STAND

STAND. COM. REP. NO. 160-04

Honolulu, Hawaii

, 2004

RE: H.B. No. 2876

H.D. 1

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committees on Labor and Public Employment and Health, to which was referred H.B. No. 2876 entitled:

"A BILL FOR AN ACT RELATING TO HEALTH CARE,"

beg leave to report as follows:

The purpose of this bill is to provide health insurance for all residents of Hawaii by, among other things:

(1) Establishing the State Health Authority (Authority) to be responsible for the overall health planning of the State and to develop a plan to, among other things:

(a) Provide state-funded health insurance or provision of basic health services for all residents;

(b) Reimburse certified health care providers within 30 days of the provision of care; and

(c) Collect or receive employment contributions, matching funds, appropriations, and the health-related portion of costs related to various types of insurance to fund the Authority's purchase of health care; and

(2) Establishing the State Health Authority Commission (Commission) to:

(a) Determine the financing costs of the Authority;

(b) Determine the means and amounts of contributions necessary to sustain the Authority and provide health care for all Hawaii taxpayers;

(c) Review all types of health benefits and insurance and determine whether they could be incorporated into the Authority; and

(d) Determine the feasibility of transferring Medicaid-related functions and funding to the Authority;

(3) Requiring the Commission to also serve as the Review Panel on Mandated Health Care Service Coverage (Review Panel) to determine:

(a) The premium costs of health insurance benefits;

(b) The portions of premium costs attributable to benefits and mandated health care service coverages;

(d) Social impact; and

(e) Medical impact;

(4) Establishing the State Health Authority Fund to receive a variety of funds and reimbursements, and to be used to carry out the functions of the Authority;

(5) Repealing the Hawaii Employer-Union Health Benefits Trust Fund (EUTF) and incorporating it into the Authority;

(6) Repealing the State Health Planning and Development Agency (SHPDA) and incorporating it's powers, duties, and function into the Authority;

(7) Requiring public input in the planning and development of the program and the financing mechanism by the Authority and Commission respectively; and

(8) Requiring the Department of Human Services to submit a waiver to the federal government to expand the federal poverty level for Hawaii to 300 percent and to eliminate the assets test.

The Hawaii State Commission on the Status of Women and ILWU Local 142 testified in support of this measure. The American Council of Life Insurers, Kaiser Permanente, Hawaii Medical Service Association, and a concerned individual opposed this measure. The Department of Commerce and Consumer Affairs, EUTF Board of Trustees, and Department of Budget and Finance provided comments.

Your Committees recognize that the costs of health care are increasing rapidly, and employers continue to face rising insurance premiums, creating a financial hardship on businesses. Hawaii was once known as having a relative low rate of uninsured individuals. However, recent estimates show that over 10 percent of Hawaii's population is uninsured. Your Committees believe that all residents should have access to affordable health coverage.

Your Committees have amended this bill by:

(1) Separating the Commission and the Review Panel, and making the Commission a temporary entity and the Review Panel a permanent entity;

(2) Removing the provision that the Authority's plan include a mechanism to receive health-related costs of various types of insurance;

(3) Removing the repeal of EUTF and requesting the Commission to determine the feasibility of incorporating the EUTF into the Authority;

(4) Including the Administrator of SHPDA on the Commission;

(5) Inserting an appropriation for the Commission to carry out its duties; and

(6) Making technical, nonsubstantive amendments for purposes of clarity and style.

As affirmed by the records of votes of the members of your Committees on Labor and Public Employment and Health that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2876, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 2876, H.D. 1, and be referred to the Committee on Consumer Protection and Commerce.

Respectfully submitted on behalf of the members of the Committees on Labor and Public Employment and Health,

____________________________ DENNIS A. ARAKAKI, Chair		____________________________ MARCUS R. OSHIRO, Chair