Honolulu, Hawaii
                                                     , 1999

                                   RE:  S.B. No. 1562
                                        S.D. 1

Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 1999
State of Hawaii


     Your Committee on Health and Human Services, to which was
referred S.B. No. 1562 entitled: 


begs leave to report as follows:

     The purpose of this measure is to require the Department of
Human Services (DHS) to compensate community health centers
providing services to QUEST patients based on a risk adjustment
for serious medical conditions.

     Your Committee received testimony in support of this measure
from Aloha Care, Hawaii State Primary Care Association, Healthy
Mothers Healthy Babies, Waianae Coast Comprehensive Health
Center, Waikiki Health Center, Bay Clinic, and Waimanalo Health
Center.  Testimony in opposition was received from the DHS and
Hawaii Medical Services Association.

     This measure is intended to adequately compensate community
health centers for treating the sickest and poorest of Hawaii's
population.  Your Committee believes that the State has an
obligation to community health centers to keep them financially
viable in order that they can continue to render necessary
medical services.  Without community health centers, this
population would go without medical care.

     Your Committee has amended this measure by inserting
explanatory language into section 1.

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                                   STAND. COM. REP. NO. 500
                                   Page 2

     As affirmed by the record of votes of the members of your
Committee on Health and Human Services that is attached to this
report, your Committee is in accord with the intent and purpose
of S.B. No. 1562, as amended herein, and recommends that it pass
Second Reading in the form attached hereto as S.B. No. 1562,
S.D. 1, and be referred to the Committee on Ways and Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Health and Human

                                   SUZANNE CHUN OAKLAND, Chair

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