REPORT TITLE:
Rural Health


DESCRIPTION:
Establishes a statewide rural health plan.  Creates a rural
health special fund.  Requests the counties to create a position
of a rural transportation coordinator.  Requires DHS to review
risk adjustment factors.  (CD1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        102
THE SENATE                              S.B. NO.           S.D. 3
TWENTIETH LEGISLATURE, 1999                                H.D. 2
STATE OF HAWAII                                            C.D. 1
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO HEALTH.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  The legislature finds that adequate health care
 
 2 for the rural districts of the island of Hawaii is sorely
 
 3 lacking.  In response to this urgent need, Senate Concurrent
 
 4 Resolution No. 31, 1998, requested the department of health to
 
 5 develop a rural health plan for the island of Hawaii, including
 
 6 the districts of Puna and Ka`u, to ensure the improvement of
 
 7 health facilities and to make available sufficient medical
 
 8 services.
 
 9      In its report to the legislature pursuant to the concurrent
 
10 resolution, the department of health found that:
 
11      (1)  Rural community perceptions are that comprehensive
 
12           medical care must come first before the economic
 
13           situation in Ka`u will improve;
 
14      (2)  Elderly retirees have limited access to specialists and
 
15           may suffer long waits for transportation to larger or
 
16           specialized facilities; and
 
17      (3)  There are too few medical facilities with inadequate
 
18           transportation for a dispersed population that is
 
19           diffused over a large geographic area.
 

 
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 1      The legislature further finds that compared to the state
 
 2 population, Puna has the worst overall socio-economic status in
 
 3 the State, including the second worst per capita income ($9,450),
 
 4 second highest percentage of population below two hundred per
 
 5 cent of the federal poverty level, second highest percentage of
 
 6 households receiving public financial aid, third highest
 
 7 percentage of households receiving food stamps, and fourth
 
 8 highest unemployment rate.
 
 9      The legislature also finds that Puna has the fourth highest
 
10 level of overall health risk in the State, including the second
 
11 highest rate of births to mothers with pre-existing medical
 
12 conditions, fourth highest percentage of low birth weights, fifth
 
13 highest rate of infant mortality, and sixth highest percentage of
 
14 teen births.
 
15      The legislature further finds that compared to the state
 
16 population, Ka`u has the third worst rate for socio-economic
 
17 status, including the fourth highest percentage of population
 
18 below two hundred per cent of the federal poverty level, fourth
 
19 highest percentage of households receiving public financial aid,
 
20 fourth highest percentage of households receiving food stamps,
 
21 fifth worst per capita income, fifth highest unemployment rate,
 
22 and fifth highest percentage of adults without a high school
 
23 diploma.
 

 
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 1      The legislature further finds that Ka`u has the second
 
 2 highest level of overall health risk in the State, including the
 
 3 highest percentage of teen births, highest percentage of births
 
 4 with low birth weight, third highest percentage of births with
 
 5 inadequate prenatal care, and seventh highest infant mortality
 
 6 rate.
 
 7      The legislature further finds that the health profiles of
 
 8 Ka`u and Puna could be immensely improved with adequate funding
 
 9 for health care needs and with decent public transportation.
 
10      The purpose of this Act is to implement the recommendations
 
11 of the department of health to improve the provision of adequate
 
12 health care services and public transportation for rural
 
13 communities, and the payment methodology for QUEST.
 
14      SECTION 2.  Chapter 321, Hawaii Revised Statutes, is amended
 
15 by adding a new section to part I to be appropriately designated
 
16 and to read as follows:
 
17      "§321-    Statewide rural health plan; rural health special
 
18 fund.  (a)  The department of health shall develop a statewide
 
19 rural health plan to:
 
20      (1)  Obtain federal funds for rural communities to access
 
21           health care by creating a network of services and
 
22           resources within the State; and
 
23      (2)  Improve the efficiency and minimize the financial costs
 

 
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 1           of rural care by allowing flexibility in staffing and
 
 2           in the number and type of beds maintained as a
 
 3           requirement of federal funding subsidies.
 
 4      (b)  The statewide rural health plan shall be developed and
 
 5 administered by the department of health in conformity with
 
 6 federal requirements for receiving grants pertaining to rural
 
 7 health.
 
 8      (c)  There is established within the state treasury the
 
 9 rural health special fund to be administered and expended by the
 
10 department of health, into which shall be deposited, if required
 
11 by federal law or regulation, funds relating to rural health.
 
12 Moneys in the fund shall be expended exclusively for improvement
 
13 of rural health needs and in accordance with federal
 
14 requirements."
 
15      SECTION 3.  Chapter 346, Hawaii Revised Statutes, is amended
 
16 by adding a new section to be appropriately designated and to
 
17 read as follows:
 
18      "§346- Payment methodology for QUEST.  (a)  The department
 
19 shall conduct a review of the risk factor adjustment used to
 
20 calculate payments to QUEST medical plans under contract with the
 
21 department to provide medical services.  With each new
 
22 procurement of medical plan contracts, the department shall
 
23 validate membership, services, and cost data, and use that
 

 
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 1 validation to establish risk factors for the next contract
 
 2 period; provided that at least two years of validated membership,
 
 3 services, and cost data are available for this purpose.  If the
 
 4 department determines that additional or new risk factors should
 
 5 be added, the department shall specify the data requirements and
 
 6 the timetable in which the new risk factors are to be
 
 7 incorporated into the payment methodology for QUEST.
 
 8      For purposes of this section, the department may consult
 
 9 with contracted QUEST medical plans and other experts to identify
 
10 or replace factors in the methodology.
 
11      (b)  As used in this section:
 
12      "Risk factor adjustment" means a method of compensation,
 
13 derived from actual QUEST member experience, that accounts for
 
14 different risk characteristics associated with the medical
 
15 assistance eligibility groups, including age and gender of the
 
16 recipient.
 
17      "Validated membership, service, and cost data" means:
 
18      (1)  Confirmation of the start and end dates of the members
 
19           in a plan;
 
20      (2)  Verification that the services reported by the plan
 
21           reflects the services actually provided to the members,
 
22           and reflects the amount actually paid by the plan."
 
23      SECTION 4.  Section 36-27, Hawaii Revised Statutes, is
 

 
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 1 amended to read as follows:
 
 2      "§36-27  Transfers from special funds for central service
 
 3 expenses.  Except as provided in this section, and
 
 4 notwithstanding any other law to the contrary, from time to time
 
 5 the director of finance, for the purpose of defraying the
 
 6 prorated estimate of central service expenses of government in
 
 7 relation to all special funds, except the:
 
 8      (1)  Special summer school and intersession fund under
 
 9           section 302A-1310;
 
10      (2)  School cafeteria special funds of the department of
 
11           education;
 
12      (3)  Special funds of the University of Hawaii;
 
13      (4)  State educational facilities improvement special fund;
 
14      (5)  Convention center capital special fund under section
 
15           206X-10.5 and the convention center operations special
 
16           fund under section 206X-10.6;
 
17      (6)  Special funds established by section 206E-6;
 
18      (7)  Housing loan program revenue bond special fund;
 
19      (8)  Housing project bond special fund;
 
20      (9)  Aloha Tower fund created by section 206J-17;
 
21     (10)  Domestic violence prevention special fund under section
 
22           321-1.3;
 
23     (11)  Spouse and child abuse special account under section
 

 
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 1           346-7.5;
 
 2     (12)  Spouse and child abuse special account under section
 
 3           601-3.6;
 
 4     (13)  Funds of the employees' retirement system created by
 
 5           section 88-109;
 
 6     (14)  Unemployment compensation fund established under
 
 7           section 383-121;
 
 8     (15)  Hawaii hurricane relief fund established under chapter
 
 9           431P;
 
10     (16)  Hawaii health systems corporation special funds;
 
11     (17)  [Repeal and reenactment on July 31, 2003.  L 1998, c
 
12           142, §9.]  Boiler and elevator safety revolving fund
 
13           established under section 397-5.5;
 
14     (18)  Tourism special fund established under section
 
15           [[]201B-11[]]; [and]
 
16     (19)  Department of commerce and consumer affairs' special
 
17           funds; and
 
18     (20)  Rural health special fund under section under section
 
19           346-    ;
 
20 shall deduct five per cent of all receipts of all other special
 
21 funds, which deduction shall be transferred to the general fund
 
22 of the State and become general realizations of the State.  All
 
23 officers of the State and other persons having power to allocate
 

 
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 1 or disburse any special funds shall cooperate with the director
 
 2 in effecting these transfers.  To determine the proper revenue
 
 3 base upon which the central service assessment is to be
 
 4 calculated, the director shall adopt rules pursuant to chapter 91
 
 5 for the purpose of suspending or limiting the application of the
 
 6 central service assessment of any fund.  No later than twenty
 
 7 days prior to the convening of each regular session of the
 
 8 legislature, the director shall report all central service
 
 9 assessments made during the preceding fiscal year."
 
10      SECTION 5.  Section 36-30, Hawaii Revised Statutes, is
 
11 amended by amending subsection (a) to read as follows:
 
12      "(a)  Each special fund, except the:
 
13      (1)  Transportation use special fund established by section
 
14           261D-1;
 
15      (2)  Special summer school and intersession fund under
 
16           section 302A-1310;
 
17      (3)  School cafeteria special funds of the department of
 
18           education;
 
19      (4)  Special funds of the University of Hawaii;
 
20      (5)  State educational facilities improvement special fund;
 
21      (6)  Special funds established by section 206E-6;
 
22      (7)  Aloha Tower fund created by section 206J-17;
 
23      (8)  Domestic violence prevention special fund under section
 

 
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 1           321-1.3;
 
 2      (9)  Spouse and child abuse special account under section
 
 3           346-7.5;
 
 4     (10)  Spouse and child abuse special account under section
 
 5           601-3.6;
 
 6     (11)  Funds of the employees' retirement system created by
 
 7           section 88-109;
 
 8     (12)  Unemployment compensation fund established under
 
 9           section 383-121;
 
10     (13)  Hawaii hurricane relief fund established under chapter
 
11           431P;
 
12     (14)  Convention center capital special fund established
 
13           under section 206X-10.5 and the convention center
 
14           operations special fund established under section 206X-
 
15           10.6;
 
16     (15)  Hawaii health systems corporation special funds; [and]
 
17     (16)  Tourism special fund established under section
 
18           [[]201B-11[]]; and
 
19     (17)  Rural health special fund under section 321-    ;
 
20 shall be responsible for its pro rata share of the administrative
 
21 expenses incurred by the department responsible for the
 
22 operations supported by the special fund concerned."
 
23      SECTION 6.  In recognition of article VIII, section 2 of the
 

 
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 1 state constitution, each county is requested to establish a
 
 2 position for a rural transportation coordinator to assist in the
 
 3 identification, establishment, funding, and coordination of
 
 4 affordable and convenient public rural transportation services,
 
 5 particularly for the county of Hawaii, to allow residents to
 
 6 access health care in the Ka`u district, island of Hawaii.  The
 
 7 coordinator shall develop a plan, with the assistance of the
 
 8 state department of health, county public transportation
 
 9 agencies, and private nonprofit agencies providing transportation
 
10 services to the elderly and disabled, to establish a public rural
 
11 transportation system for the Ka`u district, particularly to
 
12 provide affordable and convenient access to health care services,
 
13 including primary providers, emergency facilities, and hospitals.
 
14 The legislature finds this request is not a mandated program
 
15 under article VIII, section 5 of the state constitution.
 
16      SECTION 7.  It is the intent of this Act not to jeopardize
 
17 the receipt of any federal aid nor to impair the obligation of
 
18 the State or any agency thereof to the holders of any bond issued
 
19 by the State or by any such agency, and to the extent, and only
 
20 to the extent, necessary to effectuate this intent, the governor
 
21 may modify the strict provisions of this Act, but shall promptly
 
22 report any such modification with reasons therefor to the
 
23 legislature at its next session thereafter for review by the
 

 
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 1 legislature.
 
 2      SECTION 8.  New statutory material is underscored.
 
 3      SECTION 9.  This Act shall take effect on July 1, 1999;
 
 4 provided that section 3 shall take effect on July 1, 2002;
 
 5 provided further that:
 
 6      (1)  The amendments made to sections 36-27 and 36-30, Hawaii
 
 7           Revised Statutes, by this Act shall not be repealed
 
 8           when those sections are reenacted on July 1, 2000,
 
 9           pursuant to section 13 of Act 216, Session Laws of
 
10           Hawaii 1997; and
 
11      (2)  The amendments made to section 36-27, Hawaii Revised
 
12           Statutes, by this Act shall not be repealed when that
 
13           section is reenacted on July 31, 2003, pursuant to
 
14           section 9 of Act 142, Session Laws of Hawaii 1998.