Hawaii’s Health Exchange Is the Nation’s Worst
Only 257 have enrolled so far in a system exempt from transparency rules.

Hawaii Health Connector


Look to the states, say Obamacare proponents desperate for success stories. A state they won’t be looking to is Hawaii, where the rollout of the health-care law has been an epic fiasco.

We’ve been told over the past few weeks that states invested in Obamacare have been able to make it work. On November 12, for instance, the Washington Post noted relatively high enrollment (which means in the tens of thousands) in New York, Washington, Colorado, and Kentucky, adding that “all are among the states that embraced Obamacare and crafted their own exchanges rather than rely on the federal site, which has been riddled with breakdowns.”

So is Hawaii, yet it has the worst state-based exchange in the nation. Though it enthusiastically embraced the health law, it has been crippled by tech problems, and the executive director recently announced that she will be stepping down. Because Hawaii legislators exempted the health law from many of the rules that hold other government ventures accountable, there remain more questions than answers about the debacle.

By latest count, only 257 Hawaiians have enrolled — all of them individuals who earn enough to be disqualified from subsidies. Moreover, the Hawaii Health Connector still can’t effectively connect to the state’s Medicaid system, leaving the poorer applicants who’ve attempted to buy insurance in indefinite limbo.

Put differently, it has cost $778,000 in federal funds for each individual who has successfully enrolled in Hawaii — and all of them have been people who would likely have been able to afford health insurance.

That low enrollment is, in large part, a result of the tech glitches that caused significant delays for the Hawaii Health Connector. The state chose to use CGI Group, the same contractor responsible for, and in the end, it took two weeks past the deadline for Hawaii’s glitch-plagued site to fully launch.

By some accounts, CGI’s problems were predictable. The company was chosen even after it presided over a problematic $87 million upgrade of Hawaii’s tax-collection system. The tax system it built has crashed repeatedly, and it will cost up to $50 million more to repair.

Given that experience, Hawaii’s Senate president, Donna Mercado Kim, says she strongly cautioned against using CGI Group to build the Hawaii Health Connector. But her warnings were ignored, she tells National Review Online. “I can’t understand it myself. It just boggles my mind that they seem to have a hold on Hawaii.”

Even though the state awarded CGI Group a $53 million contract, paid for with federal tax dollars, the procurement process was not subject to standard transparency requirements. Act 205, which established the Hawaii Health Connector, explicitly states that “the Connector shall not be an agency of the State and shall not be subject to laws or rules regulating rulemaking, public employment or public procurement.” Local reporters say the health exchange will not make public many of the papers pertaining to its procurement choices or the selection of CGI Group for the Hawaii Health Connector.

Already, conspiracy theories are circulating in Hawaii about who in government has friends in the IT and health sectors. Those theories become somewhat more plausible in the context of another recent story: Last year, the former head of the governor’s political campaign solicited donations from the health-care sector for a “private-public partnership” that advises health-care policy in Hawaii. The Hawaii Medical Service Association, the state’s biggest insurer, donated $200,000, and Kaiser Permanente gave $80,000.


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