BY MALIA ZIMMERMAN - HONOLULU — A new report from State Budget Solutions, a national nonprofit organization focusing on states’ fiscal responsibility, warns it’s time for newly elected state officials in Hawaii and throughout the country to address unfunded liabilities in the retirement system.
The share of Hawaii’s $30-billion unfunded liability per resident is $21,852, the seventh highest in the nation, said Joe Luppino-Esposito, the study’s author.
He said Hawaii’s Employees’ Retirement System is only 29 percent funded because the state isn’t putting enough money into the system to pay future promised benefits. The unfunded liability amounts to 41 percent of the state’s gross domestic product.
State officials paint a different — if still grim — picture, showing the pension system as 60 percent funded.
The translation in real dollars is $8.5 billion. That’s a major discrepancy from the SBS $30 billion estimate.
The main difference, Luppino-Esposito said, is the discount rate used. That’s the rate that determines how much money is needed today to have enough revenues in the future to meet obligations to retirees.
Hawaii uses a 7.75 percent discount rate, assuming the plan will average 7.75 percent investment growth over time, a number Luppino-Esposito said “is far too high.”
“Hawaii should use a risk-free rate instead, ensuring that state employees will actually get the pension they were promised,” Luppino-Esposito said.
Hawaii is far from alone. The SBS report, which reviewed 250 plans, documents state governments are in a $4.7 trillion hole. Liabilities have increased roughly $600 billion since last year. The average state public pension plan is only 36 percent funded, the report said.
Wes Machida, executive director of Hawaii’s Employees’ Retirement System, acknowledged there are some elements in the study to which the state should pay attention.
“There are concerns about employers being able to make those kinds of contributions,” Machida said. The “employers” he is referring to are state and local governments.
“At some point down the road, this will likely be an issue for Hawaii. The requirements will be so high as to outgrow what is available in the general fund. That is a possibility if we don’t do something to help with the situation,” Machida said.
Pension reforms implemented by the Legislature in the past four years should help, he said.
Machida and the Employees’ Retirement System Board of Trustees hope Hawaii’s newly elected governor, David Ige, will push additional reforms to further reduce benefits for new hires. The next legislative session begins in January.
Lawmakers in 2011 and 2012 approved legislation that reduced retirement benefits for new state employees who entered the system as of June 30, 2012. Another change in 2012 prevents workers from accruing benefits from overtime, bonuses, lump sum salary and allowances.
In 2011, legislation increased the employer and employee contribution rates. Employees pay between 6 to 14.2 percent of their pay into the fund. Employer contributions are steadily increasing until 2016, when the contribution rate will stabilize at 17 percent of pay for all employees except police officers and firefighters. Those agencies will contribute 25 percent of their employees’ pay.
Other changes include doubling from five to 10 the number of years it takes to become vested in the system.
Machida said the Board of Trustees lowered the anticipated rate of return for next year on investments. The rate will be reduced gradually over the next three years to 7.5 percent, and will be reviewed annually by the board, Machida said.
According to state figures, the retirement fund is at $13.9 billion as of Sept. 30, but because markets have grown, Machida said the fund is probably around $14 billion now.
Another $8.5 billion is needed to cover unfunded liabilities or future payments owed to the more than 115,000 people in the system, including all retirement income, death and termination benefits, but the state won’t be able to cover that amount for decades.
To put it in perspective, the state’s biennium operating and capital budgets are $24 billion during the next two fiscal years.
The state’s financial plan will pay off the retirement system’s unfunded liabilities within 26 years.
“The most important thing is we need to monitor what is going on with the fund and how the investment markets are impacting us. That also includes how the membership has changed and what their retirement needs are,” Machida said.
“If more people start to retire earlier, we will need more payouts, and that will require us to liquidate more funds. If members start living longer, we will need more benefit payouts. There are many different areas to monitor to make sure the fund is properly funded,” Machida added.
Between 2,000 to 2,500 state and county employees retire each year in Hawaii, adding to the $1.1 billion annual payout already made to 67,000 retirees in the plan, which has additional challenges not necessarily encountered in the rest of the country. The average life expectancy for members in Hawaii is 82 to 83 years of age, much greater than the national average, Machida said.Use Facebook to Comment on this Post
By Jasmine Greenamyer - Colon cancer will claim more than 50,000 American lives this year. One in 20 people will be diagnosed at some point in their lives.
Thanks to better screening and new treatments, the death rate from colon cancer has been dropping for more than 20 years. But even the best screening and treatment can't help those unable to afford health care.
The Affordable Care Act was designed to help make sure patients could receive the care they need. But it's failing America's most vulnerable patients. Congress must make sure the Affordable Care Act lives up to its name and enables people to access the health coverage they need.
When Congress passed healthcare reform, one key protection for patients was a requirement that insurers cover a minimum set of "essential" benefits. Another protection banned insurers from discriminating based on health status. Despite these protections, many of the insurers offering plans on the new insurance exchanges are shifting the cost burden of medications to patients.
Put simply, Congressional intent is being ignored.
That's why lawmakers must step in to make sure the Department of Health and Human Services updates its essential health benefits rule. Congress must also call on HHS to provide guidance to states that are being asked to assess whether exchange plans are discriminating against certain patients.
All exchange plans are required by law to cover prescription drugs. Each insurer maintains a list of prescription drugs -- a formulary -- that specifies the drugs it will cover. But most formularies have four or more "tiers" of coverage that place increasing cost-sharing obligations on patients. The surprise comes when you develop a condition whose medications fall into the top tier.
The first tier, usually for the most commonly prescribed medications, might include a modest copay of, say $20. But the highest tier typically involves co-insurance, in which the patient is responsible for a fixed percentage of the cost of a drug. The coinsurance percentage can run to 40 percent or more for drugs that can costs thousands of dollars.
This means that patients can get stuck with huge bills. The impact falls disproportionately on patients with serious conditions that require expensive medications, such as cancer, multiple sclerosis, and HIV/AIDS.
Indeed, a recent study by Avalere Health analyzed 123 mid-level exchange plans and found that more than 60 percent place all medication for cancer and other life-threatening conditions on the highest cost-sharing tier.
These formularies seem discriminatory, but HHS hasn't stepped in to crack down on insurers. Congress must call on federal officials to make clear that discriminatory coverage is prohibited.
Such high out-of-pocket drug costs threaten to put necessary treatments out of reach for the patients who need them most. Patients are left with little choice but to deplete their savings or retirement funds, declare bankruptcy, or skip or refuse treatments.
Researchers at Duke University Medical Center surveyed cancer patients to learn how they coped with these costs. Nearly half described the financial burden as "significant" or "catastrophic." Forty-six percent had to cut back on basic needs such as groceries.
The greater the cost-sharing, the more likely a patient will postpone or forgo medication. According to a study by University of North Carolina researchers, patients with higher co-payments were 70 percent more likely to stop taking their cancer treatment and 42 percent more likely to skip doses.
This is a serious, life-threatening problem. Skipping treatments significantly increases the risk of relapse. Missing even just 15 percent of a prescribed dose can lead to a recurrence of the cancer.
Getting a colon cancer diagnosis is bad enough without adding exorbitant out-of-pocket costs for treatment. If the new health law is to live up to its promise of affordable care, Congress must create a solution and help people get the care they need and deserve.
Jasmine Greenamyer is the Chief Operating Officer of the Colon Cancer Alliance.
HONOLULU – Attorney General David M. Louie and Director of Human Services Patricia McManaman jointly announced today that a decision by the U.S. Supreme Court validates the state’s authority to determine the level of health care coverage provided to noncitizens who are ineligible for federal Medicaid. The high court’s decision also confirms that the state did not discriminate when it exercised that authority in 2010.
On Monday, Nov.3, 2014, the U.S. Supreme Court rejected plaintiffs’ appeal in Korab v. McManaman, which leaves intact the Ninth Circuit Court of Appeals decision in favor of the state. That decision found the state was not required provide state-funded medical assistance benefits to noncitizens after the federal Medicaid program excluded them.
The federal Welfare Reform Act of 1996 eliminated federal health care funding for many noncitizens, including migrants from Palau, the Republic of the Marshall Islands, and the Federated States of Micronesia.These island nations have a Compact of Free Association (COFA) with the United States that allows their citizens to live and work in the U.S. Even after federal funds were not available, the state continued state-funded medical assistance benefits for COFA residents. The benefits provided were essentially the same as citizens received under federal Medicaid until 2010 when the state sought to implement a more limited program for noncitizens. Plaintiffs in the Korab case are noncitizen COFA residents whose benefits would have been reduced under the 2010 program. Federal District Court Judge Michael Seabright sided with the plaintiffs and issued an injunction blocking implementation of the program in 2010.
The Ninth Circuit Court of Appeals reversed the decision of the District Court earlier this year, and held that Hawaii is not required to replace the federally-funded health care benefits that were lost under the federal Welfare Reform Act. The state has remained subject to the injunction pending the decision by the U.S. Supreme Court, and expects the Federal District Court to dissolve the injunction shortly.
According to Attorney General Louie, “This decision is important because it confirms that the state's actions were not discriminatory. But it is also important to know that the state intends to continue providing significant assistance to these individuals.”
“My administration is committed to the principle that all Hawaii residents should have health insurance,” said Gov. Neil Abercrombie. “The state will strive to ensure that our neediest residents, including noncitizens, have access to quality health care coverage.”
According to Director McManaman, “The state’s plan going forward includes a program that provides Medicaid-like coverage to our neediest aged, blind, and disabled noncitizens. Coverage for children and pregnant adults will remain unchanged. The plan also includes a transition period for other non-pregnant adult noncitizens to obtain health insurance through the Hawaii Health Connector, and a state-funded program to help these very low-income noncitizens pay their share of their health insurance premiums. This ensures that needy noncitizens who are ineligible for Medicaid still have access to quality, affordable health insurance.”
Adult noncitizens who are not pregnant, and are not aged, blind, or disabled, and who were eligible beneficiaries under the injunction, will continue to receive their current level of benefits until the new programs are implemented. Those beneficiaries will soon receive a notice in the mail explaining the changes, and they should contact the Department of Human Services at the number provided on the notice if they have any questions.
BY MALIA ZIMMERMAN - HONOLULU — Some Hawaii companies are taking advantage of visitors and elderly residents, but state officials are thwarting attempts to investigate, a supervisor with the state Department of Commerce says.
Aquilino “Aku” Idao, of the department’s Consumer Affairs’ office, has filed a complaint with two state Senate committee chairman.
Idao, who has worked in law enforcement for 25 years, said he is charged with pursuing criminal cases against companies and their owners who violate state law.
His supervisors have prevented him from pursuing criminal action no matter how egregious, he says.
Idao cites a case in which Shane’s Appliance, since 2008, has been targeted with 60 complaints from residents, mainly senior citizens, “for unfair and deceptive trade practices.” The company has an F rating with the Better Business Bureau.
Timothy Caminos, Director of Communications & Public Relations at the Better Business, confirmed Shane’s Appliance has had a pattern of complaints dating back to late 2010 that are also on record with that consumer watchdog agency.
“Complaints allege that the business takes payment for appliance repair upfront - generally 100 percent - and does not perform the work,” Caminos said.
In September of 2011 there was a Court action that required Shane’s Appliance to pay restitution.
“Leading up to and during the time of their court case the complaints stopped. Within a few months of the judgment being handed down complaints resumed describing the same pattern of complaints prior to the court action. Thirteen complaints have come in over the last three months,” Caminos said.
Idao began working for the Office of Consumer Protection in 2012 and began investigating the company, though his supervisors prevented him from pursuing criminal charges.
“I was counseled and written up by the executive director, and I was ordered to cease any criminal investigations. This action resulted in several more elderly complainants being victimized,” Idao said.
In another case, Idao found several file drawers of consumer complaints filed against a Hawaii business offering “time share vacations.”
The company, which went under several aliases, but primarily is known as Just Dreams LLC of Maui and Honolulu, had 145 filed complaints against them.
“There are hundreds of unreported victims and the losses have surpassed $1 million, as just $900,000 was identified as flowing from one business account in just one year,” he wrote to the Senate chairs.
The Better Business Bureau is also quite familiar with Just Dreams, parent company to Paradise Blue and Destination Paradise.
Both subsidiaries are no longer actively selling products, however it appears that one of them exists in a support function to the parent company, Caminos said.
“Pattern of complaints against company allege that consumers are shown a demo on how to obtain 5 star inexpensive vacations, but company fails to deliver results that are made during the presentation,” Caminos said.
“Consumers are given a cancelation period but the products do not arrive until after the cancelation period has passed. Unfortunately for consumers – they are normally signing a contract or agreement, which are generally binding so if a complaint is received the company usually has a signed agreement or contact from the consumer with the terms of the sale. This is one of those instances where consumers need to be really clear about what they are signing,” Caminos said.
Brent Suyama, a spokesman for the Department of Commerce and Consumer Affairs, said the department would not disclose its policy regarding whether it allows its investigators to pursue criminal cases.
As to Idao’s case, Suyama said the department cannot comment on personnel matters, however he can confirm the matter is under review by the director’s office.
Idao has worked with several law enforcement agencies in various positions over the past two decades, including as a conservation enforcement officer for the state Department of Land and Natural Resources, a supervisory investigator for the Honolulu city prosecutor’s office, a special investigator for the state Department of Human Services, a special investigator for the state attorney general’s office, a criminal investigator for the Hawaii County prosecutor, an investigator with Pinkerton Government Services in Manhattan and as a Hawaii County police officer.
In addition to informing key senators about his concerns, Idao has filed complaints with his union, the state’s labor relations board and with the state attorney general’s office.
Senate Public Safety Chair Will Espero, D-Ewa, one of the Senate recipients, said he would review Idao’s complaint and determine whether to take it to the Legislature.
BY PANOS PREVEDOUROS PHD - I hardly ever give election advice. You, my readers, mostly independent and almost evenly split Democrat and Republican have your opinions. So I just offer some brief comments.
For governor my choice is between Duke Aiona and David Ige. Duke was a judge and he’s trustworthy. He’s pro small business of which Hawaii has plenty. David is an engineer with a keen knowledge of the state budget. He has a good working relation with Hawaii’s one-sided Legislature. Both have a grasp of Hawaii’s problems and what a governor can do about them. I think Hawaii will do OK with either of them.
Both Duke and David appear to be calm and collected enough to weather a major storm. It’s almost certain that the next economic recession will occur in the coming four years and it won’t be mild. Hawaii’s fragile economy will be clobbered by pension and EUTF liabilities, by Obamacare cost increases and by military cuts; and by the constant parasitic impacts of rail’s construction and tax.
My advice to the next Governor: Take the time to focus on transportation and energy. The renewable mandates make Hawaii more affordable and the mothballed interisland cable is yet another boondoggle; it costs more than the funds needed to mitigate Oahu’s dependency on oil! Rail won’t do anything for traffic congestion, not upon opening (when?) not ever. Do get serious about tackling the mounting traffic congestion. Upgrade the Honolulu Airport, now ranked 3rd worst in the nation: Fully enclose and air condition all terminals, expand and improve the passport control area, and electrify the Wiki-Wiki asap. Promise to work on these and you’ll get my vote.
I definitely know who to vote for Congress. Both Charles Djou and Mark Takai are smart, decent and knowledgeable candidates. I think Charles has better answers to important issues for Hawaii. The important question is this: What’s the right choice for Hawaii in the U.S. Congress? Answer: A Republican. Luckily, we have a highly competent moderate Republican candidate.
Hawaii’s congressional seniority has dropped from stellar to minimal. In a Republican controlled Senate and House, sending four Democrats is stupid, plain and simple. We’ve already been pushed to the back burner; next we’ll be permanently delegated to the pantry. Charles has congressional seniority and will be positioned in the right side of the aisle. It’s a strategic move to Hawaii’s advantage.
I wish that we finally elect some (centrist) energetic people who will own the mess of state and national debt which jeopardizes the long-term well-being of our state:
Five states with Highest Liability per Taxpayer. Hawaii is in the top-5, of course.
Government Debt per Person. The U.S. has a larger debt per capita than Greece!
The New York Times on Los Angeles' Infrastructure Woes. And an astute commentator wrote: “Can't repair the pipes; can't repair the sidewalks; can't repair the roads. But come hell or high water (pun intended) LA is going to find many tens of $billions for toy trains. Lala Land is no misnomer.”
Honolulu does the same. Is it then Honolala Land?
BY MALIA ZIMMERMAN - HONOLULU – The University of Hawaii Center on Disability Studies gives gift cards to middle school students who participate in a controversial sex education program.
The gift cards, valued at between $10 and $20 each, are issued to 11, 12 and 13-year-olds who participate in Pono Choices. About $52,200 of a $5 million U.S. Office of Adolescent Health grant were used to buy the cards.
“The Pono Choices program provides gift cards to students, who have taken the course, as an incentive to complete student surveys. Student opinion is the most powerful measure in the effectiveness of the program and we support the efforts in seeking such feedback,” said Donalyn Dela Cruz, a spokeswoman for the Hawaii State Department of Education.
The curriculum, developed by the University of Hawaii Center on Disability Studies, set off a firestorm over the past year. Some parents and lawmakers said the program, which taught children as young as age 11 about anal and homosexual sex, was inaccurate and inappropriate.
Rep. Bob McDermott, R-Aiea, who has a 12-year-old son in public school, led the charge to pressure the state Board of Education to pull the curriculum. He accused the DOE of “normalizing homosexual lifestyles” and “putting students at risk by withholding critical facts.”
After pressure from McDermott and the public, the DOE pulled the curriculum and formed a task force to review concerns. The task force released 11 new recommendations on June 6 and stopped the implementation of the program until developers addressed the concerns and inaccuracies. The program was reinstated over the summer.
According to the U.S. Department of Health and Human Services website, the University of Hawaii receives annual funding of just under $1 million a year for five years for the Pono Choices program “to reduce the number of teen pregnancies and incidence of STIs; increase positive bonding in the school and community; increase sense of self-identity and self-efficacy; and improve expectations for the future.”
McDermott, who has highlighted the most controversial and medically inaccurate parts of the curriculum and called for the program to be shut down, said the gift cards are a waste of taxpayer money.
The gift cards render the data collected through Pono Choices meaningless, McDermott said, “because of an inherent bias caused by the financial inducement.”
“This is a shameless manipulation of the data – giving 11-year-old kids a $10 dollar gift card, and then asking them how they liked the program,” McDermott said. “Hawaii's parents are in the unique situation of having their own tax dollars used to propagandize the ‘value’ of this deceptive intrusion into their public schools, to ‘sell’ them on a program they didn't ask for and don't want. Paying to be brainwashed so you will consent to pay more to have your children brainwashed is not a good use of tax dollars.”
McDermott said families were told Pono Choices was a “new curriculum” being tested or a “pilot project,” but were never told their students were participating in a research project.
“Their kids were being used as human subjects for research. This is a horrible breach of trust between the DOE and the owners of the system, the parents,” McDermott said.
VOA News - President Barack Obama called for immediate steps to ensure the U.S. medical system is ready to follow the proper protocol for treating Ebola patients.
Obama spoke Sunday with Health and Human Services Secretary Sylvia Burwell about the first case of Ebola transmission in the United States.Obama ordered the U.S. Centers for Disease Control and Prevention to quickly investigate how a nurse at Texas Health Presbyterian Hospital contracted the virus.
The nurse was part of the team treating the first Ebola patient to be diagnosed in the United States, Thomas Duncan, who died last week.
Texas officials say the health worker wore full protective gear and complied with CDC guidelines when she had contact with Duncan.
Breach of protocol
CDC Director Tom Frieden said the fact the worker was infected with Ebola shows there was a breach of protocol.
Frieden said, at this time, it appears only one person may have had contact with the health care worker while she may have been infectious. However, the case in Texas indicated a professional lapse that may have caused other health workers at the hospital to also be infected, he added.
Initial testing showed that the level of virus in the worker's system is low. The CDC will conduct a secondary test to confirm the results from a lab in Austin that showed Ebola infection, he said.
“Unfortunately it is possible in the coming days that we will see additional cases of Ebola,” Frieden added.
A union for registered nurses said the Texas health care worker's case in Dallas showed that not enough is being done to educate health workers on how to manage patients who show signs of infection.
“Handing out a piece of paper with a link to the Centers for Disease Control, or telling nurses just to look at the CDC website - as we have heard some hospitals are doing - is not preparedness,” said Bonnie Castillo, a registered nurse and senior official with National Nurses United.
Meanwhile, in Spain, authorities said a woman in Madrid infected with Ebola remains in serious condition, but is showing signs of slight improvement and that the level of virus in her blood is decreasing.
The new U.S. case comes as several airports begin a stepped-up program to screen passengers arriving from Liberia, Sierra Leone and Guinea, where thousands of people have died from the virus.
Authorities at New York's JFK International Airport are taking passengers' temperatures and asking them questions to determine whether they may have come into contact with an infected person.
The enhanced screening will expand to four other airports Thursday, including the Newark airport in New Jersey, Washington's Dulles Airport, Chicago's O'Hare and the international airport in Atlanta.
Together, the five airports receive more than 90 percent of all travelers entering the United States from the three worst-affected West African countries.
Britain is also introducing Ebola screening at certain airports and train stations.
The World Health Organization says the Ebola outbreak in West Africa has killed at least 4,000 people with about 8,400 reported cases.
Outside of Liberia, Sierra Leone and Guinea, eight people died in Nigeria and one patient died in the United States.
Some information for this report was provided by AP and Reuters.
Jeffrey Kissel, president and chief executive officer of HawaiiGAS, replaces Hawaii Health Connector Interim Executive Director Tom Matsuda. He will be the third leader of the state insurance exchange in less than a year.
The Connector’s board said in a statement Kissel has “a proven track record of leading successful organizations.”
But Kissel has no experience in the medical or insurance fields. He was president and CEO of HawaiiGAS, served in senior roles at URS, an engineering and construction company, and worked in other business organizations.
However, Hawaii Health Connector board chairman Clifford Alakai said he believes Kissel is the “ideal person to lead the Connector forward for the long-term.”
“His prior experience leading prominent and successful companies, as well as his drive and enthusiasm, will serve the Connector well to secure affordable health coverage for the residents of Hawaii,” said Alakai.
Kissel said he believes everyone deserves to have health insurance coverage, and the Hawaii Health Connector is “a highly viable resource for reasonably priced, high-quality health care.”
However, he inherits a number of financial, political and managerial challenges.
The state received $204 million from the federal government to establish the Connector and build a web portal, but that funding largely expires at the end of 2014.
During its past session, the Hawaii Legislature only allocated $1.5 million in funding for the insurance exchange, a fraction of what was requested.
The Connector’s website, which CGI Corp. developed and maintains for $74 million, still is not functioning properly nearly a year after it launched.
Hawaii Medical Service Association, the state’s largest health insurer, recently announced it won’t participate in the Connector’s Small Business Health Options Program as of January. The Connector, already under fire for being the most costly exchange in the nation, is left with just one insurance company for local small business owners to select — Kaiser Permanente.
The decision by HMSA came after it spent 8,000 hours dealing with the exchange’s technical problems, which drained finances and staffing resources, and information on 133 patient accounts vanished as they were transferred from the connector to HMSA.
HMSA will continue to insure another 5,000 people enrolled through the individual subscriber portion of the Connector.
Kissel will have to find new ways to keep the exchange financially viable with considerably less government funding.
The Connector is supposed to be funded through enrollment fees charged to local insurers, but the number of enrollees fell far short of the original business plan.
Gov. Neil Abercrombie hoped hundreds of thousands of people would register with the exchange. State officials initially estimated as many as 300,000 people would sign up for health insurance. But the last public estimate included 10,800 people who enrolled, costing about $18,888 per enrollee for taxpayers.
The exchange has hardly reduced Hawaii’s uninsured population. The state’s uninsured rate is about 6 percent, dropping just 2 percent since the exchange launched last year.
There is also a quiet political war under way that Kissel will now be in the middle of.
The Hawaii Health Connector board of directors wants the nonprofit to remain independent and financially separate from the state, as the exchange is set up to be.
However, state administration wants the state Department of Human Services — and some key lawmakers — to take over the Connector.
A pricey bureaucracy in place includes well-paid executives at the top of the Connector. Some half dozen people reportedly earn more than Kissel will.
As the exchange reaches its one-year anniversary, open enrollment for the exchange starts Nov. 15, and Kissel said he is “looking forward to hitting the ground running.
HONOLULU — Hawaii Senate Minority Leader Sam Slom is warning fellow lawmakers he has serious concerns about the state’s economic future.
Slom, the only Republican in the 25-member Senate, cites the Council on Revenues’ recent downgraded economic forecast indicating Hawaii is in a much worse financial position than anticipated.
“Hawaii is set to go bust in 2016 unless the new governor and the state Legislature make some serious cuts,” Slom said.
The administration and Legislature will be challenged, Slom said, “in dealing with the mess resulting from kicking the can down the road for so many years.”
“The final option to deal with the problem by raising taxes is the least desirable and burdensome for the people because we are already one of the highest taxing states in the nation,” Slom said.
The state Council on Revenues, the appointed body that predicts economic trends in Hawaii from which lawmakers create their budget, lowered its projections for state general fund revenue on Sept. 4 for fiscal year 2014 from -0.4 percent to -1.8 percent, or a loss of $76 million in anticipated general fund revenue.
The Council also lowered its projections for fiscal year 2015 from 5.5 percent to 3.5 percent, or an additional $188 million in anticipated loss of general fund revenue.
This is the fifth consecutive time the council has lowered its projections, said Paul Harleman, the budget director for the Senate Minority Office.
Harleman said the state must absorb a loss of $264 million of anticipated general fund revenue during the state’s two-year budget cycle.
Gov. Neil Abercrombie’s administration has made some cuts, asking state department to restrict funds by 10 percent.
However, Slom said that will not be enough to of a halt “to stop the freefall” because the $14 million Abercrombie’s move adds up to is just a “drop in the bucket” in the state’s a $6 billion state budget.
“Because the state is not constitutionally permitted to borrow from outside sources for operating expenditures, it is likely the state will tap into the Emergency Budget Reserve Fund and Hurricane Relief Fund,” Slom said. “Those funds are not large, so that will be a small Band Aid for the problem and will not address the problem of overspending for long.”
Kalbert Young, director of the Hawaii’s Office of Budget and Finance, said he agrees the state is “headed into a situation where there is anticipated fiscal year imbalance” because spending is outpacing revenue.
The combination of the state ending balance and formal reserve balances in the Hurricane Relief Fund and the Emergency Budget Reserve Fund dropping below what he set as acceptable target levels, also concerns Young.
“I have been of the opinion that the state should target combination of reserve and ending balance to be no less than 10%, but also to be of an objective to build formal reserves to be equal to 10% of the general fund budget over time. Currently, formal reserve levels are projected to be 4.4% of FY15 general fund budget. The combination of strong ending balances helped to keep Hawaii’s reserve and ending balances at or above the 10% target. Now, with declining ending balances a possibility in the future and reserve levels at 4%, there is a risk that Hawaii would have inadequate reserve levels during the next economic down-cycle,” Young said.
Young said that unlike Slom, he remains “bullish on the state economy continuing to improve over the next two to three years, translating to increased tax revenue.”
“The challenge is to ensure that expenditure growth over that same period does not outpace revenue growth,” Young said.
By Jim Epstein - Before the Apple Watch was revealed on September 9, it was rumored to include several biometric sensors that could track the vital signs of the person wearing it. The first iteration of the device turned out to be disappointing in this regard: It has only a heart rate monitor. But future iterations of the watch will likely track our body temperature, glucose levels, tremors, oxygen, and hydration, helping patients stay out of the doctor's waiting room.
This is just one of many promising ways in which Silicon Valley is poised to remake the monstrously inefficient health care industry. But can the tech industry stop the government from strangling its emerging ventures?
Take the Palo-Alto based company Theranos, founded in 2003 by Stanford University sophomore Elizabeth Holmes. It's developed a new approach to phlebotomy that involves a simple finger prick. The company uses software to test a single drop of blood on the spot at prices that read like they’re written on the menu board above a deli counter: Checking cholesterol levels costs $2.99. A glucose-tolerance test runs $8.85. Looking for the presence of a cancer antigen sets customers back $14.31. Holmes, now 30, tells the story of a diabetic who recently had several tests performed by Theranos for $34 that otherwise would have cost the insurance company $876.
Clinical labs like Quest Diagnostics, which booked $7.1 billion in revenues last year, aren't the only firms that need to watch out for Theranos. Patients don’t need to bother with insurance companies when a test costs just $2.99. Holmes, whose board of directors is packed with former high-profile government officials, is passionate about changing federal health laws to empower consumers. In February, Theranos scored a victory when the Department of Health and Human Services issued a new rule allowing patients in all 50 states to view their lab results without involving a doctor.
Other ventures aim to help patients make use of all this health data. Curious, a health technology firm cofounded by Linda Avey (who also helped start thepersonal genetics firm 23andme), will start beta testing a new platform in November that synethesizes genetic information (collected by 23andme), microbiomic profiles (collected by a startup called uBiome), personal traumas and life events that users will enter manually (such as a fight with a spouse), and (eventually) biometrics collected by wearables such as the Apple Watch. It will then analyze the information in a way that helps users determine what’s helping, causing, or exacerbating various ailments and conditions.
The company's cofounder and Chief Technology Officer, Mitsu Hadeishi, compares Curious to other peer-to-peer tech companies like Airbnb and Uber because customers will "anecdotally share things" with each other and the software will utilize its network to “look at patterns on a larger scale.” As an example, Hadeishi cites reports that eating the root black cohosh helps mitigate hot flashes. Through Curious, users could track the treatment's effectiveness and share their experiences with other users. If black cohosh helps some participants and not others, the software would look at other aspects of their health profiles that might explain the difference. "It’s not just people randomly saying things on message boards," says Hadeishi.
Ultimately, clinical studies will be necessary to establish links between treatments and outcomes, and Hadeishi sees Curious’ software in part as a "hypothesis generation source." In the past, clinicians could come up with broad theories about what works simply by observing their patients, but in the future doctors need to develop treatments tailored to subsets of patients based on their unique physiologies, so patterns are harder to detect. Tools like Curious’ software could help scientists develop testable ideas.
Medicine is in part about solving mysteries, and eventually Curious’ software (or similar products by other tech firms) could be much more effective at diagnosing problems than high-priced specialists. Yet Curious, like any company seeking to enter this space, has to look out for the Food and Drug Administration (FDA). Companies don't need the agency's approval to market products that track and share raw information on patients, but they get into trouble with the FDA when they try and make "predictive claims," says Paul Howard, the director of the Manhattan Institute’s Center for Medical Progress. Last November, the agency forced 23andme to pull its $99 personal genome test off the market for giving customers too much information about the implications of their test results.
Curious is walking a fine line in this regard, and the FDA could force the company to submit to an expensive approval process that would likely put it out of business. (Curious has raised about $900,000 in seed funding to date.) But Hadeishi says he's fairly confident that his product won’t require FDA approval, and he’s been in touch with staffers in the office of the U.S. Chief Technology Officer—a position created by President Obama to cut red tape—who are "aware of the types of things we want to do” and "want to find a way to accommodate innovation.”
Another way for patients to make use of all the health data available to them while avoiding costly and time-consuming office visits is through the burgeoning field of telemedicine.Doctors on Demand, which the Mercatus Center’s Robert Graboyes wrote about recently in Reason, offers users 15-minute online video chats with physicians for a flat fee of $40—or about the price of a co-pay to visit a doctor’s office under many insurance plans.
The Palo-Alto based HealthTap offers a similar service, with unlimited calls for $99 a month (plus $10 additional per family member), and participating physicians will call in prescriptions and examine physical symptoms photographed with a smartphone. A current limitation is that providers can’t check a patient’s pulse or temperature through a video call—but biometric data-gathering devices could change this, making telemedicine considerably more useful. A less surmountable limitation are state laws dictating that a physician licensed in one state can't treat a patient in another.
In its efforts to Uber-ize health care, Silicon Valley’s biggest challenge will be convincing states to repeal competition-killing licensing laws and working with the FDA to let software eat its way through our antiquated, expensive, and labor-intensive approach to patient care. There’s reason for optimism: In recent years, the tech industry has become far more adept at navigating the regulatory terrain in Washington. The next big political idea to fix our nation’s health care system should be to get out of the way.
Jim Epstein is a producer at Reason TV.
HONOLULU – Calling it a classic case of elderly neglect, Acting Attorney General Diane Taira announced today that a Waipahu caregiver has pleaded guilty to Manslaughter in a Honolulu Circuit Court. 36-year old Jennifer Polintan recklessly caused the death of 88-year old Nona Mosman in May of 2013.
Ms. Mosman was a client in Polintan’s care home which was licensed as a Community Care Foster Family Home (CCFFH) in Waipahu. The State Department of Human Services (DHS) certifies these care homes to enable individuals needing 24-hour care in an intermediate care facility or a skilled nursing facility to remain in a home setting as part of a family. The state licensing rules for a CCFFH require that during extended absences the licensed caregiver must provide duly qualified individuals to act as substitute caregivers. The rules also require the licensed caregiver to follow a care plan as directed by the client’s primary care physician and state contracted case management agency.
Ms. Mosman became non-ambulatory in late 2012 and was bedbound in early 2013. Once bedbound, Ms. Mosman became susceptible to bed sores and needed to be repositioned every two hours throughout the day. Ms. Mosman was completely dependant on Polintan for her activities of daily living, including eating, drinking, general hygiene, toileting, and basic self-maintenance.
An investigation conducted by Special Agent Derrick Kiyotoki of the Department of the Attorney General Medicaid Fraud Control Unit revealed that Polintan worked full time at Schofield Barracks and was absent from the home for 10 hours a day, Monday through Friday. During her extended absences, Polintan left Ms. Mosman in the care of individuals who were not duly qualified and who were incapable of carrying out the care plan. As a result of Polintan’s neglect, Ms. Mosman’s health declined rapidly, culminating in her death in May of 2013.
Acting Attorney General Taira acknowledges that providing care to elderly persons can be difficult and trying, but says that, “When someone makes a conscious decision to bring a dependent adult into their home under the guise of providing care, and is getting paid to provide that care, then it is inexcusable and can have tragic consequences when they fail to do so.” Taira adds that while these cases are difficult to investigate and prosecute, "the Department is committed to protecting the safety of vulnerable members of our community who can’t look out for themselves."
Polintan, who cooperated in the investigation and prosecution, will be sentenced on January 7, 2015, before First Circuit Judge Richard K. Perkins. The plea agreement provides that Polintan will serve one year in jail, and in addition will pay $8,980 in restitution to Ms. Mosman’s family, $4,888.00 in restitution to the State of Hawaii, a $600 fine, and court costs.
According to Deputy Attorney General Michael Parrish, who is prosecuting the case, “This type of case can go undetected without the vigilance of medical professionals and oversight agencies. Thankfully an akamai hospice nurse and social workers with the DHS Adult Protective Services branch broug
Alston Hunt Floyd & Ing (AHFI) and the Hawaii Disability Rights Center filed a lawsuit on September 5th in U.S. District Court accusing the State of Hawai`i Department of Human Services of denying critically needed treatment for autistic children.
Without the service, called applied behavioral analysis (ABA) treatment, children with autism are less likely to reach their full developmental capacity and are more likely to be institutionalized as adults.
The suit seeks an injunction to require the state to provide ABA to be in compliance with federal Medicaid rules. AHFI attorneys Paul Alston, Kristin Holland and Maile Osika represent the plaintiffs.
Founded in 1991, Alston Hunt Floyd & Ing counsels and represents clients in all types of civil matters,
including business disputes, real property matters, bankruptcy and insolvency, civil rights, healthcare law, employment law, government contracts, government relations, and strategic planning.
Alston Hunt Floyd & Ing is a member of the International Society of Primerus Law Firms.
REPORT FROM DHS - HONOLULU – The Department of Human Services (DHS) Benefit, Employment and Support Services Division (BESSD) has successfully closed a February 2011 class action lawsuit for failure to issue Supplemental Nutrition Assistance Program (SNAP) benefits within timeframes outlined by federal law. To address the application backlog, BESSD developed and implemented the Business Process Re-engineering (BPR) project, which converted the former Case Management system to a Process Management system.
Between Oct. 1, 2013 and Aug. 31, 2014, the average monthly timeliness rate for SNAP applications increased to 96.83 percent, a 30-percent improvement since Gov. Neil Abercrombie came into office.
“BESSD eligibility workers now consistently review and determine applicant eligibility within the federally mandated period of 30 days and seven days for emergencies,” said Pankaj Bhanot, BESSD Administrator.
As a result of these measurable improvements and successes, the U.S. District Court recently issued an Order of Settlement and Dismissal. “The dismissal is most welcome,” said DHS Director Patricia McManaman. “It is really a testament to the dedication and hard work of the DHS BESSD staff.”
Dismissal of the lawsuit follows a $724,000 federal Food and Nutrition (FNS) Service bonus to BESSD for the nation’s most improved SNAP Program Access Index. The BESSD also received the 2014 Global Case Management Award for Excellence in Social Services for its nationally recognized enterprise content management solutions. Combined with the reengineered business processing, both initiatives contributed significantly to the improved application processing rates.
The class action lawsuit addressed application backlogs that accrued between 2008 and 2011, a period when the number of Hawaii SNAP recipients increased from 93,956 to more than 179,700 participants. During that same period, DHS also was operating with a severely reduced workforce and limited program funding. In some locations, timely application processing rates dropped to 29 percent.
Today, SNAP application processing rates vary between 96-98 percent, and BESSD continues to exceed federal requirements. Currently, an estimated 98,360 Hawaii households (193,446 individuals) receive SNAP assistance each month. On average, BESSD issues $43.3 million in benefits each month to Hawaii SNAP recipients.
HONOLULU – Attorney General David M. Louie announced that Roselani Wise (51, Lihue) was charged with Theft in the Second Degree on July 23, 2014 and arraigned on August 12, 2014, before Judge Randal Valenciano, Fifth Circuit, Island of Kauai. Her trial has been set for October 6, 2014.
Ms. Wise, a former Department of Human Services (DHS) investigator on the island of Kauai, was charged with Theft in the Second Degree for receiving unearned compensation from the State of Hawaii from 2008 through 2012.
An investigation revealed that during the hours for which she was being paid by DHS to conduct criminal fraud investigations, Ms. Wise was employed and actually working for the Federal Transportation Security Administration at the Lihue Airport.
Ms. Wise received in excess of $10,000 for work she did not perform.
A charge by way of Written Information is merely an allegation against Ms. Wise and she is presumed innocent until found guilty of the charge beyond a reasonable doubt by a judge or jury.
HONOLULU — House Majority floor leader Rida Cabanilla is out of a job after losing the Democratic primary to Matt LoPresti.
Hawaii Reporter was first to report in May that Cabanilla controlled a 501-c-3 nonprofit that received a $100,000 grant from the Hawaii State Legislature, which had lost its federal tax-exempt status with the IRS when it neglected to file required paperwork for at least three years.
Cabanilla told Hawaii Reporter she filed paperwork with the IRS for the Ewa Historical Society Inc. to rectify the issue, but that was after she already applied for — and was granted — funding from the Legislature. Cabanilla had not told fellow lawmakers she controlled the charity - or that it was out of IRS compliance - before they granted the charity’s request, and her name did not appear anywhere on the application submitted to the Legislature.
The Old Ewa Cemetery, a historic site founded in 1896, has been owned by the city and county of Honolulu since the 1970s and is maintained by the city and county and volunteers, including descendants of people buried there.
Former City Council Member Berg, who lives in Ewa, noted the charity applied in January for a $200,000 grant from the Legislature to hire three landscapers at $42,000 a piece and three grounds keepers at $23,000 each to take care of the 3-acre Old Ewa Cemetery.
If the grant had been awarded it would have equated to $17,000 a month in state funding going toward maintenance, in addition to what the city already does monthly, Berg said.
Since the Legislature awarded Cabanilla’s charity just half the money it requested, she told Hawaii Reporrter, “The $100,000 is just for weed whacking.”
Cabanilla explained she originally listed six positions on the application because she didn’t want anyone to work at the cemetery alone because of safety concerns, including sink holes near graves and ghost sightings. The state attorney general said in July that Cabanilla's charity would not receive the grant because of the tax filing issue.
The controversy over the cemetery isn't the only one that likely contributed to Cabanilla's political demise.
In Nov. 2013, the state Campaign Spending Commission fined Cabanilla $500 for filing “false or inaccurate” campaign spending reports and $50 for filing the reports late. Cabanilla held a fundraiser in March 2013, which raised nearly $5,800 and expended nearly $2,900. Her campaign spending report said she had no activity during that period. She apologized publicly for her “error.”
In January, Cabanilla brought media coverage after she proposed solving Hawaii’s financial troubles by legalizing cultivating, manufacturing and exporting marijuana and marijuana food products internationally.
In July, Cabanilla proposed implementing “Return to Home,” which would set aside $100,000 over three years to buy homeless people from the U.S. mainland one-way airfare home. Cabanilla said giving the homeless airline tickets would reduce the ever-growing problem of homelessness in Hawaii and ensure the homeless can reconnect with family and support networks in their home states.
Neither the governor nor the state Department of Human Services, the agency that establishes and administers the program under state law, has implemented it. The Department of Human Service director said she believes the program would attract more homeless people to Hawaii.
In the general election, LoPresti will take on Berg, who is running as a Libertarian. Brian Jeremiah, a New Hope pastor who reformed himself after criminal past, is running as a Republican.