STAND. COM. REP. NO. 600

Honolulu, Hawaii

RE: S.B. No. 819

S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirty-First State Legislature

Regular Session of 2021

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 819, S.D. 1, entitled:

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

begs leave to report as follows:

The purpose and intent of this measure is to extend the hospital sustainability program.

Your Committee received written comments in support of this measure from the Department of Human Services, Healthcare Association of Hawaii, Hawaii Primary Care Association, Hawaii Pacific Health, and The Queen's Health Systems.

Your Committee finds that the hospital sustainability program is vital to preserve hospital access for Medicaid beneficiaries, especially as the State continues to face challenges from the coronavirus disease 2019 (COVID-19) pandemic and the recent recession. Your Committee notes that the program functions by levying a fee on participating providers, and that funds generated through the fee are used to draw down additional matching federal dollars, which are then distributed back to providers to help cover the difference between Medicaid reimbursements and Medicare reimbursements. Your Committee also finds that the funds generated from the fee will ensure that hospitals continue operations, help address budget constraints in the Medicaid program, and provide necessary funds that will help cover the program's budget shortfall without using moneys from the State's general fund.

Your Committee has amended this measure by:

(1) Clarifying that children's hospitals, psychiatric hospitals, and rehabilitation hospitals may be assessed hospital sustainability fees at a different rate than other private hospitals;

(2) Correcting language in a reference to section 346G-4(c), Hawaii Revised Statutes; and

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

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 819, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 819, S.D. 2.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

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DONOVAN M. DELA CRUZ, Chair