STAND. COM. REP. NO. 1517

                                   Honolulu, Hawaii
                                                     , 1999

                                   RE:  H.B. No. 1125
                                        H.D. 2




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

Sir:

     Your Committee on Ways and Means, to which was referred H.B.
No. 1125, H.D. 2, entitled: 

     "A BILL FOR AN ACT RELATING TO RECOVERY OF MEDICAL
     PAYMENTS,"

begs leave to report as follows:

     The purpose of this administration measure is to allow the
Department of Human Services to subrogate against a third party
recovery on any claim brought by an injured person who receives
medical assistance.

     The provisions of this bill are intended to provide the
Department of Human Services reimbursement for its expenditures
while fairly allocating the costs of recovery.  Recovery costs
are therefore allocated in accordance with the value of services
contributed to the recovery effort whether the claimant alone
pursues the recovery, the Department, alone, obtains the
recovery, or both the claimant and the Department pursue the
recovery, whether by separate actions or intervention.

     The Department's right of reimbursement should extend to all
third-party sources, therefore "third persons" subject to the
right of reimbursement include not just the third-party alone,
but also all third-party insurance carriers, employers, or others
covering the third-party or providing third-party benefits.

 
a                                                     HB1125 HD2
 
 
 
                                   STAND. COM. REP. NO. 1517
                                   Page 2


     Your Committees on Health and Human Services and Judiciary
requested that this Committee consider amendments to account for
situations where third-party recoveries are less than the cost of
assistance paid by the Department.  Your Committee finds that
additional amendments are not required as section 346-37(o),
Hawaii Revised Statutes, (on page 14, lines 1 to 9) specifically
allows for recovery of less than the full amount of reimbursement
due.  It is intended that the Department will equitably allocate
recovered proceeds in these situations, e.g., one-third each to
the Department, the claimant, and for fees and costs of recovery.

     As affirmed by the record of votes of the members of your
Committee on Ways and Means that is attached to this report, your
Committee is in accord with the intent and purpose of H.B. No.
1125, H.D. 2, and recommends that it pass Third Reading.

                                 Respectfully submitted on behalf
                                 of the members of the Committee
                                 on Ways and Means,



                                 ________________________________
                                 CAROL FUKUNAGA, Co-Chair



                                 ________________________________
                                 ANDREW LEVIN, Co-Chair

 
a                                                     HB1125 HD2