STAND. COM. REP. NO. 1123

                                   Honolulu, Hawaii
                                                     , 1999

                                   RE:  H.B. No. 1041
                                        H.D. 2
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Commerce and Consumer Protection, to which
was referred H.B. No. 1041, H.D. 2, entitled: 

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

begs leave to report as follows:

     The purpose of this measure is to authorize the Board of
Trustees of the Hawaii Public Employees Health Fund (Fund) to use
rate credits and reimbursements to:

     (1)  Improve plan benefits;

     (2)  Reimburse employee-beneficiaries; or

     (3)  Reduce employee-beneficiaries' monthly contributions.

     The Hawaii State Teachers Association testified in support
of the measure.  The Board of Trustees of the Fund commented on
the measure.

     Your Committee finds that the Fund is currently holding
approximately $17 million in state and county employee
contributions which it cannot expend due to the lack of statutory
authority.  The Fund's Board of Trustees, as well as your
Committee, believes that providing the Fund with the authority to
improve health benefits, reimburse employee-beneficiaries, or

 
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                                   STAND. COM. REP. NO. 1123
                                   Page 2


reduce the cost of monthly contributions would be beneficial to
both public employers and employees.

     Your Committee has amended the measure by making technical,
amendments suggested by the Fund to ensure the timely and
efficient implementation of the measure's intended purpose.

     As affirmed by the record of votes of the members of your
Committee on Commerce and Consumer Protection that is attached to
this report, your Committee is in accord with the intent and
purpose of H.B. No. 1041, H.D. 2, as amended herein, and
recommends that it pass Second Reading in the form attached
hereto as H.B. No. 1041, H.D. 2, S.D. 1, and be referred to the
Committee on Ways and Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Commerce and
                                   Consumer Protection,



                                   ______________________________
                                   BRIAN KANNO, Co-Chair



                                   ______________________________
                                   BRIAN T. TANIGUCHI, Co-Chair

 
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