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The Honolulu Advertiser
Posted on: Saturday, April 5, 2003

Audit of union-sponsored health plans sought

Advertiser Staff

The chairman of the Hawaii Public Employees Health Fund is calling for an audit of union-sponsored health plans and says they have not returned excess money to the state and their members.

In a letter to Gov. Linda Lingle's administration, House and Senate leaders and union officials, Gregory Sato said the Hawaii Public Employees Health Fund received $46.6 million in refunds from insurance providers between 1992 and 2002, of which $28.5 million was returned to taxpayers and $18.1 million was given to health fund participants.

But Sato said some unions also apparently received refunds, but did not give the money to the state or union members. Sato recommended an audit on the matter, that the state recover excess money, and pursue legal action if there has been wrongdoing.

Since the mid-1990s the Public Employees Health Fund has transferred hundreds of millions of dollars to public worker unions to buy health coverage for their members.

But lawmakers voted in 2001 to abolish the system and create a new statewide trust fund to cover all public employees. The new system is still being formed.