Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Health and Human Services, to which was referred S.B. No. 2782 entitled:

begs leave to report as follows:

The purposes of this measure are to:

Your Committee received testimony in support of the measure from the Department of Health, Healthcare Association of Hawaii, and Kaiser Permanente.

Your Committee finds that the Department of Health currently licenses all hospitals within the State through the authority given the department to promulgate rules. This measure would provide statutory-based authority for the department to conduct licensing activities and inspections and adopt rules. The rules would provide that accreditation by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) would demonstrate a hospital's compliance with all state licensing requirements for the year in which such accreditation is issued. This process will expedite the licensing of hospitals by relieving the department of the need to conduct an inspection in the year of accreditation, and thus effect a cost savings to the department. Most states have adopted this program, having found it to be very effective.

Furthermore, the Centers for Medicaid/Medicare Services use JCAHO accreditation to certify hospitals for Medicare/Medicaid reimbursement. In Hawaii, 22 of the 30 hospitals currently licensed are JCAHO accredited. The department would maintain its authority to conduct inspections if complaints are received regarding services.

As affirmed by the record of votes of the members of your Committee on Health and Human Services that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2782 and recommends that it pass Second Reading and be referred to the Committee on Ways and Means.