Honolulu, Hawaii
                                                   , 1999

                                 RE: S.B. No. 1452
                                     H.D. 3

Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii


     Your Committee on Finance, to which was referred S.B. No.
1452, H.D. 2, entitled: 


begs leave to report as follows:

     The purpose of this bill is to strengthen the protection of
the consumer rights of patients receiving health care under
managed care plans (MCPs) and from health maintenance
organizations (HMOs).

     Among other things, this bill:

     (1)  Requires the Insurance Commissioner to conduct:

          (a)  A survey and educational program of all MCPs to
               determine if deficiencies exist or improvements
               are required; and

          (b)  A program to promote public awareness and
               education about MCPs and take steps to ensure that
               all MCPs are accredited;

     (2)  Establishes the Health Insurance Revolving Fund
          (Revolving Fund) to be used to hire medical experts to
          serve on review panels, provide expert medical
          opinions, or conduct a public awareness and education
          program about MCPs;

                                 STAND. COM. REP. NO. 1842
                                 Page 2

     (3)  Requires mutual benefit societies, HMOs, and others
          offering health benefits or services to:

          (a)  Pay a one-time assessment to the Revolving Fund;

          (b)  Help pay for the costs of the survey and
               educational program;

     (4)  Establishes a review hearing process to consider an
          enrollee's appeal of an adverse decision of an MCP; and

     (5)  Clarifies the conditions under which a health plan must
          provide reimbursement for any items or services not
          necessary to stabilize a patient.

     The Department of Health, the Hawaii Medical Association,
Kaiser Permanente, Legal Aid Society of Hawaii, the Healthcare
Association of Hawaii, the Hawaii Federation of Physicians and
Dentists, the Hawaii Health Information Corporation, and an
individual testified in support of this measure.  The Hawaii
Medical Service Association testified in support of the intent of
this bill.  The Department of Commerce and Consumer Affairs,
State Farm Insurance Companies, the Access to Services
Subcommittee of the Patient Rights and Responsibilities Task
Force, and an individual commented on this bill.

     Your Committee has amended this bill by:

     (1)  Inserting definitions for "emergency medical
          condition", "emergency services", and "stabilize"; and

     (2)  Making technical, nonsubstantive revisions to conform
          to correct drafting style.
     As affirmed by the record of votes of the members of your
Committee on Finance that is attached to this report, your
Committee is in accord with the intent and purpose of S.B. No.
1452, H.D. 2, as amended herein, and recommends that it pass
Third Reading in the form attached hereto as S.B. No. 1452, H.D.

                                 STAND. COM. REP. NO. 1842
                                 Page 3

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

                                   DWIGHT Y. TAKAMINE, Chair