Legislature(1995 - 1996)
04/12/1996 08:20 AM House FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
April 12, 1996
8:20 A.M.
TAPE HFC 96-115, Side 1, #000 - end.
TAPE HFC 96-115, Side 2, #000 - end.
CALL TO ORDER
Co-Chair Mark Hanley called the House Finance Committee
meeting to order at 8:20 a.m.
PRESENT
Co-Chair Hanley Representative Martin
Co-Chair Foster Representative Mulder
Representative Brown Representative Navarre
Representative Grussendorf Representative Parnell
Representative Kelly Representative Therriault
Representative Kohring
ALSO PRESENT
Representative Norman Rokeberg; Tom Anderson, Staff,
Representative Martin; Harlan Knudson, Executive Director,
Alaska Hospital and Nursing Home Association; Bob Labbe,
Director, Division of Medical Assistance.
SUMMARY
HB 436 An Act relating to purchase and sale of mobile
homes by mobile home dealers or agents; to mobile
home titles; and providing for an effective date.
CSHB 436 (TRA) was reported out of Committee with
"no recommendation" and with a fiscal impact note
by the Department of Commerce and Economic
Development, dated 4/2/96 and with a zero fiscal
note by the Department of Public Safety, dated
4/2/96.
HB 393 An Act relating to managed care for recipients of
medical assistance; and providing for an effective
date.
CSHB 393 (FIN) was reported out of Committee with
a "do pass" recommendation and with a fiscal
impact note by the Department of Health & Social
Services, 3/27/97.
HB 528 An Act relating to applications for certificates
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of need and licensing of nursing homes; amending
the standard of review for certificates of need
for health care facilities in the state;
establishing a moratorium with respect to new
applications by prohibiting the issuance of a
certificate of need or a license for additional
nursing home capacity in the state until July 1,
1998; and providing for an effective date.
HB 528 was HELD in Committee for further
consideration.
HB 543 An Act establishing a preference when entering
into state airport land leases.
HB 543 was rescheduled to another time.
HOUSE BILL NO. 436
"An Act relating to purchase and sale of mobile homes
by mobile home dealers or agents; to mobile home
titles; and providing for an effective date."
TOM ANDERSON, STAFF, REPRESENTATIVE MARTIN noted that HB 436
was introduced at the request of the Alaska Manufactured
Housing Association. He noted that current statutes do not
provide for titling of mobile homes. The bill will title
mobile homes under the Division of Motor Vehicles. He noted
that mobile home dealers are not currently licensed or under
regulations. The legislation would also place mobile home
dealers under the purview of the Division of Occupational
Licensing, Department of Commerce and Economic Development.
A bond of $50.0 thousand dollars would be required of mobile
home dealers. Representative Martin added that the
legislation will place dealers under disclosure
requirements.
Representative Brown questioned if mobile homes should be
sold by licensed real estate agents. She asked how the
legislation will protect the public. Representative Martin
noted the bonding requirements.
Representative Mulder stressed the need for bonding. He
noted that mobile homes represent substantial investments.
In response to a question by Representative Brown,
Representative Mulder noted that the Legislature repealed
previous statutes regarding title requirements for mobile
homes. He observed that problems occurred as a result of
that action.
In response to a question by Representative Kelly, Mr.
Anderson noted that banks and lending institutions require a
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certificate of title for financing. He noted that long
after a cash sale the buyer's unit and a seller's collateral
can be claimed by an unknown lien holder.
Representative Kelly asked if title companies only deal with
real property. Representative Mulder stressed that mobile
homes are on wheels. He noted that the Division of Motor
Vehicles has requested that the fee schedule reflect the
cost of administration.
Representative Brown noted that the change from "may" to
"shall" will require titles to be issued. She questioned
the affect on current owners.
Representative Mulder stressed that titles will be issued
during the transference of ownership. Owners will not have
to get titles immediately. He noted that the Division has
the ability to charge for titling.
Representative Martin noted that approximately 124 dealers
would want to be licensed. Mr. Anderson estimated that 20
to 30 titles will be issued a year.
Representative Brown expressed concern that owners will be
required to obtain titles. Representative Mulder pointed
out that the alternative is to require a $500 dollar title
search.
Representative Parnell MOVED to report CSHB 436 (TRA) out of
Committee with individual recommendations and with the
accompanying fiscal note. Representative Kohring OBJECTED.
He asserted that the legislation will help big operators and
hurt small operators. He expressed concern with the bonding
requirement. He asked for evidence of consumer concern
regarding current practices.
Representative Mulder disclosed that he is a mobile home
owner and real estate agent.
Mr. Anderson noted that a $50.0 thousand dollar bond would
cost approximately $1.5 thousand dollars a year.
Representative Kohring noted that the bonding requirement
assumes that the individual has the proper credit
credentials.
A roll call vote was taken on the MOTION to move CSHB 436
(TRA) out of Committee.
IN FAVOR: Brown, Grussendorf, Navarre, Kelly, Martin,
Mulder, Parnell, Therriault, Foster, Hanley
OPPOSED: Kohring
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The MOTION PASSED (10-1).
CSHB 436 (TRA) was reported out of Committee with "no
recommendation" and with a fiscal impact note by the
Department of Commerce and Economic Development, dated
4/2/96 and with a zero fiscal note by the Department of
Public Safety, dated 4/2/96.
HOUSE BILL NO. 393
"An Act relating to managed care for recipients of
medical assistance; and providing for an effective
date."
REPRESENTATIVE NORMAN ROKEBERG, sponsor of HB 393, spoke in
support of the legislation. He noted that the bill asks the
Department to draft legislation establishing a pilot program
for Medicaid recipients in the state of Alaska. He
emphasized that the legislation will expedite and give
direction to the implementation of managed care. He noted
that Medicaid is the second largest component in the State's
budget after education. He observed that Medicaid funding
has escalated. Over the past five years it has increased
annually by 13.9 percent. He observed that Congress is
focused on replacing Medicaid with MediGrants. MediGrants
would be issued as block grants on a per capita basis. He
emphasized the importance of planning for the implementation
of national Medicaid and welfare legislation. He pointed
out that 94 percent of all states have managed care
principals. Alaska does not have any.
Representative Rokeberg noted that the Department of Health
& Social Services has awarded a contract to develop a report
and plan for the development of a managed care program. He
observed that the state of Oregon expanded services through
savings realized by a managed care program. He emphasized
that nationally 30 percent of the population is uninsured.
He maintained that managed care will work in Alaska. He
observed that there are examples of managed care programs in
other small areas. He noted interest in rural areas. He
asserted that managed care is coming. He maintained that
the Legislature should be involved in the development and
implementation of this major state policy.
Representative Rokeberg provided members with a proposed
committee substitute, Work Draft 9-LS1451\K, dated 4/10/96
(copy on file). He explained that the committee substitute
would clarify the steps needed to implement the pilot
program. "Competition" was also deleted.
Representative Kelly noted that the Department of Health &
Social Services intends to implement the program mandated by
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HB 393 in June, 1996. Representative Rokeberg stressed that
the Department intends to incrementally implement many of
the procedures that are part of managed care. He noted the
lack of debate regarding the issues surrounding managed
care. He stated that the legislation would mandate that the
process be hastened and that the legislature be involved.
He emphasized the need to review statutes to assure that the
State is capable of implementing a large managed care
system.
In response to a question by Representative Brown,
Representative Rokeberg reiterated that Alaska does not have
any managed care models. He envisioned the establishment of
at least two population groups. He stated that the pilot
could be set in an urban area with a rural component. He
stressed that the group should contain single mothers. He
noted that the program will take many years to implement.
The pilot program will probably not incorporate mental
health and developmentally disabled concerns.
Representative Rokeberg discussed programs in Montana. He
noted that information systems were installed to track
information regarding the program.
In response to a question by Representative Brown,
Representative Rokeberg pointed out that the Medicaid fee
schedule does not reimburse physicians for one hundred
percent of their services.
Representative Brown asked how the single mother in the
pilot program would be affected. Representative Rokeberg
noted that the primary care case management system (PPCCM)
assigns patients a specific physician to manage their entire
care. The physician will be the patients "gatekeeper" in
the utilization of the plan. They would be the primary
provider in addition to managing the patient's health care.
Representative Brown asked if the gatekeeper/doctor will be
able to decide without restrictions what the patient needs.
She asked if the legislation would provide that the Governor
or Department introduce draft legislation as a result of HB
393. Representative Rokeberg noted that the amendment would
require that the Department work through the Governor (copy
on file). Amendment 1 would also delete "authorize" and
insert "provide for" on page 2, line 17.
HARLAN KNUDSON, EXECUTIVE DIRECTOR, ALASKA HOSPITAL AND
NURSING HOME ASSOCIATION testified in support of HB 393. He
stressed that the cost of health care must be contained. He
noted that the strength of managed care is that it provides
an incentive for maintaining the patient's health. He
asserted that managed care can work in Alaska. He
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emphasized that the legislation directs the Department to
work with the provider community.
Representative Therriault MOVED to adopt Work Draft 9-
LS1451\K, dated 4/10/96. There being NO OBJECTION, it was
so ordered.
Representative Therriault referred to a letter from the
Tanana Chiefs Conference, dated 2/16/96 (copy on file). He
noted that the letter raises questions regarding the
participation of the Indian Health Service. Mr. Knudson
emphasized that no one should be excluded.
Representative Parnell asked if there is a compelling reason
to keep the findings section in HB 393.
BOB LABBE, DIRECTOR, DIVISION OF MEDICAL ASSISTANCE stated
that the findings section directs the Department regarding
the implementation of the pilot. He stated that the
information is helpful. He emphasized the need to make
Alaska's program specific to Alaska.
(Tape Change, HFC 96-115, Side 2)
Mr. Labbe stressed that HB 393 fits with the Department's
plan.
Representative Rokeberg stated that the intent of section 1
is to provide further direction to the Department. He noted
that HB 393 mandates that the Governor bring back to the
Legislature draft legislation. He observed that HB 393 will
essentially sunset after January 1, 1997.
Mr. Labbe pointed out that CSHB 393 (FIN) could be read to
imply that the Department does not have authority to move
forward on its current planning if HB 393 is enacted. This
could inhibit the Department's attempts to manage Medicaid
expenditures.
Representative Parnell MOVED to adopt Amendment 1. There
being NO OBJECTION, it was so ordered.
Representative Parnell MOVED to report CSHB 393 (FIN) out of
Committee with individual recommendations and with the
accompanying fiscal note. There being NO OBJECTION, it was
so ordered.
CSHB 393 (FIN) was reported out of Committee with a "do
pass" recommendation and with a fiscal impact note by the
Department of Health & Social Services, 3/27/97.
HOUSE BILL NO. 528
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"An Act relating to applications for certificates of
need and licensing of nursing homes; amending the
standard of review for certificates of need for health
care facilities in the state; establishing a moratorium
with respect to new applications by prohibiting the
issuance of a certificate of need or a license for
additional nursing home capacity in the state until
July 1, 1998; and providing for an effective date."
HARLAN KNUDSON, EXECUTIVE DIRECTOR, ALASKA HOSPITAL AND
NURSING HOME ASSOCIATION testified on HB 528. He provided
members with recommendations for modifications to HB 528
(Attachment 1). He maintained that HB 528 is an opportunity
to create a plan to meet Alaska's long term care needs.
Mr. Knudson reviewed Attachment 1. He requested that in
section 1, subsections (1) and (2) be deleted. He observed
that there were 764 licensed nursing home beds in January
1992. He stressed that the State pays by the bed. The
occupancy of nursing home beds was 84 percent in January
1992. Medicaid accounted for 70 percent of occupancy. He
pointed out that the pioneer home in Ketchikan contributes
to the low occupancy rates. There was 758 beds in January
1, 1996. He disagreed that there is an overabundance of
nursing home beds. He noted that occupancy of nursing home
beds in Anchorage and Fairbanks is above 90 percent. He
maintained that the moratorium requires rural residents to
send their elderly to urban areas. He stressed the cultural
difference between rural and urban areas.
Mr. Knudson requested that section 2 be deleted. He
maintained that section 2 takes responsibility from the
legislature. Section 2 allows the Department of Health &
Social Services to establish state policy on the funding of
new construction or new services for health facilities in
Alaska. He asserted that the Department can deny nursing
home beds to protect its Medicaid budget.
Representative Martin maintained that the executive branch
has the responsibility for establishing policy for many
state programs. Representative Kelly pointed out that the
executive branch establishes regulations based on the
statutes. He maintained that the legislature establishes
policy.
Mr. Knudson stated that providers and state agencies have
the responsibility to identify the needs and recommend
policy to the legislature and implement the policy
directives of the legislature. He emphasized that agencies
should not establish were funding should be provided and
overall policy.
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Mr. Knudson noted that the Alaska Hospital and Nursing Home
Associations supports a one year moratorium on nursing home
beds. He emphasized that this is the second year of a three
year moratorium. He pointed out that a study on the long
term care needs of Alaska was contracted by the Division of
Senior Services in June 1995. He stressed that the study
will be released soon. He stated that if the next
Legislature does not agree with the recommendations of the
study the moratorium could be extended.
Mr. Knudson recommended that section 4 be amended to include
a nursing home administrator and that "working group" be
changed to "planning group". He stated that the planning
group should propose a plan identifying needs, priorities
and funding sources.
Representative Mulder noted that proposed committee
substitute, Work Draft 9-LS1731\F, dated 4/11/96 reflects
Mr. Knudson's request for deletion of section 1 (1) and (2)
(copy on file). He added that the work draft provides a one
year moratorium.
HB 528 was HELD in Committee for further consideration.
ADJOURNMENT
The meeting adjourned at 10:00 a.m.
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