Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committees on Health and Human Services, to which was referred H.B. No. 2109, H.D. 2, entitled:

beg leave to report as follows:

The purpose of this measure is to provide a tax credit to resident taxpayers for long-term care insurance premiums.

Testimony in support of this measure was received from the Executive Office on Aging, State Farm Mutual Automobile Insurance Company, American Council of Life Insurers, Chamber of Commerce of Hawaii, Hawaii Long Term Care Association, Healthcare Association of Hawaii, and Hawaii Medical Association. Testimony in opposition was received from the Department of Taxation and Kokua Council. Comments were received from the Tax Foundation of Hawaii.

Your Committees find that long-term care for our elderly population is costly. Costs for nursing homes often exceed a family's ability to pay, threatening self-sufficiency. Even home- and community-based services require resources beyond the means of many families. Many family members, in order to care for their aging loved one, may be forced to work reduced hours at their jobs, adjust career and personal goals, place their own health in jeopardy, and retire earlier than intended, resulting in lower pensions and retirement benefits. Your Committees also find that a tax incentive will encourage individuals to assume responsibility for their, and their loved ones, long-term care.

Your Committees have amended this measure by:

As affirmed by the records of votes of the members of your Committees on Health and Human Services that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2109, H.D. 2, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 2109, H.D. 2, S.D. 1, and be referred to the Committee on Ways and Means.