The state and the Hawai'i Medical Service Association have reached an agreement to provide an estimated 3,500 uninsured children in "gap group" families with health coverage.

The three-year Keiki Care Plan pilot project is aimed at families who do not qualify for state or federal healthcare programs but can't afford healthcare premiums.

The majority of these families have household incomes equal to or more than 300 percent of the federal poverty level, according to HMSA.

Because these children have no access to preventive care, many are often taken to emergency rooms. This care often is not compensated, placing a burden on hospitals and physicians.

"This is more than just a family problem," Cliff Cisco, HMSA senior vice president, said in a statement. "It's a community problem and it requires a community-based solution where public and private sectors work together to cover our children."

Lillian Koller, director of the state Department of Human Services, said this plan will ensure that all Hawai'i children will have access to healthcare.

"By launching Keiki Care, Hawai'i has moved a step closer toward our goal of all residents having access to quality health insurance," Koller said.

HMSA, Hawai'i's largest insurer, and the state each will contribute $1 million to cover the cost of the premiums.

Laura Lott, HMSA spokeswoman, said HMSA will use money from its $500 million reserve fund to pay for the program, which she said will not be subsidized by HMSA membership dues.

To be eligible, children must be between 31 days and 19 years old, live in Hawai'i, be uninsured continuously for at least six months and be ineligible for any other federal or state health plan, such as Quest. The Quest program is available to low-income families.

Enrollment begins Saturday and coverage will take effect April 1.

"The Quest kids are taken care of, and then there's a group whose families make too much money to qualify for Quest, but then maybe the work provides for mom and dad, but it doesn't offer a children's benefit," Lott said. "So those are the groups that we really are targeting."

The Keiki Care Plan will provide basic healthcare benefits, including doctor visits, immunizations, diagnostic tests, certain preventive services, emergency care, mental-health care, dental services and some prescription drugs.

Although families won't pay a premium, they will be responsible for copayments for certain services. Office visits would require a $7 copayment, for example, while hospital stays will cost $100 per day.

Anyone with questions about the program should call HMSA at 948-5555. Information about the program should be on HMSA's Web site, www.hmsa.com, by Saturday, Lott said.

Reach Curtis Lum at culum@honoluluadvertiser.com.