Power Brokers VI: Crossing the Pacific into Hawai’i


Brian Daffron

September 12, 2013

Power Brokers takes a turn over the waters of the Pacific to Hawai’i, whose indigenous population shares a common history with Native Americans and Alaskan Natives on the mainland. In 1893, the sovereign kingdom of Hawai’i was overthrown, with the country seeing an eventual annexation by the United States five years later. Since statehood in 1959, there has been a growing movement of recognizing the importance of Hawaiian language, culture and sovereign recognition. This includes war crime complaints filed within the International Criminal Court and the UN Human Rights Council.

RELATED: Native History: When Hawaii Was Riding the Wave Toward Sovereignty

Because of the growing interest in Hawaiian sovereignty, it is important to recognize the members of the Hawai’i State Legislature who are open about their indigenous identity. Many of these indigenous legislators have been in office for several terms and hold majority leadership positions.

PPACA Raises Barriers to State Single Payer Efforts – The Amazing Maze of US Health Care

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.
James L. McGee, CEBS--On Health Care Reform

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Last week’s post highlighted encouraging initiatives in several states to implement a single payer system within a single state.

This was always a daunting challenge even before health reform. The Patient Protection and Affordable Care Act has raised the bar even higher.

ERISA and its preemption

Before PPACA a legal hurdle called the ERISA preemption severely hamstrung state health reform efforts. For those of us in the employee benefits profession, ERISA, including its preemption clause, is our bible or at least our Deuteronomy.

ERISA was passed by Congress in 1974 to regulate employee benefit plans. The preemption clause precludes states from regulating employee benefit plans. There were two exceptions to that preemption and both are instructive.

Insurance and not insurance

Under the McCarran Ferguson Act of 1945 states have the authority to regulate insurance plans. Under ERISA states still retain the right to regulate insured health plans.

After the law was passed, Congress figured out that the state of Hawaii had already established a law requiring employers to provide health insurance to their employees. I guess news travels slowly from Hawaii. Congress passed the first of many subsequent amendments to ERISA making an exception to the general preemption for Hawaii.

One reason for the preemption clause was the belief that Congress would tackle national health care reform soon and they wanted to protect that right at the national level, a theme that would reappear in PPACA.

The consequence of allowing states to only regulate “insured” health plans was the movement by many larger employers to “self-insured” plans. By taking on the risk of health insurance themselves, employers escaped the mandates imposed by state insurance departments. Companies operated in multiple states could establish uniform benefit designs for all of their employees. At least one source estimates about 43% or 53 million people with health care coverage are regulated by ERISA and not by state insurance departments.


When Congress exempted Hawaii from the preemption clause they only exempted the Hawaii law as it existed in 1974. Employers have since discovered the loopholes in Hawaii law for part time employees and contract employees. Now, even though Hawaii has always had the lowest rate of uninsured in the country, that number is increasing as more and more employers exploit that loophole.

The ERISA preemption prevents efforts by state to expand coverage by requiring employers to offer health insurance.  Instead they are confined to a hodgepodge of confusing and complicated programs to expand state Medicaid insurance programs or offer subsidies to small employers.

Obama blocks states?

The PPACA does not make it easier for state single payer advocates.  The Obama Administration vigorously opposed bipartisan efforts in the House Education and Labor Committee to give states more latitude as laboratories for reform.

Photo Credit:  Maui-Tropica

Please Click Here to Read the Complete Article on Health Care Reform by Jim McGee » The Amazing Maze of US Health Care »

The Amazing Maze of US Health Care » Seven dollars and forty cents – no sense

Amazing seems a most appropriate word to describe the financing and delivery of health care services in the United States of America.
James L. McGee, CEBS--On Health Care Reform

Seven dollars and forty cents – no sense

Seven dollars and forty cents hardly seems like an amount that should erect a barrier to health care.

In fact, when Mr. Koch (all names are fictitious) called to complain about this bill for seven dollars and forty cents, my first reaction was, “You should appreciate how lucky you are that you have a health care plan that pays most of your bills. Why are you quibbling over $7.40?”
Of course, that is not an appropriate customer service response.

But listen to Mr. Koch. “This bill is for two pain pills that were given to me when I was admitted to the hospital for an emergency surgery.   Medicare won’t pay for the pills because they were “self-administered.”

Our insurance plan won’t pay, because Medicare won’t allow payment. (a common Medicare complementary policy). The hospital wants its $7.40. I must have been semi conscious when they gave me the pills, because I do not remember it at all.  Why should I pay for pills that some nurse made me swallow when I was semi-conscious?”
Mr. Koch’s total pharmacy bill for this hospital stay was over $8,000  Who is the one who is quibbling over $7.40?  And the issue has little to do with whether the two pills cost $7.40.
In fact, it is more likely that the hospital knows full well that the two pills only cost $0.20  But they calculate that it will take at least an additional $7.20 of bureaucratic labor to collect that $0.20.  The bureaucracy needs to be fed.
Think about the effort to maintain these bureaucracies.   Somewhere in the bowels of the CMS (Center for Medicare and Medicaid Services) someone has crafted regulations that stipulate that Medicare will not pay for certain medications that are self administered.
The logic is apparent  Before Medicare Part D, CMS did not pay for prescriptions outside the hospital or physician office. “Self administered” appears to fairly delineate the boundary between those drugs that can only be administered in a hospital or physician office setting, from those dispensed by a pharmacist.

Please Click Here to Read the Complete Article by Jim McGee » The Amazing Maze of US Health Care » Seven dollars and forty cents – no sense