Prepaid Health Care in Hawaii

The Hawaii PHC Act set minimum standards of health care benefits for workers. All employers, excluding Federal, State, and City government and other categories specifically excluded by the law must provide employees in Hawaii who suffer a disability due to non-work related illness or injury with adequate medical coverage. This is required to protect their employees from the high costs of medical care.

Whether you are a concerned business owner in Hawaii or an employee who wants to know how Prepaid health plans work, this article will help you find the answers you need.

What Is Prepaid Health Care?

Prepaid health care plans are group health plans that must be purchased for employees in Hawaii. There are many different plans available, so if you are looking for coverage for your employees, you will need to shop around. Like other group health plans, prepaid health care plans are sponsored by an employer or organization and that company’s members are eligible to enroll in the plan.

Who Pays For Prepaid Health Care In Hawaii?

The costs of prepaid health care plans are typically split between the employer and employee, although some employees may opt to pay the full premiums for their employees. State law requires that employees must not pay a share that is more than 1.5% of their total wages for their insurance.

Here’s How It Works

With a prepaid health insurance plan, you will only have to pay 1.5% of your net salary toward your premiums. If your monthly paycheck is $1,500 you are obligated to pay 1.5% of that amount, or $22.50, for your health insurance coverage. Your employer will cover the remaining premium costs, as mandated by state law.

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Opting Out Of Prepaid Health Care

You have the option to waive your medical coverage if you like, but we don’t suggest doing so. If you do choose to opt out, you can submit the HC-5 Waiver form to your employer. This form must be resubmitted each year to continue waiving coverage.

Who Must Receive Prepaid Health Coverage

Some forms of employment are excluded from the Hawaii PHC Act’s requirements. These exclusions include but are not limited to:

People who work less than 20 hours a week
Federal, State, and County workers
Agricultural seasonal workers
Insurance or real estate salespeople paid by commission
People working for their son, daughter, or spouse
Children under age 21 working for their parent

How To Provide Prepaid Health Care Coverage

As an employer, you can obtain coverage by:

Purchasing an approved health care plan
Adopting a self-insured health care plan
Purchasing a different insurance plan

If you are an employer who needs to purchase a prepaid health care plan, Proinsurance Hawaii can help you get started. We are licensed to provide you with the enterprise insurance products you need to keep your employees in good health. You can get a free quote by calling 808-735-0106.