STAND. COM. REP. NO. 497

Honolulu, Hawaii

RE:    S.B. No. 1253

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

Madam:

     Your Committees on Health and Tourism and Government Operations, to which was referred S.B. No. 1253 entitled:

"A BILL FOR AN ACT RELATING TO HAWAII HEALTH SYSTEMS CORPORATION CONTRACTS,"

beg leave to report as follows:

     The purpose of this measure is to provide quality health care in the State's community hospital system by enabling Hawaii Health Systems Corporation to operate efficiently and autonomously.

     The measure attempts to accomplish this purpose by exempting Hawaii Health Systems Corporation from the Procurement Code.

     Your Committees received testimony in support of this measure from Hawaii Health Systems Corporation and one individual.  Your Committees received testimony in opposition to this measure from the Department of Accounting and General Services, the State Procurement Office, the Coalition of Hawaii Engineering and Architectural Professionals, Diagnostic Laboratory Services, Inc., and the American Institute of Architects.

     Your Committees find that the Hawaii Health Systems Corporation public health facilities provide essential safety-net hospital and long term care services throughout the State and are often the only hospitals in many rural communities.  Conflicts between the current required Procurement Code process and federal laws and regulations hinder the ability of Hawaii Health Systems Corporation to receive the full benefits of federal healthcare reimbursements.  Your Committees further find that Hawaii Health Systems Corporation must have the authority to operate with appropriate flexibility and autonomy in order to remain viable and respond to the needs of the specific communities served.

     As affirmed by the records of votes of the members of your Committees on Health and Tourism and Government Operations that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 1253 and recommend that it pass Second Reading and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Health and Tourism and Government Operations,

____________________________ CLARENCE K. NISHIHARA, Chair

____________________________ DAVID Y. IGE, Chair