Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 1950, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to establish a prescription drug expansion program under Medicaid to make prescription drugs more affordable for individuals with incomes at or below three hundred per cent of the federal poverty level.

Specifically, this bill statutorily requires the Department of Human Services to provide for an expansion of prescription drug benefits under the Medicaid program, which shall offer discounted prescription drugs to qualified individuals. All rebates from pharmaceutical manufacturers are to be deposited into a newly created Medicaid prescription drug rebate special fund, which is to be used to expand Medicaid prescription drug benefits. Upon termination of the expansion program, the balance in the fund is to revert to the general fund.

The bill further appropriates a blank amount for fiscal year 2002-2003 to the special fund as start-up costs providing $1 for each prescription for a qualified individual, and for administration of the program, to be expended by the Department of Human Services. Finally, the bill requires that the appropriated amount be reimbursed by the Medicaid prescription drug expansion program by the end of fiscal year 2004-2005.

Upon further consideration, your Committee has amended this bill by specifying the appropriation amount at $1,500,000.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1950, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 1950, S.D. 2.