March 8, 2002
Contact: Rep. Ken Hiraki
State Capitol, Room 320
(808) 586-6180




The chairman of the Consumer Protection & Commerce Committee today called House Republicans reckless for recalling a bill that would have amounted to a massive new tax on employees and regarded as unconstitutional by the State Attorney General.

Rep. Ken Hiraki made his remarks following yesterday's failed GOP recall of House Bill 2750, which would have required private sector employees to pay as much as 40 percent of the premiums for health plans offered by their employers.

"Under the formula contained in the bill, a full-time employee making minimum wage would pay $80 a month in health insurance premiums versus the approximately $15 he or she is paying now. That's a 433 percent increase!" Hiraki said.

Hiraki said his committee received the bill from the House Labor and Economic Development committees and conducted its own due diligence on the measure.

"After we saw how employees would be whacked with a huge increase, we also discovered that it was especially unfair to low-wage earners. Why must a minimum wage janitor pay the same amount as an oil company executive for the same health plan?" he asked.

Finally, passing this bill would have caused Hawaii's unique federal ERISA exemption to be pre-empted and is therefore unconstitutional, Hiraki said.

"Most lawmakers, myself included, are very sensitive to employers' concerns over the rising cost of health care. That's why Democrats introduced this measure in the first place and, I believe, that's the reason the previous joint committee passed the bill to my committee -- to keep it alive in the hope that our committee could amend the bill in a way that would stand up in court and was fair to all parties. But we could not in the limited time allotted to us, and that's why the bill was held," Hiraki said.

Hiraki said the correct approach is to adopt House Concurrent Resolution 29, House Draft 1, calling for a thorough study incorporating the concerns of all stakeholders -- business, employees, insurance, health care, government, and the general public -- as was recommended by a task force on mandated benefits.

"This entire issue needs to be dealt with in a comprehensive manner that brings all the parties to the table. Neither employers nor employees are responsible for the rapid rise in health care costs.

"The Republican members who sit on the aforementioned committees should have been fully aware of the issues and argued against recalling a bill so flawed. Their behavior on this matter was completely reckless and no doubt created some false and unrealistic expectations among employers," Hiraki said.