STAND. COM. REP. NO. 1020

Honolulu, Hawaii

RE:    H.B. No. 89

       H.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2017

State of Hawaii

Sir:

     Your Committees on Human Services and Commerce, Consumer Protection, and Health, to which was referred H.B. No. 89, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO THE HOSPITAL SUSTAINABILITY PROGRAM,"

beg leave to report as follows:

     The purpose and intent of this measure is to:

     (1)  Continue the hospital sustainability program for two years;

     (2)  Clarify that the rate of the outpatient hospital sustainability fee shall not exceed three percent of net outpatient hospital service revenue;

     (3)  Allow the Department of Human Services to exclude any facility from the hospital sustainability fee on outpatient care services if its exclusion is required to meet federal standards of approval; and

     (4)  Appropriate funds out of the hospital sustainability program special fund for fiscal years 2017-2018 and 2018-2019.

     Your Committees received testimony in support of this measure from the Department of Human Services, Hawaii Health Systems Corporation, Office of the Mayor of the County of Hawai‘i, Chamber of Commerce Hawaii, Hawai‘i Pacific Health, Healthcare Association of Hawaii, and The Queen's Health Systems.

     Your Committees find that the Legislature created the hospital sustainability program, which was enacted by Act 217, Session Laws of Hawaii 2012, to increase Medicaid payments to hospitals in recognition that Medicaid payments to hospitals were below the actual costs of care.  Because of the hospital sustainability program, Medicaid payments to many facilities in the State are closer to the actual costs of care, which helps to ensure that Medicaid patients have access to the hospital care they need.

     As affirmed by the records of votes of the members of your Committees on Human Services and Commerce, Consumer Protection, and Health that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 89, H.D. 1, and recommend that it pass Second Reading and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Human Services and Commerce, Consumer Protection, and Health,

________________________________ ROSALYN H. BAKER, Chair

________________________________ JOSH GREEN, Chair