Questions for HMSA After “Shaping Hawaiʻi’s Healthcare Future”

HMSA’s leaders spoke with members of the Hawaiʻi Medical Association during “Conversations at HMA” about the future of health care in Hawaiʻi and the end of Payment Transformation. The conversation wa

HHTF Staff · 2026-05-27

Additional data since publication

HHIP holds no data from the Hawaiʻi All-Payer Claims Database. References to it in this piece are corrected below.

The Hawaiʻi Healthcare Task Force believes these questions matter not only to physicians, but to patients, employers, policymakers, and communities that depend on functioning primary care. Before Hawaiʻi moves further into OneHealth, global budgets, or the next risk-sharing model, HMSA should answer these questions clearly.

1. Did Payment Transformation improve access to primary care? Did patients get more timely appointments, more open panels, and better access to primary care, especially on the Neighbor Islands?

2. Did Payment Transformation help clinics stay open? Did it improve physician retention, clinic finances, staffing, and the ability of small practices to survive?

3. Does HMSA acknowledge that primary care reimbursement needs a substantial increase? HMSA reported that primary care visits fell while urgent care and ER use rose. If reduced primary care access leads to more expensive care, will HMSA acknowledge that Hawaiʻi needs a substantial increase in primary care reimbursement, not just another payment model?

4. How did HMSA calculate its claim that it spends 10% on primary care? What services, clinicians, payments, administrative costs, quality bonuses, and drug spending were included or excluded? How much of that money reached frontline primary care clinics?

5. What happens to work between visits? How will HMSA pay for phone calls, portal messages, lab review, medication adjustment, care coordination, and chronic disease follow-up now?

6. Is the new fee schedule enough to sustain primary care through the transition? How did HMSA decide that the replacement fee schedule covers the real cost of practicing in Hawaiʻi, and will it publicly track clinic closures, closed panels, staff reductions, and physicians leaving HMSA networks?

7. Can physicians negotiate the new contract and payment terms? Are independent physicians and small clinics able to negotiate the fee schedule, reporting rules, and exit provisions, or are they being told what HMSA will pay? If HMSA says the terms are negotiable, who has authority to negotiate and how does a small practice begin?

8. Are the network numbers real? Will HMSA support independent validation of who is actually practicing, correctly listed, taking patients, submitting claims, and available for appointments?

9. How will HMSA protect independent clinics outside OneHealth? What safeguards will prevent patients from being shifted away from independent primary care into urgent care, ER, hospital-owned services, or system-controlled sites?

10. Will HMSA support an independent review before expanding the next model? Before the next model expands, will HMSA support a public evaluation of what worked, what failed, and what should not be repeated, including whether Payment Transformation built clinician retention, appointment availability, open panels, rural access, lower administrative burden, and frontline primary care capacity?

Hawaiʻi does not need another slogan about transformation. We need to know whether patients can get care. Pay for capacity before you cap spending.

Why these questions matter

Payment Transformation should not be evaluated only as an internal payment experiment. For nearly a decade, primary care practices were asked to organize around a model that affected staffing, documentation, patient communication, care coordination, attribution, quality reporting, and business planning. HMSA now appears to be moving affected practices back toward fee-for-service. That raises a practical question: will the new payment structure keep clinics open and accessible to patients?

Fee-for-service has real flaws. It often fails to pay for the work that keeps patients stable between visits, including medication adjustment, lab review, chronic disease follow-up, portal messages, phone calls, caregiver support, and coordination with specialists. The problem is not that HMSA tried to move beyond fee-for-service. The problem is whether the replacement model built the primary care capacity needed to care for patients.

A fixed payment does not create a physician, a nurse, a care manager, an appointment slot, or an open panel. Primary care investment means the clinic can hire staff, answer messages, manage chronic disease, and keep appointments open. Risk transfer means the clinic is responsible for more work without enough money or control to do it.

The recent HMA discussion made this question more urgent. HMSA leadership described Payment Transformation as no longer producing the desired impact and acknowledged that primary care visits have fallen while urgent care use, emergency department use, and costs have risen. If fewer primary care visits meant that patients were healthier and less likely to need acute care, that would support the model. If fewer primary care visits coincided with more urgent care and emergency department use, Hawaiʻi needs to ask whether patients were getting care in the right setting.

This is where reimbursement becomes central. HMSA’s increased reimbursement for Neighbor Island providers is appropriate and appreciated. It recognizes that care is harder and more expensive to deliver in rural and geographically isolated communities. But that should be the beginning of a broader correction, not the end of the discussion. Primary care remains underpaid across Hawaiʻi.

Underpayment does not always make clinics disappear immediately. Physicians and clinics often adapt first. They may close panels, reduce participation in certain insurance contracts, move toward direct primary care, spend more time on cash-pay services or procedures, sell to larger systems, shift into urgent care or telehealth, or leave Hawaiʻi. Those choices may be rational survival strategies, but they reduce access for patients who depend on insurance. An insurance card is not access if no one can get an appointment.

That is why the transition back toward fee-for-service needs close scrutiny. Moving practices back to fee-for-service only helps if the fee schedule is adequate to support primary care in Hawaiʻi. If the new fee schedule does not cover the cost of care, the transition does not fix the problem. It simply changes the mechanism by which clinics struggle or fail.

The contract issue matters here. The available PPO participating physician agreement language indicates that HMSA reserves the right to adjust its Schedule of Maximum Allowable Charges with 60 days’ written notice, and that the determination of charges in that schedule is at HMSA’s sole discretion after internal review. That may give HMSA broad authority, but it also makes the content of the notice important. Clinics should not be expected to prepare for a major payment transition without the actual payment terms, applicable fee schedules, treatment of between-visit work, appeal rights, and transition rules.

The fee schedule itself is not simple public information. HMSA’s “Fee Schedules & Requests” document says the Maximum Allowable Charges for PPO, HMO, and QUEST plans are located through HHIN+, but it also says that the appearance of a code does not guarantee payment and that payment remains subject to eligibility, benefit limitations, plan terms, and HMSA payment policies. A general reference to a fee schedule does not necessarily tell a clinic what it will actually be paid or whether the new structure will support the work patients need.

Network adequacy also needs independent validation. A name in a directory is not the same thing as an appointment. The relevant question is whether the clinician is correctly listed, actively practicing, submitting claims, accepting patients, and available to see patients within a reasonable timeframe.

The data problem is also important. HHIP’s review of available all-payer summary data found that its current aggregated claims table can distinguish broad categories such as Primary Care and Emergency, but it does not contain a separate urgent care category or the granular claims fields needed to isolate urgent care visits independently. (Retired: the claims table referred to was HHIP's modeled placeholder, not state data.) HHIP’s later data request note explains that without place-of-service codes and similar claim-level details, the public cannot independently verify HMSA’s urgent care trend claims from the available all-payer summary data .

That does not mean HMSA’s internal numbers are wrong. It means HMSA should release the definitions and trend tables behind them. If HMSA is relying on data showing that primary care visits fell while urgent care and emergency department use rose, physicians and the public need to know the denominator, baseline years, member population, service definitions, claim codes, and whether the results are adjusted.