The Hawaii Prepaid Health Care Act (HPHCA), originally passed in 1974 and reenacted in 1981, sets forth the minimum standards for healthcare benefits for Hawaiian employees. These rules affect all employers with at least 1 Hawaii resident employee working an average of 20 hours per week in a 4 week period. The HPHCA is exempted from ERISA.
Given that HPHCA regulations impose stricter rules for employers than the Affordable Care Act employer mandate and most other states, it’s important to be aware of the regulations and make a best effort to comply.
If you employ any Hawaiian residents who work 20+ hours a week (Hawaii resident employees) your company must comply with the following HPHCA requirements or face potential penalties.
The Hawaii DLIR may apply the following penalties if HPHCA requirements aren’t met:
If you employ Hawaii residents, you may need to start offering them compliant benefits as soon as possible. If you don’t yet employ Hawaii residents, you’ll still want to consider the HPHCA to determine which plans you’d need to offer and budget for the stricter contribution requirements.
What if I don’t offer benefits yet?
Are my current plans compliant?
If you offer health benefits through Gusto, our licensed advisors are here to help. If you offer health benefits through another broker, contact your broker directly to determine next steps.
What do I need to do during a Gusto open enrollment?
After our licensed advisors help you choose compliant plans and company contributions, here’s what to expect during open enrollment.
Hawaii employees who enroll in coverage are all set — our team will double-check that they chose the correct plan and submit their enrollment to the carriers. ID cards will arrive 5-7 business days after the carriers process your coverage.