Hawaii Medical Service Association, which in August stopped selling small-business insurance on the Hawaii Health Connector, is opposing a bill that would force it to reverse that decision.

The bill would require all Hawaii health insurers with a 20 percent market share to offer small business plans via the Hawaii Health Connector, the state’s version of Obamacare.

"Only HMSA has 20 percent market share in the small-group market, so really again you’re just targeting HMSA," HMSA lobbyist Jennifer Diesman told lawmakers at a hearing called Wednesday by the House Health Committee. "We communicated repeatedly the continued difficulties working with the Connector. We do not believe there is value for small businesses."

When HMSA stopped selling policies on the small-business side of the exchange, it left Kaiser Permanente Hawaii as the sole health plan choice for employers using the Connector. HMSA still sells individual plans on the exchange.

"It would place us in a competitive disadvantage with other issuers who are not subject to the 20 percent market share threshold and are able to offer health insurance coverage without being encumbered by the administrative, technical and financial burdens of participating in the (Small Business Health Options Program)," Diesman said.

Through House Bill 726 and Senate Bill 745 lawmakers are attempting to increase competition on the Connector, the online marketplace created by the Affordable Care Act to provide Obamacare health plans in Hawaii.

House Health Committee Chairwoman Della Au Belatti (D, Moiliili-Makiki-Tantalus) said lawmakers are trying to have parity with the federally run exchanges, which require insurers selling individual policies on the exchange to also offer small-business plans.

"(The bill) may well target HMSA but that’s the reality," Belatti said.

HMSA believes there would be more efficiencies in a federally run exchange than there is in the state-based online marketplace, but "that’s not where we are today," Diesman told lawmakers.

Jeff Kissel, the Connector’s executive director, testified that a majority of states have adopted similar provisions mandating insurers’ participation on the exchange.

"The effect is to give all business equal access to Hawaii’s major insurance providers," he said.