Learning from the Aloha State

Since 1974, Hawaii has required its employers to provide health insurance to all employees working at least 20 hours a week. More recently, the state created a new program to cover the "gap group" of 50,000 uninsured residents, along with a new program to create a "seamless system of health care" for all Aloha State residents. And Hawaii has managed to insure nearly all of its citizens while keeping the annual price of health insurance at nearly half of that paid in many mainland states ($1,300 per person and $4,000 per family). At the same time, life expectancy is the highest in the nation and infant mortality is among the lowest. In seeking to reform a dysfunctional national insurance system, policymakers should learn from the Hawaiian experience, which shows that small business can live with an employer mandate, universal coverage can cut costs by encouraging early preventive care, and a dominant payer can reduce administrative expenses.