SB3128 HD1

PART I

SECTION 1. Act 212, Session Laws of Hawaii 2021, as amended by Act 150, Session Laws of Hawaii 2022 is amended as follows:

1. By amending subsection (b) of section 6 to read:

"(b) The transfer of positions and respective class specifications of the Oahu region from the Hawaii health systems corporation's personnel system to the department of health, as set forth in the transition documents submitted by the working group established pursuant to section 9 of this Act no later than twenty days prior to the convening of the regular sessions of 2022, [~~and~~] 2025, and 2026, shall be completed no later than December 31, [~~2025;~~] 2026; provided that:

(1) All employees of the Oahu region who are employed as of December 31, [~~2025,~~] 2026, shall be transferred to the department of health before the transition of the Oahu regional health care system into the department of health is complete;

(2) All employees of the Oahu region who occupy civil service positions shall be transferred to the department of health by this Act and retain their civil service status, whether permanent or temporary, and shall maintain their respective functions as reflected in their current position descriptions during the transition period; provided that any changes determined necessary by the working group established pursuant to section 9 of this Act shall follow standard union consultation process prior to implementation;

(3) Employees shall be transferred without loss of salary; seniority, except as prescribed by applicable collective bargaining agreements; retention points; prior service credit; any vacation and sick leave credits previously earned; and other rights, benefits, and privileges, in accordance with state employment laws;

(4) The personnel structure of the Oahu regional health care system shall remain unchanged, unless modified and approved by the working group and as approved by the conditions established pursuant to this Act;

(5) Any employee who, prior to this Act, is exempt from civil service or collective bargaining and is transferred as a consequence of this Act shall be transferred without loss of salary and shall not suffer any loss of prior service credit, contractual rights, vacation or sick leave credits previously earned, or other employee benefits or privileges, and, except in the instance of discipline, shall be entitled to remain employed in the employee's current position for a period of no less than one year after the transition of the Oahu regional health care system into the department of health is complete;

(6) The wages, hours, and other conditions of employment shall be negotiated or consulted, as applicable, with the respective exclusive representative of the affected employees, in accordance with chapter 89, Hawaii Revised Statutes; and

(7) The rights, benefits, and privileges currently enjoyed by employees, including those rights, benefits, and privileges under chapters 76, 78, 87A, 88, and 89, Hawaii Revised Statutes, shall not be impaired or diminished as a result of these employees being transitioned to the department of health pursuant to this Act. The transition to the department of health shall not result in any break in service for the affected employees. The rights, benefits, and privileges currently enjoyed by employees shall be maintained under their existing collective bargaining or other agreements and any successor agreement."

2. By amending subsection (b) of section 7 to read:

"(b) Notwithstanding any law to the contrary, the terms of the following members of the board of directors of the Hawaii health systems corporation shall expire on December 31, [~~2025:~~] 2026:

(1) The regional chief executive officer of the Oahu regional health care system; and

(2) The two board members residing on the island of Oahu appointed pursuant to section 323F-3(b)(7), Hawaii Revised Statutes."

3. By amending section 8 to read:

"SECTION 8. (a) During the transition planning period commencing on July 1, 2021, to and including the completion of the transition of the Oahu regional health care system into the department of health no later than December 31, [~~2025,~~] 2026, the Oahu regional system board may:

(1) Develop and implement its own policies, procedures, and rules necessary or appropriate to plan, operate, manage, and control its facilities without regard to chapter 91, Hawaii Revised Statutes;

(2) Enter into and perform any contract, lease, cooperative agreement, partnership, or other transaction whatsoever that may be necessary or appropriate in the performance of its purposes and responsibilities, and on any terms the regional system board may deem appropriate with either:

(A) Any agency or instrumentality of the United States, or with any state, territory, possession, or subdivision thereof; or

(B) Any person, firm, association, partnership, or corporation, whether operated on a for-profit or not-for-profit basis; provided that the transaction furthers the public interest;

(3) Conduct activities and enter into business relationships the regional system board deems necessary or appropriate, including but not limited to:

(A) Creating nonprofit corporations, including but not limited to charitable fundraising foundations, to be controlled wholly by the regional system board or jointly with others;

(B) Establishing, subscribing to, and owning stock in business corporations individually or jointly with others; and

(C) Entering into partnerships and other joint venture arrangements, or participating in alliances, purchasing consortia, health insurance pools, or other cooperative agreements, with any public or private entity; provided that any corporation, venture, or relationship entered into under this subsection shall further the public interest;

(4) Execute, in accordance with all applicable bylaws, rules, and laws, all instruments necessary or appropriate in the exercise of any powers of the regional system board;

(5) Make and alter regional system board bylaws and rules for its organization and management without regard to chapter 91, Hawaii Revised Statutes;

(6) Enter into any contract or agreement whatsoever, not inconsistent with the laws of the State, execute all instruments, and do all things necessary or appropriate in the exercise of the powers granted under chapter 323F, Hawaii Revised Statutes, including securing the payment of bonds; provided that contracts or agreements executed by the regional system board shall only encumber the regional subaccounts of the regional system board;

(7) Own, purchase, lease, exchange, or otherwise acquire property, whether real, personal, or mixed, tangible or intangible, and any interest therein, in the name of the regional system board; provided that the regional system board shall be subject to the requirements of section 323F-3.5, Hawaii Revised Statutes;

(8) Contract for and accept any gifts, grants, and loans of funds or property, or any other aid in any form from the federal government, the State, any state agency, or any other source, or any combination thereof, in compliance, subject to chapter 323F, Hawaii Revised Statutes, with the terms and conditions thereof; provided that the regional system board shall be responsible for contracting for and accepting any gifts, grants, loans, property, or other aid if intended to exclusively benefit the Oahu region public health facilities and operations;

(9) Provide health and medical services to the public directly or by agreement or lease with any person, firm, or private or public corporation, partnership, or association through or in the health facilities of the regional system board or otherwise; provided that the regional system board shall be responsible for conducting the activities under this paragraph solely within the Oahu regional system;

(10) Approve medical staff bylaws, rules, and medical staff appointments and reappointments for all public health facilities of the regional system board, including but not limited to determining the conditions under which a health professional may be extended the privilege of practicing within a health facility, as determined by the regional system board, and adopting and implementing reasonable rules, without regard to chapter 91, Hawaii Revised Statutes, for the credentialing and peer review of all persons and health professionals within the facility; provided that the regional system board shall be the governing body responsible for all medical staff organization, peer review, and credentialing activities to the extent allowed by law;

(11) Enter into any agreement with the State, including but not limited to contracts for the provision of goods, services, and facilities for the support of the regional system board's programs, and contracting for the provision of services to or on behalf of the State;

(12) Develop internal policies and procedures for the procurement of goods and services, consistent with the goals of public accountability and public procurement practices, and subject to management and financial legislative audits; provided that the regional system board shall enjoy the exemptions under section 103‑53(e) and chapter 103D, Hawaii Revised Statutes;

(13) Authorize, establish, and abolish positions; and

(14) Employ or retain any attorney, by contract or otherwise, for the purpose of representing the regional system board in any litigation, rendering legal counsel, or drafting legal documents for the regional system board.

(b) During the transition period commencing on July 1, 2021, to and including the completion of the transition of the Oahu regional health care system into the department of health no later than December 31, [~~2025,~~] 2026, the Oahu regional system board shall continue to enjoy the same sovereign immunity available to the State.

(c) During the transition period commencing on July 1, 2021, to and including the completion of the transition of the Oahu regional health care system into the department of health no later than December 31, [~~2025,~~] 2026, the Oahu regional system board shall be exempt from chapters 36, 37, 38, 40, 41D, 103D, 103F, part I of chapter 92, and section 102-2, Hawaii Revised Statutes."

4. By amending subsections (f) and (g) of section 9 to read:

"(f) The working group shall submit reports to the legislature no later than twenty days prior to the convening of the regular sessions of 2022, [~~and~~] 2025, and 2026 that shall include the five-year pro forma operating and budget plan, ten-year pro forma capital improvement plan, proposed legislation to address any matters not covered by this Act that may be necessary to complete the transfer of the Oahu regional health care system into the department of health, and a timeline of major milestones necessary to effectuate the transfer of personnel, assets, liabilities, and contracts needed to complete the transfer pursuant to this Act. The report to be submitted to the legislature no later than twenty days prior to the convening of the regular session of 2026 shall include any updates to the five-year pro forma operating and budget plan and ten-year pro forma capital improvement plan and a breakdown of the costs that will be incurred to effectuate the transfer of the Oahu regional health care system pursuant to this Act. The reports shall also document the completion of the transfer and dissolution of the Oahu regional health care system.

(g) The working group shall be dissolved on December 31, [~~2025,~~] 2026, or upon completion of the transition of the Oahu regional health care system into the department of health, whichever is first."

5. By amending section 14 to read:

"SECTION 14. This Act shall take effect on July 1, 2021; provided that part II of this Act shall take effect on December 31, [~~2025~~] 2026."

PART II

SECTION 2. The Oahu regional health care system and the department of health shall enter into an agreement regarding Oahu regional health care system taking care of low acuity patients in the department of health's custody by no later than December 31, 2024.

PART III

SECTION 3. The Oahu regional health care system shall submit a report to the legislature no later than twenty days prior to the convening of the regular session of 2026. The report shall include but not be limited to:

(a) The activities undertaken by the Oahu regional health care system to establish partnerships with other state agencies or public or private organizations to ensure all useable spaces on the Leahi hospital campus and at Maluhia have been filled; and

(b) How the Oahu regional health care system is ensuring that the use of its facilities are part of the continuum of care for long-term care and mental and behavioral health services in the State.

PART IV

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 3000.

THE SENATE	S.B. NO.	3128
THIRTY-SECOND LEGISLATURE, 2024		S.D. 2
STATE OF HAWAII		H.D. 1