STAND. COM. REP. NO. 956

Honolulu, Hawaii

RE:    S.B. No. 12

       S.D. 2

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

Madam:

     Your Committee on Commerce, Consumer Protection, and Affordable Housing, to which was referred S.B. No. 12, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO HEALTH INSURANCE RATE REGULATION,"

begs leave to report as follows:

     The purpose of this measure is to re-enact health insurance rate regulation by prohibiting health insurance rates from being excessive, inadequate, or unfairly discriminatory. 

     This measure also requires that health care insurers submit rate filings for approval by the Department of Commerce and Consumer Affairs, establishes what type of information needs to be provided to enrollees with regard to rates, and establishes various penalties and appeal procedures.

     The Hawaii State Teachers Association submitted written comments in support of this measure.  The Hawaii Medical Service Association submitted written testimony in opposition of this measure.  Written comments were submitted by the Department of Commerce and Consumer Affairs and the American Family Life Assurance Company of Columbus.

     Act 74, Session Laws of Hawaii 2002 (Act 74), established a health insurance rate regulation law that ensured that health insurance rates were not excessive, inadequate, or unfairly discriminatory in a manner similar to the way that motor vehicle, workers' compensation, homeowners', and other property and casualty insurance lines are presently regulated.  Pursuant to a sunset provision, Act 74 was repealed on June 30, 2006. 

     Your Committee finds that the intent of this measure is to re-enact the health insurance rate regulation law in order to protect Hawaii consumers from predatory and discriminatory pricing and to open the market for competition, therefore, providing Hawaii consumers with more choices for health insurance.

     Your Committee has amended this measure to clarify that the definition of "managed care plan" or "plan" does not include specific disease or disability policies.

     As affirmed by the record of votes of the members of your Committee on Commerce, Consumer Protection, and Affordable Housing that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 12, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 12, S.D. 2.

Respectfully submitted on behalf of the members of the Committee on Commerce, Consumer Protection, and Affordable Housing,

____________________________

BRIAN T. TANIGUCHI, Chair