Legislature(2011 - 2012)BELTZ 105 (TSBldg)

03/01/2012 01:30 PM LABOR & COMMERCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
Moved SB 199 Out of Committee
Heard & Held
Bills Previously Heard/Scheduled
Moved CSSB 190(L&C) Out of Committee
Heard & Held
        SB 116-WORKERS' COMP.: COLL BARGAINING/MEDIATION                                                                    
1:38:54 PM                                                                                                                    
CHAIR EGAN announced SB 116 to be up for consideration.                                                                         
SENATOR  PASKVAN  moved to  bring  CSSB  116 (L&C),  labeled  27-                                                               
LS0549\X, before the committee. There were no objections.                                                                       
DANA  OWEN, staff  to the  Senate Labor  and Commerce  Committee,                                                               
said this  CS clarifies issues  that were raised in  the previous                                                               
hearing of the bill and adds  one item that was not discussed. He                                                               
said  the  title  was  expanded   to  add,  "An  Act  authorizing                                                               
employers   and   employees    to   mediate   disputed   workers'                                                               
compensation  claims and  to  negotiate  a collective  bargaining                                                               
agreement that offers mediation  and mandates arbitration..." The                                                               
remainder  of the  title stays  the same.  Section 1  remains the                                                               
He said  the changes  begin in  Section 2,  collective bargaining                                                               
agreements.  Subsection (a)  expands  language in  (a)(1) of  the                                                               
previous bill and  provides more details of  the appeals process.                                                               
Changes begin  on line  28 where the  bill establishes  a process                                                               
for resolving  disputes through  mediation, arbitration  or both.                                                               
The  parties  must  agree  before a  particular  dispute  may  be                                                               
submitted to mediation. Then if  mediation fails, it provides for                                                               
1:42:27 PM                                                                                                                    
MR. OWEN pointed  out that lines 2  and 3 of page  2 specify that                                                               
the arbitration will be conducted under  AS 09.43. Title 9 is the                                                               
code  of  civil procedure  and  chapter  43 is  arbitration;  the                                                               
sections that  are cited, 300  to 595, constitute Article  3, the                                                               
Revised Uniform Arbitration  Act. In the last  meeting they heard                                                               
there was  some confusion  over how the  arbitration was  to take                                                               
place.  The drafter  suggested that  it would  be most  direct to                                                               
establish the arbitration as taking  place under AS 09.43 because                                                               
attorneys  and courts  are familiar  with  it; everyone  involved                                                               
should be familiar with it.                                                                                                     
1:43:58 PM                                                                                                                    
He also said  that placing it under AS 09.43  implies a different                                                               
appeals process  than the Workers'  Compensation Act  where there                                                               
is an appeal  to the Workers' Compensation  Commission. This will                                                               
obviate  that  as appeals  will  no  longer  go to  the  Workers'                                                               
Compensation Commission (the original intent of the bill).                                                                      
MR. OWEN  said the bill  clarifies that mediation  or arbitration                                                               
will govern  the dispute resolution  process under  this chapter.                                                               
It  also  says the  dispute  resolution  process must  result  in                                                               
findings  of fact,  award in  a final  order or  decision by  the                                                               
arbitrator and  that award order  or decision has the  same force                                                               
and effect  as a finding  of fact, award  order or decision  of a                                                               
hearing  officer   under  AS  23.30.005   (Workers'  Compensation                                                               
Board). This  means the arbitrator's ruling  under a collectively                                                               
bargained agreement  will have  the same effect  and force  as an                                                               
order of the board.                                                                                                             
Subsection (b)  on page 2, line  25, of the bill  guarantees that                                                               
benefits under  Chapter 23.30 (Workers' Compensation  Act) cannot                                                               
be bargained  away. It further  clarifies that the  agreement and                                                               
processes  negotiated   under  this  law  cannot   themselves  be                                                               
considered a reduction of benefits.                                                                                             
1:45:39 PM                                                                                                                    
Subsection (c)  on line 30  insures that physicians can  meet and                                                               
communicate  with parties  to  a negotiation  in  the process  of                                                               
establishing lists  of physicians  who are the  exclusive medical                                                               
providers  in  a  collectively  bargained  agreement.  Currently,                                                               
physicians are prevented by law  from collaborating on contracts,                                                               
fees and  things like  that. Alaska has  a very  narrow exception                                                               
carved  out  in  statute  and   this  would  be  the  only  other                                                               
exception. Currently  physicians are allowed  to do that  only if                                                               
they are negotiating a managed  benefits organization. This would                                                               
allow physicians  to talk to  one another  if they were  going to                                                               
try and  get on  to the  list that would  be established  under a                                                               
collectively bargained agreement under this statute.                                                                            
1:47:20 PM                                                                                                                    
DENNIS  BAILEY, drafting  attorney,  Legislative Affairs  Agency,                                                               
Alaska  State  Legislature,  said  he  was  available  to  answer                                                               
questions on SB 116.                                                                                                            
SENATOR GIESSEL  said as a  health care provider  her overarching                                                               
concern is patients'  choice in one of the  most intimate aspects                                                               
of their  lives. She  invited her staff  to explain  her proposed                                                               
1:48:32 PM                                                                                                                    
                       A M E N D M E N T                                                                                    
     OFFERED IN THE SENATE               BY SENATOR GIESSEL                                                                     
     TO:  CSSB 116(L&C), Draft Version "X"                                                                                      
     Page 3, lines 13 - 15:                                                                                                     
          Delete all material.                                                                                                  
     Renumber the following paragraphs accordingly.                                                                             
     Page 3, line 26, following "not":                                                                                          
          Insert "(1)"                                                                                                          
     Page 3, lines 26 - 27:                                                                                                     
          Delete ". For purposes of this subsection"                                                                            
          Insert "; for purposes of this paragraph"                                                                             
     Page 3, line 29, following "chapter":                                                                                      
          Insert "; or                                                                                                          
               (2)  identify health care providers who are                                                                      
       the exclusive source of medical treatment provided                                                                       
      under this chapter; in this paragraph, "health care                                                                       
     provider" has the meaning given in AS 09.55.560"                                                                           
     Page 3, line 30, through page 4, line 4:                                                                                   
          Delete all material.                                                                                                  
     Reletter the following subsection accordingly.                                                                             
SHARON LONG,  staff to Senator  Giessel, directed them to  page 3                                                               
of  the amendment  where  lines  13-15 were  deleted  to show  up                                                               
later. The second change begins on  line 26 and inserts "1" after                                                               
"not"  and deletes  "for  the purposes  of  this subsection"  and                                                               
inserts "for the purposes of this  paragraph." On line 29, "2" is                                                               
inserted  after "chapter."  The  language that  was deleted  from                                                               
lines 13-15 is inserted after "chapter."                                                                                        
The last change deletes lines 30 and  31 on page 3 through line 4                                                               
on  page 4.  This preserves  the right  currently in  statute for                                                               
injured workers to choose their own health care provider.                                                                       
SENATOR PASKVAN said he understands  that now there are generally                                                               
exclusive providers designated  under plans and asked  if that is                                                               
true and assuming it is, does this prohibit that in the future.                                                                 
SENATOR GIESSEL replied the main  purpose is to allow the patient                                                               
to choose  whatever health care  provider they want to:  in other                                                               
words, their  private physician  or if  they are  part of  a plan                                                               
that  designates   a  physician.  This  addresses   a  collective                                                               
bargaining  agreement  not  a  person   who  is  not  part  of  a                                                               
collective bargaining agreement.                                                                                                
SENATOR  PASKVAN said  his  belief is  if  you want  to  go to  a                                                               
dentist, there  are dentists the state  has said are on  the list                                                               
and  those dentists  have agreed  with the  state of  Alaska, for                                                               
instance, that  they will do a  cavity for $100. His  question is                                                               
if this would prohibit the  State of Alaska from negotiating with                                                               
dentists to get a lower collective price for that service.                                                                      
SENATOR GIESSEL  said it wasn't  her intent  to do that,  but the                                                               
drafter could help answer that.                                                                                                 
MR. BAILEY  said the  focus of  the bill  allows an  employer and                                                               
their  employees in  a  union  to negotiate  a  mediation and  an                                                               
arbitration process. As part of  that process they are allowed to                                                               
negotiate the  selection of health  care providers that  would be                                                               
permitted to  provide services to  the union members  (in section                                                               
2).  The normal  operation of  the workers'  compensation statute                                                               
that allows employers to negotiate  with health care providers to                                                               
provide  services  under  their  workers'  compensation  coverage                                                               
isn't  affected by  this  bill.  The bill  is  restricted to  the                                                               
concept of  negotiating different  terms under the  provisions of                                                               
the collective bargaining agreement.                                                                                            
SENATOR PASKVAN  remarked that the  short answer  is no or  he is                                                               
confused. He rephrased his question;  if you allow full choice to                                                               
the employee who  goes to a dentist that charges  $150 instead of                                                               
a contracted dentist who charges $100, who pays the $50?                                                                        
MR.  BAILEY  replied  under  the  current  workers'  compensation                                                               
statute  outside   of  a  collective  bargaining   agreement  the                                                               
employee  who  makes  a  claim can  choose  his/her  health  care                                                               
provider and an alternate. The  issue really is choosing who your                                                               
health  care provider  is. There  may be  circumstances where  an                                                               
employer chooses  the health  care provider  for an  employee who                                                               
makes a claim,  but that is limited to employees  that don't make                                                               
their own  choice. It  may be that  the employer  could negotiate                                                               
with   a  group   of  physicians   to  provide   that  in   those                                                               
circumstances,  but the  general  rule is  the  employee gets  to                                                               
choose  their own  physician in  workers'  compensation. So,  the                                                               
question  of negotiating  a lower  rate is  more applicable  to a                                                               
health  care   plan  not  within   the  context  of   a  workers'                                                               
compensation claim.                                                                                                             
SENATOR PASKVAN  said he thinks  where it talks  about "competing                                                               
physicians  may  meet  and communicate"  means  with  respect  to                                                               
whether they  are participants in  an exclusive  source agreement                                                               
with  an employer.  His  perception is  if  you have  competitors                                                               
meeting,  you have  price  fixing  and wanted  to  know what  the                                                               
result of that would be.                                                                                                        
MR.  BAILEY  replied  the  purpose   of  allowing  physicians  to                                                               
communicate  concerning  providing  services   by  the  group  is                                                               
intended  under AS  23.50. In  the  absence of  a provision  like                                                               
that, whoever  is negotiating  with the  physicians could  go and                                                               
negotiate  with each  physician and  pit one  against another  to                                                               
negotiate a  lower price. It's  included in this bill  because it                                                               
provides for a  negotiation of who the medical  providers are. In                                                               
that negotiation  physicians, presumably,  would want to  be able                                                               
to negotiate as a group not  individually. That is the purpose of                                                               
Section (c).                                                                                                                    
SENATOR GIESSEL said the amendment would remove that section.                                                                   
MR.  BAILEY said  the  amendment takes  out  the provision  about                                                               
negotiating who  the health  care provider is.  It says  we don't                                                               
want  you  to negotiate  who  the  physicians  are; we  want  the                                                               
existing method  that allows  an individual  to choose  their own                                                               
provider to apply instead.                                                                                                      
2:01:51 PM                                                                                                                    
MS. LONG  said the  amendment takes away  the ability  to bargain                                                               
away  one's  right   to  choose  a  physician   in  a  bargaining                                                               
agreement,  but  it  doesn't change  the  ability  of  physicians                                                               
getting  together  to decide  to  provide  a service  through  an                                                               
employer at  certain rates. It  doesn't take away  the provisions                                                               
of  the physicians  under AS  23.50.020 outside  of a  bargaining                                                               
MR. BAILEY added that AS  23.50 allows physicians to negotiate as                                                               
a  group under  certain  circumstances. The  only  reason it  was                                                               
included  originally   was  as  it  applies   to  the  collective                                                               
bargaining  agreement  sections.  If  you  take  it  out  of  the                                                               
collective bargaining  agreement context, it does  not affect the                                                               
remainder of AS 23.50 which relates to bargaining by physicians.                                                                
SENATOR GIESSEL  said Mr. Owen  referred to a managed  care group                                                               
and that provision is still there.                                                                                              
2:04:20 PM                                                                                                                    
SENATOR   PASKVAN  said   the   operative   term  is   "competing                                                               
physicians." If the physicians formed as  a group they are not in                                                               
competition with each  other, but the question is  if that second                                                               
group is comprised of competing  individuals and how that affects                                                               
the analysis.                                                                                                                   
MR. BAILEY  replied that you  have to keep  it in the  context of                                                               
this  bill that  relates to  collective bargaining  for mediation                                                               
(to  decide who  the  health  care providers  are  for the  union                                                               
employees).   When a collective  bargaining agreement  allows for                                                               
(it's not mandated) designating a  certain group of physicians to                                                               
provide medical services, then the  provisions of (c) apply.  So,                                                               
by taking that  section out, you're saying that  it doesn't apply                                                               
here  because  a  particular  physician  isn't  being  chosen  to                                                               
provide services.                                                                                                               
SENATOR PASKVAN stated that lines  13-17 of the amendment say the                                                               
agreement  may not  identify health  care providers  who are  the                                                               
exclusive source of medical treatment,  but the inference is that                                                               
there is a list of exclusive source  and you can't give it to the                                                               
employee. Is that a misunderstanding?                                                                                           
MS. LONG replied that she didn't understand the question.                                                                       
SENATOR  PASKVAN asked  why put  an amendment  in that  says they                                                               
cannot identify the list if they never put a list together.                                                                     
SENATOR GIESSEL said this bill  deals with a disputed works claim                                                               
issue (collective  bargaining agreements) that would  have a list                                                               
of exclusive health care providers.  The injured worker would now                                                               
be confined to an exclusive list  that might or might not include                                                               
their own  personal healthcare  provider. That  is the  piece the                                                               
amendment  removes.  It would  allow  them  to  go to  their  own                                                               
healthcare provider.                                                                                                            
CHAIR EGAN stated  that he wanted to make sure  the committee had                                                               
enough time to  get answers to the questions  before passing this                                                               
MR.  BAILEY said  the amendment  removes  negotiation of  medical                                                               
providers under the collective bargaining agreement.                                                                            
2:11:51 PM                                                                                                                    
SENATOR  PASKVAN clarified  that  it  has no  one  with which  to                                                               
negotiate reduced prices.                                                                                                       
SENATOR DAVIS said she would  feel comfortable acting on the bill                                                               
if Mr. Bailey could answer the question.                                                                                        
MR.  BAILEY said  the amendment  does one  thing: it  removes the                                                               
negotiation of medical providers  under the collective bargaining                                                               
agreement.  The  results  of  the   provisions  of  the  existing                                                               
workers' compensation  statute, which  allows you to  choose your                                                               
own  treating physician  in a  claim would  continue to  apply as                                                               
they  normally  do.  Section   (c)  (about  competing  physicians                                                               
negotiating) doesn't apply anymore  because there wouldn't be any                                                               
specified physicians under the collective bargaining agreement.                                                                 
SENATOR PASKVAN remarked so this  removes any negotiation between                                                               
an employer  and physicians with  respect to  providing services,                                                               
and asked  if it  also means  that the employer  has no  one with                                                               
whom they  can negotiate  reduced prices as  a package  for their                                                               
MR. BAILEY replied  that the employer and the  employee under the                                                               
existing  bill  without the  amendment  negotiate  that. If  that                                                               
section is removed,  there isn't going to be  a negotiation under                                                               
the  collective  bargaining  agreement for  selecting  particular                                                               
employees.  So  the  employer  would  not be  in  a  position  to                                                               
negotiate with  physicians about  what they  provide or  what the                                                               
costs of their services are.                                                                                                    
SENATOR  PASKVAN agreed  that no  price negotiation  follows, but                                                               
pointed that  out as a potential  loss to the employees  when the                                                               
employers' superior  bargaining strength might be  able to obtain                                                               
a discounted price.                                                                                                             
MR. BAILEY said  there is no negotiation by the  employer for the                                                               
cost of  paying for  the employee's  physician and  that wouldn't                                                               
change  if the  amendment is  adopted. If  it doesn't  pass, then                                                               
both  the employer  and employee  negotiate that  already in  the                                                               
collective bargaining agreement.                                                                                                
SENATOR GIESSEL said  the strength of having a  person being able                                                               
to choose  their own health  care provider  is that they  will be                                                               
continuing to see that person  and that healthcare provider knows                                                               
their physical  condition both before  the injury and  after, how                                                               
they are progressing  through it, family history  and things like                                                               
CHAIR EGAN said he would hold SB 116 for a future meeting.                                                                      

Document Name Date/Time Subjects
SB 175 Senate L&C follow up, Hurlburt.pdf SL&C 3/1/2012 1:30:00 PM
SB 175
SB 175 expanded list of medications currently authorized 022912.pdf SL&C 3/1/2012 1:30:00 PM
SB 175
SB 116 L&C v X.pdf SL&C 3/1/2012 1:30:00 PM
SB 116
SB 116 Amendment X.1, Giessel 030112.PDF SL&C 3/1/2012 1:30:00 PM
SB 116
SB 199 Kodiak Daily Mirror Article.pdf SL&C 3/1/2012 1:30:00 PM
SB 199
SB 199 Secondary School Definition.pdf SL&C 3/1/2012 1:30:00 PM
SB 199
SB 199 Sectional Analysis.pdf SL&C 3/1/2012 1:30:00 PM
SB 199
SB 199 Where Did the Money Go.pdf SL&C 3/1/2012 1:30:00 PM
SB 199
HB 168 Legal memo, Bailey 022912.pdf SL&C 3/1/2012 1:30:00 PM
HB 168
HB 168 Legal memo, Bailey 032111.PDF SL&C 3/1/2012 1:30:00 PM
HB 168
HB 168 lttr supporting, Alaska Chamber February 2, 2012.pdf SL&C 3/1/2012 1:30:00 PM
HB 168
HB 168 Press release, Rep. Feige 040711.PDF SL&C 3/1/2012 1:30:00 PM
HB 168
HB 168 white paper ACV 041011.pdf SL&C 3/1/2012 1:30:00 PM
HB 168
SB 217 Sponsor Statement.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 Sectional Analysis.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB217-DOA-DRB-2-27-12.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB217-DCCED-CBPL-02-24-12.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 testimony opposing, Eric Douglas, CVS Caremark.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 testimony NCPA.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 Survey of Community Pharmacies, National Community Pharmacists Association.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 Opposing Testimony to HB259 by Eric Douglas - CVS Caremark 022712.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 Model Audit Guidelines for Pharmacy Claims by the Academy of Managed Care Pharmacy, January 2012.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 lttr supporting, National Community Pharmacists Association 013012.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 lttr supporting, Alaska Pharmacists Association, 020312.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 lttr supporting, Alaska Board of Pharmacy - Holm 030112.PDF SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 lttr supporitng, National Association of Chain Drug Stores 020212.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 List of Supporters.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 Examples of State Audit Laws, Alaska Pharmacists Association, 020512.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 Examples of Abusive Auditing Practices in Alaska, Alaska Pharmacists Association 021012.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 Commercial Pharmaceutical Supply Chain - flow chart, Health Strategies Consultancy.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
SB 217 audit_guidelines_final (hi res).pdf SL&C 3/1/2012 1:30:00 PM
SB 217
NCPA Support SB217.pdf SL&C 3/1/2012 1:30:00 PM
SB 217
HB 168 lttr supporting, RDC 3-5-12.pdf SL&C 3/1/2012 1:30:00 PM
HB 168