STAND. COM. REP. NO. 1381_______

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: S.B. No. 1288
                                     S.D. 1
                                     H.D. 1




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

Sir:

     Your Committee on Labor and Public Employment, to which was
referred S.B. No. 1288, S.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO THE PUBLIC EMPLOYEES HEALTH
     FUND,"

begs leave to report as follows:

     The purpose of this bill is to enable the Board of Trustees
of the Public Employees Health Fund (Health Fund) to contract for
more than one type of benefit plan for medical, drug, vision, and
dental benefits.

     The Hawaii Health Systems Corporation testified in support
of this bill.  The Hawaii State Teachers Association testified in
support of the intent of this bill.

     Upon further consideration, your Committee has amended this
bill by:

     (1)  Deleting its substance and inserting the substance of a
          similar bill, H.B. 1042, H.D. 2; and

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

     Your Committee notes that H.B. 1042, H.D. 2, passed out of
the House of Representatives earlier this session after public
hearings before this Committee and the Committee on Finance.

 
 
                                 STAND. COM. REP. NO. 1381_______
                                 Page 2

 

     Your Committee finds that current law authorizes the Board
of Trustees (Board) of the Health Fund to contract for only one
statewide plan for each of its medical, drug, dental, and vision
benefit plans.  This measure will provide the Board with the
flexibility to contract for more than one benefit plan per
benefit category.  Your Committee believes that fostering healthy
competition will result in better quality state benefit plans at
a better price.

     As affirmed by the record of votes of the members of your
Committee on Labor and Public Employment that is attached to this
report, your Committee is in accord with the intent and purpose
of S.B. No. 1288, S.D. 1, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as S.B. No.
1288, S.D. 1, H.D. 1, and be referred to the Committee on
Finance.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Labor and Public
                                   Employment,



                                   ______________________________
                                   TERRY NUI YOSHINAGA, Chair