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 S.B. No. 2782 entitled:

begs leave to report as follows:

The purpose of this measure is to expedite the annual state licensing of hospitals by the Department of Health.

Specifically, this measure allows the Department of Health to accept accreditation by the Joint Commission on Accreditation of Healthcare Organizations as evidence that a hospital demonstrates compliance with all state licensing requirements for the year in which the accreditation is issued.

Your Committee finds that this measure will expedite the licensing of hospitals by the Department of Health by relieving it of the need to conduct annual inspections for all hospitals in certain years. Your Committee further finds that most states have adopted this same accreditation program which, in effect, duplicates the costly task of inspection currently being performed by the Department, but at the hospitals' own expense. In addition, the Centers for Medicare and Medicaid Services also use accreditation by the Joint Commission on Accreditation of Healthcare Organizations to certify hospitals for Medicare/Medicaid reimbursement. In Hawaii, twenty-two of thirty hospitals currently licensed are accredited by the Joint Commission on Accreditation of Healthcare Organizations. While saving costs, the Department maintains its authority to conduct inspections upon the receipt of complaints.

Your Committee has amended the bill by making technical changes that have no substantive effect.

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 S.B. No. 2782 as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2782, S.D. 1.