Report Title:

Health insurance; premium contribution rates

Description:

Provides direct temporary economic relief for a period of two years by allowing private employers the flexibility to implement up to a 60/40 cost sharing for their employees’ health insurance premiums. Sets the maximum employee contribution at forty per cent of the total premium.

HOUSE OF REPRESENTATIVES

H.B. NO.

2750

TWENTY-FIRST LEGISLATURE, 2002

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO HEALTH INSURANCE PREMIUM CONTRIBUTIONS.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The September 11, 2001, terrorist attacks on the United States have severely impacted Hawaii’s economy. Businesses experienced catastrophic revenue losses as a result of the decrease in the number of visitors to Hawaii. Our State’s continuing economic stagnation has hurt other sectors of our economy not dependent on tourism.

Furthermore, Hawaii’s employers, particularly small businesses, have not had any economic relief and continue to experience lagging sales, increasing health insurance premiums, and the high costs of workers’ compensation and general liability coverages. As the primary source of income for a majority of Hawaii’s workers, small businesses face some of the most formidable obstacles in remaining competitive and profitable. By directly addressing the issue of who pays for health insurance, the legislature is seeking to increase the awareness of health care in general and the role of society as a whole in containing costs and sharing the burden. While this measure shifts health costs from one payee to another, it is only meant to be a short-term solution to the current crisis. The Prepaid Health Care Act of 1974 should be reviewed in its entirety so that long-term solutions may be appropriately proposed in future legislative sessions.

In response to the governor’s declaration of an economic emergency and the enactment of Act 15 of the Third Special Session of 2001, giving the governor added powers, the purpose of this Act is to provide direct temporary economic relief for a period of approximately two years by allowing employers more flexibility in how much they are required to contribute to their employees’ health insurance premiums.

SECTION 2. Chapter 431, Hawaii Revised Statutes, is amended by adding a new section to article 10A to be appropriately designated and to read as follows:

"§431:10A- Liability for payment of premium; withholding. Unless an applicable collective bargaining agreement specifies differently, every employer shall contribute at least sixty per cent of the premium for coverage required by chapter 393 and the employee shall contribute the balance.

The employer shall withhold the employee's share of the premium from the employee's wages as specified by the director.

SECTION 3. All laws inconsistent with this Act shall be suspended during the effective period of this Act and to the extent that the suspension is necessary to effectuate the purposes of this Act.

SECTION 4. Upon the repeal of this Act, all statutes that were suspended under this Act shall be reinstated in the form that existed on the day before the effective date of this Act.

SECTION 5. If any provision of this Act, or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the Act, which can be given effect without the invalid provision or application, and to this end the provisions of the Act are severable.

SECTION 6. New statutory material is underscored.

SECTION 7. This Act shall take effect upon its approval and shall be repealed on June 30, 2004.

INTRODUCED BY:

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