STAND. COM. REP. NO. 966

                                   Honolulu, Hawaii
                                                     , 1999

                                   RE:  H.B. No. 1042
                                        H.D. 2




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Commerce and Consumer Protection, to which
was referred H.B. No. 1042, H.D. 2, entitled: 

     "A BILL FOR AN ACT RELATING TO THE PUBLIC EMPLOYEES HEALTH
     FUND,"

begs leave to report as follows:

     The purpose of this measure is to permit the board of
trustees of the public employees health fund ("Board") to
contract for more than one type of benefit plan for medical,
drug, vision, and dental benefits.

     The Hawaii Public Employees Health Fund and the Hawaii
Health Systems Corporation presented testimony in support of the
measure.  The Hawaii State Teachers Association, although not
present, submitted written testimony in support of the measure.

     Your Committee finds that current law authorizes the Board
to contract for only one statewide plan for each of its medical,
drug, dental, and vision benefit plans.  This measure will
provide the Board the flexibility to contract for more than one
benefit plan per benefit category thereby fostering more
competition to provide the state quality benefit plans with the
best value.

     As affirmed by the record of votes of the members of your
Committee on Commerce and Consumer Protection that is attached to
this report, your Committee is in accord with the intent and
purpose of H.B. No. 1042, H.D. 2, and recommends that it pass

 
a                                                     HB1042 HD2
                                   STAND. COM. REP. NO. 966
                                   Page 2


Second Reading and be referred to the Committee on Ways and
Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Commerce and
                                   Consumer Protection,



                                   ______________________________
                                   BRIAN KANNO, Co-Chair



                                   ______________________________
                                   BRIAN T. TANIGUCHI, Co-Chair

 
a                                                     HB1042 HD2