After disappointing enrollment in a new subsidized healthcare program for adults in poverty, the state Department of Human Services wants to insure 18,400 more people, a move that also will help reduce almost $150 million annually that hospitals around the state claim they are losing out on.

About 1,600 people have applied for the state's QUEST-Ace program since enrollment opened in March, and officials hope to eventually insure about 20,000.

By raising the income cap to twice the federal poverty level, the state hopes to extend coverage to more of those in the "gap group" of uninsured adults whose incomes are too high for them to receive state health insurance but too low for them to be able to afford private plans.

At the same time, it is hoped the plan will reduce the number of uninsured adults getting healthcare at hospitals, reducing the costs to these facilities.

As part of the plan, the state plans to remove a bias against the self-employed in attaining state-subsidized coverage — a $60 fee that was not charged to those who are employed by others.

DHS Director Lillian Koller anticipates that these changes will make 22,000 more people eligible for Quest-ACE, and she hopes to bring total enrollment to 20,000 after Jan. 15.

In another move yesterday, DHS officials handed out $14.4 million in checks to 17 public and private hospitals, which collectively claim losses of about $147 million this year on charity cases and bad debt.

This was the third year in a row in which DHS obtained additional federal money to help hospitals with charity care. The state had not received extra federal money for charity care during the previous decade, according to the department.

"Hospitals need help getting us to that glorious place of universal healthcare," Koller said.

Paula Yoshioka, the executive vice president and chief administrative officer for The Queen's Medical Center, said "any increase is going to help us with providing care."

Emergency rooms often serve as a safety net for those who can't receive care elsewhere. "They have no other alternative," Yoshioka said.

Hawai'i ranks second in the country for its low uninsured rate, but almost 9 percent of state residents still lack insurance. According to a June report by the New York-based Commonwealth Fund, the state would have to insure 13,629 more adults to rise to the top of the list.

Koller said the state tried several types of outreach to enroll adults earning less than the federal poverty limit. But although Quest-Ace can cover 20,000, only 1,600 have applied since enrollment opened in March.

Quest-Ace is being funded to the tune of $100 million over six years using federal money. It is being expanded under a waiver that will allow enrollment to grow by 20,000 adults who do not have dependent children.

The coverage will include outpatient physician visits, inpatient hospital stays, emergency room services, dental treatments, prescription drug costs and mental healthcare.

Since about 22,000 of the state's uninsured people fall between 100 percent and 200 percent of the federal poverty limit, the state plans to offer coverage to those people next month.

The idea is to try to draw in part-time workers, those who are unemployed and others who lack insurance but don't qualify for the main Quest program, which is limited to the neediest children and their families.

About 18 percent of the Wai'anae Coast Comprehensive Medical Center's 26,000 patients are uninsured, and about 9 percent earn between 100 percent and 200 percent of the federal poverty limit, according to medical director Ricardo Custodio. The center charges fees on a sliding scale for those who don't have health insurance.

But income isn't the only reason people are uninsured. "A lot of them are new to the state, some of them are new to Wai'anae. A lot of it was because Quest required proof of residency and citizenship this year, and a lot of people who didn't send in proof became uninsured," he said.

In addition, there are people who lost their jobs and couldn't afford to continue their coverage, those who can't afford to pay their share of the insurance offered through work, or those who can't work more than 19 hours a week so they can qualify for employee health insurance.

Reach Treena Shapiro at tshapiro@honoluluadvertiser.com.