The following testimony was presented February 10, 2023, by the Grassroot Institute of Hawaii to the Senate Committee on Health and Human Services.
February 10, 2023
Conference Room 225 and Via Videoconference
To: Senate Committee on Health and Human Services
Sen. Joy A. San Buenaventura, Chair
Sen. Henry J.C. Aquino, Vice Chair
From: Grassroot Institute of Hawaii
Ted Kefalas, Director of Strategic Campaigns
RE: SB322 — RELATING TO THE INTERSTATE LICENSED PROFESSIONAL COUNSELORS COMPACT
Dear Chair and Committee Members:
The Grassroot Institute of Hawaii would like to offer its comments on SB322, which would enter Hawaii into the Interstate Licensed Professional Counselors Compact.
If this bill is enacted, the Legislature will take an important step in encouraging more counselors to work in Hawaii.
The need for counselors and mental health professionals has been clearly demonstrated across the last three years. Last year, the state Department of Health reported that 11,000 Hawaii youth had a major depressive episode in 2019, but only half received mental health services.
Attracting more counselors to practice in Hawaii requires a multipronged strategy that will address everything from Hawaii’s high cost of living to the state’s regulatory scheme for healthcare facilities. Perhaps most important is the need to reform licensing regulations for healthcare professionals.
One-fourth of all licensed workers in the U.S. work in healthcare. Their licenses can be difficult to obtain, are expensive and carry geographic or “scope of practice” limitations.
As discussed in an upcoming policy brief on medical licensing by the Grassroot Institute of Hawaii, the state’s shortage of healthcare professionals makes its restrictions on healthcare workers who already hold licenses in other U.S. states seem redundant and self-defeating.
As the Federal Trade Commission noted in a report on occupational licensing portability:
There is little justification for the burdensome, costly, and redundant licensing processes that many states impose on qualified, licensed, out-of-state applicants. Such requirements likely inhibit multistate practice and delay or even prevent licensees from working in their occupations upon relocation to a new state. Indeed, for occupations that have not implemented any form of license portability, the harm to competition from suppressed mobility may far outweigh any plausible consumer protection benefit from the failure to provide for license portability.
In other words, though medical licensing is intended to protect the public, there is a point at which the level of regulation reduces the number of people in practice without an appreciable public benefit.
One study of licensing among medical professionals found that “licensing is associated with restricted labor supply, an increased wage of the licensed occupation, rents, increased output prices, and no measurable effect on output quality.”
This is where we can benefit from the lessons learned during the coronavirus situation. The governor’s emergency modification to state licensing laws demonstrated a need to embrace license portability, making it a simple matter for healthcare workers licensed in other states to practice in Hawaii.
The interstate compact approach outlined in this bill would streamline licensing for counselors, making it easier for them to move from participating states to Hawaii without facing time-consuming, costly and redundant regulatory hurdles.
The state would retain its control over Hawaii licensure requirements, but simultaneously increase the pool of physical therapists able to practice in Hawaii and shorten the time it would take for them to begin working here.
At present, the Counseling Compact includes 17 states. Almost two dozen other states have introduced legislation to join as well. Years of successful implementation testify to the safety and effectiveness of this approach to license reciprocity.
Joining the Counseling Compact would be an important step toward attracting more counselors to our state, thereby addressing mental health needs and improving healthcare access for all.
Thank you for the opportunity to submit our comments.
Director of Strategic Campaigns,
Grassroot Institute of Hawaii
 “Department of Health Encourages Move From Awareness to Acceptance for National Children’s Mental Health Month,” Hawaii Department of Health, May 2, 2022.
 Ryann Nunn, “Improving Health Care Through Occupational Licensing Reform,” RealClear Markets, Aug. 28, 2018
 Karen Goldman, “Options to Enhance Occupational License Portability,” U.S. Federal Trade Commission, September 2018, p. 25.
 Sean Nicholson and Carol Propper, “Chapter Fourteen — Medical Workforce,” iin “Handbook of Health Economics, Vol. 2,” Elsevier, B.V., 2012, p. 885, cited also in the previously mentioned FTC study, footnote #9, p3.