The departments of Health and Human Services and the Treasury Friday granted Hawaii the first State Innovation Waiver under Section 1332 of the Affordable Care Act. Section 1332 allows the federal agencies to waive specific ACA provisions for states if the proposal would provide similar coverage to a comparable number of residents and not increase the federal deficit, among other requirements. Hawaii’s five-year waiver frees the state from the requirement to operate a Small Business Health Options Program (SHOP), allowing the tax credit amounts that would be paid to small employers through a SHOP to support a fund that helps small businesses cover their health care costs. Section 1332 waivers became available Jan. 1. For more on Section 1332 and the Hawaii waiver, visit