STAND. COM. REP. NO. 3286

Honolulu, Hawaii

RE: S.C.R. No. 54

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2018

State of Hawaii

Sir:

Your Committees on Labor and Commerce, Consumer Protection, and Health, to which was referred S.C.R. No. 54 entitled:

"SENATE CONCURRENT RESOLUTION REQUESTING THE AUDITOR TO CONDUCT A STUDY TO ASSESS THE IMPACT OF MEDICAL BILL REVIEW COSTS ON THE STATE'S WORKERS' COMPENSATION SYSTEM,"

beg leave to report as follows:

The purpose and intent of this measure is to request the Auditor to conduct a study to assess the impact of medical bill review costs on the State's workers' compensation system.

Your Committees received testimony in support of this measure from the Work Injury Medical Association of Hawaii and O‘ahu County Committee on Legislative Priorities of the Democratic Party of Hawai‘i. Your Committees received comments on this measure from the Office of the Auditor and Department of Labor and Industrial Relations.

Your Committees find that although workers' compensation premiums in Hawaii have dropped significantly since the reforms in the mid-1990s, it is important to understand the impact of medical bill review costs, which include pharmacy benefit manager and third party administrator costs, on the State's workers' compensation system. Your Committees further find that not much data has been collected to allow for a review of the impact of medical bill review costs. Your Committees believe that it is crucial that the State understand the fine print of the various fee structures and the implications on its total medical bill review costs.

Your Committees have amended this measure by:

(1) Requesting the Auditor to submit a preliminary report to the Legislature by January 1, 2019;

(2) Requesting the State Health Planning and Development Agency to make the all-payer claims database available to assist the Auditor in compiling data for the study; and

(3) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

As this measure moves forward, your Committees request that your Committee on Ways and Means consider providing resources in another vehicle for the Auditor to conduct the medical bill review costs study requested in this measure.

As affirmed by the records of votes of the members of your Committees on Labor and Commerce, Consumer Protection, and Health that are attached to this report, your Committees concur with the intent and purpose of S.C.R. No. 54, as amended herein, and recommend that it be referred to your Committee on Ways and Means, in the form attached hereto as S.C.R. No. 54, S.D. 1.

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

________________________________ ROSALYN H. BAKER, Chair

________________________________ JILL N. TOKUDA, Chair