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. 2867 entitled:

begs leave to report as follows:

The purpose of this measure is to require the Department of Human Services (DHS) to revise the formula for determining Medicaid reimbursement amounts to providers.

Testimony in support of this measure was received from the Hawaii Health Systems Corporation, Hawaii Medical Association, Hawaii Psychiatric Medical Association, Queen's Medical Center, Healthcare Association of Hawaii, Hawaii Long Term Care Association, and a private citizen. Testimony in opposition was received from the DHS.

This measure also makes appropriations, as follows:

Your Committee agrees with the preamble to this measure, that a financial crisis exists in the State's Medicaid payment system to reimburse providers. This measure is intended to rescue Medicaid providers from financial ruin and to maintain access to essential health care services. Because federal moneys subsidize the Medicaid program, federal approval is necessary for the State's reimbursement amounts. This measure essentially requires the DHS to amend its Medicaid plan submissions to the federal government, which would increase reimbursements to providers.

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. 2867 and recommends that it pass Second Reading and be referred to the Committee on Ways and Means.