Hawaii to keep running a state-based exchange

Lawmakers in Hawaii have agreed to try to keep the state’s glitch-plagued public health insurance exchange in state hands in 2015.

If the exchange enrollment system works, certified agents and brokers can use it enroll individuals and small employers directly in exchange coverage.

The House and the Senate included those provisions in a version of state Senate Bill 2470 that could give the state-based Hawaii Health Connector exchange $1.5 million in funding.

Gov. Neil Abercrombie, D, has been a strong supporter of the exchange program, and lawmakers expect him to sign the bill soon.

The Patient Protection and Affordable Care Act provided startup funding for PPACA exchanges for 2014 but requires the exchanges to support themselves with user fees or other sources of funding in 2015.

The U.S. Department of Health and Human Services has ruled that exchanges with startup money left over at the end of 2014 can use the money for some purposes in 2015.

Tom Matsuda, who has been interim executive director of the exchange since December, had asked the state for $4.7 million in funding.

Hawaii relied heavily on manual systems to get 9,800 residents through the exchange “qualified health plan” selection process.

The enrollment system problems hurt sales. Avalere Health analysts are estimating that Hawaii’s paid exchange QHP enrollment will only be about half what they would have expected, based on the number of moderate-income uninsured people living in Hawaii. The Hawaii exchange has been one of the worst-performing exchanges in Avalere Health exchange performance rankings.