Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Consumer Protection and Commerce, to which was referred H.B. No. 237 entitled:

begs leave to report as follows:

The purpose of this bill is to:

Testimony in support of the intent of this bill was received from the Hawaii Medical Service Association and Kaiser Permanente. The Legislative Information Services of Hawaii testified to instead place this subject matter within section 393-7, Hawaii Revised Statutes, of the Prepaid Healthcare Law.

Your Committee finds that government-mandated benefits require health care plans to cover specific diseases, conditions, and services. Since 1989, the Legislature has required coverage and expansion of services, with thirteen mandates over the last ten years. Health care costs are continuing to rise due to increasing physician use, the advent of innovative medical technology, and pharmaceutical costs.

This bill creates a panel, which will assess social, medical, and financial impacts of mandated health insurance coverage. This panel will recommend a cap on the costs of mandated insurance coverage in terms of percentage of average annual state wage. Furthermore, this bill repeals the State Auditor's duty to review such proposals. This measure will provide legislators with important information that is necessary to make informed decisions prior to legislating any additional mandated health benefits.

Your Committee requests that the House Committee on Finance assess the feasibility of including a representative of the business community to serve on the panel.

Your Committee has amended this bill by changing the effective date of the bill to July 1, 2003 and the date of initial evaluation of cost to no later than twenty days prior to the convening of the Regular Session of 2005.

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. 237, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 237, H.D. 1, and be referred to the Committee on Finance.