HMSA extends primary care payment model transition by six months

Hawaiʻi Medical Service Association announced Monday it will extend the transition period for its new primary care physician payment model by six months, giving doctors the option to delay implementation until Jan. 1, 2027.

The move follows discussions with Gov. Josh Green, the state and primary care physicians over concerns about practice continuity and member care.

Physicians who prefer additional time may remain under their current payment arrangement through the extension period. Those who want to move sooner may opt into the new fee-for-service model beginning July 1.

The updated transition plan also includes a 15% higher fee schedule for Neighbor Island primary care physicians to offset the added costs and access challenges of rural practice, a temporary financial support program for eligible practices experiencing hardship directly tied to the transition, and assistance to help practices adapt to new billing, workflow and reimbursement processes.

“We’ve heard the concerns raised by physicians and state leaders, and we are making this adjustment because we understand primary care is essential to Hawaiʻi’s health care system,” said HMSA Chief Executive Officer Dr. Mark Mugiishi. “Our goal is to support physicians, protect continuity of care for our members, and make sure this transition is implemented in a responsible way.”

Green, a physician himself, said the collaboration reflects a shared commitment to rural health care access.

“As a doctor, I have heard directly from physicians and communities about the pressure primary care practices are facing,” he said. “This agreement gives physicians more time, provides targeted support, and helps ensure patients can continue seeing the doctors they know and trust.”

HMSA said the transition remains necessary to reflect the current health care environment and to meet regulatory requirements for claims-based rate setting, which affect how the state documents care and accesses federal health care funding. The insurer said the extension is intended to ensure the shift to a value-based model is done deliberately rather than abandoned.

“This is about getting the transition right,” Mugiishi said.

Primary care physicians will receive additional information from HMSA on transition options, support program eligibility and implementation timelines.