REPORT TITLE:
Business Regulation


DESCRIPTION:
Repeals regulation of electrologists, hearing aid dealers and
fitters, and real estate collection servicing agencies.  Requires
auditor to conduct sunset studies of other professions and
vocations.  Requires legislative reference bureau to study dental
licensing examinations.  Requires auditor to conduct an audit of
the dental provider reimbursement practices of insurers and other
entities.  Makes conforming amendments.  (HB1096, HD1)

 
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                                                        1096
HOUSE OF REPRESENTATIVES                H.B. NO.           H.D. 1
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO THE REPEAL OF BUSINESS REGULATION.



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

 1      SECTION 1.  The legislature finds that deregulating certain
 
 2 professions and vocations has the potential for reducing
 
 3 government bureaucracy and red tape.  Streamlining government
 
 4 operations by terminating unnecessary programs will help to make
 
 5 government more cost effective and efficient, which the
 
 6 legislature finds to be extremely important given the weakened
 
 7 condition of the State's economy.
 
 8      Nevertheless, the legislature finds that streamlining
 
 9 government services should not be undertaken when the public's
 
10 health and safety will be adversely affected; when elimination of
 
11 licensing will open the door for fraud, incompetence, and public
 
12 distrust in professionals; or when terminating a program will
 
13 adversely impact the provision of services to affected groups
 
14 under mandated government programs, such as under the Felix
 
15 consent decree.
 
16      The legislature further finds that the auditor has conducted
 
17 a number of sunset reports in the past that recommended repealing
 
18 several regulatory programs that the auditor considered to be
 
19 unnecessary to protect the public health, safety, and welfare
 

 
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 1 under the principles set forth in the Hawaii regulatory licensing
 
 2 reform act.
 
 3      In other cases, the auditor has found that a regulatory
 
 4 program that the legislature has found to be necessary may be
 
 5 better administered by the director of commerce and consumer
 
 6 affairs rather than a regulatory board.  Because many of the
 
 7 sunset studies conducted by the auditor are not up to date,
 
 8 however, the legislature finds that there is a need for the
 
 9 auditor to conduct a further review of other professions and
 
10 vocations to determine whether they should be eliminated or
 
11 continued and, if continued, whether regulations should be by a
 
12 board or the department of commerce and consumer affairs.
 
13      Accordingly, the purpose of this Act is to:
 
14      (1)  Repeal the laws relating to the regulation of
 
15           electrologists, hearing aid dealers and fitters, and
 
16           real estate collection servicing agencies, and making
 
17           conforming amendments to other Hawaii Revised Statutes
 
18           sections to delete references to repealed sections.
 
19           The legislature finds that the laws regulating these
 
20           professions are unnecessary in that they do not serve
 
21           to protect the public health, safety, and welfare and
 
22           should therefore be eliminated;
 

 
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 1      (2)  With respect to the laws regulating barbering, beauty
 
 2           culture, dispensing opticians, speech pathologists and
 
 3           audiologists, dental hygienists, dentistry, and
 
 4           elevator mechanics, require the auditor to conduct a
 
 5           study, or a series of studies as appropriate, to
 
 6           determine:
 
 7           (A)  Whether, under existing sunset law criteria, the
 
 8                regulation of these professions or vocations
 
 9                should be sunsetted or continued; and
 
10           (B)  Assuming that regulation of one or more of these
 
11                professions and vocations should continue, whether
 
12                regulation is handled more efficiently and cost
 
13                effectively by a regulatory board or commission,
 
14                or by the department of commerce and consumer
 
15                affairs;
 
16      (3)  Require the legislative reference bureau to conduct a
 
17           study on the licensing examination used by the board of
 
18           dental examiners; and
 
19      (4)  Require the auditor to conduct an audit of dental
 
20           provider reimbursement practices of insurers and
 
21           related entities.
 
22              PART I.  REPEAL OF BUSINESS REGULATIONS
 

 
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 1      SECTION 2.  Chapters 448F, 451A, and 454D, Hawaii Revised
 
 2 Statutes, are repealed.
 
 3      SECTION 3.  Section 412:3-502, Hawaii Revised Statutes, is
 
 4 amended to read as follows:
 
 5      "§412:3-502  Foreign financial institution.  No foreign
 
 6 financial institution shall receive deposits, lend money, or pay
 
 7 checks, negotiable orders of withdrawal or share drafts from any
 
 8 [[]principal[]] office, branch, agency, automatic teller machine,
 
 9 or other location in this State, unless expressly authorized by
 
10 this chapter, other laws of this State, or federal law;
 
11 provided[,] that nothing in this section shall prohibit any
 
12 foreign financial institution from participating in the
 
13 disbursement of cash through an automatic teller machine network
 
14 or from operating from any location in this State as a mortgage
 
15 broker licensed under chapter 454[, or as a real estate
 
16 collection servicing agent registered under chapter 454D]."
 
17      SECTION 4.  Section 443B-1, Hawaii Revised Statutes, is
 
18 amended by amending the definition of "collection agency" to read
 
19 as follows:
 
20      ""Collection agency" means any person, whether located
 
21 within or outside this State, who by oneself or through others
 
22 offers to undertake or holds oneself out as being able to
 

 
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 1 undertake or does undertake to collect for another person, claims
 
 2 or money due on accounts or other forms of indebtedness for a
 
 3 commission, fixed fee, or a portion of the sums so collected.
 
 4      "Collection agency" includes:
 
 5      (1)  Any person using any name other than the person's own
 
 6           in collecting the person's own claims with the
 
 7           intention of conveying, or which tends to convey the
 
 8           impression that a third party has been employed;
 
 9      (2)  Any person who, in the conduct of the person's business
 
10           for a fee, regularly repossesses any merchandise or
 
11           chattels for another; and
 
12      (3)  Any person who regularly accepts the assignment of
 
13           claims or money due on accounts or other forms of
 
14           indebtedness and brings suits upon the assigned claims
 
15           or money due on accounts or other forms of indebtedness
 
16           in the person's own name; provided that any suits shall
 
17           be initiated and prosecuted by an attorney who shall
 
18           have been appointed by the assignee[; provided further
 
19           that any person who by oneself or through others offers
 
20           to undertake or holds oneself out as being able to
 
21           undertake or does undertake to collect for another
 
22           person the amounts due under any agreement which
 

 
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 1           provides for installment payments and which is secured
 
 2           by an interest in real property, including without
 
 3           limitation, mortgage loans and agreements of sale,
 
 4           whether or not the collection servicing agent receives
 
 5           any compensation or other consideration for one's
 
 6           services, shall fall within the purview of chapter
 
 7           454D].
 
 8      "Collection agency" does not include licensed attorneys at
 
 9 law acting within the scope of their profession, licensed real
 
10 estate brokers, and salespersons residing in this State when
 
11 engaged in the regular practice of their profession, nor banks,
 
12 trust companies, building and loan associations, savings and loan
 
13 associations, financial services loan companies, credit unions,
 
14 companies doing an escrow business, individuals regularly
 
15 employed on a regular wage or salary in the capacity of credit
 
16 persons or in other similar capacity for a single employer who is
 
17 not a collection agency, nor any public officer or any person
 
18 acting under an order of court."
 
19      SECTION 5.  Section 468E-4, Hawaii Revised Statutes, is
 
20 amended to read as follows:
 
21      "§468E-4 Persons and practices not affected.  Nothing in
 
22 this chapter shall be construed as preventing or restricting:
 

 
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 1      (1)  A physician or surgeon from engaging in the practice of
 
 2           medicine in this State; [or]
 
 3      (2)  A [licensed] hearing aid dealer from engaging in the
 
 4           practices of fitting and selling hearing aids in this
 
 5           State; [or]
 
 6      (3)  Any person licensed in this State by any other law from
 
 7           engaging in the profession or occupation for which the
 
 8           person is licensed; [or]
 
 9      (4)  Any person employed by any federal government agency as
 
10           a speech pathologist or audiologist from performing
 
11           that person's duties as an employee of the agency if
 
12           the person must qualify for employment under government
 
13           certification or under civil service regulations;
 
14           provided that this section is applicable only when the
 
15           person is performing duties as a federal employee.
 
16           However, such person, without obtaining a license under
 
17           this chapter, may consult with or disseminate the
 
18           person's research findings and other scientific
 
19           information to speech pathologists and audiologists
 
20           outside the jurisdiction of the organization by which
 
21           the person is employed.  Such person may additionally
 
22           elect to be subject to this chapter; [or]
 

 
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 1      (5)  The activities and services of persons pursuing a
 
 2           course of study leading to a degree in speech pathology
 
 3           at a college or university, if such activities and
 
 4           services constitute a part of a supervised course of
 
 5           study and such person is designated "speech pathology
 
 6           intern," "speech pathology trainee," or by other such
 
 7           titles clearly indicating the training status
 
 8           appropriate to the person's level of training; [or]
 
 9      (6)  The activities and services of a person pursuing a
 
10           course of study leading to a degree in audiology at a
 
11           college or university, if such activities and services
 
12           constitute a part of a supervised course of study and
 
13           such person is designated "audiology intern,"
 
14           "audiology trainee," or by any other such titles
 
15           clearly indicating the training status appropriate to
 
16           the person's level of training; [or]
 
17      (7)  The activities and services of a person fulfilling the
 
18           clinical experience requirements or the clinical
 
19           fellowship year leading to the ASHA certificate of
 
20           clinical competence; or
 
21      (8)  The performance of speech pathology or audiology
 
22           services in this State by any person not a resident of
 

 
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 1           this State who is not licensed under this chapter, if
 
 2           such services are performed for no more than five
 
 3           working days in any calendar year and in cooperation
 
 4           with a speech pathologist or audiologist licensed under
 
 5           this chapter, and if such person meets the
 
 6           qualifications and requirements for application for
 
 7           licensure described in section 468E-5.  However, a
 
 8           person not a resident of this State who is not licensed
 
 9           under this chapter, but who is licensed under the law
 
10           of another state which has established licensure
 
11           requirements at least equivalent to those established
 
12           by section 468E-5, or who is the holder of the ASHA
 
13           certificate of clinical competence in speech pathology
 
14           or audiology or its equivalent, may offer speech
 
15           pathology or audiology services in this State for no
 
16           more than thirty working days in any calendar year, if
 
17           such services are performed in cooperation with a
 
18           speech pathologist or audiologist licensed under this
 
19           chapter."
 
20                 PART II.  AUDITOR'S SUNSET REVIEW
 
21      SECTION 6.  Professions and vocations; sunset review.(a)
 
22 The auditor shall conduct a study, or a series of studies, as
 

 
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 1 appropriate, as provided in subsection (b), regarding the
 
 2 regulation of the following professions or vocations:
 
 3      (1)  Practice of barbering (chapter 438, Hawaii Revised
 
 4           Statutes);
 
 5      (2)  Beauty culture (chapter 439, Hawaii Revised Statutes);
 
 6      (3)  Dental hygienists (chapter 447, Hawaii Revised
 
 7           Statutes);
 
 8      (4)  Dentistry (chapter 448, Hawaii Revised Statutes);
 
 9      (5)  Elevator mechanics (chapter 448H, Hawaii Revised
 
10           Statutes);
 
11      (6)  Dispensing opticians (chapter 458, Hawaii Revised
 
12           Statutes); and
 
13      (7)  Speech pathologists and audiologists (chapter 468E,
 
14           Hawaii Revised Statutes).
 
15      (b)  With respect to the professions or vocations specified
 
16 in subsection (a), the auditor shall determine:
 
17      (1)  Whether, under existing criteria in chapter 26H, Hawaii
 
18           Revised Statutes, the regulation of these professions
 
19           or vocations should be sunsetted or continued; and
 
20      (2)  If the auditor determines that one or more of these
 
21           professions and vocations should continue, whether
 
22           regulation of these professions and vocations would be
 

 
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 1           handled more efficiently and cost effectively by a
 
 2           regulatory board or commission, or by the department of
 
 3           commerce and consumer affairs.
 
 4      (c)  The auditor shall report its findings and
 
 5 recommendations to the legislature no later than twenty days
 
 6 before the convening of the regular session of 2000.
 
 7             PART III.  STUDIES RELATING TO DENTISTRY
 
 8      SECTION 7.  The legislative reference bureau, with the
 
 9 assistance of the board of dental examiners, shall conduct a
 
10 study on the licensing examination used by the board.
 
11 Specifically, the study shall include a determination of the
 
12 following issues:
 
13      (1)  Whether the licensing examination or examinations used
 
14           by the board of dental examiners appropriately tests
 
15           for professional competency in the field of dentistry
 
16           or serves as an undue exclusionary barrier to entry in
 
17           the profession, given examination pass rates since
 
18           1992.  In considering this issue, the legislative
 
19           reference bureau, with the assistance of the board of
 
20           dental examiners, shall undertake a comparison of the
 
21           examination pass rates for examinations given by the
 
22           board among the following groups of applicants:
 

 
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 1           (A)  Graduates of institutions in the United States
 
 2                accredited by an accreditor recognized by the
 
 3                United States Secretary of Education;
 
 4           (B)  Graduates of institutions in the United States not
 
 5                accredited by an accreditor recognized by the
 
 6                United States Secretary of Education;
 
 7           (C)  Graduates of institutions in foreign countries
 
 8                that are accredited by the governments of those
 
 9                countries;
 
10           (D)  Graduates of institutions in foreign countries
 
11                that are not accredited by the governments of
 
12                those countries; and
 
13      (2)  Whether the Western Regional Examination should be used
 
14           in lieu of the state constructed examination, or as an
 
15           option to the state constructed examination, and if so,
 
16           under what conditions; and
 
17      (3)  The legislative reference bureau with the assistance of
 
18           the board of dental examiners shall consider any other
 
19           issues pertinent to a determination of the fairness of
 
20           the state constructed dental examination.
 
21      The legislative reference bureau shall submit any findings,
 
22 recommendations, and necessary proposed legislation to the
 

 
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 1 legislature not later than twenty days prior to the convening of
 
 2 the regular session of 2000.
 
 3      SECTION 8.  The auditor, with the cooperation of Hawaii
 
 4 Medical Service Association and Hawaii Dental Service, shall
 
 5 conduct an audit of the cost effectiveness of the dental provider
 
 6 reimbursement practices of insurers and related entities.
 
 7 Specifically, the auditor shall investigate the cost implications
 
 8 to Hawaii Medical Service Association and Hawaii Dental Service
 
 9 of a direct payment and equal reimbursement law, particularly
 
10 with respect to claims that a requirement of direct payment to
 
11 service providers would be more costly to insurers than the
 
12 present practice of making payments to the individual insureds.
 
13 The auditor shall perform a management audit of Hawaii Medical
 
14 Service Association and Hawaii Dental Service to the extent
 
15 necessary to determine the cost implications of direct payment
 
16 and equal reimbursement.
 
17      The auditor shall report its findings and conclusions to the
 
18 legislature no later than twenty days before the convening of the
 
19 regular session of 2000.
 
20      SECTION 9.  Statutory material to be repealed is bracketed.
 
21 New statutory material is underscored.
 
22      SECTION 10.  This Act shall take effect upon its approval.
 

 
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