Dive Brief:
- The Hawaii Health Connector, on course to run out of money later this year, has put a contingency plan in place to cease operations if it can't secure additional funding.
- According to the contingency plan obtained by the Honolulu Star-Advertiser, the exchange will stop accepting new enrollments and discontinue outreach services this month, then transfer its technology and functions to the state by Sept. 30. The system's workforce is slated to be eliminated by Feb. 28.
- The approximately 37,000 people enrolled through the exchange would keep their coverage for now, but would have to re-enroll in plans through healthcare.gov to continue their coverage next year.
Dive Insight:
The exchange's troubles went from bad to worse in March after the state was notified that it was out of compliance with the ACA because it had failed to become financially sustainable by 2015 and because it was not yet integrated with the Medicaid system, which determines subsidies and tax credits. As a result, the federal government restricted the exchange's grant funding, and could cut off state Medicaid funding if the exchange isn't connected by the beginning of open enrollment in November.
Exchange officials recently failed to obtain the necessary level of funding to save the system from the state legislature. Gov. David Ige's administration is now attempting to negotiate with federal officials to release grant money to save the marketplace.
If Hawaii Health Connector shuts down, it won't be without precedent; the former Cover Oregon state exchange made the switch to the federal exchange in 2014.
Want to read more? You may enjoy this story about why almost half of state exchanges are struggling financially.