STAND. COM. REP. NO. 2492

Honolulu, Hawaii

RE:    S.B. No. 3015

       S.D. 1

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fourth State Legislature

Regular Session of 2008

State of Hawaii

Madam:

     Your Committee on Health, to which was referred S.B. No. 3015 entitled:

"A BILL FOR AN ACT RELATING TO THE PATIENTS' BILL OF RIGHTS AND RESPONSIBILITIES ACT,"

begs leave to report as follows:

     The purpose of this measure is amend the Patients' Bill of Rights and Responsibilities Act by prohibiting certain unfair or deceptive business practices by managed care plans.

     Your Committee received testimony in support of this measure from the Department of Commerce and Consumer Affairs.  Comments were received from the Hawaii Medical Service Association.

     Chapter 432E, Hawaii Revised Statutes, relating to the Patients' Bill of Rights, does not contain provisions for unfair or deceptive acts or practices in managed care plans.  According to the Department of Commerce and Consumer Affairs, this measure is intended to protect consumers by establishing prohibited practices for managed care plans.  This measure is based partly on the California managed care plan statutes.

     Your Committee finds that this measure adds protection for consumers by allowing action against insurers by way of complaint or investigation, rather than by external review.  Often, consumers cannot obtain legal representation for external review appeals.

     Your Committee has amended this measure by:

     (1)  Deleting reference to treating each instance of noncompliance as a separate violation;

     (2)  Requiring that each instance of violation of the section be subject to section 431:2-203, Hawaii Revised Statutes, relating to administrative proceedings for enforcement; and

     (3)  Replacing the term "noncompliance" with the term "violation" in order to make correct the cross reference to section 431:2-203, Hawaii Revised Statutes, which uses "violates".

     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. 3015, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 3015, S.D. 1, and be referred to the Committee on Commerce, Consumer Protection, and Affordable Housing.

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

____________________________

DAVID Y. IGE, Chair