Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Labor & Public Employment, to which was referred S.B. No. 1052 entitled:

begs leave to report as follows:

The purpose of this bill is to protect the health of children by providing health care coverage for children who are financially supported by employee-beneficiaries of the Hawaii Employer-Union Health Benefits Trust Fund (EUTF). Specifically, this bill amends the current statutory definition of a "dependent-beneficiary" to include children who:

The Board of Trustees of the EUTF (Board) and Hawaii State Teachers Association testified in support of this bill. The Department of Budget and Finance testified in opposition to this measure.

Healthcare for all individuals has always been a tenet of Hawaii's society that was demonstrated by the passage of the Prepaid Healthcare Act which affords the ability to obtain healthcare insurance to most residents of Hawaii. However, your Committee notes that Hawaii's unique culture and lifestyle, along with a high cost-of-living, has led to individuals supporting and raising their nieces, nephews, grandchildren, cousins, siblings, or other "hanai" children. Although dependents of employee-beneficiaries of the EUTF such as children, stepchildren, adopted children, and foster children are currently covered under the benefits of an employee-beneficiary, such "hanai" children are not afforded this same benefit. According to rough estimates by the Board that are based on a number of assumptions, the fiscal impact of including "hanai" children as beneficiaries range from $4.9 million to $10.96 million. Your Committee finds that the benefits achieved by providing healthcare coverage to children far outweigh the potential costs of allowing these children to obtain healthcare coverage under the policies of employee-beneficiaries of the EUTF.

As affirmed by the record of votes of the members of your Committee on Labor & Public Employment that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1052 and recommends that it pass Second Reading and be referred to the Committee on Finance.