. You know, we've been thinking about, we've been discussing this probably for the last six months about how can we as a health center help our community with, with these impacts that are coming.

And so these are just some things that we know that we are a trusted community partner within our community. We know that our patients come to us. We know our patients, we know our communities, we know our families. We have been talking about establishing community hubs where we can help patients with that six month eligibility process.

We currently have a kiosk in the tumor supermarket. We also have one in the EVA CFS service site there. These are service hubs where our patients can come to and turn in their documents.

We also have what we call pods in all of our clinics where our patients can come to and turn in those eligibility documents as well.

We'll implement Medicaid enrollment touchpoints where there's no wrong door approach, meaning at every touch approach in our clinics, whether it be the MA, the clinical assistant, the check in the provider, we will provide our staff with scripts to start talking to our patients about Medicaid eligibility and redetermination and so forth.

We plan to increase outreach to high impact areas and then also create work requirement opportunities. So you see that number of 5,800 and we know Waianae does not have 5,800 jobs. But we plan to create a program where we can offer education programs and volunteer opportunities at our pantries on our clinic sites as well.

Things that our patients can do to keep their eligibility intact and then establish volunteer opportunities and then really continue to fortify our partnerships with our CBOs, our native Hawaiian health plans and our faith based programs. Thank you.

Any questions?

Yeah, on your first slide, it's 36,000. 36,000 patients. Oh, sorry.

Yep, 36,000.

36,000 Patients last year. Yeah. Is that your, like your whole universe when you say 6000 people on the Y&I, you know 6000 people that use Y and I comp are going to lose their health insurance. That's 6000 out of how many?

6,000 out of the 36 in your.

But in your patient universe, it's. It's about pretty static. 36000 a year.

Yeah. Yeah. So pretty, pretty static between 34, 36 we h.

Okay.

It's probably a little lower than pre. Pandemic time, but it has been increasing ever since.

Okay.

So I'm talking about a substantial amount. If 6,000 it's going to lose. And you have a no wrong door policy, which means that patients who lose their Medicaid coverage will still be able to get care with Bioni Comprehensive.

Yes, of course.

And so what happens the uncompensated care? I mean what if they need labs? And who ends up paying for the labs if there's no coverage?

Well, we'll go through our process first and you know, determining if they qualify for Medicaid or not. We'll, we'll start there. Then we have our, our studying fee scale program.

At least. At least. Absolutely. At least something.

Medication? Yeah, yeah.

Physical therapy.

Yeah.

But a lot of like inpatient therapy kind of thing may not be.

Yeah, correct.

So your physicians and your medical providers, their work product may not be covered if they're not. If there's no, if there's no insurance.

If there's no insurance. Correct. Yes. Yeah. Okay. We will see you without. Regardless of your ability to pay, we'll still see you.

What raises for these 700 employees, we might not see that there for next year. So. Thank you. Thank you. So.

So 6,000 of the 36000 people that visit y. Com are probably going to lose their health insurance. Do we know. You know, you said earlier about a third of them are.

Third of them might be that medical frail population that we just don't know.

About just yet would include homeless, could include homeless, involved, mentally ill, mentally ill.

So maybe a third, maybe closer to.

Half and then the rest of that population. Do you know who they are? Are they also. Because those are, those are high utilizers typically.

Yeah.

Do we know whether the rest of the 6,000 are high utilizers or.

I don't know their utilization patterns at this time. We can just give you the demographics of these people who are, they're 19, between 19 to 64, you know, who have no dependent 13 and under and who are, who don't meet all those other requirements that we carved out already.

In the coming months we're planning to do a deep dive to look at who these patients are and if, how. Many times they're coming in or you. Know, what are their high risk and things. So that's what we're planning to do the coming months.

Right. That would be helpful because I think one argument is going to be, especially on the coast is going to be that aside from the folks that are really down and out on the street or who have substantial mental health problems that the expectation would be some of these folks go get jobs.

As you noted, there likely aren't 6,000 jobs on the Waianae coast. But it would be helpful to find out, you know, who these folks are.

Waianae is a, the coast is, is a small enough, it's a big community, but small enough that we should be able to get a pretty good snapshot of how we can best help them either move toward getting coverage or figure out exactly what kind of help they'll need.

Assuming they won't be covered, that we're just going to throw them off, you know, they will just be thrown off their health care because of this big bill. Thank you.

Thank you very much. Thank you.

Next we have Richard Taaffe from the Big Island. Thank you for coming here from Kona. Identify yourself and I'm going to point out the uncompensated care for the entire state is going to be covered by HA after. Thank you. Okay. Richard.

Aloha. I'm Richard Taaffe. I'm the CEO of the Hawaii Island Community Health Center. And I'm happy to be here. And I don't have any slides. I've been traveling and have been kind of under the weather. So I don't come with, I come with lots of notes.

Good. Okay, please proceed.

So the Hawaii Island Community Health Center serves about 80% of the Hawaii island. We have 14 locations clinics from Hilo to Puna to Kau to the West Hawaii area. We also have school based clinics in nine schools.

And you mentioned earlier that you got that Ohana helped with and they also helped us with a school based van to get out to the schools. So they've been good partners.

So just, just for perspective, 80% of around 220,000 population of the Big Island. So they, they cover over a third.

Yeah, yeah. So right now we're serving one in five patients in that area which is almost 38,000 patients. And almost 70% of those are on Medicaid are dual eligibles. Medicaid, Medi, Medi or Medicaid. So that's about 26,000 patients that are on Medicaid.

It's hard to know as you've been hearing, you know, the rules are still coming out. It's really hard to know how many are going to be kicked off the rolls if you will. We're estimate if we anywhere at 10%, we're talking about, you know, 2600.

That doesn't sound like a lot, but what that translates in terms of dollars is anywhere about, look at my notes here. About over $3 million. If it goes up higher than that and we've estimated if it could go up, if it goes up to 2025%, we're going to talk about $7 million loss per year.

We will continue to see patients regardless. Just like Waianae. Our numbers are very similar to Waianae in terms of their distribution of population like that. But we have so many small clinics scattered around. Our focus has really been more on looking at redetermination and renewal as opposed to workforce.

Until we know more about the workforce, we're looking at what's happened, what are the reporting requirements, what are the things that we can do to work with Med Quest in terms of. But we have been developing a plan for re-enrollment. We really feel that that's where we need to focus our attention at this moment.

And so we have an 8.0 plan that we have and I won't go through it, but it's about outreach and education, being proactive. It's about verification of coverage. It's about getting our patients, our staff out there, data sharing and restructuring. But we want to create it.

We're creating a internal task force to look at the best way to reach folks and get them redetermined. Use all of our sites just as WI has in terms of using kiosks and people and staff in the clinics.

I will say that under Act 3101 of the things we put in there, and we appreciate the money that we did get because that supports those patient navigators, those outreach workers that will be able to continue to be funding funded to do the activities and that's part of the reason we put it in.

If we hadn't gotten that monies, we may have had to cut back on those positions which are going to be critical for re-enrollment.

I would just say also that the re-enrollment I've been trying to motivate our staff from the perspective of saying, let's look at the positive, why it's good to get them back in every six months.

Because that, and not just say yes, we need them re-enrolled because we need to increase, maintain their enrollment in Medicaid and for the coverage. Let's look at it from a quality perspective. If they come back in, we can address their chronic care conditions, we can address their health issues and get them in.

And let's use that as a motivation and not just oh, you, we need to get you re-enrolled. So kind of quality issues as well as re-enrollment issues. So that's kind of the mantra trying to use we have our internal tools.

We're going to be looking at obviously using technology in our data Azara and our EPIC system to identify and track these patients who are in, who are fall into the categories on the Medicaid parcel. But it's always going to take boots on the ground. Data only goes so far. So it's going to be boots on the ground.

And that's where our, as I said earlier, our patient navigators and our care coordinators, outreach people are going to need to be there.

There's a number of things that we want to partner and I'm going to turn to Judy and MedQuest because I think we need to be partnering with and getting list of names and numbers and disenrollment records and reports that come out of MedQuest. We've often thought we should.

We already have staff who go through the CALEO system and check for eligibility for Medicaid. Maybe we can. There's another step we can do about deputizing our own people so they don't have to do two steps we go through. We put them into and check with the CALEO system.

Then they have to be reviewed again by MedQuest and we deputize our staff to actually authorize and approve. That would short circuit that process and make sure that we get people in more efficiently. So basically simplifying the enrollment process.

Maybe there's some things around presumptive eligibility, looking at grace period coverage so if they are eligible and making sure that that's continued. Right now I believe we do have that and I'd like to see that continued. And I think ultimately that we should all be setting KPIs individually and at the state.

What's our goal and how we report and then report on them on a regular consistent basis so that we're moving towards those goals. And so I think I basically covered what I needed to or wanted to thank and I'm happy to answer any questions.

I don't really have any questions. It's basically I just want to hear what it sounds like from the FQHCs because we have already coverage and it sounds like from MedQuest's testimony you're looking at 10% disenrollment, which means $3 million. Yes. And how will that affect your budget? $3 million loss, that would be about.

A 7% budget loss.

Okay. Okay. So that's something that you folks are going. Because you also have a. No, no, closed our plan.

Right. And we don't know how many of those will impact our uninsured rate, just similar to Y and I, they have a 5% uninsured rate. Ours is about 56%. So will we see an increase there?

I will say and thank you to the Legislature and to you guys about having the state uninsured fund and supporting that because that those are funds through the Department of Health that help cover some of those uninsured and uninsured and low uninsured, low insured people.

Well, we'll see whether or not we can get funding for that.

Right.

Okay, thank you very much. Okay. Paige, are you online? You're up. We're running, we're running behind schedule, which is very not par with me, but please proceed.

Absolutely. And thank you again for the opportunity to participate online. We also have flu in our household and so we wanted to make sure we did not come in in person today. So just to start and I'll go as quickly as I can, just who we are as HAH.

We represent several types of Medicare certified facilities in the state but today we're really speaking to the experience for our hospitals under HR1. We do represent all of the hospitals in the state and that includes Tripler, but it also includes our HHSC partners and the rural and neighbor island facilities affiliated with some of our larger members.

Just like many have spoken to, we do anticipate that there will be an increase in uninsured population. And as many have spoken to already, what we're looking at is about a doubling of the number of uninsured insured. The good news is that we're starting from a small number of uninsured.

But I don't think that it negates the fact that we are going to see many, many more people uninsured in the state as a result of HR1.

I think what is most interesting potentially to this Committee is what we are estimating our increase in uncompensated care costs to be which would be around 30 to 35 million just for the uninsured population. So that's about a pot tripling of our uncompensated care costs.

Right now we estimate that that cost is about 15 million per year and again we think it might go up to about 45 million as a result of this bill. I want to note uncompensated cost.

Paige. Okay. Based upon the testimony today, your figures are off. Yeah, Med Quest is estimating 38,000. 38,000, not 30,000 of Medicaid enrollees will be disenrolled. ACA plan enrollees. When we combine both Kaiser and HMSA, we're looking at another 24,000. So double that. So you're talking about really an estimate of.

That's why we came up when we started this. We're looking at a 5 to 6% of the population being potentially disenrolled by, by the ACA premium tax credits expiring in addition to the Medicaid. So is your estimate of the 30 to 35 million low, since your figures are about half of what has already been testified to?

Right. We can look, we can go back and look at it. I will say that I think a lot of our estimates are based on that increased uninsured rate. And the uncompensated care costs that we are referencing here now is based only on the uninsured population.

So I think in terms of looking at that for the uninsured, I think we're okay with this number. You know, as many other testifiers have spoken to, it is hard to know what exactly the impact will be.

But we can go back with the number that we've seen from MedQuest today and from Kaiser and HMSA and see if we need to adjust anything in terms of estimating what the increased cost to hospitals might be for those who might become underinsured. And that's. That was sort of one of the things we wanted to caveat. Right.

Is this is really just looking at that additional increase in the uninsured. I think as HMSA and Kaiser have spoken to. Right. Folks may be looking at a lower cost plan, but that could result in higher deductibles, higher CO pays.

We haven't actually estimated what the increase in uncompensated care costs might be for those who go from a higher coverage plan to a lower coverage plan. But with this particular data, we're happy to do that.

Okay. Please proceed.

Great. Yeah. And I kept it short because I knew I was last. So I only have two more slides. Yeah. We are concerned about the federal funding cuts. I think, as everyone is. I want to note that the statewide margin for private hospitals in 2024 was negative 1%. And that's even with the provider tax program and HR1.

Does tax. Does touch the provider tax program. I don't think we're in a desperate state. I think in the way that some other states in the nation are, we're kind of below, I think, the threshold that Congress is looking to lower our provider tax program to. But, you know, it does make a difference. Right.

When we're already operating that negative 1% in terms of margin. Any loss, any increase in uncompensated care is going to stress, I would say largely our smaller in our rural hospitals. We've talked a lot today too about the increase in terms of premiums. Right. The increase in terms of taxpayers.

But the other concern we have is the closure of programs, services or beds. I think normally what you would see more is that people would limit the number of beds in facilities. We see that particularly with our long term care facilities.

But there is the potential, right, that a service, especially a loss leading service such as behavioral health or OBGYN, maternal health services, those tend to be the ones most at risk, not only on Oahu, but especially on our neighbor islands where there's already really precarious access to care.

And I think the last thing that we're really worried about is the ability to hire and pay for our needed workforce. We've made a lot of efforts and a lot of great strides, I would say, in trying to bolster our workforce.

But anytime you have reductions in payment, that means that perhaps you can't get a specialist in again. Maybe you have to staff fewer beds if you're not able to hire as many nurses.

That is a concern that we have considering how many years we've put into trying to really make sure that we have the labor workforce that we need. I do want to touch briefly though. I know that we've talked a lot about concern to rural communities. I know, Senator, that's of particular interest to your district.

So I did want to just touch a little bit though on one part of hr, one that we are hoping can help us to address some of our longstanding concerns and that is the Rural Transformation, Rural Health Transformation Fund.

We have not been notified yet from CMS about what the status of the application they have until the end of the year, the very end of the year on the East Coast.

But we'll know a little bit earlier on New Year's Eve what our application looks like, whether or not we are able to receive the full amount that we applied for. We did apply for the full $200 million. We're guaranteed 100 million. The next 100,000,000 up to 200 million is not guaranteed.

And really what we're looking at for the major highlights of the grant application are workforce development, expanding telehealth, accessing care, in particular with respite care, improving access to EHRs to help make things more efficient, looking at improving quality of care through an innovation fund, and then of course an oversight team because this is quite a bit of money coming in at once that we want to make sure that we're spending thoughtfully, but also that we're meeting spending deadlines.

So again, I think I appreciated the Waianae folks for coming in and saying, you know, we're, we're trying to look forward. I think that we are trying to make sure that we have everything we need in this Rural Health Transformation Fund.

But again, it doesn't negate what we're looking at in terms of the coverage losses and the increase in uncompensated care. So I'll stop there to see if you folks have any questions for the hospitals and any of our Members.

My first question is the Rural Health Transformation Fund that basically only covers, like, rural Oahu and the neighbor islands. Right. And not, and not metro. Right. Yeah. And, and, and my concern is, as testified to by Meredith and Judy, a substantial, this enrollment in the state of Hawaii is Metro Oahu.

So we're, we're going to see a lot of uncompensated care by the metro Oahu hospitals and physicians if the rural, I mean, that's not going to be covered by the Rural Health Transformation Fund. Is that correct? Yes. Nodding your head.

Yeah, that, that is correct. I think our ideal with that would be, have been that Congress, you know, pass this fund without making the cuts that they did to Medicaid and actually passing the enhanced premium tax credits. I just wanted to touch on this as a potential source of funding.

But no, it does not, does not affect the uncompensated care costs and the insurance losses. It's not going to address that, unfortunately.

Okay, thank you very much. Any questions?

Yeah, I guess can you, if you or Dr. Lewin, somebody can. Meredith, maybe the. What, what are we talking about in the, when we're talking about the boundary between rural and not rural.

Well, the workforce money could go to urban.

Well, maybe you can come up and so that people who might be watching can hear on the mic.

Oh, sorry about that.

I guess because to be very specific, like Queen's Mana. Mana.

Yeah.

Covers trauma for everyone.

Sure. Some things that cover rural areas that are in, that are, that are in urban locations will be eligible. Okay. Most likely we haven't seen all the wrecks yet from the feds, but generally speaking, the money's intended for the neighbor islands and the rural areas, and that's where the care part will be.

But some of the infrastructure to provide that care can be in the urban area. But I don't think this bails us out of this issue. And, and it won't be some of the reimbursement stuff. It won't be. We probably won't be eligible. We'll have to see how we do with this.

And it's, of course, five years, and it's temporary. We can't rely on a system feature.

Yeah.

Thank you.

Any other questions? It looks bleak, folks, but hopefully we'll see. We'll see what happens. But thank you, folks, very much. We are 20 minutes behind schedule, which I guess is very unusual for me. And with that, we are adjourned.