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Hawaii exchange seeks funding for orderly shutdown

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Managers of the state-based health insurance exchange in Hawaii say they need more cash even to shut the program down properly.

The governor signed a $2 million Hawai’i Health Connector bill into law last week. Exchange managers had asked for at least $5.4 million.

Jeffrey Kissel, the exchange executive director, reportedly told the exchange board last week that the exchange needs more than $2 million to help pass control of the exchange on to the U.S. Department of Health and Human Services (HHS) in time for the 2016 Patient Protection and Affordable Care Act (PPACA) open enrollment period, according to reports in the Honolulu Star-Advertiser and other publications in Hawaii.

The third PPACA open enrollment period is set to start Nov. 1 and run until Jan. 31, 2016.

See also: Plan maker: PPACA enrollment calendar flunks buzz test

PPACA requires a state-based exchange to use resources other than HHS grants to pay for operations after it has been up and running for a year. Some state-based exchanges are getting subsidies from their states, grants from nonprofit groups or assessments from local insurers. 

One rough measure of exchange stability might be use of social media. A check today, for example, showed only 11 of the 18 state-based exchanges have posted a tweet on their Twitter feeds this month.

Officials in California, for example, have said that Covered California may be able to operate next year without unexpected layoffs, but that it will cut its budget and try to have its own workers do work that contractors have been doing.

In Hawaii, Kissel suggested earlier this year that the exchange there could generate cash to support itself by acting as a benefit plan administrator for multi-employer health benefits programs. State business groups that already run multi-employer benefits programs objected to that proposal.

The Hawaii exchange succeeded at getting 35,000 people enrolled into health coverage this year, but Kissel says it has too little cash to do much more than abruptly shut down. 

Kissel and other exchange officials were not immediately available to comment on the reports of exchange financial challenges.