STAND. COM. REP. NO.  264-10

 

Honolulu, Hawaii

                , 2010

 

RE:   H.B. No. 2089

      H.D. 1

 

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fifth State Legislature

Regular Session of 2010

State of Hawaii

 

Sir:

 

     Your Committee on Health, to which was referred H.B. No. 2089 entitled:

 

"A BILL FOR AN ACT RELATING TO HEALTH INSURANCE,"

 

begs leave to report as follows:

 

     The purpose of this bill is to maximize the value of health insurance premiums and enable employers and consumers to gain a clear understanding of how health care premium dollars are allocated by health insurers in Hawaii by:

 

     (1)  Requiring health insurers to spend a minimum percentage of insurance premiums on medical expenses; and

 

     (2)  Providing greater transparency with regard to how health insurance premiums are spent by insurers.

 

     The Department of Commerce and Consumer Affairs (DCCA) and the Hawaii Medical Association supported this bill.  The Hawaii Medical Service Association and Faith Action for Community Equity supported the intent of this measure.  The Hawaii Association of Health Plans opposed this bill.

 

     Your Committee has amended this bill by, among other things:

 

(1)  Excluding from "administrative costs": medical expenses incurred by the insurer, affiliates, and contractors under common management or control in servicing the insured for premiums received;

 

(2)  Including the affiliates and contractors of health insurers that are under common management or control in servicing the insured under the requirements to spend a minimum percentage of insurance premiums on medical expenses;

 

(3)  Clarifying that the definition of "premiums" includes the amount of money that the insurer, the insurer's affiliates and contractors under common management or control in servicing the insured earn in a calendar year from the sale of health insurance, net of reinsurance;

 

(4)  Requiring the DCCA's Insurance Division to collect from health care providers, analyze, and disseminate health care information for use in an annual publication to assist the public in choosing health care providers;

 

(5)  Changing the effective date to July 1, 2020, to encourage further discussion; and

 

(6)  Making technical, nonsubstantive changes for clarity, consistency, and style.

 

     As affirmed by the record of votes of the members of your Committee on Health that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2089, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2089, H.D. 1, and be referred to the Committees on Consumer Protection & Commerce and Judiciary.

 

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

 

 

 

 

____________________________

RYAN I. YAMANE, Chair