STAND. COM. REP. NO. 1066-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: S.B. No. 3176
                                     S.D. 2




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committees on Consumer Protection and Commerce and
Judiciary and Hawaiian Affairs, to which was referred S.B. No.
3176, S.D. 2, entitled: 

     "A BILL FOR AN ACT RELATING TO INSURANCE,"

beg leave to report as follows:

     The purpose of this bill is to extend the right to insurance
benefits to reciprocal beneficiaries.

     Testimony in support of this measure was received from the
State Civil Rights Commission, Commission on the Status of Women,
American Civil Liberties Union of Hawai`i, Lambda Aloha, Kona
Village Realty, Inc., and a few individuals.  Testimony in
opposition to this measure was received from Hawaiian Electric
Company, Inc.  Testimony was also received from the State
Department of Budget and Finance Senate Hawaii Public Employees
Health Fund.

     Your Committees find that the provisions of this bill
recognize the importance of insurance coverage for all
individuals in the State, regardless of their status, and
provides reciprocal beneficiaries with equal access to health
care and other benefits.  

     Your Committees acknowledge the concern of some committee
members that the definition of "reciprocal beneficiaries" is
overly broad and will lead to abuse of the law and therefore,
unintended consequences.  However, this issue was raised in 1997,

 
 
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at the time the law relating to reciprocal beneficiaries was
originally enacted, and this concern has not been proven valid.
Your Committees also acknowledge that the provisions of this bill
may conflict with provisions of the Employee Retirement Income
Security Act (ERISA), therefore your Committees intend that there
be further discussion on that issue.

     As affirmed by the records of votes of the members of your
Committees on Consumer Protection and Commerce and Judiciary and
Hawaiian Affairs that are attached to this report, your
Committees are in accord with the intent and purpose of S.B. No.
3176, S.D. 2 and recommend that it pass Second Reading and be
referred to the Committee on Finance.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committees on Consumer
                                   Protection and Commerce and
                                   Judiciary and Hawaiian
                                   Affairs,




_____________________________      ______________________________
ERIC G. HAMAKAWA, Chair            RON MENOR, Chair