Governor Abercrombie Selects HMSA Health Plan

article top

BY JIM DOOLEY– A healthcare plan offered by the Hawaii Medical Service Association will be the template for all insurance plans offered to the public when President Obama’s universal coverage law begins in 2014, Gov. Neil Abercrombie announced today.

Gov. Neil Abercrombie, Insurance Commissioner Gordon Ito

Under the federal law – formally titled the Affordable Care Act and informally known to many as Obamacare – yesterday was the deadline for all states to select a minimum package of benefits which must be offered to the public and which must be purchased by anyone without health coverage.


Most Hawaii residents are currently covered by health insurance through their employers and won’t be affected by today’s announcement. But the new federal law will require that some 83,000 Hawaii residents who don’t have health coverage now will have to buy it by 2014.

The federal law requires that certain benefits must be offered and yesterday was the milestone for states to pick a model plan that supplies those minimum benefits, which Abercrombie called “the 10 commandments.”

“This was not a contest between plans,” the governor said “This was simply to try and take an existing plan that essentially covered all the benefits and put that forward with the knowledge that…all of the plans in Hawaii meet this very, very easily.”

Because HMSA dominates the Hawaii market, it wasn’t unexpected that one of its coverage plans, the HMSA Preferred Provider Plan (offered in 2010), would win government approval.

HMSA controls some 70 per cent of the Hawaii health insurance market, with Kaiser Permanente a distant second at about 20 per cent.

“The HMSA plan is simply the lead dog on this benefits packages sled,” Abercrombie said.

State Insurance Commissioner Gordon Ito said his office hired an actuarial consultant to analyze competing plans in Hawaii, assessing factors including benefits, affordability and which would case “the least least market disruption if selected.

Abercrombie said that selection of the HMSA plan would not give it an inside track on competing for new customers when the federal law takes effect in 15 months.

And he said HMSA’s donation of $200,000 to non-profit group helping to plan and prepare for changes in the health care industry here played no role in the decision announced today.

The money was donated to the Hawaii Institute for Pubic Affairs, run by Abercrombie’s political campaign manager, attorney William Kaneko, which is operating the Hawaii Healthcare Transformation Initiative, a “public-private” partnership between private industry and state government.

Kaiser Permanente donated $80,000 to the initiative and other parties in the health care market here donated lesser amounts, Hawaii Reporter disclosed in July.

Abercrombie said his selection of HMSA was unaffected by that donation. “They didn’t give money to me,” he said.

The various plans considered for selection were so similar that “I could have thrown a dart at the board” to make the pick, the governor said.

Besides the HMSA plan, others that were reviewed included Kaiser’s Small Groups Plan, University Health Alliance’s 3000 Plan, and various plans offered to state and federal employees.

The mandatory benefits required under the new federal law are:

 Ambulatory patient services

 Emergency services

 Hospitalization

 Maternity and newborn care

 Mental health and substance use disorder services, including behavioral health treatment

 Prescription drugs

 Rehabilitative and habilitative services and devices

 Laboratory services

 Preventative and wellness services and chronic disease management

 Pediatric services, including oral and vision care

Available insurance coverage plans will eventually be offered to the public at



Previous articleFor This Doctor, Business As Usual Is Over
Next articleJames Pflueger Last Remaining Defendant In Federal Tax Case
Jim Dooley joined the Hawaii Reporter staff as an investigative reporter in October 2010. Before that, he has worked as a print and television reporter in Hawaii since 1973, beginning as a wire service reporter with United Press International. He joined Honolulu Advertiser in 1974, working as general assignment and City Hall reporter until 1978. In 1978, he moved to full-time investigative reporting in for The Advertiser; he joined KITV news in 1996 as investigative reporter. Jim returned to Advertiser 2001, working as investigative reporter and court reporter until 2010. Reach him at


  1. It is amazing how the governor could pick the most expensive, most comprehensive health plan that HMSA offers as the plan to be covered by Obamacare. This will only serve to let everyone know that your health plan expenditures will at least double if not tripple in the very near future as every one will not have to be covered by this (the most expensive) plan that HMSA offers.

Comments are closed.