HOUSE OF REPRESENTATIVES	H.C.R. NO.	142
THIRTY-FIRST LEGISLATURE, 2021
STATE OF HAWAII

HOUSE CONCURRENT

RESOLUTION

 

 

REQUESTING THE AUDITOR TO STUDY THE FEASIBILITY OF PROVIDING HEALTH BENEFITS TO STATE AND COUNTY EMPLOYEES USING A SELF-INSURED MODEL.

 

 

 

        WHEREAS, according to the National Conference of State Legislatures, in 2010, forty-six states self-insured or self-funded at least one of their employee health care plans, and at least twenty-nine states self-funded all of their employee health care offerings; and

 

        WHEREAS, self-insured or self-funded plans have a number of potential advantages over fully insured plans; and

 

        WHEREAS, many states administering self-insured or self-funded employee health care plans have been able to lower costs while still maintaining a high level of health benefits; and

 

        WHEREAS, Hawaii's employer-union health benefits trust fund is currently fully insured rather than self-insured; and

 

        WHEREAS, health care premiums have risen rapidly over the last decade; and

 

        WHEREAS, it is both prudent and essential that the State examine whether converting the employer-union health benefits trust fund to a self-insured model will result in cost savings; now, therefore,

 

        BE IT RESOLVED by the House of Representatives of the Thirty-first Legislature of the State of Hawaii, Regular Session of 2021, the Senate concurring, that the Auditor is requested to study the feasibility of providing health benefits to state and county employees using a self-insured model; and

 

        BE IT FURTHER RESOLVED that in conducting the study, the Auditor is requested to collect and take into account thorough data on:

 

        (1)   Historical census;

 

        (2)   Health benefit premiums;

 

        (3)   Contributions;

 

        (4)   Plan documents;

 

        (5)   Claims information; and

 

        (6)   Any other information the Auditor deems appropriate; and

 

        BE IT FURTHER RESOLVED that in conducting the study, the Auditor is requested to examine the potential impacts of transitioning health benefits to a fully self-insured model, partially self-insured model, or other risk retention model including:

 

        (1)   Risks to the State from acting as its own insurer, including:

 

                  (A)   Uncontrolled utilization; and

 

                  (B)   Cost increases from catastrophic claims events;

 

        (2)   Investment returns on reserves in the employer-union health benefits trust fund;

 

        (3)   Administrative cost savings, including any federal tax or fee savings;

 

        (4)   Fiduciary and legal obligations of the State;

 

        (5)   Benefits available for employees and other insured persons;

 

        (6)   Changes in provider reimbursement levels, capitation, and care management practices;

 

        (7)   Any other factors or impacts the state auditor deems to be relevant;

 

        (8)   Risk assumptions used and analysis of the assumptions; and

 

        (9)   A funding model that involves a rate stabilization reserve fund, maximum levels of employer contributions to the other post-employment benefits trust fund, the diversion of the excess in employer contributions to the employees' retirement fund, and the use of transient accommodations tax revenues to supplement deficient county public employer contribution amounts; and

 

        BE IT FURTHER RESOLVED that the Auditor is requested to contract the services of or obtain assistance from any other entities to perform any related services that may be required for the purposes of the study, to the extent that is possible within the Auditor's budget; and

 

        BE IT FURTHER RESOLVED that the Auditor is requested to submit a report of the Auditor's findings and recommendations, including any proposed legislation, to the Legislature no later than twenty days prior to the convening of the Regular Session of 2022; and

 

        BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Auditor and Chairperson of the Board of Trustees and Administrator of Employer-Union Health Benefits Trust Fund.

 

 

 

	OFFERED BY:	_____________________________

Report Title:  

Employer-Union Health Benefits Trust Fund; Auditor; Study