After $205 Million, the Hawaii Obamacare Exchange Shutting Down

Yet another state Obamacare exchange has sucked up Federal dollars and then disintegrated.

Hawaii is a state that couldn’t be more sympathetic to Barack Obama or his promises regarding healthcare. Yet they could not keep their exchange going. It is shutting down. As Americans for Tax Reform report,

Despite over $205 million in federal taxpayer funding, Hawaii’s Obamacare exchange website will soon shut down.  Since its implementation, the exchange has somehow failed to become financially viable because of lower than expected Obamacare enrollment figures. With the state legislature rejecting a $28 million bailout, the website will now be unable to operate past this year.

According to the Honolulu Star-Advertiser the Hawaii Health Connector will stop taking new enrollees on Friday and plans to begin migrating to the federally run Outreach services will end by May 31, all technology will be transferred to the state by September 30, and its workforce will be eliminated by February 28.

While the exchange has struggled since its creation, it is not for lack of funding. Since 2011 Hawaii has received a total of $205,342,270 in federal grant money from the Department of Health and Human Services (HHS). In total, HHS provided nearly $4.5 billion to Hawaii and other state exchanges, with little federal oversight and virtually no strings attached.

My first thought is to ask why an audit is not being started to find where the money went. But, if this report is accurate, the real issue is simply that Obamacare isn’t working. It isn’t attracting enough willing clients.

Despite this generous funding, the exchange has underperformed from day one. In its first year, Hawaii enrolled only 8,592 individuals – meaning it spent almost $23,899 on its website for each individual enrolled. Currently over 37,000 individuals are enrolled in Hawaii’s exchange – well below the estimated 70,000 enrollees that is required to make the website financially viable. Unfortunately, taxpayers will have to hand out an additional $30 million so that Hawaii can migrate to the federal system.

[See also, “Obamacare Fraud – Maryland’s Health Insurance Exchange Under Investigation.”]

Note that this is not the only Obamacare exchange that has failed. Phil Kerpen wrote for the Sentinel,

Federal taxpayers spent a shocking total of $5.4 billion — with a B — on grants to establish what ended up being just 13 state Obamacare exchanges.


Massachusetts, which had a perfectly functional health exchange built by then-Governor Romney for a total of about $3.5 million, received $225 million from federal taxpayers for “upgrades” that broke the site so badly its director broke down in tears.

Tiny Vermont got $200 million and built a site so bad that they may pull the plug later this summer. Minnesota is also considering shutting down; they got $189 million.


Maryland’s exchange wasted $190 million from federal taxpayers and another $20 million or so from state taxpayers on their first site before they gave up and started over on a different technology platform. They will likely request another big bailout from the governor this summer.

Republican governors in New Mexico and Nevada accepted $123 million and $101 million in federal funds with nothing to show for it; both states have shut down and moved into the federal exchange.

Even California, supposedly the “success story” among state exchanges, doesn’t have much to show for a cost to federal taxpayers of precisely $1,065,683,056. Its 2015 goal was to boost enrollment by 500,000 people — it actually added just 7,098. Total enrollment has stalled at just 40 percent of potential. And the site has a miserable one-star Yelp rating. Not exactly the greatest results for a billion-dollar website.

Then there is Oregon, the disaster so astonishingly spectacular that it almost makes the rest look quaint. With $305 million of federal tax dollars flushed and not a single person ever signed up, Oregon would be a scandal simply for the scale of its failure. But it’s much worse. A blockbuster report by Wilmette Week found that the whole Cover Oregon debacle was run by now-disgraced former Governor John Kitzhaber’s reelection campaign, based entirely on politics. Specifically, they found that the site was being run by a political consultant named Patricia McCaig, who calls herself “the Princess of Darkness.”

“By her own admission, Patricia McCaig knew virtually nothing about health care reform or the reasons Cover Oregon had crashed,” according to Wilmette Week. “Her primary mission was not to save a beleaguered state program but to get Kitzhaber re-elected.”

It sounds as if some of these states need investigative audits to determine who should go to jail. But in the case of Hawaii, how is the Federal exchange,, going to make Obamacare any more viable? If not enough people are signing up in a liberal state like Hawaii, then what are the chances that Obamacare has enough enrollees nationally?