Hawaii’s Governor Proposes Health Insurance Rate Regulation

Hawaii Gov. Ben Cayetano (D) has proposed a plan that would offer the state insurance commissioner "more control" over Hawaii's health insurance rates, but some state lawmakers have said that the Legislature should not address the "complex" issue during a five-day emergency special session, the Honolulu Advertiser reports. State lawmakers plan to hold a special session on Oct. 22 intended to focus primarily on boosting the state economy in the aftermath of the Sept. 11 attacks on the World Trade Center and the Pentagon. Under Cayetano's proposal, the state insurance commissioner could order health insurers to modify rates determined "excessive, inadequate or unfairly discriminatory," and health plans would have to reduce rates or return "excessive reserves" to members. The proposal also would require health plans to inform members of increases in health care costs when planning to boost rates. "We believe that Hawaii citizens need to be ensured of as seamless a system of health care coverage as possible," state Insurance Commissioner Wayne Metcalf said, adding that 48 states have similar laws. However, state Senate President Robert Bunda (D) said that state lawmakers "should look at this in a regular session rather than just carte blanche here it is in a special session," adding that "we need to spend more time" on the measure. State House Speaker Calvin Say (D) added, "It's not a bad idea, it's just the timing is not right. What is the crisis?" Cliff Cisco, a spokesperson for the Hawaii Medical Service Association, the state's largest health insurer, called the proposal "unnecessary" and said that the plan "unfairly targets" HMSA. Chris Pablo, a spokesperson for Kaiser Permanente Hawaii, added, "It is a bill that should be considered during the regular session of the Legislature when there is sufficient time to address this most complex problem of rising health care costs" (Arakawa, Honolulu Advertiser, 10/9). For further information on state health policy in Hawaii, visit State Health Facts Online.

'No Need to Rush'
Although the health insurance regulation "definitely should be taken up" by the state Legislature, a Honolulu Advertiser editorial warns that "it is far too complex to be considered" in a special session. According to the editorial, "there is no need to rush into oversight of the health insurance industry's rates and reserve levels." The editorial concludes, "Both the industry and the people it serves deserve a reasoned, careful review. Let's step back and wait until January and the regular session of the Legislature for any action" (Honolulu Advertiser, 10/10).