STAND. COM. REP. NO. 400

                                   Honolulu, Hawaii
                                                     , 1999

                                   RE:  S.B. No. 528
                                        S.D. 1




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 S.B. No. 528 entitled: 

     "A BILL FOR AN ACT RELATING TO HEALTH INSURANCE,"

begs leave to report as follows:

     The purpose of this measure is to exempt health insurance
offered under federally funded programs by insurers, mutual
benefit societies, health maintenance organizations, and managed
care plans from mandated coverage requirements.

     The Department of Human Services, and The Insurance
Commissioner presented testimony in support for this measure.
The Hawai`i Early Intervention Coordinating Council presented
testimony in opposition. 

     Your Committee feels that there is some uncertainty about
whether federal program requirements prevail over mandated
benefits within state insurance laws.  This measure would clarify
that certain federally funded programs, are exempt from these
mandated benefits requirements.

     It is not your Committee's intent to interfere with the
benefits received by federal employees.  Therefore, Your
Committee has amended this measure to clarify that only those
programs under the Social Security Act should be exempted.


 
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                                   STAND. COM. REP. NO. 400
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     Your Committee is concerned that certain benefits and rights
may be compromised, but would like to pass the measure along for
the purpose of continuing discussion.

     Furthermore your Committee notes that the Insurance
Division's regulatory role over fiscal solvency should not be
affected by this measure and that a health insurer contracting
with a federally funded program must still meet other
requirements of the State's Insurance Laws.

     As affirmed by the record of vote 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 S.B. No. 528, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as S.B.
No. 528, S.D. 1, 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

 
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