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Remember Hawaii’s Health Care Lessons

Just 16 years ago Hawaii was held up as a model for national universal health-care. Now it is broke and even its vaunted employer mandated coverage is not guaranteeing everyone is getting coverage.

From the archives of the New York Times:

Hawaii Health Care Is Called a Model for U.S.

May 19, 1993

Hawaii’s universal health-care system, which insures 96.5 percent of the state’s residents and costs less than health care in other states and Canada, could serve as a national model, health officials from Hawaii say in a new report.

The report also says that requiring employers to provide insurance for employees who work at least 20 hours a week has not bankrupted small businesses, as some feared when the plan went into effect 19 years ago.

"In fact, some indirect indicators suggest that the effect may be positive," said the report, to be published on Wednesday in The Journal of the American Medical Association

Hawaiians rank at or near the top in health status compared with other Americans, the health officials said.

"We believe a considerable amount of this success is attributable to direct and indirect effects of Hawaii’s employer mandate," they said, adding that the state’s approach receive serious attention as a task force headed by Hillary Rodham Clinton considers health-care changes

Hawaii was also held up as as a model during the recent debate about expanding the federal State Children’s Health Insurance Program (SCHIP), since it was the only state universal child health care program in the country.

But that didn’t last too long.

From the Associated Press:

Hawaii Ends Universal Child Health Care 7 Months After Start

Saturday , October 18, 2008

HONOLULU — Hawaii is dropping the only state universal child health care program in the country just seven months after it launched.

Gov. Linda Lingle’s administration cited budget shortfalls and other available health care options for eliminating funding for the program. A state official said families were dropping private coverage so their children would be eligible for the subsidized plan.

"People who were already able to afford health care began to stop paying for it so they could get it for free," said Dr. Kenny Fink, the administrator for Med-QUEST at the Department of Human Services. "I don’t believe that was the intent of the program." …

Hawaii lawmakers approved the health plan in 2007 as a way to ensure every child can get basic medical help. The Keiki (child) Care program aimed to cover every child from birth to 18 years old who didn’t already have health insurance..

State health officials argued that most of the children enrolled in the universal child care program previously had private health insurance, indicating that it was helping those who didn’t need it.

The Republican governor signed Keiki Care into law in 2007, but it and many other government services are facing cuts as the state deals with a projected $900 million general fund shortfall by 2011…

Families with children currently enrolled in the universal system are being encouraged to seek more comprehensive Medicaid coverage, which may be available to children in a family of four earning up to $73,000 annually.

These children also could sign up for the HMSA Children’s Plan, which costs about $55 a month

Despite Hawaii’s experience, the expansion of SCHIP was still rammed through Congress as soon as the Obama administration was sworn in.

Meanwhile Hawaii’s hospitals have losing money for eight years and are going broke.

From the Associated Press:

Hospitals in Hawaii report $150 million in ’07 losses

October 24, 2008

HONOLULU (AP) – Hawaii hospitals suffered operating losses of $150 million last year and expect the situation to worsen in the near future

Hawaii Medical Center, which operates two former St. Francis hospitals on Oahu, filed for bankruptcy this year and cut the number of beds it offers.

The state’s publicly subsidized hospital network, Hawaii Health Systems Corp., has had to request millions in emergency funding from the state to stay afloat.

Kona Community Hospital, part of the network, laid off 10 percent of its workers. Also on the Big Island, the privately run North Hawaii Community Hospital laid off 12.6 percent of its staff.

A Ernst & Young LLP report released Thursday, and prepared for the Healthcare Association, shows hospitals as a group have sustained operating losses for eight consecutive years.

Reimbursements from Medicare, which represent about one-third of Hawaii patient charges, only covered 77 percent of costs. Medicaid/ Quest payments covered about 71 percent of costs.

Payments from private insurers such as the Hawaii Medical Service Association cover slightly more than expenses, but they are not enough to make up for losses produced in providing medical services to Medicare and Medicaid/Quest patients

And, on top of everything else, it turns out that Hawaii’s wonderful employer mandated health-care isn’t working out so well, after all.

Strangely enough, businesses have found ways to get around it. Such as hiring fewer than 20 employees.

From the Honolulu Advertiser:

Isle health care law questioned

Tuesday, June 30, 2009

A law enacted in Hawai’i in 1974 that requires employers to provide health insurance for employees working at least 20 hours a week is being cited by researchers who are skeptical of similar mandates being suggested in the argument for universal health care.

The result of Hawai’i’s Prepaid Health Care Act has been that businesses have relied more on employees who work fewer than 20 hours a week and thus aren’t covered under the requirement, wrote San Francisco Federal Reserve Bank research adviser Rob Valletta and co-authors Tom Buchmueller and John DiNardo, both University of Michigan professors.

The results of the research into health insurance coverage in Hawai’i "imply that an employer mandate is not an effective means for achieving universal coverage," they wrote.

"Although overall insurance coverage rates are unusually high in Hawai’i, a substantial number of people remain uninsured, suggesting a need for alternative approaches if universal coverage is the ultimate goal," they said

So the solution is obvious – stricter mandates from the Federal Government.

By the way, the Heritage Foundation had challenged the idea of using Hawaii as a model for any national system back in 1994.

Here is the conclusions of one of their reports at the time:

A Critique of the Hawaii Health Care System

by Hellreich, Phillip D., Dr.
Heritage Lecture #496

August 4, 1994

In conclusion, Hawaii has had most of the components of the Clinton health care proposals in effect since the enactment of its Prepaid Health Care Act in 1974.

It has failed in its two major goals of 1) decreasing the number of Hawaii’s population that were uninsured and 2) curtailing the ever-rising costs of health care delivery.

In order to control spiraling health care costs, it has just instituted its Health Quest Program, which will severely ration care and deprive most of the citizens of our state of their right to be treated by the physician of their choice. In light of this information, the American people and members of Congress should think long and hard before enacting a health care proposal which shares so many features of Hawaii’s Prepaid Health Care Act.

Isn’t it odd how we no longer hear about Hawaii being the model for a US system of healthcare?

Probably because it turned out to show us all too clearly where we will be headed under its favorite son’s ‘Obama-Care,’ after all.

This article was posted by Steve Gilbert on Tuesday, July 28th, 2009. Comments are currently closed.

15 Responses to “Remember Hawaii’s Health Care Lessons”

  1. VMAN

    It’s just like government mandated overtime if you don’t want to pay it hire more people so that no one gets over 40 hours. It’s a common practice. And what exactly do they call it when the government mandates how businesses are run? Can you say “socialism” sure I knew you could. Why can’t these dillrods stay out of businesses way and let it flourish? Oh I know it’s because NONE of them have ever run a business and they don’t know their butts from a hole in the ground.

  2. Liberals Demise

    OH MAN …… This is our redeeming moment for the classical fingerprint / DNA of Socialized Medicine.
    “Come to papa, baby!!”

  3. proreason

    All powerful governments are often able to termporarily suspend the laws of economics, and even human nature. But life has a way of rearing its ugly (ugly to Statists) head.

    And no amount of evidence is enough to persuade the tyrants of the danger of their methods.

    That’s because they don’t care about the danger, since the danger never affects the tyrants. Indeed, they view the danger as a useful tool to control the serfs.

    Until the guillotines emerge again.

  4. neocon mom

    If Hawaii weren’t a beautiful Island paradise it would easily be recognized as the money pit that it has become thanks to government “safety nets”.

  5. Rusty Shackleford

    I still have to go back to the way it was proposed to legislation originally. By Hitlery Clinton. At the time merely the first “lady”…not a voted-in member of government. Back then it just skewered every last belief I had of fair and equitable government.

    And, we also have heard the “California economic model” barkers pretty much die down as that argument died on the vine in light of recent developments. Interestingly…and as a small point of order, their chief executive is a FOREIGN NATIONAL.

  6. wardmama4

    There are just so many problems and just plain idiotic ‘ideas’ that can be dis proven here.

    Competition – open – not employer required benefit – not within a State or area – but from the entire US would help to bring down the Insurance costs.

    Anyone knows that when something is offered for free versus paying for it – more people will use it more often for no reason other than – They can. Which will make things worse not better.

    Also anyone with a brain can deduce – if another responsibility of parenthood is provided by the Government – there will be an increase in population – as people always get in line for the next Government entitlement – when if forced to pay their way – family size (most importantly from the non-married) would be kept manageable or non-existent.

    And have you read/listen to the blather – ‘rushing because so many are begging for something to be done’ – because the costs are so high (cost of what, where, who – provide references, sources please) – won’t add to the deficit (in whose insane dreams/fantasy is that ever going to happen) – Public option will make competition for private option (no it will end up forcing more into Public option – just as it’s done for education – and look how that’s turned out).

    Finally I want someone – anyone to show me where exactly in the Constitution it says Healthcare is a RIGHT (btw – I’d also like to see where abortion is a right also) – I have several copies of the Constitution and have read it – don’t see where Healthcare, Education, abortion, Medicare, Medicaid, Social Security are RIGHTS – at all.

  7. I’ve linked to your post, from our blog, freedomactionnow.wordpress.com. One would think that when a plan fails in Hawaii, fails in Tennessee, fails in Massachussetts, that the government would think that it’s a really bad idea to impose it on all the other states.

  8. sharonfurst

    ZZM, where in the world did you get the idea that the public plan in Hawaii has failed? All this site posts are the negative aspects of the Hawaii public option. Yes, there are negative aspects, but the positives FAR out weigh the negatives. (Point in fact: the hospitals are failing due to mismanagement more than due to state payments.)
    Hawaii is one place that everyone can get medical care. And you pay according to your need. You guys really need to check your facts.

    I’ve lived here for 18 years and the public and private health insurance plans has coexisted just fine.

  9. Gillespie

    could you possible state what those positive affects are? Sure anyone can get health care, but should that come at the expense of the hospitals going under or having to beg money from the government (which gets its money from our tax dollars)?

    in addition, the article states that it has had to “severely ration care” and doesn’t allow you to pick your own physician anymore. Doesn’t sound like a very much improved health care system to me.

  10. watermark0n

    “It’s just like government mandated overtime if you don’t want to pay it hire more people so that no one gets over 40 hours”

    That was sort of the point. Before this law, it was common for businesses to require people work 16, even 18 hours a week, and there was basically no other choice for anyone who wanted to advance in their career. It was a race to the bottom. The 40 hour work week raises our quality of life.

  11. watermark0n

    “It’s just like government mandated overtime if you don’t want to pay it hire more people so that no one gets over 40 hours”

    That was sort of the point. Before this law, it was common for businesses to require people work 16, even 18 hours a day, and there was basically no other choice for anyone who wanted to advance in their career. It was a race to the bottom. The 40 hour work week raises our quality of life.

  12. kazooga1234

    What they don’t say in this article is when things started to go down hill was when there was a resection. Not many people where visiting the island and thats where all the income comes from. They still would of had those exact same problems cept probably worse if they didn’t have some sort of universal health care. There where already lots of people going broke at the time because it’s not like you can just jump from one island to the other to find jobs. Also there where a lot of bad business deals that where happening in Hawaii that where horrible mistakes. Those are still being paid off.

    • proreason

      So, if I understand your point correctly, when a state is totally screwed up, you shouldn’t really say anything about its failed health care system.

      Well then, we certainly won’t be able to blame Obamycare for destroying the country. The Moron is busy as a beaver with dozens of other schemes to turn us into Cuba north.




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