STAND. COM. REP. NO. 671

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: H.B. No. 1664
                                     H.D. 2




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Consumer Protection and Commerce, to which
was referred H.B. No. 1664, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO HEALTH,"

begs leave to report as follows:

     The purpose of this bill is to implement the recommendations
of the Patient Rights and Responsibilities Task Force in order to
strengthen the Hawaii Patient Bill of Rights and Responsibilities
Act.

     The twenty-member Task Force, representing various
organizations and agencies with diverse views and interests, was
established in 1998 to review various laws affecting patient
rights in this State.

     Testimony fully supporting this bill was received from The
Department of Commerce and Consumer Affairs, Hawaii Health
Information Corporation, Healthcare Association of Hawaii, Hawaii
Federation of Physicians & Dentists, and Hawaii Nurses'
Association. The American Association of Retired Persons, Hawaii
Medical Association, Hawaii Medical Services Association (HMSA),
University Health Alliance (UHA), the Patient's Rights and
Responsibilities Task Force-Access to Services Subcommittee,
Hawaii Coalition for Health, Physicians HealthHawaii, Inc., and
Kaiser Permanente strongly supported the intent of the bill and
most of its provisions, and also proposed various amendments.
 


 
 
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     HMSA and UHA expressed serious concerns about many
shortcomings in the external appeals process mandated by the
bill.  Section 7 of the bill provides that after all internal
appeals have been exhausted, the enrollee may appeal the decision
to a three-member review panel consisting of two lay persons (a
representative of the health plan not involved in the dispute,
and a representative appointed by the Insurance Commissioner) and
a physician not involved in the dispute, but not necessarily a
physician with the same medical specialty or expertise as the
treating physician.  Since it is the highly complex medical
issues which result in these contested cases, such as those
involving "experimental treatment," it is questionable whether
such a panel of non-experts could adequately and efficiently
address the issues.  Timeliness is often crucial to patients in
cases of this type, yet the process imposes no measures to assure
prompt resolution.  The process may also be unnecessarily
adversarial, when these cases really require a panel of medical
experts using evidence-based, scientific research.  Alternative
models exist for such dispute resolution, including the voluntary
external review process adopted by the California Association of
Health Plans.

     Your Committee finds that many issues raised by the
testifiers are important for the protection of patients and
consumers of health care plans.  Upon careful consideration, your
Committee has incorporated many of the testifiers'
recommendations, and has amended the bill as follows:

     (1)  Inserted a new subsection (e) to the section entitled
"Accreditation of managed care plans," to exempt those managed
care health plans that have conducted the Consumer Assessment
Health Plan Survey on their own, from assessments by the
insurance commissioner for actual expenses in administering that
survey.

     (2)  In the section entitled "Complaints and Appeal
Procedure for enrollees," provided that the notice of final
internal determination by the managed care plan shall be sent to
the enrollee's treating physician as well as the enrollee, the
enrollee's appointed representative, if applicable, and the
commissioner.  Previously, the bill was silent as to notifying
the treating physician.

     (3)  In the section entitled "Appeals to the Commissioner,"
provided that the physician member of the three-member review
panel shall have the same or higher level of expertise and
experience as the treating physician.


 
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                                 Page 3

 
     (4)  In the section entitled "Appeals to the commissioner,"
provided that in an action against the managed care plan, the
enrollee may recover attorney's fees and costs of suit only if
the enrollee prevails before the review panel. 

     (5)  Under "Information to enrollee," clarified that any
material change in the participating provider agreements,
services or benefits shall be brought to an enrollee's notice
whenever the change affects the enrollee's services or benefits,
regardless of whether the change affects the organization or
operation of the managed care plan.  Previous language required
that both conditions be met in order to trigger the notice.

     (6)  Added a new subsection to article 1 and a new
subsection to chapter 432D, Hawaii Revised Statutes, under
"Emergency medical services," to provide that if a claim or
payment for emergency medical service is denied for the reason
that it is not medically appropriate to determine the diagnosis
or to stabilize the patient, the patient will not be liable for
payment to the emergency department and emergency provider.

     (7)  Made technical, nonsubstantive amendments for purposes
of clarity and style.    

     Your Committee has made these amendments to foster further
discussion of the issues involved and to allow for additional
input from the public whose rights and responsibilities are
directly affected by this bill.  Your Committee respectfully
requests that subsequent committees reviewing this measure give
serious consideration to adopting amendments that address
legitimate concerns over deficiencies in the external review
process.

     As affirmed by the record of votes of the members of your
Committee on Consumer Protection and Commerce that is attached to
this report, your Committee is in accord with the intent and
purpose of H.B. No. 1664, H.D. 1, as amended herein, and
recommends that it be referred to the Committee on Finance, in
the form attached hereto as H.B. No. 1664, H.D. 2.

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



                                   ______________________________
                                   RON MENOR, Chair