HB202 SD2 SSCR1565

STAND. COM. REP. NO.1565

Honolulu, Hawaii

, 2001

RE: H.B. No. 202

H.D. 1

S.D. 2

Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committees on Commerce, Consumer Protection and Housing and Judiciary, to which was referred H.B. No. 202, H.D. 1, S.D. 1, entitled:

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

beg leave to report as follows:

The purposes of this measure, as received, were to:

(1) Clarify the health insurance reimbursement procedures by defining "clean claims"; establishing reimbursement reports to satisfy the notice to provider requirement; requiring entities to make available an electronic system to produce verification of eligibility; and requiring that a report to the Insurance Commissioner on claims unpaid or contested with reasons for the contested claims be filed; and

(2) Establish full parity in health coverage benefits for mental health and substance abuse treatment for minors under age 18.

Testimony in support of Part I (health insurance reimbursement) of the bill was submitted by the Department of Commerce and Consumer Affairs, Hawaii Medical Association, Hawaii Psychiatric Association, Hawaii Chapter American Physical Therapy Association, and a private physician. Testimony in opposition was submitted by the Hawaii Medical Service Association, Kaiser Permanente, University Health Alliance, Voluntary Employees' Benefit Association of Hawaii, and Mutual Benefit Association of Hawaii.

Testimony in support of Part II (parity for minors) of the bill was submitted by the Department of Health, Hawaii Youth Services Network, Mental Health Association in Hawaii, Hawaii Psychological Association, Equal Insurance Coalition, Hawaii Medical Association, Hawaii Psychiatric Association, and a private citizen. Testimony in opposition was submitted by the Hawaii Medical Service Association, National Federation of Independent Business, Kaiser Permanente, Chamber of Commerce of Hawaii, University Health Alliance, Voluntary Employees' Benefit Association of Hawaii, Mutual Benefit Association of Hawaii, and Hawaii Business Health Council.

Your Committees find that there have been complaints to the Insurance Commissioner regarding abuse of the notice provision which further delayed payment to providers. Your Committees do not believe that this was the intent of the law, thus your Committees agree that amendments are needed to ensure that health insurers comply with the true sprit of the law, to pay health and dental insurance claims in a timely fashion.

Your Committees further find that there is a need to address child and adolescent mental health and substance abuse issues before Hawaii is faced with a tragedy such as the recent high school shootings in other states. Your Committees further find that imposing no limits on children's services for mental health and substance abuse could be one of the best preventative measures to ensure good mental health during adulthood.

It is not your Committees' intent to shift the State's responsibility to health plans to cover services required under the Felix consent decree. Your Committees amended this measure to reflect this, however, your Committees urge careful consideration of this language when this measure is deliberated in conference to ensure that the carve-out is for the services rendered under Felix, and not the Felix-class. It is further not the intent of your Committees to exclude Felix-class minors from the benefits of this measure simply because they are Felix eligible. It is intended to only ensure that health plans are not paying for the services for which the State is responsible.

Your Committees have amended this measure by:

(1) Amending Part I by replacing its contents with the contents of S.B. No. 171, SD2, which are substantively similar, however S.B. No. 171, SD2, removes the notice requirement and does not allow health plans to use reimbursement reports as a substitute. It further does not remove the sunset date of July 1, 2002, and has a defective effective date of July 20, 2051;

(2) Amending Part II by removing the definition of benefits to minors which defined the mental health and substance abuse benefit, further clarifying the Felix exemption, and requiring providers to adhere to standard of care treatment guidelines that the health plan has identified; and

(3) Changing the effective date to July 20, 2050.

As affirmed by the records of votes of the members of your Committees on Commerce, Consumer Protection and Housing and Judiciary that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 202, H.D. 1, S.D. 1, as amended herein, and recommend that it pass Third Reading in the form attached hereto as H.B. No. 202, H.D. 1, S.D. 2.

Respectfully submitted on behalf of the members of the Committees on Commerce, Consumer Protection and Housing and Judiciary,

____________________________ BRIAN KANNO, Chair		____________________________ RON MENOR, Chair