STAND. COM. REP. 1429
Honolulu, Hawaii
, 2003
RE: S.B. No. 665
S.D. 1
H.D. 2
Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twenty-Second State Legislature
Regular Session of 2003
State of Hawaii
Sir:
Your Committee on Consumer Protection and Commerce, to which was referred S.B. No. 665, S.D. 1, H.D. 1, entitled:
"A BILL FOR AN ACT RELATING TO PREPAID HEALTH CARE PLAN,"
begs leave to report as follows:
The purpose of this bill is to provide for a more effective administration of the Prepaid Health Care Act by prohibiting persons representing a health maintenance organization, mutual benefit society that issues individual and group hospital or medical service plans, or any other health care organization from serving as a member of the Prepaid Health Care Advisory Council (Council).
Testimony in support of this measure was submitted by the Department of Labor and Industrial Relations and Hawaii Medical Association. The Hawaii Coalition for Health and a concerned citizen testified in support of this measure and suggested amendments.
Your Committee finds that the Council affects whether a new health plan may enter the Hawaii market because it advises the Director of Labor and Industrial Relations as to whether a proposed new health care plan should be approved as providing the amount and quality of coverage required under the Prepaid Health Care Act. Historically, representatives from the Hawaii Medical Services Association and Kaiser Permanente, the two dominant health insurance plans in Hawaii, have been permitted to sit on the Council. This arrangement has the appearance of being unfair to health care contractors attempting to enter Hawaii's health care insurance market. Your Committee believes that the absence of Hawaii's health insurers on the Council would aid in assuring the public that the Council deliberates fairly and honestly, without conflicting interests. Furthermore, your Committee expects that this bill will lead to increased competition and improved health services for the public.
However, your Committee finds that because of its ambiguity, the language in the bill may be less effective than expected. Your Committee finds that as currently drafted, the bill specifically excludes from the Council, persons "representing" health maintenance and other similar organizations. However these persons are not currently required to be represented on the Council. Your Committee further finds that the law does intend that medical and public health service providers, whether employed by a health maintenance organization or other similar plan, are to be represented on the Council. Therefore, your Committee has amended this bill by:
(1) Specifying that, other than health care services providers, employees of a managed care plan shall not be appointed to the Council;
(2) Defining "managed care plan" as in section 431:14F-102 of the health insurance rate regulation chapter of the Hawaii Revised Statutes (HRS), to clearly identify the entities to which the prohibition in this bill applies; and
(3) Providing that, in the event that this Act is preempted by the Employee Retirement Income Security Act, section 393-7, HRS will revert to its form prior to the enactment of this bill.
As affirmed by the record of votes of the members of your Committee on Consumer Protection and Commerce that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 665, S.D. 1, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 665, S.D. 1, H.D. 2.
Respectfully submitted on behalf of the members of the Committee on Consumer Protection and Commerce,
|
____________________________ KENNETH T. HIRAKI, Chair |