Honolulu, Hawaii



RE:    H.B. No. 2715

       H.D. 2

       S.D. 1




Honorable Ronald D. Kouchi

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2016

State of Hawaii




     Your Committee on Judiciary and Labor, to which was referred H.B. No. 2715, H.D. 2, entitled:




begs leave to report as follows:


     The purpose and intent of this measure is to:


     (1)  Require the Department of Labor and Industrial Relations to contract with an actuarial firm that has experience conducting workers' compensation closed claims studies in the United States to perform a comprehensive study of workers' compensation in the State to determine whether the system and laws are equitable to all parties; provided that the total cost of the study is not to exceed $400,000;


     (2)  Require the study to be submitted to the Legislature; and


     (3)  Appropriate funds to the Department of Labor and Industrial Relations to contract with an actuarial firm to produce the study; provided that no monies shall be released unless matched dollar-for-dollar by the fees assessed pursuant to this measure.


     Your Committee received testimony in support of this measure from the Department of Labor and Industrial Relations, Hawaii Insurers Council, and Chamber of Commerce Hawaii.  Your Committee received comments on this measure from Automated HealthCare Solutions.


     Your Committee finds that legislation is introduced every year alleging unfair treatment of injured workers and delayed processing of workers' compensation claims.  Implementation of this measure will help increase employee health and safety in the workplace and encourage timely and appropriate services for employees injured on the job in a supportive and non-confrontational environment.


     Your Committee has amended this measure by:


     (1)  Limiting the scope of the study to closed claims in the State's workers' compensation system, at the request of the Department of Labor and Industrial Relations;


     (2)  Deleting all references to "comprehensive";


     (3)  Deleting language requiring the actuarial firm to perform a study of the State's laws and systems regarding workers' compensation and report on whether the State's workers' compensation laws and systems are equitable to all parties and whether specific statutory or systemic changes are warranted;


     (4)  Clarifying that a portion of the total cost of the study, equal to the amount appropriated, be paid for by an assessment to the workers' compensation insurers, workers' compensation captive insurers, and workers' compensation self-insureds in the State, rather than limiting the total cost of the study to $400,000;


     (5)  Requiring the study to be completed by November 30, 2017, and submitted to the Legislature no later than twenty days prior to the convening of the Regular Session of 2018;


     (6)  Amending section 1 to reflect its amended purpose; and


     (7)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.


     As affirmed by the record of votes of the members of your Committee on Judiciary and Labor that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2715, H.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2715, H.D. 2, S.D. 1, and be referred to your Committee on Ways and Means.


Respectfully submitted on behalf of the members of the Committee on Judiciary and Labor,