Hawaii is dropping the only state universal child health care program in the country just seven months after it launched.
Gov. Linda Lingle's administration cited budget shortfalls and other available health care options for eliminating funding for the program. A state official said families were dropping private coverage so their children would be eligible for the subsidized plan.
"People who were already able to afford health care began to stop paying for it so they could get it for free," said Dr. Kenny Fink, the administrator for Med-QUEST at the Department of Human Services. "I don't believe that was the intent of the program."
State officials said Thursday they will stop giving health coverage to the 2,000 children enrolled by Nov. 1, but private partner Hawaii Medical Service Association will pay to extend their coverage through the end of the year without government support.
"We're very disappointed in the state's decision, and it came as a complete surprise to us," said Jennifer Diesman, a spokeswoman for HMSA, the state's largest health care provider. "We believe the program is working, and given Hawaii's economic uncertainty, we don't think now is the time to cut all funding for this kind of program."
Hawaii lawmakers approved the health plan in 2007 as a way to ensure every child can get basic medical help. The Keiki (child) Care program aimed to cover every child from birth to 18 years old who didn't already have health insurance — mostly immigrants and members of lower-income families.
It costs the state about $50,000 per month, or $25.50 per child — an amount that was more than matched by HMSA.
State health officials argued that most of the children enrolled in the universal child care program previously had private health insurance, indicating that it was helping those who didn't need it.
The Republican governor signed Keiki Care into law in 2007, but it and many other government services are facing cuts as the state deals with a projected $900 million general fund shortfall by 2011.
While it's difficult to determine how many children lack health coverage in the islands, estimates range from 3,500 to 16,000 in a state of about 1.3 million people. All were eligible for the program.
"Children are a lot more vulnerable in terms of needing care," said Democratic Sen. Suzanne Chun Oakland. "It's not very good to try to be a leader and then renege on that commitment."
The universal health care system was free except for copays of $7 per office visit.
Families with children currently enrolled in the universal system are being encouraged to seek more comprehensive Medicaid coverage, which may be available to children in a family of four earning up to $73,000 annually.
These children also could sign up for the HMSA Children's Plan, which costs about $55 a month.
"Most of them won't be eligible for Medicaid, and that's why they were enrolled in Keiki Care," Diesman said. "It's the gap group that we're trying to ensure has coverage."