The Hawaii Medical Services Association is abandoning the state’s insurance exchange
Hawaii’s largest insurance company has pulled out of the state’s health insurance exchange, Hawaii Health Connector. The insurer, the Hawaii Medical Service Association, opted to pull its small business plans from the exchange late last week. Next year, agents working with small businesses will have only one insurer to work with through the exchange: Kaiser Permanente. The decision is not expected to affect individual health insurance plans in any way and many of the states insurers do not have plans to pull out of the Hawaii exchange in the foreseeable future.
Decision is based on the poor performance of the exchange and its ongoing technical problems
The Hawaii Medical Services Association claims that the decision is based on the problematic history and present of the state’s insurance exchange. The exchange has been plagued with technical issues since its launch last year. These issues have made it difficult for individuals and small businesses to enroll for insurance coverage. Management problems have also emerged within the exchange, raising questions as to whether or not the exchange can properly serve the state.
Insurer reports losses during the first quarter of this year
The insurance company has reported that it has lost some $30 million during the first quarter of this year, placing it $8.3 million in debt. Some of the company’s financial losses may be due to the faults of the insurance exchange. The company had initially supported the exchange, but soon began decrying its operation and the technical issues that were not quickly and effectively resolved.
Insurer will honor the policies it has already sold through the state’s insurance exchange
The insurer will continue to honor the 5,000 policies it has sold through the state’s exchange, but will not be selling policies through the exchange in the future. The Hawaii health insurance exchange is set for another open enrollment period later this year. During this period, consumers will be able to sign up to receive insurance coverage and take advantage of subsidies being offered by the federal government.