STAND. COM. REP. NO. 2824

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  H.B. No. 3016
                                        H.D. 1
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Health and Human Services, to which was
referred H.B. No. 3016, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO MEDICAL ASSISTANCE TO
     LOW-INCOME PERSONS,"

begs leave to report as follows:

     The purpose of this measure is to make an appropriation to
provide necessary funds to the Department of Human Services (DHS)
to raise the income eligibility for the medically needy program.

     Your Committee received testimony in support of this measure
from the DHS, Healthcare Association of Hawaii, Life Foundation,
and two private individuals.

     The "medically needy program" is a Medicaid option which
Hawaii has chosen to implement.  The program is for aged and
disabled persons who are ineligible for the standard Medicaid
program because their income levels exceed 100 per cent of the
federal poverty level.  In essence, this is a gap group that is
not income qualified but has significant medical expenditures.
The medically needy program utilizes a "spend-down" provision and
a "medically needy" (MN) income standard.  The dollar amount by
which net countable monthly income income exceeds the MN income
standard is the spend-down requirement, so that a person who
incurs monthly medical expenses that are more than the spend-down
requirement will be provided medical coverage for the remainder
of the month. 

 
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                                   STAND. COM. REP. NO. 2824
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     A typical situation is a person who is disabled from a
terminal illness and whose income exceeds the maximum amount
allowable to qualify for Medicaid.  That person has medical bills
that would reduce the person's income to below the qualifying
amount for Medicaid, but still that person would not qualify for
medical assistance unless the State has implemented the medically
needy program.

     The DHS has the authority to raise the qualifying income
level for the medically needy program to 130 per cent of the
assistance allowance "subject to the appropriation of state funds
and availability of federal matching assistance".  (Section
346-14(16), Hawaii Revised Statutes)  This measure is intended to
make an appropriation to accomplish that result.

     Your Committee has amended this measure by changing the
appropriated amount from $1 to $2, to affirm to the commitment of
this Committee to provide this appropriation.

     As affirmed by the record of votes of the members of your
Committee on Health and Human Services that is attached to this
report, your Committee is in accord with the intent and purpose
of H.B. No. 3016, H.D. 1, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as
H.B. No. 3016, H.D. 1, S.D. 1, and be referred to the Committee
on Ways and Means.

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



                                   ______________________________
                                   SUZANNE CHUN OAKLAND, Chair

 
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