Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Health, to which was referred S.B. No. 784 entitled:

begs leave to report as follows:

The purpose of this measure is to clarify and specify the management and control of service provided by the twelve hospitals of the Hawaii Health Systems Corporation.

Hawaii Health Systems Corporation submitted testimony in support of this measure. The Hawaii Government Employees Association submitted testimony in opposition.

Your Committee finds that the business of health care is not only highly competitive, it is dynamic and constantly changing. As Hawaii Health Systems Corporation noted in its testimony, the changing environment creates many opportunities for improving on quality of care, increasing the services that can be offered and for enhancing the delivery of that care. However, if a health care organization does not have the flexibility and authority to make prudent operational and management decisions, that same dynamic health care delivery environment can also result in the loss of millions of dollars in revenue, or result in millions of dollars in unnecessary costs.

Upon further consideration, your Committee has amended this measure by adding a provision that establishes a decision-making process before making the determination to substantially reduce or eliminate any direct patient care services, including that any action recommended as a result of the process be reported to the Legislature within ten days of board approval.

As affirmed by the record of votes of the members of your Committee on Health that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 784, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 784, S.D. 1, and be referred to the Committee on Ways and Means.