Legislature(2001 - 2002)

04/11/2002 03:43 PM HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 407-CERTIFICATE OF NEED PROGRAM                                                                                            
CHAIR DYSON  announced the  first order  of business,  HOUSE BILL                                                               
NO. 407, "An Act relating to the certificate of need program."                                                                  
Number 0110                                                                                                                     
REPRESENTATIVE  KOHRING  moved   to  adopt  version  22-LS1389\P,                                                               
Lauterbach,  4/11/02,  as  the  work   draft.    There  being  no                                                               
objection, Version P was before the committee.                                                                                  
CHAIR DYSON offered his understanding that Version P is the same                                                                
as   Version   O   with   [Representative   Cissna's   conceptual                                                               
Amendment 1] that was adopted at the April 9 hearing.                                                                           
Number 0200                                                                                                                     
REPRESENTATIVE COGHILL moved to adopt Amendment 1, which read                                                                   
[original punctuation provided]:                                                                                                
     Page 7:   Delete lines 1 - 4.                                                                                              
     Page 7, line 1:                                                                                                            
     COMPREHENSIVE  HEALTH  PLAN;  LIMITATIONS.    The  plan                                                                    
     required under  AS 47.05.010(b), enacted by  sec. 11 of                                                                    
     this Act,                                                                                                                  
               (1) It is not intended  by the legislature to                                                                    
     be updated periodically;                                                                                                   
               (2)   shall be prepared by  the Department of                                                                    
     Health and  Social Services by  January 1, 2003,  and a                                                                    
     copy  of it  shall be  given by  the department  to the                                                                    
     legislature by that date: and                                                                                              
               (3)   shall  be prepared  by using  staff and                                                                    
     other resources  of the  department that  are generally                                                                    
     available  to  perform  the duties  of  the  department                                                                    
     without   an   additional  appropriation   specifically                                                                    
     designated for  preparation of the  plan or  without an                                                                    
     additional  appropriation to  fund  indirect impact  of                                                                    
     existing personnel or resources."                                                                                          
REPRESENTATIVE WILSON objected for purposes of discussion.                                                                      
Number 0220                                                                                                                     
REPRESENTATIVE  COGHILL  explained  that Amendment  1  would  add                                                               
"relating  to  comprehensive  health   planning"  to  the  title.                                                               
Referring to  the fact  that the  amendment to  Version O  at the                                                               
April 9 hearing had been conceptual, he said:                                                                                   
     We  adopted this  by  conceptual amendment,  basically,                                                                    
     and  ...  I  wanted  to  look it  over  and  ask  legal                                                                    
     drafting to  look it over,  and this is  basically what                                                                    
     [would] come back.   And the only thing  that we didn't                                                                    
     look  at was  the date,  and Representative  Cissna had                                                                    
     ... registered some  concern about that.   And I'm open                                                                    
     to that discussion.   But at this point,  it would take                                                                    
     the plan that's required and ... then put it in these                                                                      
     three bullets, if you will.                                                                                                
REPRESENTATIVE  COGHILL noted  that  Amendment 1 [paragraph  (1)]                                                               
calls  for a  one-time plan;  it is  not intended  to be  updated                                                               
periodically,  which  is  in  contrast  to  what  is  already  in                                                               
statute, to his recollection.   [Under paragraph (2)] it would be                                                               
prepared by [the  Department of] Health and  Social services, and                                                               
the  date  would  be  2003,  as  adopted  [in  the  amendment  to                                                               
Version O at  the previous hearing].   He indicated he  wanted it                                                               
to be very  clear that this [plan is to  be developed] within the                                                               
resources of the Department of  Health and Social Services, which                                                               
paragraph (3) accomplishes.                                                                                                     
Number 0325                                                                                                                     
CHAIR  DYSON asked  whether Representative  Cissna  was in  basic                                                               
agreement with Representative Coghill's Amendment 1.                                                                            
REPRESENTATIVE CISSNA replied that she  was in agreement, but had                                                               
real concerns  about the date.   She indicated she'd  requested a                                                               
partial  copy of  the  health plan  dated  June 1984;  department                                                               
personnel had  informed her  of what  is in  place that  could be                                                               
drawn on for  a [future plan].  She stated  that there are gaping                                                               
holes  [in the  current state  health plan].   She  asked if  the                                                               
department could  speak to  this matter.   She suggested  that an                                                               
understanding of  the missing pieces  would give members  an idea                                                               
of what is reasonable timing for using existing services.                                                                       
Number 0450                                                                                                                     
ELMER LINDSTROM,  Deputy Commissioner,  Department of  Health and                                                               
Social Services,  told the committee  he didn't believe  the date                                                               
to be  a relevant matter  because, briefly, "No money,  no plan."                                                               
He  said  the  [1984]  report  was  the  last  one  done  by  the                                                               
department.   He  explained that  rarely a  week goes  by in  the                                                               
department  in which  someone  does not  say, "I  wish  we had  a                                                               
comprehensive  health   plan.".    If  the   department  had  the                                                               
resources,  it  would have  done  a  plan.    In the  absence  of                                                               
additional  resources  to  develop   a  comprehensive  plan,  Mr.                                                               
Lindstrom said he thought the plan would not be accomplished.                                                                   
Number 0519                                                                                                                     
REPRESENTATIVE  CISSNA said  she  was uncertain  about the  date.                                                               
She remarked, "I really care about  Alaska and that we survive as                                                               
a state in  some kind of not-third-world  category."  Referencing                                                               
the  [old  health  plan]  with its  problems  and  the  preceding                                                               
overview presentation  by the Alaska Suicide  Prevention Council,                                                               
she  again emphasized  the need  for a  plan.   As for  the bill,                                                               
Representative  Cissna said  she  sees  "two perfectly  wonderful                                                               
sides," without a way to  discern the right policy; she expressed                                                               
doubt that the committee could  arrive at good policy without any                                                               
information, which  is lacking in  critical areas.   For example,                                                               
there is no health systems data; it doesn't exist.                                                                              
Number 0599                                                                                                                     
REPRESENTATIVE COGHILL  pointed out that  there will be  a change                                                               
in the  administration [because  the governor's  term is  up] and                                                               
suggested that if this administration  is going to say, "No way,"                                                               
it might be good  to [extend the date to 2004].   He conveyed his                                                               
inclination  to  allow  the  date   to  change  to  2004  if  the                                                               
department is required to use existing resources.                                                                               
CHAIR DYSON offered  his conviction that Alaska needs  to do some                                                               
comprehensive  planning in  mental health,  senior care,  health-                                                               
service  delivery  in urban  and  rural  areas, prenatal  alcohol                                                               
poisoning,  child  abuse,  and  alcohol abuse.    He  stated  his                                                               
intention  of joining  [Representative  Cissna]  in holding  some                                                               
interim hearings  on this matter.   He added that other  bills in                                                               
the  committee, pertaining  to planning,  won't make  it [through                                                               
the  legislative   process  this   session].    He   deferred  to                                                               
Representative Cissna with regard to the date.                                                                                  
Number 0708                                                                                                                     
REPRESENTATIVE CISSNA  said no  area is as  needing of  effort as                                                               
the medical health [planning] area.   She pointed out that mental                                                               
health does  have a comprehensive  plan, as  do many areas.   She                                                               
added, "We really  are just ragged in  the fastest-growing sector                                                               
of our economy,  which is really pretty scary.   And I agree with                                                               
you:  this summer, you're on.  Let's go for 2004."                                                                              
CHAIR   DYSON   announced,   "Let   the   record   reflect   that                                                               
Representative Cissna moves  that we amend Amendment  1, line 12,                                                               
to January [1,] 2004."                                                                                                          
Number 0755                                                                                                                     
REPRESENTATIVE STEVENS  objected, saying he didn't  see the point                                                               
of changing it  back.  He noted  that this is just  what was done                                                               
at the last meeting - it was changed  from 2004 to 2003.  He said                                                               
his concern  at that  time was that  a lot is  being asked  to be                                                               
done;  however, it  is not  unreasonable to  expect that  this be                                                               
done by  2003.   He offered  that if the  premise is  that things                                                               
will  be  different  in  a new  administration,  why  not  simply                                                               
consider this bill next year?                                                                                                   
CHAIR  DYSON said  the amendment  from Representative  Cissna had                                                               
been presented  suddenly on  [April 9], and  that perhaps  it was                                                               
acted upon with less than due diligence.  He added:                                                                             
     Several  of us  have had  time to  think about  it some                                                                    
     more.   The reason we did  a title change today  was to                                                                    
     make  sure that  Representative  Cissna's amendment  on                                                                    
     Tuesday did not fail for  lack of a broad enough title.                                                                    
     ... But it is an amendment  to a bill largely aimed ...                                                                    
     on a  different subject.   So  ... you  could certainly                                                                    
     argue that a comprehensive study  belonged in a bill of                                                                    
     its own,  but the  reason we're  dealing with  this one                                                                    
     now  is  because [of]  the  interest  in modifying  the                                                                    
     certificate of need that's come up this year.                                                                              
CHAIR DYSON  acknowledged that  Representative Cissna  and others                                                               
recognize  that  having   better  information  and  comprehensive                                                               
planning  would  be  a  valuable  component  in  evaluating  CONs                                                               
[certificates of need].  He  expressed his belief that the bill's                                                               
sponsor is interested in seeing  the bill move forward this year.                                                               
When  these two  subjects  were linked,  he  said, the  committee                                                               
wound up dealing  with the date.  He offered  his perception that                                                               
the real issue is whether it  is reasonable to expect - with very                                                               
limited resources  - to have a  valuable product that is  able to                                                               
be accomplished by January.                                                                                                     
Number 0928                                                                                                                     
REPRESENTATIVE  CISSNA expressed  her  view of  a "complete  tie"                                                               
between an  evaluation tool  and the  plan.   She said,  "I don't                                                               
have  the  tools  to  make  that decision,  and  I've  asked  the                                                               
department,  and they  don't  have  the tools  to  make ...  that                                                               
decision."    She said  perhaps  other  members felt  comfortable                                                               
making [this decision], but she didn't.                                                                                         
CHAIR DYSON said  he would argue that this  is why Representative                                                               
Cissna's amendment carried.                                                                                                     
Number 0971                                                                                                                     
REPRESENTATIVE  JOULE offered  his  understanding  that when  the                                                               
amendment  passed [on  April  9]  with the  2003  date, that  was                                                               
assuming  an accompanying  fiscal  note; the  2004  date and  the                                                               
clarification that this  will be done with  existing resources is                                                               
the difference  between the two dates.   He said, "This  way, the                                                               
bill moves forward  without a fiscal note,  giving the department                                                               
18  months  to  do  something with  its  existing  resources,  as                                                               
opposed  to  doing  something  in 6  months  with  no  additional                                                               
resources."   He specified that he  was speaking in favor  of the                                                               
amendment to Amendment 1 [to change the date to 2004].                                                                          
CHAIR DYSON voiced his  understanding the Representative Cissna's                                                               
amendment [on April  9] called for the plan to  be completed with                                                               
existing  resources and  hadn't anticipated  a fiscal  note.   He                                                               
asked whether Representative Stevens  maintained his objection to                                                               
the amendment to [Amendment 1].                                                                                                 
Number 1046                                                                                                                     
REPRESENTATIVE STEVENS said yes.   He added that Alaska is facing                                                               
enormous problems  statewide such as  the "salmon disaster."   He                                                               
noted  that  these  problems  need serious  study,  and  [if  the                                                               
amendment  to Amendment  1  failed]  would be  dealt  with via  a                                                               
report  to the  legislature  by  January 2003.    In response  to                                                               
Representative Cissna,  he said he  thought he would  support the                                                               
2003 date, but indicated he wanted to hear more about it.                                                                       
REPRESENTATIVE CISSNA withdrew the amendment to Amendment 1.                                                                    
Number 1130                                                                                                                     
CHAIR  DYSON asked  if there  was any  objection to  Amendment 1.                                                               
Hearing no objection, he announced that Amendment 1 was adopted.                                                                
MR. LINDSTROM,  in response to  Chair Dyson, said  the department                                                               
had prepared  two fiscal notes, both  dated 4/10/02.  One  is for                                                               
$100,500 for  health planning and facilities  management, and the                                                               
other, from the Division of  Medical Assistance, is in the amount                                                               
of $4.6 million, for Medicaid services.                                                                                         
CHAIR DYSON  observed that Representative Coghill  had put before                                                               
the committee a zero fiscal note.  He requested an explanation.                                                                 
Number 1210                                                                                                                     
REPRESENTATIVE  COGHILL called  his  zero fiscal  note a  "direct                                                               
challenge to  the administration's fiscal  note."  He said  a lot                                                               
has to do with  how he figured the growth of  the economy and the                                                               
way some  Medicaid reimbursements are  calculated.  He  asked the                                                               
committee  to recognize  that  this will  not  have an  actuarial                                                               
impact  on the  state.   He said  he recognizes  the department's                                                               
concerns, but drew attention to  words in the department's fiscal                                                               
note  such  as may,  if,  expected,  estimates, assumptions,  and                                                               
CHAIR DYSON  asked whether it  is correct  that even if  the bill                                                               
passes in  its present form,  there will  be no impact  until new                                                               
facilities are  built, in use,  and impacting Medicaid  rates and                                                               
reimbursement rates.                                                                                                            
Number 1293                                                                                                                     
MR.  LINDSTROM agreed,  but pointed  out that  every fiscal  note                                                               
[from a  department] is based on  assumptions regarding "somebody                                                               
doing something."   The department's fiscal note is  based on the                                                               
best information  the department  has, he said,  and on  what the                                                               
department  believes  is most  likely  to  happen, based  on  the                                                               
letters  of  interest  and  CON  applications.    In  this  case,                                                               
however, the  decisions of  whether to  build facilities  will be                                                               
independent business decisions that the state doesn't control.                                                                  
MR.  LINDSTROM   added  that  the  committee   has  heard  widely                                                               
divergent  testimony   on  the  impacts   of  the  bill.     Some                                                               
passionately  believe  [HB 407]  is  the  best thing  that  could                                                               
happen to  health care in the  state, while others believe  it is                                                               
the  death  knell for  the  health  care infrastructure  in  many                                                               
Number 1346                                                                                                                     
MR. LINDSTROM noted that everyone  believes this bill will have a                                                               
significant  impact;  the department  shares  this  opinion.   He                                                               
offered  that  the  department could  not  provide  members  with                                                               
certainty  about the  exact  costs.   He  referenced his  earlier                                                               
testimony  that  a lack  of  data  has hindered  [more  accurate]                                                               
estimates.   He stated,  "There is  ... rarely  a bill  that goes                                                               
through the legislature  where it is more  abundantly clear that,                                                               
yes, there  will be a  fiscal impact, and  it will accrue  to the                                                               
Medicaid program because the Medicaid  program insures one out of                                                               
six Alaskans ... in this state."                                                                                                
MR.  LINDSTROM  referenced an  analysis  done  on behalf  of  the                                                               
Tanana  Valley Clinic  by Information  Insights, dated  March 25,                                                               
which ultimately  concluded that  over time the  bill -  at least                                                               
under the assumptions given - would  [result in] a savings to the                                                               
Medicaid  program.    He   added,  "Nevertheless,  this  analysis                                                               
provided  by Tanana  Valley Clinic  indicated in  the first  year                                                               
there would  probably be  an additional cost  of $200,000  to the                                                               
Medicaid program  if one  facility was built  in Fairbanks."   He                                                               
expressed doubt  that anyone  knew for  sure how  many facilities                                                               
would be  built.   "There is unanimity,  Mr. Chairman,  that this                                                               
bill is going to have a fiscal impact," he concluded.                                                                           
CHAIR  DYSON  concurred, noting  that  members  indeed had  heard                                                               
conflicting  testimony, including  testimony about  other states.                                                               
He announced  his intention, out  of respect for  the department,                                                               
to send the bill forward with all three fiscal notes.                                                                           
CHAIR DYSON  called for an  at-ease at 4:08  p.m.  He  called the                                                               
meeting back to order at 4:09 p.m.                                                                                              
Number 1450                                                                                                                     
CHAIR  DYSON informed  members that  an objection  for discussion                                                               
purposes needed to be withdrawn to [Amendment 1].                                                                               
REPRESENTATIVE WILSON withdrew her objection.                                                                                   
CHAIR  DYSON  again asked  whether  there  was any  objection  to                                                               
Amendment 1.  There being no objection, Amendment 1 was adopted.                                                                
Number 1470                                                                                                                     
REPRESENTATIVE STEVENS asked about the multiple fiscal notes.                                                                   
CHAIR  DYSON explained  that  it  is within  the  purview of  the                                                               
Speaker  [of the  House]  to  decide [on  a  fiscal  note].   The                                                               
committee  is  providing the  Speaker  with  a synthesis  of  the                                                               
information it has received about the fiscal notes.                                                                             
Number 1505                                                                                                                     
REPRESENTATIVE  COGHILL moved  to  report CSHB  407 [version  22-                                                               
LS1389\P,  Lauterbach, 4/11/02],  as  amended,  out of  committee                                                               
with  individual  recommendations  and  the  accompanying  fiscal                                                               
REPRESENTATIVE  KOHRING objected  for  discussion  purposes.   He                                                               
said he wasn't comfortable including  the three fiscal notes, and                                                               
would prefer  to adopt the zero  fiscal note.  He  concurred with                                                               
Representative Coghill  and suggested  overhead could  be greatly                                                               
offset, with  a possible  result of  zero cost  or at  least much                                                               
less cost than the department projects.                                                                                         
REPRESENTATIVE  KOHRING  then   withdrew  his  objection,  saying                                                               
although the legislation  doesn't go as far as he  would like, he                                                               
wanted to  move it forward.   He reiterated that he  didn't agree                                                               
with the  department's fiscal notes,  which are higher  than what                                                               
he would expect.                                                                                                                
Number 1573                                                                                                                     
REPRESENTATIVE  CISSNA objected  to the  motion, explaining  that                                                               
she believes  the state isn't prepared  to deal with some  of the                                                               
problems it  is facing, and  that the plan  needs to be  in place                                                               
prior  to making  such choices.   In  response to  Representative                                                               
Stevens,  she reiterated  that she  objected to  making a  choice                                                               
without having the tools to do it.                                                                                              
A  roll call  vote was  taken.   Representatives Dyson,  Stevens,                                                               
Kohring,  Joule,  Wilson, and  Coghill  voted  to move  CSHB  407                                                               
[version  22-LS1389\P,  Lauterbach,  4/11/02,  as  amended]  from                                                               
committee.    [Representative   Cissna  abstained.]    Therefore,                                                               
CSHB 407(HES) was  moved out of  the House Health,  Education and                                                               
Social Services Standing Committee by a vote of 6-0.                                                                            

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