Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committees on Health and Human Services and Commerce, Consumer Protection and Housing, to which was referred H.B. No. 2207, H.D. 1, entitled:

beg leave to report as follows:

The purpose of this measure is to create the offense of health insurance fraud arising from acts or omissions related to health insurance claims.

Testimony in support of this measure was submitted by Hawaii Medical Service Association (HMSA) and NAMI Oahu. Testimony in opposition to this measure was submitted by the Healthcare Association of Hawaii, Hawaii Medical Association, and the Office of the Public Defender. The State Insurance Commissioner and the American Council of Life Insurance submitted comments on this measure.

Your Committees find that this measure is intended to deter fraudulent health insurance claims by creating a civil cause of action for insurers to recover payments or benefits obtained through fraudulent acts or omissions by an insured or a provider. Your Committees further find that this measure targets not only insured individuals making such fraudulent claims but also includes health care providers who substantiate or allow such fraudulent claims to be filed.

Upon further consideration, your Committees have amended this measure by:

(1) Deleting all references to specific criminal penalties;

(2) Changing the effective date to upon its approval; and

As affirmed by the records of votes of the members of your Committees on Health and Human Services and Commerce, Consumer Protection and Housing that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2207, H.D. 1, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 2207, H.D. 1, S.D. 1, and be referred to the Committee on Judiciary.