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Hawaii Medical Journal logoLink to Hawaii Medical Journal
. 2010 Jun;69(6 Suppl 3):7–12.

The “Compact Impact” in Hawai‘i: Focus on Health Care

Sheldon Riklon 1,2,, Wilfred Alik 1,2, Allen Hixon 1,2, Neal A Palafox 1,2
PMCID: PMC3123150  PMID: 20539994

Abstract

The political, economic, and military relationship between the former Pacific Trust Territories of the United States is defined by the Compact of Free Association (COFA) treaty. The respective COFA treaties allow the United States military and strategic oversight for these countries, while COFA citizens can work, reside, and travel with unlimited lengths of stay in the United States. The unforeseen consequences of the diaspora of the people of the COFA nations to the United States and its territories is called the “Compact Impact.” In 2007 the social, health, and welfare system costs attributed to the estimated 13,000 COFA migrants in Hawai‘i was $90 million dollars. The US federal government does not take full responsibility for the adverse economic consequences to Hawai‘i due to COFA implementation. The lack of health and education infrastructure in the COFA nations, as well as the unique language, culture, political, and economic development of the region have contributed to the adverse elements of the Compact Impact. The Department of Human Services of Hawai‘i, once supportive of the COFA peoples, now looks to withdraw state sponsored health care support. This paper reviews the historical, political, and economic development, which surrounds the Compact Impact and describes Hawai‘i's government and community response. This paper attempts to understand, describe, and search for solutions that will mitigate the Compact Impact.

Background

Geography

Micronesia is comprised of a series of remote islands and atolls stretched for thousands of miles across the western Pacific Ocean. The total area of Micronesia is equal to twice the continental United States, however the total land mass of all the islands combined is approximately the size of the state of Rhode Island. Micronesia, from a geographical perspective, comprises the Marshall Islands, Pohnpei, Yap, Palau, Chuuk, Kosrae, Northern Marianas, Guam, Nauru, and Kiribati. From a Hawai‘i political and popular press perspective, the Federated States of Micronesia (FSM), which includes Pohnpei, Yap, Chuuk and Kosrae, the Republic of the Marshall (RMI), and Republic of Palau (ROP) are commonly referred to as “Micronesia”, and the peoples of these areas are “Micronesians”. Micronesia and Micronesian for the purposes of this paper will be limited to the ROP, the RMI and the FSM.

Population

The current population of the FSM is 107,000 (Chuuk: 54,000; Kosrae: 8,000; Pohnpei: 34,000; and Yap: 11,000). The RMI has 60,000 people and the Republic of Belau has 18,000 inhabitants. Since early 1990 there has been a significant migration of the people from the FSM and Marshall Islands to Hawai‘i, Guam, the Common Wealth of the Northern Marianas and the continental United States. It is estimated that more than 15% of the Marshall Islands population lives outside of the RMI.1,2

Health Indicators

Health Indicators vary across Micronesia but in general are quite poor with high rates of chronic and infectious disease. Infant mortality and life expectancy are poor when compared to US standards. Tuberculosis, Hepatitis B, and Syphilis are endemic in Micronesia.3 Outbreaks of Cholera and Dengue fever are not uncommon. Hansen's disease is still commonly diagnosed. Malnutrition and Vitamin A deficiency remain serious problems in many of the outlying areas.4,5

Infant mortality in the FSM is six times that of the United States. Life expectancy is 65 years in the FSM compared to 77 years in the United States. Rates of chronic disease contribute to life expectancy and are a serious and growing problem in Micronesia.6 Many researchers have linked lifestyle illness to the transition from subsistence existence based on fishing and harvesting locally available foods to dependence on canned and preserved imported products.7 Obesity is a significant problem affecting half of all men and women. Type 2 Diabetes rates are alarming affecting half of the people over 50 years of age. Smoking and alcohol consumption remain challenging problems and ischemic heart disease, stroke and cancer rates are all increasing. High rates of adolescent male suicide persist in the FSM and RMI.812

Youth lifestyle risk factors for non-communicable disease such as obesity, tobacco, alcohol, dietary intake and physical activity are extreme.11 These factors suggest that the magnitude of diabetes, heart disease, cancers, hypertension, and stroke will be very high in years to come.13

Socio-Political History

The current poor health indicators of the COFA nations may be understood in context of the socio-political history of the US Associated Pacific. Much of the western Pacific was under colonial rule for the past four hundred years. Spain was present from the mid 1500s. Germany had a significant role beginning in the late 1800s to be replaced by Japan in 1914. The United States entered the Pacific in 1944 as part of WWII Pacific campaign. At the end of the war, the United States obtained administrative oversight of Northern Marianas, Palau, Chuuk, Yap, Kosrae, Pohnpei, and the Marshall Islands. Subsequently under the UN Security Council 1947 these areas became a “Strategic Trust of United States” called The Trust Territory of the Pacific Islands (U.S. -TTPI). As such the United States set up a military base in Marshall Islands (Kwajalein Missile Range) and began US Nuclear Weapons Testing Program (1946–58).14,15 Beyond military and strategic opportunities for the United States, the main objectives of the Trusteeship Agreement were economic development and self-reliance of TTPI.

In 1977 the United States offered political self-determination to the Northern Marianas, Marshall Islands, Chuuk, Yap, Kosrae, Pohnpei, and Palau. The Northern Marianas chose to become a Commonwealth (Commonwealth of the Northern Marianas) in 1978. Federated States of Micronesia (FSM), Marshall Islands, Palau (1979–1986) chose to become Freely Associated States (FAS). The Freely Associated States formed a relationship with the United States governed by a Compact of Free Association (COFA). Each entity developed its own compact with United States. Typically economic development, grant support, and political relationships were negotiated. The Compact with the FSM and RMI from 1986–2001 was extended to 2004 then amended for the period from 2004 to 2024.

Under the Compact of Free Association, COFA citizens received broad migration rights including the right to reside and work in the United States with no visa or labor certification and no limitations of stay (US citizens are also allowed the same privileges in the COFA nations). These special rights classify them as legal “migrants,” not immigrants or refugees. Citizens of the FAS States were categorized by the Immigration and Naturalization Service initially as “Qualified Aliens.” At the time of the COFA signing in 1986, citizens of the COFA nations were categorized by the Immigration and Naturalization Service initially as “Qualified Aliens”, who have “Permanent Residence Under Color of Law” (PRUCOL), which means they are legal residents in the United States under administrative discretion. In 1996, through US administrative action, Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) changed PRUCOL to “Non Qualified Aliens” status rendering COFA migrants ineligible for federal public assistance — making them ineligible for federal Medicaid assistance. The Hawai‘i state government's response to PRWORA was to continue the eligibility of health care for the COFA migrants under the state medical assistance (Quest) program.

The Motivation to Migrate

Poor health and educational outcomes persists in the COFA nations. Despite large amounts of investment economic development has not been uniform or sustained. A large out migration has occurred and continues. Although the actual numbers are difficult to quantify there are estimates of over 20,000 Micronesians in Hawai‘i, Guam, and the CNMI.16

Approximately 7000 Marshallese reside in Arkansas and 4000 Marshallese in Costa Mesa, California. There are significant populations of COFA migrants in Oregon and Washington states. In Hawai‘i there are now an estimated 15,000–17,000 migrants, dispersed over O‘ahu, Maui, Kaua‘i, and the Big Island. One community of nearly 1000 Marshallese reside in a single geographic location, Ocean View, Big Island.1,16

Impact of Migration

As they migrate to Hawai‘i, their health status mirrors the poor health indicators in their home nations. They bring significant burdens of infectious and chronic disease. For example, estimates are that migrants from the Freely Associated States in 2008 accounted for 17% of all new tuberculosis cases and 94% of all new Hansen's disease cases.

In 2007 a total of $918,458 was attributable to communicable disease services.1820 Data is incomplete for non-communicable diseases among FAS migrants in Hawai‘i.

It is estimated by Hawai‘i's Micronesians that 110 people are currently on dialysis and 130–160 are on chemotherapy. A 2004 National Cancer Institute study reported that nuclear related cancers have not yet all been expressed and predict that more nuclear related cancers diagnoses will occur after 2004.

In addition to direct clinical services, migrants may require health, housing, education, social services and in some cases legal services. Lack of appropriate language services by health care providers coupled with literacy and cultural issues may affect their ability to efficiently navigate the health care system.19 Housing issues, overcrowding, and homelessness may worsen existing health status and complicate efforts to care for migrants from Micronesia.16

In 2007 Hawai‘i Department of Human Services spent an estimated $37 million to cover housing and financial assistance. The Department of Health spent close to $7 million for direct health care and the department of education spent $53 million.18,20

The Economic Future of the COFA Nations

The July 2003 United States General Accountability Office (GAO) reported that a major goal of the first 15 years of the Compact (1986–2001) to assist the FSM and RMI to become economically self sufficient has failed. In fact, the FSM and RMI are currently economically dependent on the United States according to the report.21

The June 2006 United States GAO Report on the FSM and RMI Compact impact which includes a forecast on the second or amended Compact (2004–2024) is entitled: “Prospects Limited for the Marshall Islands and Micronesia.” The 2006 GAO report states “the RMI and FSM economies show limited potential for achieving long term development objectives” and the report graphically depicts how the US Compact economic support is designed to decline for these Pacific nations by two-thirds between 1987 and 2023 (the beginning of the Compact period to the end of the amended Compact) Furthermore the 2006 GAO reports emphasizes that the design of the Compact trust fund, which is to replace the direct US economic assistance at the end of the 2023 Compact period for the RMI and FSM, will not be sustainable or support the present infrastructure.22 These reports contextualize the economic, and therefore the health, education, and economic realities of US Policy in the Pacific.

The COFA migrants will likely continue to migrate to Hawai‘i to benefit from the opportunities of basic health, welfare and education. There is a high likelihood that the out migration to Hawai‘i and the Unted States may increase as the financial resources from the COFA decreases in the FSM and RMI. Currently these peoples have limited alternatives for adequate health care and education. The driving forces for out migrations include a lack of education and health infrastructure in the FSM and RMI, lack of job opportunities, displacement because of US Nuclear Weapons testing, and displacement because of rising waters from climate change. The pulling forces from the United States include military and private sector recruitment.

Federal Compact Impact Aid

It is estimated that Hawai‘i spends over $90 million annually in uncompensated social, education, heathcare, and legal costs attributed to COFA migrants.16 Under the federal Compact $30 million in aid annually is divided between Hawai‘i, CNMI, and Guam. Hawai‘i's share based on the 2000 US Census is 11.2 million.16 However, as mentioned earlier, Hawai‘i spends over $37 million annually on health care for COFA migrants in the public and government sectors. Due to the 1996 PRWORA regulation, these expenditures are not reimbursed by the federal government. The actual cost to Hawai‘i is difficult to evaluate because hospitals receive federal disproportionate share payments for uncompensated care.

Reports on the Compact Impact

The United States General Accounting Office published several reports in December 2001 regarding the Compact Impact. These reports recommend that the Federal Government take active measures to address significant Compact Impact issues in the upcoming negotiations of the amended Compacts of Free Association with the RMI and FSM which would extend to 2024. It is not apparent what actions were taken in the amended Compact negotiations to address issues of Compact Impact.23,24

The Compact Impact on health care in Hawai‘i has been extensively described and studied in two existing Hawai‘i state Reports. One is the July 2004 Hawai‘i uninsured policy brief entitled “Impacts of the Compacts of Free Association on Hawai‘i's Health Care System.”17 This report was developed by the Hawai‘i Institute for Public Affairs. The second report is the Compact of Free Association Task Force Report whose committee was established by Hawai‘i Legislature Senate Resolution Nos. 142 SD 1 in 2007.18 This report was submitted to the 2009 State Legislature. One of the authors (NP) served on both these committees.

These two reports clearly articulate the history and situation with the Compact nations as it relates to health care in Hawai‘i. Both reports note that the impact was initiated and is being sustained by US federal policies but more federal support is needed. Both reports above recommended that the State increase efforts to help the COFA migrant access and receive better health services in Hawai‘i.

The 2009 Task Force Report recommends that the State should be proactive and increase all human services to the people of the COFA nations in a more organized, prevention-based and strategic way. The report recommends that the state of Hawai‘i and US Congress should advocate and support measures to increase the availability and quality of health services in their home nations so that the necessity to come to Hawai‘i for health services is decreased.

Basic Health Hawaii — A New Health Care program for COFA Migrants

The Compact Impact to health care has been substantial. In 2009, during a period of economic decline, Basic Health Hawaii (BHH) was developed by Hawai‘i's Department of Human Services (DHS) as a means to save $15 million. BHH is a State medical assistance program, part of Hawai‘i Quest, (Quest Expanded Access, Quest-Net, SHOTT) which is designed only for COFA migrants 19 years of age and older who are not eligible for federal medical assistance. The three part strategy DHS developed included: 1) Migrants who are not enrolled in QUEST by the start of BHH would be ineligible for membership 2) COFA migrants already enrolled in the Quest program would have a reduction in their health benefits package (including no dialysis coverage and no cancer treatment), and 3) the QUEST program would be capped at 7000 COFA members (there are currently about 7500 COFA members on Quest).25 As a result of The Children's Health Insurance Program Reauthorization Act of 2009, implementation of BHH would not affect COFA children under 18 and women needing maternity services.26

DHS informed COFA migrants about BHH implementation less than two months before a proposed September 1, 2009 start date. A restraining order, filed by the Lawyers of Equal Justice on behalf of the COFA migrants, was enacted because due process for notification was not provided to the COFA migrants as delineated by Hawai‘i state administrative regulations. DHS has subsequently been completing its due process regulations, and looks to implement BHH before July 1, 2010. Notably there has been no DHS or the State report assessing the short, medium and long term financial impact on the state healthcare system or the health consequences that would be expected for COFA migrants and the general population of Hawai‘i if BHH was implemented.

The Current Federal View

In September 2009 the US Department of State issued a letter to the FSM and RMI governments that the US Government is not responsible for the medical care of COFA Migrants in the United States. Each of the US states, territories and possessions will determine the availability of those services.27

Hawai‘i US Congressional Action 2007–2010

In 2007 Senators Daniel Akaka and Daniel Inouye introduced a bill into the US Senate, SB 1676, which would extend eligibility for Federal Medicaid benefits to COFA migrants. Representatives Neil Abercrombie and Mazie Hirono introduced a companion bill in the US House of Representatives in 2007, HR 4000 with the same intent. Neither of these bills were passed into law.

In early 2009, the Senate Finance Offices, with support and urging of Hawai‘i's Congressional Offices released the Children's Health Insurance Program Act of 2009; which made COFA children and pregnant women eligible for Federal Medicaid assistance.

In 2009 Representative Abercrombie, Senator Akaka and Senator Inouye put forward legislative language to be included in the Obama Health Care Reform Bill that would make COFA migrants eligible for federal Medicaid and to increase federal Compact Impact funding to Hawai‘i. The final versions of House and Senate versions of the Health Care Reform Bill did not contain the legislative language proposed by the Hawai‘i congressional offices.

Hawai‘i State Legislative Action 2007–2010

The State Legislature responded in a supportive fashion. There have been several hearings in late 2009 initiated by Senator Kalani English, Representative John Mizuno and Representative Suzanne Oakland-Chun to mitigate the actions of the BHH proposal as put forward by DHS.

In the current 2010 Hawai‘i legislative session there have been several health care related legislative actions introduced regarding COFA migrants. These include SB 2934, HB 2467, and HR 25. SB 2934 and HB 2467 sought to reinstitute or adjust the medical assistance health benefits for COFA migrants to the pre-BHH levels. HR 25 garnered Hawai‘i legislative support to request US Congress to reinstitute federal Medicaid assistance for COFA migrants.

COFA Community Action

In response to the BHH proposal, members of the COFA community in Hawai‘i organized to deal with the healthcare crisis facing their community. Existing community action groups including the Micronesian Community Network, Micronesians United, Nations of Micronesia, Micronesians United-Big Island, and Micronesian Culture Awareness Program activated. They developed public education and public awareness materials. Two newly-formed organizations, Micronesian Health Advisory Coalition and Pa Emman Kabjere (organization of Marshallese dialysis patients), recruited members from within their respective COFA communities as well as from interested Hawai‘i residents. Rallies were carried out at the Hawai‘i State Capitol, sit-ins at the Hawai‘i Governor's office, and public information presentations were held. Testimonies in opposition to the BHH were presented at legislative and DHS hearings.

Members of Pa Emman Kabjere and their attorney flew to the Marshall Islands to plead with the RMI legislature to address the BHH Members of the Micronesian Health Advisory, through the unrelenting support of the RMI-Honolulu Consul General Noda Lojkar, met with RMI President Jurelang Zedkaia to gain RMI government support. As a result of the meeting, President Zedkaia promised to discuss the issue with FSM President Emanuel Mori and ROP President Johnson Toribiong. A letter of support was to be drafted and submitted to the governor's office and respective Hawai‘i State government offices and the US Congress.

Discussion

The current situation for Micronesians attempting to access health care services in Hawai‘i has a long and challenging history. US strategic interventions in the region over fifty years ago began an historic relationship between nations and socioeconomic disparities that persist to this day. Regardless of the intertwining history and the binding compact between nations, current leadership at the state and national level have failed to find a credible method to defray the cost of healthcare for Micronesian people.

The diaspora will likely continue. The driving and pulling forces include the lack of health infrastructure in their home nations, opportunities in the United States, US military and private sector recruitment, displacement because of US nuclear weapons testing, and displacement because of rising waters from climate change. Failing to respond to the past and prepare for the future is not an option.

While solutions may not be simple, they should be guided by a moral compass that honors our previous commitments. United States presence in Micronesia has caused a steep slope of change to the cultural, economic and social fabric of Micronesia. The Micronesian infrastructure and people are challenged to meet this rate and quantity of change. While the focus has shifted to paying for health care for Micronesians in Hawai‘i, the primary goal should be to build health services in their home countries. For any dollar spent on health care in the United States, several dollars should be invested in health improvement and capacity building throughout the western Pacific.

Efforts to save money by reducing health coverage to Micronesians will likely result in increasing utilization of the emergency department for late stage disease which tends to be a very costly and non-cost effective strategy to provide care. Leaving vulnerable populations without access to adequate healthcare increases the burden and cost to everyone.

While the federal government is technically not responsible for health care in Hawai‘i as they interpret the Compact, there must be a recognition of the unique burden placed on Hawai‘i due to the geographic and cultural relationship to Micronesia. Also, it is clear that the federal government did not do any Compact Impact migration planning or projections before the Compact was implemented in 1986, or during its mid-course in the 1990's. Therefore the federal government was left reacting to unanticipated consequences of migration in 2001 — at the end of the first 15 years of the COFA. Furthermore the Compact Impact was exacerbated by removal of COFA migrants from federal Medicaid in 1996. The onus of health care provision was then made the responsibility of the states and territories. Lack of planning and anticipation by the federal government has played a devastating role to migrant health care in Hawai‘i.

Federal responsibility may take the form of federal matching funds for state expenditures on Micronesian health care. This is not novel, as many state programs operate with federal matching funds.

Solutions to the current state health care crisis will require a comprehensive multi-faceted, multi-partnership approach to ensure success. Lasting solutions will need to draw from the community utilizing financial, cultural, health, education, social work, and urban planning expertise.

The Compact Impact intersects in the international, national, state, and community arena. The policy level must involve solution based strategies from the RMI government, FSM Government, ROP government, and US federal government (Administration, Department of Interior, Department of State, Department of Defense, Department of Veterans Affairs, Department of Health and Human Services, and Department of Energy). In the Hawai‘i state level the administration, legislature and congressional representatives play a crucial role in supporting and advocating for strategic solutions. Most importantly the policies must work synergistically.

The bilateral relationship between the United States and the COFA nations over many years has set a precedent for working together. There has been a 2009 summit of the Secretary of Interior, Secretary of VA, and Secretary of Defense to discuss issues of the Insular Pacific. At the federal level there is a Pacific Insular affairs workgroup. There are functioning Compact implementation teams for the FSM and RMI.

Solutions include 1) reversing the 1996 PWORA law for COFA migrants, i.e., allow COFA migrants eligibility for federal assistance, 2) use an evidence-based, data driven methodology to determine the level of Compact Impact funding that is necessary to mitigate the impact to the state of Hawai‘i and elsewhere, 3) increase COFA nations funding and technical assistance to ensure sustainable healthcare and education systems with high quality and standards, 4) invest in the prevention-type services for COFA migrants to increase future cost-saving, 5) utilize COFA community organizations in Hawai‘i as resources and primary partners in planning and determining the appropriate interventions and strategies of their community, 6) follow the recommendations made by the Hawai‘i legislative Compact 2008 committee, 7) hold the implementation of BHH until a complete financial and impact study can be completed

The COFA migrants/nations can be instrumental in the process by 1) preparing its citizens prior to their relocation to the United States through various community education and health literacy programs, 2) collaborating with appropriate state and federal agencies such as health, education, social affairs, and immigration for better navigation through the various agencies and programs, 3) continuing to educate its community on expectations and services required, 4) working with the federal government to understand their health and educational infrastructure requirements, and 5) to continue to be productive members of the respective US states of relocation.

Conclusions

The relationship between the United States and Micronesia that brings us to the current issue of health care payment for Micronesian migrants is complex. We are bound together by a common and sometimes unfortunate web of thermonuclear weapons testing, treaties, and promises of economic development that have not come to fruition. Micronesia today remains a series of countries with very poor health indicators. Micronesian migrants in Hawai‘i have many unmet medical needs. A great state and nation is one that has the ability and know how to protect and assist the vulnerable and those in greatest need. Creative health policies that share the responsibility between the state and federal level for this historic relationship must be crafted soon. While short and long term solutions will need to include efforts both in Hawai‘i and in Micronesia, Federal matching funds for directed state health expenditures may be an appropriate avenue forward.

Figure.

Figure

Acknowlegement

We would like to thank our colleagues who have read and commented on this manuscript. Conflict of interest: none.

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