STAND. COM. REP. NO. 1213_______

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: S.B. No. 131
                                     S.D. 3
                                     H.D. 1




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committees on Human Services and Housing and Health, to
which was referred S.B. No. 131, S.D. 3, entitled: 

     "A BILL FOR AN ACT RELATING TO LONG-TERM CARE,"

beg leave to report as follows:

     The purpose of this bill is to:

     (1)  Require that employers offer long-term care (LTC)
          insurance to employees;

     (2)  Enact the National Association of Insurance
          Commissioners (NAIC) Model Long-Term Care Act of 1998,
          (Model Act), and conform Hawaii's LTC insurance
          statutes to the Model Act; and

     (3)  Appropriate funds to:

          (A)  Hire a qualified LTC insurance actuary and staff
               necessary to review LTC insurance filings;

          (B)  Establish a Long Term Care Volunteer Ombudsman
               program to augment the federal Long Term Care
               Ombudsman program, which serves as an advocate for
               the residents of the increasing number of
               community nursing facilities and adult residential
               care homes; and


 
 
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          (C)  Allow the Department of Human Services (DHS) to
               continue the design and implementation of a
               Medicaid-managed LTC demonstration project.

     Your Committees received testimony in support of this bill
from the Insurance Commissioner, Department of Commerce and
Consumer Affairs (DCCA), Hawaii Coalition for Affordable Long
Term Care, Faith Action for Community Equity, the Policy Advisory
Board for Elder Affairs, Hawaii State Teachers Association,
Hawaii Long Term Care Association, Maui Economic Opportunity,
Inc., Aloha Care, and two concerned individuals.

     Testimony that supported the measure and also included
comments or suggested amendments was received from the Executive
Office on Aging, Hawaii State Commission on the Status of Women,
and the National Association of Retired Federal Employees.
Healthcare Association of Hawaii urged that your Committees pass
the bill, submitted comments, and suggested amendments.  AARP
testified that the three programs proposed by the bill were
worthy, but that the original purpose of the measure had been
subverted.  The Hawaii State Association of Life Underwriters
supported the measure and expressed a concern.

     DHS and Benefit Services of Hawaii, Inc., offered comments.

     Hawaii Electric Company, Inc., submitted a number of
concerns regarding the bill.  State Farm opposed the measure as
drafted.  The American Council of Life Insurance, which supported
the efforts of the Joint Legislative Committee (JLC), strongly
opposed the bill, offering comments and suggesting amendments.

     Your Committees have amended this bill by replacing its
contents with that of a similar measure heard previously in this
session by your Committees, H.B. No. 169, H.D. 2.  The House bill
addresses a number of concerns expressed by testifiers, and
unlike the Senate bill:

     (1)  Provides funding for an actuarial study to delineate an
          appropriate and affordable LTC financing program;

     (2)  Extends the sunset of the JLC, from June 30, 1999, to
          June 30, 2000; and

     (3)  Includes the version of the NAIC Model Act developed by
          the DCCA Insurance Commissioner for the purpose of
          incorporating provisions of the NAIC Model Regulations
          that increase protection for consumers.


 
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     Your Committees have also amended this measure for purposes
of clarity, consistency and style.

     As affirmed by the records of votes of the members of your
Committees on Human Services and Housing and Health that are
attached to this report, your Committees are in accord with the
intent and purpose of S.B. No. 131, S.D. 3, as amended herein,
and recommend that it pass Second Reading in the form attached
hereto as S.B. No. 131, S.D. 3, H.D. 1, and be referred to the
Committees on Consumer Protection and Commerce and Labor and
Public Employment.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committees on Human Services
                                   and Housing and Health,

                                   
                                   
                                   
                                   
______________________________     ______________________________
ALEXANDER C. SANTIAGO, Chair       DENNIS ARAKAKI, Chair