Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Judiciary, to which was referred H.B. No. 2207, H.D. 1, S.D. 1, entitled:

begs leave to report as follows:

The purposes of this measure are to create the offense of health insurance fraud arising from acts or omissions related to health insurance claims, and to provide insurer's with a civil cause of action against person's who benefit from the offense or who allow the offense to occur.

Your Committee finds that this measure is intended to deter fraudulent health insurance claims by an insured or a provider, and to prevent health care providers from substantiating or allowing such fraudulent claims to be filed, by permitting civil claims against them.

According to the testimony of the Hawaii Medical Service Association on this measure before the Committees on Health and Human Services and Commerce, Consumer Protection and Housing, the current system of investigating health care fraud cases is quite comprehensive, with the involvement of the federal and state law enforcement. Therefore, providing insurers with a civil cause of action is not necessary. However, your Committee finds that the crux of a successful health insurance fraud prosecution lies in the first instance in the reporting of the fraud to authorities.

Your Committee has amended this measure by deleting its contents, inserting the definition of insurance fraud found in the motor vehicle insurance law to apply by reference in several chapters relating to health insurance and providing civil immunity to persons reporting fraud.

As affirmed by the record of votes of the members of your Committee on Judiciary that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2207, H.D. 1, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 2207, H.D. 1, S.D. 2.