STAND. COM. REP. NO.  95

Honolulu, Hawaii

                , 2007

RE:   H.B. No. 1474

      H.D. 1

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

Sir:

     Your Committee on Health, to which was referred H.B. No. 1474 entitled:

"A BILL FOR AN ACT RELATING TO TAXATION OF PREMIUMS,"

begs leave to report as follows:

     The purpose of this bill is to:

     (1)  Ensure a healthy and balanced health care insurance marketplace; and

     (2)  Allow equal opportunities for growth and success among insurers

by eliminating the premium tax on health insurers of prepaid health care plan contracts.

     Summerlin Life and Health Insurance Company supported this bill.  The Department of Commerce and Consumer Affairs supported the intent of this measure.  Kaiser Permanente and AlohaCare opposed this bill.  The Tax Foundation of Hawaii submitted comments on this measure.

     Your Committee has amended this bill by:

     (1)  Requiring that an authorized insurer must demonstrate a sufficient level of mutual benefit of public good as is required of a nonprofit insurer; and

     (2)  Making technical, nonsubstantive changes for clarity, consistency, and style.

     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 H.B. No. 1474, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1474, H.D. 1, and be referred to the Committee on Consumer Protection & Commerce.

Respectfully submitted on behalf of the members of the Committee on Health,

____________________________

JOSHUA B. GREEN, M.D., Chair