When Brian Fong started working at Hyatt Place Hotel last December, he never expected he’d be out of a job within three months.
The 55-year-old Mililani resident had taken the gig as a night auditor, spending each graveyard shift counting money from food and beverage sales to ensure they added up. Then COVID-19 hit, and by the end of March, Fong, like thousands of other Hawaii residents, was suddenly unemployed.
His first unemployment insurance check arrived in April, and he feels lucky to have avoided the days and frustration of waiting plaguing so many others.
But one question still lingers — what to do when his health insurance runs out in two weeks? Fong, a diabetic, doesn’t want to be uninsured during this pandemic.
As COVID-19 upends Hawaii’s economy, the mandatory shutdowns and the resulting widespread unemployment are highlighting the fragility of the state’s reliance on employer-sponsored health care coverage.
Health experts say the uninsured rate is likely to rise in tandem with Hawaii’s unemployment rate, which has already reached record levels. While Hawaii’s uninsured rate was just 4.1% in 2018, one of the lowest rates in the nation, the uninsured rate for people without jobs was 18.7%.
Already, applications to Med-QUEST — the state’s version of Medicaid, the public health insurance program for people with low incomes — have spiked 40%, with more than 21,000 applying since early March.
“The increases are dramatic for us, and certainly nothing we’ve seen before,” said Meredith Nichols, the assistant administrator of Hawaii’s Department of Human Services Med-QUEST division.
As the stay-at-home rules drag on, workers who would normally find other jobs can’t easily get rehired. The lucky ones are still getting health coverage through work, even if they aren’t working.
Some workers are trying to get on their spouse’s or parents’ health insurance plans. Seniors older than 65 who find themselves out of work may be eligible to apply for Medicare, the federal program for the elderly and people with disabilities. Still others aren’t even thinking about health coverage yet, as they try to prioritize getting food, keeping housing and staying healthy.
Enrollment in Med-QUEST now stands at 348,000 as of May 11, compared to 327,000 at the beginning of March.
The jump has been most pronounced on Kauai, where there was an 85% increase in applications during March through May compared to the same time last year.
Kauai resident Julia Woodrow, 28, was one of those who applied.
She had been working about 50 hours a week at three different bartending and retail jobs before the pandemic. But because she didn’t work enough hours at any one company, she didn’t qualify for health insurance and had been uninsured for more than a year.
Some tips from Hawaii’s Med-QUEST office:
— Apply for Med-QUEST first, even if you’re not sure you’re eligible. Click here to apply online or on paper.
– If you don’t qualify, they’ll refer you to the federal marketplace to purchase a plan. You might qualify for subsidies, and you have 60 days to enroll in the federal marketplace after losing your job.
— If there’s a gap between losing your job and getting on Med-QUEST, Med-QUEST can retroactively cover health problems within the past 60 days.
— If you do get another job, don’t cancel Med-QUEST until after you’ve gotten employer-sponsored insurance. Med-QUEST isn’t kicking anyone off the program during this pandemic.
— Even if you don’t have health insurance, if you get sick, you should seek health care from community health centers, where there is tiered pricing for uninsured people, or even the emergency room if it’s an emergency.
That’s because Hawaii’s decades-old employer coverage mandate, the Prepaid Health Care Act, requires that you work at least 20 hours a week at a particular wage for four consecutive weeks in order to qualify for coverage.
The 1974 law is touted as the first in the nation to require minimum health care coverage, but that’s one of its major limitations: people who work inconsistent hours might never be eligible for health insurance through any one employer.
Ironically, becoming unemployed was what suddenly gave Woodrow health insurance. She used to pay $95 for therapy out of pocket, but now each session is free.
“Once I lost them all I was able to qualify for QUEST,” she said.
Woodrow was eligible, but not everyone who has applied for Med-QUEST during the pandemic has received it.
About one-fifth of the 12,377 applications received since April 1 were rejected because the applicant wasn’t poor enough to qualify. Another 2% were denied due to their citizenship status.
So far, state officials seem confident that they will be able to afford the higher costs associated with more enrollment.
Judy Mohr Petersen, Med-QUEST division administrator for the state DHS, says a federal funding boost provided in January has helped the division to cover the additional enrollment thus far, and the office isn’t planning to ask for more state money for this fiscal year.
The Med-QUEST division’s 130 eligibility workers are sufficient to meet the surge in demand, Nichols said. The office isn’t adding more staff and expects the number of applications to continue at the same rate.
“We’re fortunate to have a robust system in place so with that huge increase in applications, our system has been able to handle it,” she said.
“My educated guess is a lot of people who have experienced job loss have experienced loss of insurance are already applying,” she said. “I don’t expect the volume of applications to increase,” more than they already have, she said.
But Beth Giesting, the director of the Hawaii Budget & Policy Center, thinks more costs to the state could be inevitable.
“Even though the federal government has temporarily increased the match they are providing, it is a far cry from what the state needs at a time like this,” Giesting said.
Petersen noted that application volume depends on how long the pandemic lasts, when the next wave comes and how long people are out of work — something no one really knows.
“Given the unprecedented nature of what we’re dealing with, we’re not making predictions,” she said.
For those who aren’t eligible for Med-QUEST, there are other options, but they’re more expensive.
One way for people to extend their employer-covered health insurance is through COBRA, a federal law that allows employees to extend their health insurance after leaving a job.
The last time Fong was unemployed, he paid more than $1,000 for just one month of health insurance through COBRA.
Nichols from Med-QUEST recommends people apply for public health insurance first.
“Usually when people are losing their jobs it’s the kind they can least afford. If I was talking to my aunty, I would be like, ‘Oh no no no,’ COBRA is the last thing you want to look at.”
Furthermore, COBRA is not always an option for those who work at small businesses, says Giesting.
Many small companies in Hawaii with less than 20 employees are not required to provide COBRA, “and they almost never do,” she said.
The other option is to buy health insurance on the federal marketplace created through the Affordable Care Act, also known as Obamacare. There are subsidies available for people who can’t afford premiums, but Giesting notes the plans can still be out of reach financially.
“The problem of course is that the Affordable Care Act plans are a far cry from what people have been used to with their employer coverage, and it certainly is inferior and more expensive to the Medicaid program,” she said.
Then there are those who may not be able to take advantage of any options at all.
Even when Hawaii’s health insurance system is working as it is intended, immigrants and migrants are often left out.
The state excludes many low-income immigrants and migrants from Med-QUEST and the state’s employer mandate exempts seasonal agricultural workers. In 2018, the uninsured rate for U.S.-born Hawaii residents was just 3.3%. For non-U.S. citizens, the rate was more than three times higher — 12.6%.
Victoria Fan, an associate professor of health policy based at the University of Hawaii Manoa, says people will likely continue to fall through the cracks of the health insurance system as the pandemic continues.
“It will be those people who are too wealthy for Medicaid, or rather, not poor enough for Medicaid, and not rich enough to pay for COBRA, or not having another spouse that might have coverage for that person,” Fan said.
“It’s that gap. It’s always been those gaps. That’s the problem with our fragmented system.”
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