Repeals certain administrative aspects of Hawaii Prepaid Health Care Act.

A BILL FOR AN ACT

Section 393-13, Hawaii Revised Statutes, relating to liability for payment of premiums for prepaid health care plans, requires that the employee shall contribute at least one half of the premium cost but not more than 1.5 per cent of the employee's wages for coverage required by the Act. The legislature finds that the provisions of this act are administrative within the intended meaning of 29 USC 1144. The Legislature also finds that the cost of providing such prepaid health plans has escalated at a rate so far exceeding that of the increase in salaries since the Hawaii Prepaid Health Care Act was enacted in 1974 as to render administratively impossible the desired public policy of the Legislature to balance the cost of such premiums by requiring 50 percent to be paid by the employee and 50 per cent to be paid by the employer. These changing circumstances have placed an unanticipated and undue burden on employers in the State of Hawaii. The Legislature further finds that the language of the original Act did not properly anticipate such administrative problems as presently exist regarding employer-employee responsibilities for the cost of prepaid health plans.

The purpose of this Act is to provide for more effective and fairer administration of the Prepaid Health Care Act by eliminating language in the Act that creates an unnecessary conflict with regard to the distribution of prepaid health care costs among employers and employees.

SECTION 2. Section 393-13, Hawaii Revised Statutes, is amended to read as follows:

"§393-13 Liability for payment of premium; withholding; recovery of premium. Unless an applicable collective bargaining agreement specifies differently every employer shall contribute at least one-half of the premium for the coverage required by this chapter and the employee shall contribute the balance. [;provided that in no case shall the employee contribute more than 1.5 per cent of the employee's wages; and provided that if the amount of the employee's contribution is less than one-half of the premium, the employer shall be liable for the whole remaining portion of the premium.]

The employer shall [withold] withhold the employee's share from the employee's wages with respect to pay periods as specified by the director.

If an employee separates from the employee's employment after the employee's employer has prepaid the employee's share of the cost of providing health care coverage, the employer may deduct an amount not to exceed one-half of the premium cost [but without regard to the 1.5 per cent limitation from the last salary or wages due the employee,] or seek other appropriate means to recover the premium.

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.