Hawaii: 1332 Waiver Proposal Updated to Comply With Federal Guidance, Maintains Small Business Tax Credits

The State Health Care Innovation Waiver Task Force revised its draft 1332 waiver proposal, which would now retain small business tax credits for eligible employers rather than request the federal government pay the $46 million value of the tax credits directly to the State to support the small business community, as proposed in the previous draft. The waiver still seeks authority to replace the ACA's employer mandate and Small Business Health Options Program (SHOP) Marketplace with the State's longstanding employer-sponsored insurance requirements under the Hawaii Prepaid Health Care Act, which has more stringent standards than the ACA. The updates to the proposal are in response to federal guidance published in December 2015 that requires states' 1332 waivers to offer comparable coverage, affordability, and comprehensiveness, and to maintain budget neutrality. The State Legislature must approve the 1332 authorizing language prior to submitting the waiver application to HHS for approval.