Hawaii’s Keiki Care Program

It’s difficult to say when, exactly, the latest attempt to reform health care in America turned sour. Some might point to the day a man flashed a loaded firearm outside a “town hall” meeting in New Hampshire along with a sign bearing the Thomas Jefferson quote about refreshing the tree of liberty “with the blood of patriots and tyrants.” Others might bring up Rep. Joe Wilson of South Carolina interrupting the President’s joint session address to call Obama a liar (twice), a breach of decorum that drew finger wags from both sides of the aisle. Still others might argue this debate was poisoned from the start, that civility and nuanced discourse were mere fantasies destined to be shattered by the special interest cudgels of lobbyists and cable network pundits.

But there was another moment, closer to home, that tells the story equally well—when a little-known children’s health care initiative in Hawaii became a national story, a rallying cry for the forces gathered against what both sides had agreed to call “Obamacare.”

In retrospect it was too perfect: a government-subsidized program in the President’s birth state that was now on life support, stripped of funding by the state’s Republican Governor, ostensibly in the name of curbing profligate spending.

FOX News wasn’t the first to pick up the scent, but they’ve got the biggest bullhorn. In July, Sean Hannity aired a segment in the series “Universal Nightmare” in which Gov. Linda Lingle called Keiki Care a “cautionary tale” fraught with “unintended consequences,” and the right-wing blogosphere lit up like Rush Limbaugh’s face at a Sarah Palin rally. Soon, the prevailing narrative on Keiki Care was all but set in pohaku: it was a failure, an unfair drain on taxpayers and a clear example of government overstepping its bounds.

Lost amid the din was any real, cogent analysis of the program. Did it actually help anyone? What was the impetus behind its creation and ultimate dismantling? And, most importantly, do the detractors have a better idea?


Act 236, also known as the Hawaii Children’s Health Care Program, was passed in 2007. Its goal was to provide coverage to so-called “gap children”—kids who were uninsured, but whose families didn’t qualify for other state and federal programs like Medicaid either because of income or residency status.

In addition to the obvious, sound bite-friendly desire to protect the well-being of the next generation, the motives were financial: according to data from the Hawaii Health Information Corporation, uninsured children paid 3,302 visits to state emergency rooms in 2008, at a total cost of $4.4 million. “Taxpayers should know it is cheaper to cover kids with health insurance than [to] cover expensive hospital costs for uninsured kids,” Barbara Luksch, project director of Hawaii Covering Kids, says in a quote posted on the advocacy group’s Web site.

Though it’s been pigeonholed by opponents as purely government-run, in reality Keiki Care was backed by a partnership between the state Department of Human Services (DHS) and the private Hawaii Medical Services Association (HMSA), with the state paying $25.50 per month per child.

Gov. Lingle initially supported the plan, but that support quickly eroded. On November 1, 2008, DHS terminated its contract with HMSA. The following day, Linda Smith, a “senior policy advisor” in the Lingle Administration, wrote an op-ed in the Honolulu Star-Bulletin in which she argued that “Keiki Care fail[ed] to achieve its worthy goal” and “inefficiently utilized state funds by subsidizing families who did not need help.” Smith cited figures showing that, of the roughly 2,000 children enrolled in the program, a significant majority had previously been insured through HMSA’s Children’s Plan, with their parents footing the bill. (No one denies that Keiki Care helped some legitimate, uninsured “gap children.” A DHS estimate puts the number at approximately 300.)

HMSA continued funding the program through the end of 2008. Earlier this year, the legislature amended Act 236 to extend Keiki Care to June 30, 2012. Funding was slashed from $600,000 to $200,000 annually, which would have cut the number of kids covered from 2,000-plus to around 600.

Despite the reduced cost (a small fraction of the state’s total budget shortfall), Gov. Lingle vetoed the bill on July 10. Less than a week later, the legislature overrode her veto, but the following day the Governor announced she would not release money for Keiki Care. Addressing her colleagues before the override vote, state Rep. Kymberly Pine summed up the message of Gov. Lingle and others who wanted to quash Keiki Care once and for all. “People are soaking up the taxpayers’ money [who] don’t need the help that we intended this bill for,” said Pine. “People who can afford health insurance or who were paying for health insurance switched over.”

Note the way Pine conflates “people who can afford health insurance” with “people who were paying for health insurance.” If the financial crisis has taught us anything it’s that people will pay for things they can’t afford. For many, it’s cars and houses and luxury items. But for people with more altruistic motives, it’s health insurance for their kids. How do we know that at least some of the families who were paying for HMSA’s coverage out of pocket didn’t need the help just as badly as those who weren’t?


To say that opponents of Keiki Care overstated their case is not to say the program didn’t have flaws. A December 2008 report from DHS’s Med-QUEST division pointed out that children enrolled in Keiki Care weren’t required to apply for other government-subsidized plans such as the Medicaid-managed QUEST program, which offers more comprehensive benefits. QUEST eligibility was expanded in October 2006 and again in January 2008; families that enrolled in HMSA’s Children’s Plan prior to the expansions might have been eligible for QUEST, DHS argued.

It’s a valid point. But what’s interesting is that it actually runs counter to the argument of the anti-public health care crowd. The best alternative to Keiki Care, most everyone seems to agree, is not private insurance, which rules our current system, but other public options. As this debate expands beyond the efficacy of one specific program and becomes about our medical system as a whole, that’s a hugely important point. It’s also one that’s been virtually ignored.

Anyone who looks at health care in America and sees something other than an epic national disaster is either delusional, out-of-touch or both. The private model has led us to a place where more than 30 million Americans don’t have health insurance, and even those who do are forced to navigate an inefficient, convoluted network of paperwork and preexisting conditions designed to maximize profits and, often, minimize coverage. The pro-privatization crowd likes to conjure the boogeyman of “government bureaucrats.” What they fail to acknowledge is that bureaucrats are already running the show—they’re just privately financed and thus wholly immune to the will of voters.

The solution is, obviously, where the shouting begins. On one side are those clamoring for a public, single-payer system similar to the ones used in most of the industrialized world. On the other side are people who say we should do away with any government control and let individuals buy their insurance on the open market. In his recent speech to Congress, President Obama dismissed both of those notions as too extreme (though once upon a time candidate Obama expressed support for single-payer).

Whether the President’s attempts at compromise and bipartisanship will lead to a genuine solution or an ineffectual, watered-down bill that leaves insurance companies firmly in the driver’s seat is an open question (though the answer, unfortunately, is becoming clearer by the day).

But—even as the tide seems to have turned and all hope for a rational discussion (let alone solution) seems to have fizzled—we have to pay attention. We have to note what examples are being used, what statistics cited. And when one of those examples happens to be in our own backyard, we can’t let FOX News have the final word. Maui Time Weekly