1015-10397 annual report color adj-may7(f)
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Aloha,2017 was a time of transition for us. Mike Gold retired in
December after fi ve years as chief executive offi cer and a
43-year career serving HMSA members and mentoring our
colleagues. We’re grateful for his leadership, his dedication to
Hawaii’s health, and his boldness in moving the state to a
new health care model.
With a new leadership team comes a reinvigorated commitment
to our mission: creating a sustainable health care system that
improves the health and well-being of everyone in Hawaii.
Renewing our mission means that we’ll move with continued
focus and determination to transform how HMSA operates and
relentlessly pursue new tools and strategies to support you and
your health and well-being.
Our ongoing fi nancial stability is the foundation for our work.
In 2017, 93 cents of every dollar we collected in premiums paid
for member benefi ts and expenses. Our fi nancial reserve helps
us make strategic investments that enhance the health of
our members and the health of Hawaii.
Thank you for choosing HMSA and for trusting us to be your
partner. We look forward to what we’ll achieve together in 2018.
Mahalo,
Michael B. Stollar
President and Chief Executive Offi cer
Robert S. Harrison
Chair of the Board
MESSAGE FROM THE PRESIDENTAND CHIEF EXECUTIVE OFFICERAND CHAIR
December after fi ve years as chief executive offi cer and a
43-year career serving HMSA members and mentoring our
colleagues. We’re grateful for his leadership, his dedication to
Hawaii’s health, and his boldness in moving the state to a
new health care model.
With a new leadership team comes a reinvigorated commitment
to our mission: creating a sustainable health care system that
improves the health and well-being of everyone in Hawaii.
Renewing our mission means that we’ll move with continued
focus and determination to transform how HMSA operates and
relentlessly pursue new tools and strategies to support you and
your health and well-being.
Our ongoing fi nancial stability is the foundation for our work.
In 2017, 93 cents of every dollar we collected in premiums paid
for member benefi ts and expenses. Our fi nancial reserve helps
us make strategic investments that enhance the health of
our members and the health of Hawaii.
Thank you for choosing HMSA and for trusting us to be your
partner. We look forward to what we’ll achieve together in 2018.
Mahalo,
Michael B. Stollar
President and Chief Executive Offi cer
Robert S. HarrisonRobert S. Harrison
Chair of the Board
Operationsand Finances
BILLION PAID IN MEMBER BENEFITS
Your health is our priority. HMSA has been proudly serving
the people of Hawaii as a nonprofi t health plan since we were
founded in 1938. We’re committed to putting your premiums
to good use — providing access to top-quality health care and
well-being resources.
$3.09Premiums Collected$3.3 billion.
Premium Dollar93 cents of every dollar collected goes directly
to paying for our members’ care.
Net GainHMSA ended the year with a net gain of $58 million, which is
approximately 1.7 percent of the $3.3 billion we collected in premiums
from members and employers. This was the result of investment income
we earned in the record-high U.S. stock market in 2017, our responsible
stewardship of premiums, and the federal government’s one-year
suspension of a major Affordable Care Act fee. HMSA and other health
plans will resume paying ACA taxes and fees in 2018.
The 2017 income was invested in the HMSA reserve, which protects
our members and the community during a health crisis.
WHAT HMSA OWNSCash and short-term investments ....................................................................$ 359,864Investments
Bonds ................................................................................ $ 175,717 Mutual funds .................................................................... 193,996Preferred stock ................................................................. 7,000 Real estate ....................................................................... 101,919Investment in subsidiaries ................................................ 26,421Other investments ............................................................ 29,161
Total investments ................................................................................... 538,214Receivables ....................................................................................................... 209,549Deferred income taxes ...................................................................................... 20,659 Electronic data processing equipment, net ....................................................... 4,269Other assets ...................................................................................................... 41,019
Total assets ........................................................................................... $ 1,173,574
WHAT HMSA OWESEstimated member claims outstanding ............................................................$ 303,063Membership premiums collected in advance .................................................. 40,020Accrued expenses ............................................................................................ 264,055Provision for experience rating ........................................................................ 57,533Premium deficiency reserve ............................................................................. 6,400Federal income tax payable ............................................................................. 1,951 Notes payable .................................................................................................. 3,149Other liabilities ................................................................................................ 19,367
Total liabilities ...................................................................................... 695,538
RESOURCES AVAILABLE FOR THE PROTECTION OF MEMBERSTotal resources available for the protection of members ................................. 478,036
Total liabilities and resources .............................................................. $ 1,173,574
Member premiums ................................................................ $ 3,332,650 .......... 100.0%Member benefits
Medical and hospital claims .................. $ 2,968,510 ..................................... 89.1%Claims adjustment expenses ................. 123,569 ..................................... 3.7%
Total member benefits ...................... 3,092,079 ..................................... 92.8%General administrative expenses .............. 193,301 ..................................... 5.8%
Total expenses ......................................................... 3,285,380 .......... 98.6%
Net operating income ....................................................... 47,270 ........... 1.4%
Net investment and other income ........................................ 30,623 .......... 0.9%
Income before income tax expense .................................. 77,893 .......... 2.3%
Income tax expense ............................................................. 19,888 .......... 0.6%
Net income .................................................................. $ 58,005 .......... 1.7%
CONDENSED HMSABALANCE SHEET*December 31, 2017
CONDENSED HMSASTATEMENT ofOPERATIONS*Year endedDecember 31, 2017
*Statutory basis (in thousands)
2CONDENSED HMSA2CONDENSED HMSA2CONDENSED HMSA2CONDENSED HMSASTATEMENT of2STATEMENT ofOPERATIONS*2OPERATIONS*2CONDENSED HMSA2CONDENSED HMSASTATEMENT of2STATEMENT ofOPERATIONS*2OPERATIONS*2CONDENSED HMSA2CONDENSED HMSASTATEMENT of2STATEMENT ofOPERATIONS*2OPERATIONS*Year ended2Year ended
1CONDENSED HMSA1CONDENSED HMSA1CONDENSED HMSA1CONDENSED HMSA1212CONDENSED HMSA2CONDENSED HMSA1CONDENSED HMSA2CONDENSED HMSA212CONDENSED HMSA2CONDENSED HMSA1CONDENSED HMSA2CONDENSED HMSA
3STATEMENT of
3STATEMENT of
3STATEMENT of
3STATEMENT of
3STATEMENT of
3STATEMENT ofOPERATIONS*3OPERATIONS*3STATEMENT of
3STATEMENT ofOPERATIONS*3OPERATIONS*
December 31, 20173December 31, 20173232STATEMENT of2STATEMENT of
3STATEMENT of2STATEMENT ofOPERATIONS*2OPERATIONS*3OPERATIONS*2OPERATIONS*232OPERATIONS*2OPERATIONS*3OPERATIONS*2OPERATIONS*23245December 31, 2017
5December 31, 2017
5December 31, 2017
5December 31, 2017
5December 31, 2017
5December 31, 2017
5353December 31, 20173December 31, 2017
5December 31, 20173December 31, 20173534546
STATEMENT of
6STATEMENT ofOPERATIONS*6OPERATIONS*Year ended6Year ended6December 31, 20176December 31, 20176STATEMENT of
6STATEMENT ofOPERATIONS*6OPERATIONS*6Year ended6Year endedDecember 31, 20176December 31, 2017Year ended6Year ended
787879CONDENSED HMSA9CONDENSED HMSA9CONDENSED HMSA9CONDENSED HMSA9CONDENSED HMSA9CONDENSED HMSACONDENSED HMSACONDENSED HMSACONDENSED HMSA
STATEMENT ofOPERATIONS*Year ended
STATEMENT ofOPERATIONS*STATEMENT ofOPERATIONS*Year endedYear endedDecember 31, 2017December 31, 2017
Investingin YOU
Helping you make positive, lasting changes is the
best way to help you stay healthy. That’s why HMSA
brought Blue Zones Project® to Hawaii in 2014. Blue
Zones Project partners with local businesses, schools,
and workplaces to help you build healthy habits
through community activities like purpose workshops
and cooking demos. In 2017, Blue Zones Project made
the healthy choice the easy choice in even more
communities statewide.
Blue Zones Project engaged more than 33,000people in their health and well-being last year.
●
✽ ●
✽
●✽ ✽
✽
NORTH HAWAII
EAST HAWAIIWEST HAWAII
CENTRAL MAUI
KOOLAUPOKOWAHIAWA
MANOA/MAKIKI/McCULLY/MOILIILI
KAPOLEI/EWA
Blue Zones Project worked with:
• 123 new worksites
• 21 new schools
• 10 new grocery stores
Blue Zones Project® is a trademark of Blue Zones, LLC. All rights reserved.
5NEWBLUE ZONESPROJECTCOMMUNITIES NAMED
✽ New communities● Previously established communities
Investingin Hawaii'sFuture
270PARTNERSHIPS WITH LOCALBUSINESSES OFFERING HEALTHAND WELL-BEING DISCOUNTS
• 21 on Hawaii Island
• 57 on Oahu
• 38 in Maui County
• 17 on Kauai
We’re committed to building a healthy future for
the people of Hawaii. In 2017, we partnered with
communities, businesses, and schools to ensure
a bright future in which we work together to
ensure health and well-being across Hawaii.
We also participated in133 community events
statewide, including runs and walks, health fairs,
and career days.
“ Thank you, HMSA, for your continued community support.It is rare to have a sponsor reach out to us! Thank you forbeing that aware of the community.”
- Makawao Merchants Association
“HMSA gives members a discount on Still and Movingweekly classes like yoga, Feldenkrais, hula, Pilates, qi gong,belly dance, aerial silks, and Nia. We’re delighted to workwith HMSA to give members an array of options to attaina healthy mind, body, and spirit!”
- Doris Morisaki, Aloha Ambassador,Still and Moving Center
HMSA KAIMANAAWARDS ANDSCHOLARSHIPPROGRAM
$160kIN AWARDS AND SCHOLARSHIPSFOR SCHOOLS AND STUDENTS
Nearly $1 million awarded since the
program started in 2005.
“With the Kaimana Scholarship, I've been ableto pursue a degree in exercise science and minorin medical sciences. After graduating with myundergraduate degree, I plan on applying to theJohn A. Burns School of Medicine, where I will work toward becoming a doctor in pediatrics. Asa pediatrician, I will return and serve my communityon the North Shore and provide my services forlow-income families.
I'm studying the medical fi eld because there is no better way to give back to your community than to help residents on their path to live a long, happy, and healthy life.”
– Kanani Uluave, 2017 Kaimana Scholarshiprecipient, Kahuku, Oahu
Investingin QualityCare
91%
OF HMSA’S PRIMARY CAREPROVIDERS ARE NOW PARTICIPATINGIN PAYMENT TRANSFORMATION
As part of payment transformation, 250 nurses,
social workers, and case managers are working
side by side with doctors, hospital staff, and
community resources to improve the health
of HMSA members living with severe illnesses
like diabetes, heart disease, cancer, and
other conditions.
We’ve been working with primary care
providers, specialists, and hospitals to
develop our payment transformation model,
which rewards them for improving the health
of HMSA members and pays them for value
instead of volume.
HMSA Leadership in 2017Offi cersRobert S. HarrisonCHAIRChairman and ChiefExecutive Offi cerFirst Hawaiian Bank
John T. Komeiji, Esq.VICE CHAIRChief Administrative Offi cerand General CounselHawaiian Telcom
Carla J. Nip-Sakamoto, M.D.SECRETARYOahu physician
Gina L. MartingTREASURERSenior Vice President andChief Financial Offi cerHawai‘i Medical Service Association
Gwen S. MiyasatoASSISTANT SECRETARYExecutive Vice President,Chief Internal Operations Offi cer,and Chief of StaffHawai‘i Medical Service Association
Michael B. StollarASSISTANT TREASURERPresident and Chief Operating Offi cerHawai‘i Medical Service Association
Board of DirectorsLorraine H. Akiba, Esq.CommissionerHawaii Public Utilities Commission
Paul T. Esaki, M.D.Kauai physician
Terrence R. GeorgePresident and Chief Executive Offi cerHarold K.L. Castle Foundation
Michael A. GoldChief Executive Offi cerHawai‘i Medical Service Association
Elizabeth S. HokadaManaging Director, Financial AssetsKamehameha Schools
Howard H. KarrRetiredFormer Vice ChairmanFirst Hawaiian Bank
Whitney M.L. Limm, M.D.Executive Vice President, Clinical IntegrationThe Queen’s Medical Center
Kathryn S. MatayoshiRetiredFormer SuperintendentDepartment of Education(through November 2017)
Elliot K. MillsVice President, Hotel OperationsDisneyland Resort and Aulani,A Disney Resort and Spa
Ross R. MurakamiPartnerKMH LLP
Kenric M. Murayama, M.D.Chair, Department of SurgeryJohn A. Burns School of Medicine
Randy P. PerreiraExecutive DirectorHawaii Government Employees Association
James C. PolkVice ChairmanBank of Hawaii – Consumer Banking Group
Lisa M.K. SakamotoDiocesan Finance Offi cerThe Roman Catholic Churchin the State of Hawaii
Roger J. WallVice ChairmanFoodland Super Market Ltd.
Reverend MonsignorTerrence A.M. WatanabePastorSt. Theresa Church
Robert W. WoPresidentC.S. Wo & Sons Ltd.
Senior Executive StaffMichael A. GoldChief Executive Offi cer(retired at end of 2017)
Michael B. StollarPresident and Chief Operating Offi cer
David R. HerndonExecutive Vice President andChief Member Services Offi cer
Timothy E. JohnsExecutive Vice President andChief Consumer Offi cer(through June 2017)
Gwen S. MiyasatoExecutive Vice President,Chief Internal Operations Offi cer,and Chief of Staff
Mark M. Mugiishi, M.D., F.A.C.S.Executive Vice President andChief Health Offi cer
Janna L.S. NakagawaExecutive Vice President,Chief Governance andCorporate Services Offi cer
Katy Y. AkimotoSenior Vice PresidentHealth Management Operations(effective May 2017)
Jennifer A. DiesmanSenior Vice PresidentGovernment Relations(effective May 2017)
Dick S. EscueSenior Vice President,Chief Information Offi cer(effective March 2017)
Linda J. KatagiriSenior Vice PresidentMember Services(through May 2017)
Gina L. MartingSenior Vice President, Chief Financial Offi cer
Kathryn S. MatayoshiSenior Vice President Account Relationship Management(effective December 2017)
Hilton R. RaethelSenior Vice President Foundational Enhancement Services(through mid-May 2017)
Stephany N. VaioletiSenior Vice PresidentMember Operations(effective October 2017)
Jennifer A. WalkerSenior Vice President andGeneral Counsel(effective May 2017)
Elisa YadaoSenior Vice President,Chief Communications andCommunity Engagement Offi cer
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