Prepaid Health Care

Requires employers that have more than 25% of their work force
working less 20 hours per week, to provide and pay for prepaid
health insurance for all of their employees, regardless of number
of hours worked.

THE SENATE                              S.B. NO.           2298
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            

                   A  BILL  FOR  AN  ACT



 1      SECTION 1.  The legislature finds that a crisis exists in
 2 the State's uninsured health care population.  According to the
 3 U.S. Bureau of Census, 7.3 per cent of Hawaii residents were
 4 uninsured in 1990 and 10 per cent were uninsured in 1998.  That
 5 10 per cent is climbing, according to the School of Public Health
 6 of the University of Hawaii at Manoa.  The consequences can be
 7 grave for the health and well-being of Hawaii's residents, such
 8 as serious illness and a growing mountain of unpaid bills.  For
 9 Hawaii's women and children, lack of medical insurance means
10 inadequate prenatal care, newborn care, and immunizations, with
11 the attendant consequences and burdens on the economy in cost to
12 the State in providing the care through welfare programs.
13      The legislature further finds that there is a population
14 that is not on welfare but that nonetheless cannot afford to
15 purchase medical insurance on their own although they have jobs.
16 This is the growing population of part-time workers who work less
17 than twenty hours per week for an employer.  Some may have two or
18 more jobs at less than twenty hours per week for each job.
19 Employers are required to provide and pay for prepaid health

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                                     S.B. NO.           2298

 1 insurance to employees who work at least twenty-hours per week.
 2 Anyone working less than twenty hours per week is not entitled to
 3 prepaid health insurance.  The legislature further finds that
 4 employers are increasingly using this loophole in the law to hire
 5 many part-time workers in order to escape having to pay for
 6 prepaid health insurance.
 7      The federal Employee Retirement Income Security Act
 8 prohibits any amendment to the Hawaii Prepaid Health Care Act
 9 that, "...provides for more than the effective administration of
10 such Act".  This Act seeks only to provide for the effective
11 administration of the Hawaii Prepaid Health Care Act in
12 accordance with its stated intent that, "...there is a need to
13 extend that protection to workers who at present do not possess
14 any or possess only inadequate prepayment coverage".
15      The purpose of this Act is to close the loophole described
16 above to require employers who have more than twenty-five per
17 cent of their entire workforce who work less than twenty hours
18 per week, to pay for prepaid health insurance for all of the
19 workforce regardless of the number of hours worked.  In this
20 manner, administration will be improved by eliminating the need
21 to identify large numbers of part-time employees.
22      SECTION 2.  Chapter 393, Hawaii Revised Statutes, is amended
23 by adding a new section to be appropriately designated and to

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                                     S.B. NO.           2298

 1 read as follows:
 2      "393-    Employer required contributions.  If an employer
 3 has more than twenty-five per cent of the total number of the
 4 employer's employees working less than twenty hours per week, all
 5 of the employer's employees shall be deemed to be regular
 6 employees, without regard to the number of hours worked by any
 7 employee."
 8      SECTION 3.  New statutory material is underscored.
 9      SECTION 4.  This Act shall take effect on July 1, 2000.
11                           INTRODUCED BY:  _______________________