Report Title:

Health Insurance Reimbursements



Requires the Auditor to conduct a study of the adequacy of health plan reimbursements to providers.  Effective July 1, 2020.  (SB2864 HD2)



S.B. NO.



S.D. 2


H.D. 2













     SECTION 1.  (a)  The auditor shall prepare a written report on the adequacy of health plan reimbursements to physicians and hospitals in Hawaii.  This report shall include, to the extent practicable:

     (1)  A survey of the amount of compensation or salary of the active, practicing doctors in Hawaii in the following areas of specialty:

         (A)  Internal medicine;

         (B)  Obstetrics and gynecology;

         (C)  Pediatrics;

         (D)  Neurology;

         (E)  Anesthesiology; and

         (F)  Orthopedics;

     (2)  A comparison of Hawaii physician compensation or salary information to national physician salary information;

     (3)  A survey of the patient co-share payments in Hawaii compared to patient co-share payments in other states;

     (4)  A survey of the Hawaii Medical Service Association, Hawaii Management Alliance Association, Kaiser Foundation Health Plan, Summerlin Life and Health Insurance Company, and University Health Alliance to determine:

         (A)  The reimbursements paid to physicians for the top twenty-five most-used medical procedures in each area of specialty listed under paragraph (1);

         (B)  The reimbursements from the twenty-five most-used office codes;

         (C)  The reimbursements from the twenty-five most-used hospital-based codes;

         (D)  A comparison of the reimbursements surveyed in subparagraphs (A), (B), and (C) with the Medicare and Medicaid rate for the same service; and

         (E)  The identification of the current procedural terminology codes for the reimbursements, if applicable;

          provided that the reimbursements studied should be the maximum eligible amount that is both the plan payment and any co-payment or co-share due from the member;

     (5)  A comparison of the reimbursements in paragraph (4) with the reimbursements in other states;

     (6)  A survey of selected providers, including physicians and hospitals, to provide examples of the actual costs of providing health care services in Hawaii;

     (7)  A survey of students at the John A. Burns School of Medicine to determine whether low reimbursements create a disincentive to practice in Hawaii;

     (8)  A survey reflecting the shortfalls in payments by medicare, medicaid, and private insurance to cover costs incurred by hospitals and physicians;

     (9)  A survey to compare insurance premiums paid by individuals and employers for health plan coverage in Hawaii with insurance premiums paid in other states; and

    (10)  A survey to compare the average costs of malpractice insurance premiums incurred by physicians and by specialties in Hawaii with other states.

     (b)  Each health plan listed in subsection (a)(4) shall submit, at the time and in the form prescribed by the auditor, the information deemed necessary by the auditor to complete the report required under this section.  Proprietary or trade secret information submitted in compliance with this section shall remain confidential and protected from discovery, production, and disclosure for as long as the auditor deems necessary.

     In the final report submitted to the legislature, the auditor shall report confidential data without disclosing the identity of the source of the data.

     (c)  The auditor shall report the auditor's findings and recommendations to the legislature not later than twenty days prior to the convening of the regular session of 2010.

     SECTION 2.  There is appropriated out of the general revenues of the State of Hawaii the sum of $        or so much thereof as may be necessary for fiscal year 2008-2009 for the hiring of a consultant to assist the auditor in preparing this report and for the purchase of information.

     The sum appropriated shall be expended by the office of the auditor for the purposes of this Act.

     SECTION 3.  This Act shall take effect on July 1, 2020.