Legislature(2007 - 2008)HOUSE FINANCE 519

04/05/2008 12:00 PM House FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Recessed to 30 min. after Session --
+ HB 337 HEALTH CARE: PLAN/COMMISSION/FACILITIES TELECONFERENCED
Heard & Held
+ SB 185 SEX OFFENDER/CHILD KIDNAPPER REGISTRATION TELECONFERENCED
Heard & Held
+ SB 229 TANANA VALLEY FOREST/MINTO FLATS REFUGE TELECONFERENCED
Moved Out of Committee
+ SB 265 SEX OFFENDERS & CHILD KIDNAPPERS:PFD TELECONFERENCED
Heard & Held
+ SJR 17 OFFSHORE OIL & GAS REVENUE TELECONFERENCED
Moved Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= SB 196 PRESCRIPTION DATABASE TELECONFERENCED
Moved HCS CSSB 196(FIN) Out of Committee
                  HOUSE FINANCE COMMITTEE                                                                                       
                       April 5, 2008                                                                                            
                         12:55 p.m.                                                                                             
                                                                                                                                
 CALL TO ORDER                                                                                                                
                                                                                                                                
 Co-Chair Meyer called the House Finance Committee meeting  to                                                                  
 order at 12:55:26 PM.                                                                                                        
                                                                                                                                
 MEMBERS PRESENT                                                                                                              
                                                                                                                                
 Representative Mike Chenault, Co-Chair                                                                                         
 Representative Kevin Meyer, Co-Chair                                                                                           
 Representative Bill Stoltze, Vice-Chair                                                                                        
 Representative Harry Crawford                                                                                                  
 Representative Richard Foster                                                                                                  
 Representative Les Gara                                                                                                        
 Representative Mike Hawker                                                                                                     
 Representative Reggie Joule                                                                                                    
 Representative Mike Kelly                                                                                                      
 Representative Mary Nelson                                                                                                     
 Representative Bill Thomas Jr.                                                                                                 
                                                                                                                                
 MEMBERS ABSENT                                                                                                               
                                                                                                                                
 None                                                                                                                           
                                                                                                                                
 ALSO PRESENT                                                                                                                 
                                                                                                                                
 Ginger  Blaisdell,   Staff,  Senator   Lyda  Green;   Karleen                                                                  
 Jackson, Commissioner,  DHSS;  Rod Betit,  President,  Alaska                                                                  
 Hospital and  Nursing  Home Association;  Paul  Morris,  CFO,                                                                  
 Alaska Regional  Hospital;  Paul Fuhs,  Alaska  Open  Imaging                                                                  
 Center;  Senator  Joe  Thomas;  Marty  Freeman,  Division  of                                                                  
 Forestry,  Department  of  Natural  Resources;  Senator  Bill                                                                  
 Wielechowski; Trevor  Fulton, Staff,  Senator Lesil  McGuire;                                                                  
 Debbie   Richter,   Director,   Permanent   Fund   Division,                                                                   
 Department of Revenue                                                                                                          
                                                                                                                                
 PRESENT VIA TELECONFERENCE                                                                                                   
                                                                                                                                
 Daniel Lynch, Soldotna; Patricia Senner, Nurse Practitioner,                                                                   
 Alaska   Nurses   Association;   Linda   Barefoot,   Regional                                                                  
 Director, Purdue Pharma;  Brian Howes, Investigator, OCC  and                                                                  
 Professional Licensing; Joel  Gilbertson, Regional Director,                                                                   
 Strategic   Development   and   Administration,   Providence                                                                   
 Hospital;   Robert   Cimasi,   President,   Health    Capital                                                                  
 Consultants, Missouri;  Nancy  Cross,  Physician, Fairbanks;                                                                   
 Dr.  Larry  Stinson,  Anchorage;  Grant Roderer,  Physician,                                                                   
 Anchorage; Joanne Smith, Wasilla; Richard Cobden, Physician,                                                                   
 Fairbanks;  Kevin   Dorey,  Fairbanks;   Mike  Powers,   CEO,                                                                  
 Fairbanks  Memorial   Hospital;  Jill   Thorvald,  Executive                                                                   
 Director,  Medical  Facility,   Fairbanks;  Stephen   Sutley,                                                                  
 Fairbanks;   Scott   Bell,   Fairbanks   Memorial    Hospital                                                                  
Foundation  Board;   Maree  Barney-Sutley,   Fairbanks;  Ryan                                                                   
Smith, CEO,  Hospital, Soldotna;  Roman Stevens,  CEO Medical                                                                   
Center, Fairbanks;  Mike McNamara,  Surgeon, Anchorage;  Mark                                                                   
Wade,   Surgeon,   Fairbanks;  Murray   Richmond,   Chaplain,                                                                   
Fairbanks  Memorial Hospital;  Carone Sturm, Fairbanks;  Mike                                                                   
Maddox, Fairbanks;  Jennine Hinman,  Health Care  Consultant,                                                                   
Advanced   Medical  Centers  of   Alaska,  Wasilla;   Kathryn                                                                   
Monfreda, Chief, Criminal Records  and Identification Bureau,                                                                   
Division of Statewide Services, Department of Public Safety                                                                     
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
CSSB 196(FIN)am                                                                                                                 
                                                                                                                                
          "An  Act  relating  to  establishing  a  controlled                                                                   
          substance prescription database."                                                                                     
                                                                                                                                
          HCS CSSB  196 (FIN)  was REPORTED out  of Committee                                                                   
          with  no   recommendations,  a  Senate   Labor  and                                                                   
          Commerce   Committee  Letter  of  Intent,   and  an                                                                   
          accompanying  new fiscal  note from the  Department                                                                   
          of  Health and  Social  Services  and a  previously                                                                   
          published  fiscal  note   from  the  Department  of                                                                   
          Commerce, Community and Economic Development.                                                                         
                                                                                                                                
HB 337    "An  Act   establishing  the  Alaska   Health  Care                                                                   
          Commission  and the Alaska health  care information                                                                   
          office;  relating  to   health  care  planning  and                                                                   
          information;  repealing  the  certificate  of  need                                                                   
          program  for  certain  health care  facilities  and                                                                   
          relating   to   the   repeal;   annulling   certain                                                                   
          regulations  required  for  implementation  of  the                                                                   
          certificate  of  need  program for  certain  health                                                                   
          care  facilities; and  providing  for an  effective                                                                   
          date."                                                                                                                
                                                                                                                                
          HB 337 was HEARD and  HELD in Committee for further                                                                   
          consideration.                                                                                                        
                                                                                                                                
CSSB 185(STA) (title am)                                                                                                        
                                                                                                                                
          "An  Act relating  to the central  registry  of sex                                                                   
          offenders   and  child   kidnappers   and  to   the                                                                   
          registration  requirements  for sex  offenders  and                                                                   
          child  kidnappers; and  providing for an  effective                                                                   
          date."                                                                                                                
                                                                                                                                
          SB 185 was HEARD and HELD in Committee for further                                                                    
          consideration.                                                                                                        
                                                                                                                                
SB 229    "An Act relating to  the Tanana Valley State Forest                                                                   
          and  to assignment  of certain  forest land  to the                                                                   
          Minto  Flats State Game  Refuge; and providing  for                                                                   
          an effective date."                                                                                                   
                                                                                                                                
           SB 229 was REPORTED out of Committee with a "do                                                                      
           pass" recommendation and  with zero fiscal note  #1                                                                  
           by the  Department of  Natural Resources  and  zero                                                                  
           fiscal note #2 by Department of Fish and Game.                                                                       
                                                                                                                                
 CSSB 265(FIN)                                                                                                                  
                                                                                                                                
           "An Act relating to  the payment of permanent  fund                                                                  
           dividends  to  certain   individuals  required   to                                                                  
           register  as sex  offenders  or  child kidnappers;                                                                   
           relating   to   execution   upon   permanent   fund                                                                  
           dividends  by   civilian  process   servers   using                                                                  
           electronic  procedures; amending  Rule  89,  Alaska                                                                  
           Rules of  Civil  Procedure;  and providing  for  an                                                                  
           effective date."                                                                                                     
                                                                                                                                
           CSSB 265 (FIN) was HEARD and HELD in Committee  for                                                                  
           further consideration.                                                                                               
                                                                                                                                
 SJR 17    Urging  the United  States  Congress to  provide  a                                                                  
           means  for  consistently  sharing,  on  an  ongoing                                                                  
           basis,  revenue   generated   from  oil   and   gas                                                                  
           development  on the  outer continental  shelf  with                                                                  
           all coastal energy-producing states to ensure  that                                                                  
           those  states   develop,  support,   and   maintain                                                                  
           necessary     infrastructure      and      preserve                                                                  
           environmental integrity.                                                                                             
                                                                                                                                
           SJR 17  was REPORTED out  of Committee  with a  "do                                                                  
           pass" recommendation and  with zero fiscal note  #1                                                                  
           by the Senate Resources Committee.                                                                                   
                                                                                                                                
                                                                                                                                
 12:55:33 PM                                                                                                                  
                                                                                                                                
 Co-Chair Meyer presented summary of the bills on the  agenda.                                                                  
                                                                                                                                
 CS FOR SENATE BILL NO. 196(FIN) am                                                                                           
                                                                                                                                
                                                                                                                                
      "An Act relating to establishing a controlled substance                                                                   
      prescription database."                                                                                                   
                                                                                                                                
 12:56:42 PM                                                                                                                  
                                                                                                                                
 GINGER BLAISDELL,  STAFF, SENATOR  LYDA GREEN,  presented  an                                                                  
 overview  of  the  bill.  She  indicated  that  the   medical                                                                  
 community and the  Alaska Pharmacy  Association brought  this                                                                  
 need  to  the  attention  of  Senator  Green.  Ms.  Blaisdell                                                                  
 described the legislation as a compilation of existing  bills                                                                  
 from forty  other  states.  She referred  to  the PowerPoint                                                                   
presentation  (Prescription   Drug  Monitoring   Program  and                                                                   
Database, copy on file). She reported that:                                                                                     
                                                                                                                                
   All states  have  laws  and regulations  that  govern  the                                                                   
   distribution and handling of controlled substances.                                                                          
                                                                                                                                
   Diversion   of    controlled    substances    and    other                                                                   
   pharmaceuticals  is  generally  recognized  as  a  serious                                                                   
   problem throughout the United States.                                                                                        
                                                                                                                                
Ms.  Blaisdell   referenced   available  support   materials,                                                                   
including  letters  from  the White  House  designating  drug                                                                   
diversion  as one  of President  Bush's  top priorities.  Ms.                                                                   
Blaisdell expressed that:                                                                                                       
                                                                                                                                
   States  have  found  that  Prescription   Drug  Monitoring                                                                   
   Programs  (PDMPs)  are  among  the  most  effective  tools                                                                   
   available to identify and prevent drug diversion.                                                                            
                                                                                                                                
Ms. Blaisdell defined drug diversion:                                                                                           
                                                                                                                                
   Diversion is  taking a  legal  prescriptive substance  and                                                                   
   altering   it   to   provide   a   different   effect   or                                                                   
   selling/giving it  to  someone other  than  the person  to                                                                   
   whom it was intended.                                                                                                        
                                                                                                                                
 Diversion affects the health of our citizens.                                                                                  
                                                                                                                                
 Diversion often promulgates other criminal activity.                                                                           
                                                                                                                                
Ms. Blaisdell indicated the goals:                                                                                              
                                                                                                                                
   Prescription Drug Monitoring Programs are intended to                                                                        
   promote pharmaceutical care while deterring diversion                                                                        
   through education and law enforcement.                                                                                       
                                                                                                                                
   Prescription  Drug  Monitoring   Programs  are   aimed  at                                                                   
   upholding statutory  mandates  in a  manner  that is  most                                                                   
   supportive  of  and   least  disruptive  to   medical  and                                                                   
   pharmacy practices.                                                                                                          
                                                                                                                                
Ms. Blaisdell noted  it would only take two minutes  a day to                                                                   
download information  from the database; the  new legislation                                                                   
is meant to  be a helpful tool  not a new mandated  task. Ms.                                                                   
Blaisdell  described  national   ads  produced  for  the  $30                                                                   
million  U.S.  drug  awareness  campaign.  She  stressed  the                                                                   
importance of education:                                                                                                        
                                                                                                                                
   There  is  a  national  presumption  that  the  misuse  of                                                                   
   prescription drugs  is safer than  using illicit  "street"                                                                   
   drugs.                                                                                                                       
                                                                                                                                
   Prescription  and  over-the-counter  medications  are  fast                                                                  
   becoming  the  new "party"  drugs  for many  teenagers  and                                                                  
   adults.                                                                                                                      
                                                                                                                                
   Twenty-five  to  forty  percent of  MySpace  users  include                                                                  
   postings  on  how to  get prescription  medication  on  the                                                                  
   internet.                                                                                                                    
                                                                                                                                
 Ms. Blaisdell revealed the most commonly abused medications:                                                                   
                                                                                                                                
  Pain Killers                                                                                                                  
  Stimulants                                                                                                                    
  Sedatives and Tranquilizers                                                                                                   
  Over-the-Counter Drugs                                                                                                        
                                                                                                                                
 She described prescription abuse to include:                                                                                   
                                                                                                                                
   Children through  elderly individuals abuse for themselves                                                                   
   or for personal profit.                                                                                                      
                                                                                                                                
   Nearly seventy  percent of prescription drugs are  obtained                                                                  
   for free from friends and family.                                                                                            
                                                                                                                                
   Pain  killers are  the number  one abused  drug because  of                                                                  
   the feeling of euphoria and/or high resale value.                                                                            
                                                                                                                                
 Ms. Blaisdell stressed the importance of this legislation,                                                                     
 noting that:                                                                                                                   
                                                                                                                                
   The   Department  of  Commerce,   Community  and   Economic                                                                  
   Development   (DCCED),   Board   of   Pharmacy,  currently                                                                   
   conducts  research  and licensee  investigations regarding                                                                   
   drug diversion practices.                                                                                                    
                                                                                                                                
   A  Prescription Drug  Monitoring Program  will provide  the                                                                  
   direction  and tools  for  collecting accurate  and  timely                                                                  
   prescription drug  information to assist in the prevention                                                                   
   of  diversion and promote  safe and  effective health  care                                                                  
   for Alaska's citizens.                                                                                                       
                                                                                                                                
 1:03:24 PM                                                                                                                   
                                                                                                                                
 Ms. Blaisdell continued on the importance of this                                                                              
 legislation:                                                                                                                   
                                                                                                                                
   State and local  law enforcement agencies are experiencing                                                                   
   a rise in prescription drug diversion criminal activity.                                                                     
                                                                                                                                
   This  legislation  was requested  by  Alaskan pharmacists,                                                                   
   doctors and law enforcement officials.                                                                                       
                                                                                                                                
   With legislation,  the state will  be eligible for  federal                                                                  
   funding.                                                                                                                     
                                                                                                                                
Ms. Blaisdell reported that this legislation:                                                                                   
                                                                                                                                
   Establishes a Prescription Drug Monitoring  Program within                                                                   
   the Board of Pharmacy.                                                                                                       
                                                                                                                                
   Tracks all  schedule I-V  controlled  substances in  state                                                                   
   and federal law.                                                                                                             
                                                                                                                                
   Data will be electronic rather than paper.                                                                                   
                                                                                                                                
Ms. Blaisdell explained:                                                                                                        
                                                                                                                                
   Data can  be used  by licensed  prescribers  who have  the                                                                   
   authority to prescribe when caring for a patient.                                                                            
                                                                                                                                
   Data can be  used by  a licensed  or registered  dispenser                                                                   
   who  is   considering  a   controlled   substance  to   an                                                                   
   individual.                                                                                                                  
                                                                                                                                
   Data can  be  used  by  the  personnel  of  the  Board  of                                                                   
   Pharmacy regarding licensing  inquiries, and  for database                                                                   
   management.                                                                                                                  
                                                                                                                                
   Data  can   be  requested   through  the   Board  by   law                                                                   
   enforcement entities  with  a  subpoena or  court  ordered                                                                   
   warrant.                                                                                                                     
                                                                                                                                
Ms. Blaisdell continued that data can be used to:                                                                               
                                                                                                                                
 Improve health care for patients                                                                                               
                                                                                                                                
   Identify prescribing and dispensing practices  that may be                                                                   
   of question; and                                                                                                             
                                                                                                                                
   Identify individuals who  show a pattern  of inappropriate                                                                   
   use.                                                                                                                         
                                                                                                                                
1:06:03 PM                                                                                                                    
                                                                                                                                
Ms. Blaisdell revealed that the data is confidential and not                                                                    
subject to public disclosure:                                                                                                   
                                                                                                                                
   Health  Insurance  portability   and  Accountability   Act                                                                   
   exceptions  are  allowed   for  state  Prescription   Drug                                                                   
   Monitoring Programs.                                                                                                         
                                                                                                                                
   Patient privacy is secured by the details  of the contract                                                                   
   for the vendor who will capture the data.                                                                                    
                                                                                                                                
   Privacy is insured by the Class A misdemeanor  and Class C                                                                   
   felony charges that  would accompany inappropriate  use of                                                                   
   the data.                                                                                                                    
                                                                                                                                
 Ms.  Blaisdell  referred  to   the  fiscal  notes  from   the                                                                  
 Department of  Commerce, Community  and Economic Development                                                                   
 and the Department of Health and Social Services.                                                                              
                                                                                                                                
 Ms. Blaisdell  indicated that statewide  insurance providers                                                                   
 and individuals who self-pay  are expected save $1.4  million                                                                  
 in the first year. She remarked that:                                                                                          
                                                                                                                                
   Senate  Labor and Commerce  adopted a committee substitute                                                                   
   that addressed  almost all concerns  voiced by the  medical                                                                  
   community   and  government   agencies.  The  side-by-side                                                                   
   document is in the bill packet.                                                                                              
                                                                                                                                
   Senate Labor and Commerce adopted intent language                                                                            
   regarding the impact of future funding. The intent memo                                                                      
   is in bill packet.                                                                                                           
                                                                                                                                
 She reassured the Committee  that after checking through  the                                                                  
 bill  with  legislative   legal  every  sentence  and   every                                                                  
 paragraph  has  some  sort  of  privacy  protection  or  data                                                                  
 security written into the bill.                                                                                                
                                                                                                                                
 1:09:14 PM                                                                                                                   
                                                                                                                                
 Representative  Nelson  questioned   if  the  Native   Health                                                                  
 Service would  have access  to this  database. Ms.  Blaisdell                                                                  
 replied that  Maine  is the  only  state to  enter voluntary                                                                   
 contracts  with   military  and   tribal  health  providers.                                                                   
 Military and tribal health is governed by federal law  rather                                                                  
 than state  law so they  are exempt  from participating.  She                                                                  
 added that  those providers  who  choose to  participate  can                                                                  
 receive permission.                                                                                                            
                                                                                                                                
 Representative  Nelson asked  if  this would  be  phrased  as                                                                  
 anyone  who  contracts  and   compacts  with  Indian   Health                                                                  
 Service. Ms. Blaisdell agreed  that most people are  entering                                                                  
 into contracts.                                                                                                                
                                                                                                                                
 1:10:28 PM                                                                                                                   
                                                                                                                                
 Representative Gara  questioned if  the main  purpose of  the                                                                  
 bill  would be  to  provide  a  database  accessible  to  all                                                                  
 pharmacists in the  state. Ms. Blaisdell  responded that  the                                                                  
 database would be accessible to all pharmacists who  apply to                                                                  
 have access to retrieve  information. All pharmacists in  the                                                                  
 state  would  be  required   to  report  any  dispensing   of                                                                  
 controlled substances.                                                                                                         
                                                                                                                                
 Representative Gara  asked  if one  of  the purposes  of  the                                                                  
 database would  be  for pharmacists  to  check on  the  other                                                                  
 medications a  patient  may  have been  prescribed.  He  also                                                                  
 inquired  if this  information  would  be  available  to  the                                                                  
 physician when prescribing a drug for a patient.                                                                               
                                                                                                                                
Ms. Blaisdell emphasized that  not every prescription will be                                                                   
in the  database. The  database will  only indicate  drugs in                                                                   
Schedule  I-V:  painkillers,   sedatives,  tranquilizers,  or                                                                   
stimulants. She  provided the  example of an elderly  person,                                                                   
always going to the same pharmacy,  would have a prescription                                                                   
history at that pharmacy. A medical  provider can access this                                                                   
database  to  look at  the  person's  history when  they  are                                                                   
writing a prescription.                                                                                                         
                                                                                                                                
1:13:20 PM                                                                                                                    
                                                                                                                                
Representative Gara  inquired if pharmacists now  have access                                                                   
to  a  database  to determine  if  there  is  potential  drug                                                                   
interaction.                                                                                                                    
                                                                                                                                
Ms. Blaisdell responded that pharmacists  are not the primary                                                                   
individual  trying   to  discover  every   drug  interaction.                                                                   
Discovering potential  drug interactions will start  with the                                                                   
medical  provider. She  signified that  patients who  "doctor                                                                   
shop" using  multiple pharmacies  could be tracked  with this                                                                   
database.                                                                                                                       
                                                                                                                                
1:14:40 PM                                                                                                                    
                                                                                                                                
Vice-Chair Stoltze questioned  the access individuals have to                                                                   
the database. He requested information  on any fees involved.                                                                   
                                                                                                                                
Ms. Blaisdell  remarked that any  individual can  request the                                                                   
report of  their own  history in  the database. She  reported                                                                   
that the fee will not exceed ten  dollars but the patient can                                                                   
also ask their physician to run  a history. She revealed that                                                                   
prescriptions  listed in  the database  will use the  medical                                                                   
term for the medication not the brand name.                                                                                     
                                                                                                                                
Vice-Chair Stoltze  asked if the database would  be available                                                                   
to  other  professional boards,  primarily  for  disciplinary                                                                   
cases.  He also  asked for  comment  on how  the large  chain                                                                   
pharmacies handle prescription information.                                                                                     
                                                                                                                                
1:16:47 PM                                                                                                                    
                                                                                                                                
Ms. Blaisdell  reported letters of support from  the National                                                                   
Association of  Chain Drug Stores (Safeway, WalMart,  etc). A                                                                   
large corporate  drug store can  share data within  their own                                                                   
corporate chain  but not among  different drug  store chains.                                                                   
The proposed database would capture all this information.                                                                       
                                                                                                                                
Vice-Chair  Stoltze asked  again  about  the availability  to                                                                   
other professional boards.                                                                                                      
                                                                                                                                
Ms.  Blaisdell  responded  that   this  information  is  only                                                                   
accessible by a court ordered warrant or subpoena.                                                                              
                                                                                                                                
1:18:32 PM                                                                                                                    
                                                                                                                                
 Representative Nelson  referred to  another  database set  up                                                                  
 for antihistamines that expunges the records after one  year.                                                                  
 She asked if  there was a  time frame to  expunge records  in                                                                  
 this bill.                                                                                                                     
                                                                                                                                
 Ms. Blaisdell responded  that there is  a two year provision                                                                   
 to dispose of  the information. The  database is looking  for                                                                  
 someone with a pattern of use, not a one-time incident.                                                                        
                                                                                                                                
 Representative  Nelson asked  if  pharmacists  are  privy  to                                                                  
 patient's  drug   history  through   a  patient's  insurance                                                                   
 provider.                                                                                                                      
                                                                                                                                
 1:20:02 PM                                                                                                                   
                                                                                                                                
 Ms. Blaisdell  responded that  a patient's  drug history  can                                                                  
 not be obtained through  their insurance provider. She  noted                                                                  
 that the use of cash to pay for a prescription is one  of the                                                                  
 key data elements that may reveal drug diversion.                                                                              
                                                                                                                                
 1:20:50 PM                                                                                                                   
                                                                                                                                
 Representative  Gara  stressed   concern  about  information                                                                   
 becoming accessible to  the general public.  He pointed to  a                                                                  
 provision in  the bill  indicating that  law enforcement  may                                                                  
 obtain  information  from  the  database  through  a   search                                                                  
 warrant or subpoena. He noted in civil cases information  can                                                                  
 be obtained  through  a "discovery  process" and  voiced  his                                                                  
 concern that information may be obtained in this manner.                                                                       
                                                                                                                                
 1:22:11 PM                                                                                                                   
                                                                                                                                
 Ms. Blaisdell disclosed that  the data is not accessible  for                                                                  
 "discovery"  or civil  suits  only  through  a  court  order,                                                                  
 warrant or  subpoena. She  cited an  example  that a  medical                                                                  
 doctor  could not  provide  a  person's  medical  history  to                                                                  
 another member of the family.                                                                                                  
                                                                                                                                
 Representative  Gara  asked  where  in  the  bill  it  states                                                                  
 information may not be obtained through a discovery order.                                                                     
                                                                                                                                
 Ms. Blaisdell replied  that there is  no provision that  says                                                                  
 it is not accessible  through a discovery  order because  the                                                                  
 only provision  for accessing  this information,  outside  of                                                                  
 the physician or  pharmacist, is through  a court warrant  or                                                                  
 subpoena                                                                                                                       
                                                                                                                                
 1:23:12 PM                                                                                                                   
                                                                                                                                
 DANIEL  LYNCH,  SOLDOTNA  testified  via teleconference   and                                                                  
 voiced  his   concern   about   privacy   information   being                                                                  
 disclosed. He  noted  the widespread  internet  and  database                                                                  
 theft. He cautioned that  hackers have entered many  national                                                                  
corporate  databases and  a potential  hacker into this  drug                                                                   
database  would  obtain  personal  information  for  possible                                                                   
theft or sale  to insurance companies or employers.  He noted                                                                   
the  long-standing   confidentiality  between   patients  and                                                                   
physicians and  hoped privacy can be maintained.  He wondered                                                                   
if  possible new  hiring to  enter  these prescriptions  will                                                                   
raise the price of medications.                                                                                                 
                                                                                                                                
1:26:30 PM                                                                                                                    
                                                                                                                                
PATRICIA   SENNER,   NURSE   PRACTITIONER,    ALASKA   NURSES                                                                   
ASSOCIATION testified via teleconference  spoke in support of                                                                   
the  bill.  As  prescribers,  the  association  welcomed  the                                                                   
opportunity of receiving accurate  information for controlled                                                                   
medication  prescribed  to  their patients  but  warned  that                                                                   
someone in a  physician's office, hospital or  pharmacy could                                                                   
go on a  "fishing" expedition to locate  private information,                                                                   
noting  the recent  Britney  Spears  case. She  suggested  at                                                                   
third  layer manager  who would  give  permission before  any                                                                   
information could be released from the database.                                                                                
                                                                                                                                
1:28:37 PM                                                                                                                    
                                                                                                                                
LINDA BAREFOOT,  REGIONAL DIRECTOR,  PURDUE PHARMA  testified                                                                   
via teleconference in support of this legislation.                                                                              
                                                                                                                                
1:30:03 PM                                                                                                                    
                                                                                                                                
BRIAN  HOWES,  INVESTIGATOR,  OCCUPATIONAL  AND  PROFESSIONAL                                                                   
LICENSING testified via teleconference  and was available for                                                                   
questions.                                                                                                                      
                                                                                                                                
1:30:44 PM                                                                                                                    
                                                                                                                                
Co-Chair Meyer CLOSED PUBLIC TESTIMONY.                                                                                         
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 1 25-LS1092\V.2.                                                                        
                                                                                                                                
     Page 2, line 25:                                                                                                           
          Delete "an inpatient in a licensed"                                                                                   
          Insert "those administered to a patient at a"                                                                         
                                                                                                                                
Vice-Chair Stoltze OBJECTED for discussion.                                                                                     
                                                                                                                                
Ms. Blaisdell explained that Amendment  #1 clarified language                                                                   
confusion in the bill.                                                                                                          
                                                                                                                                
Vice-Chair  Stoltze WITHDREW  his OBJECTION.  There being  NO                                                                   
further OBJECTION, it was so ordered.                                                                                           
                                                                                                                                
1:32:49 PM                                                                                                                    
                                                                                                                                
Co-Chair Meyer MOVED to ADOPT Amendment 2, 25-LS1092\V.1.                                                                       
                                                                                                                                
      Page 5, lines 7-9                                                                                                         
                                                                                                                                
           Delete "The board may enter into agreements with                                                                     
      dispensers  that are  not  regulated by  the  state  and                                                                  
      practitioners in  this state  to submit  information  to                                                                  
      and access information  in the database subject to  this                                                                  
      section and the regulations of the board."                                                                                
                                                                                                                                
           Insert "The board may enter into agreements with                                                                     
      (1) dispensers in this  state that are not regulated  by                                                                  
      the  state   to  submit   information   to  and   access                                                                  
      information in  the database, and  (2) practitioners  in                                                                  
      this  state  to  access  information  in  the database,                                                                   
      subject  to this  section  and the  regulations  of  the                                                                  
      board."                                                                                                                   
                                                                                                                                
 Vice-Chair Stoltze OBJECTED for discussion.                                                                                    
                                                                                                                                
 Vice-Chair  Stoltze  requested   if  there  were  any   other                                                                  
 dispensers not regulated by the state.                                                                                         
                                                                                                                                
 Ms. Blaisdell disclosed  that originally  the paragraph  only                                                                  
 mentioned military or tribal but it was broadened to  include                                                                  
 the internet  or  medical  doctors  on  ships  inside  Alaska                                                                  
 waters.                                                                                                                        
                                                                                                                                
 Vice-Chair Stoltze  WITHDREW his  OBJECTION.  There being  NO                                                                  
 further OBJECTION, it was so ordered.                                                                                          
                                                                                                                                
 1:34:58 PM                                                                                                                   
                                                                                                                                
 Co-Chair Meyer referred to the fiscal notes.                                                                                   
                                                                                                                                
 1:35:26 PM                                                                                                                   
                                                                                                                                
 Representative  Gara  questioned  the  date  information   is                                                                  
 removed from the database.                                                                                                     
                                                                                                                                
 Ms. Blaisdell replied  that it  would be two  years from  the                                                                  
 date the prescription was obtained.                                                                                            
                                                                                                                                
 Representative  Gara  asked  if  there  would  be  a  problem                                                                  
 reducing it  to one year.  Ms. Blaisdell  replied that  forty                                                                  
 states  have  this  database  and  most  have  a  three  year                                                                  
 provision.   Representative    Gara   inquired   about    the                                                                  
 classification for the Class C and Class B offenses.                                                                           
                                                                                                                                
 1:37:46 PM                                                                                                                   
                                                                                                                                
 Ms.  Blaisdell   deferred  to   legislative   legal  or   the                                                                  
 Department of  Law. She  mentioned  that the  legislation  is                                                                  
 written  this way  in  other  states  and  seems  to  be  the                                                                  
 accepted nationwide practice.                                                                                                  
                                                                                                                                
Representative  Gara pointed  out  that  "knowingly" is  only                                                                   
written in  regards to part of  the crime. He wanted  to make                                                                   
sure that the  legislation is properly written  so someone is                                                                   
not  put in  prison if  they did  not "know"  what they  were                                                                   
doing was wrong.                                                                                                                
                                                                                                                                
1:39:02 PM                                                                                                                    
                                                                                                                                
Ms. Blaisdell remarked that this  issue was brought up before                                                                   
in House Judiciary  with the example that if  a janitor finds                                                                   
personal information  that has been thrown in the  trash of a                                                                   
doctor's  office,  the office  did  not "knowingly"  give  it                                                                   
away.   But  if  the   janitor  then   illegally  uses   that                                                                   
information, then that would be classified as "knowingly."                                                                      
                                                                                                                                
Representative  Gara  wondered if  someone  who  works for  a                                                                   
pharmacist  and  "unknowingly"  gives the  medication  to  an                                                                   
improper individual would that  be classified as "knowingly".                                                                   
                                                                                                                                
1:41:08 PM                                                                                                                    
                                                                                                                                
Ms. Blaisdell remarked  that in the federal grant  there is a                                                                   
significant emphasis  on education for the proper  use of the                                                                   
database.  There has been  discussions if  the access  to the                                                                   
database could  be delegated to  another individual  on staff                                                                   
in a  pharmacy or  medical office  and the resounding  answer                                                                   
was no.                                                                                                                         
                                                                                                                                
1:43:02 PM                                                                                                                    
                                                                                                                                
Vice-Chair Stoltze MOVED to REPORT  HCS CSSB 196 (JUD) out of                                                                   
Committee,    with   a   Letter    of   Intent,    individual                                                                   
recommendations  and accompanying  fiscal notes. There  being                                                                   
NO OBJECTION, it was so ordered.                                                                                                
                                                                                                                                
HCS CSSB 196 (JUD) REPORTED from  the Committee with a Letter                                                                   
of Intent,  no recommendations,  and accompanying  new fiscal                                                                   
note from the  Department of Health and Social  Services, and                                                                   
a previously  published  fiscal note from  the Department  of                                                                   
Economic Development.                                                                                                           
                                                                                                                                
1:44:15 PM                                                                                                                    
                                                                                                                                
HOUSE BILL NO. 337                                                                                                            
                                                                                                                                
     "An Act  establishing the Alaska Health  Care Commission                                                                   
     and the Alaska health care  information office; relating                                                                   
     to health  care planning and information;  repealing the                                                                   
     certificate  of  need program  for  certain health  care                                                                   
     facilities  and   relating  to  the   repeal;  annulling                                                                   
     certain regulations  required for implementation  of the                                                                   
     certificate  of  need program  for  certain health  care                                                                   
     facilities; and providing for an effective date."                                                                          
                                                                                                                                
 1:44:32 PM                                                                                                                   
                                                                                                                                
 KARLEEN  JACKSON,  COMMISSIONER,  DEPARTMENT  OF  HEALTH  AND                                                                  
 SOCIAL  SERVICES presented  an  overview  of  the  bill.  She                                                                  
 indicated this was  the Governor's  Health Care Transparency                                                                   
 Act  crafted  after  a  year's  work  with  input  from   two                                                                  
 different  reports,  the  Governor's  Health  Care   Planning                                                                  
 Strategy Council and the Certificate of Need Task Force.  The                                                                  
 intent of  bill  was to  have three  components  that  worked                                                                  
 together to  improve Alaska  Health Care.  She indicated  the                                                                  
 three components of the bill to achieve this goal were to:                                                                     
                                                                                                                                
      1.  Create a Health Commission charged with making  sure                                                                  
      Alaska has  a  state-wide plan  responsive  to  changing                                                                  
      demographics and Market  conditions to guide public  and                                                                  
      private investments in  the health care service  system.                                                                  
      Begin policy discussion  about tough issues like end  of                                                                  
      life care.                                                                                                                
                                                                                                                                
      2. Promote  self-responsibility by  giving Alaskans  new                                                                  
      tools to  take charge of  their health  and health  care                                                                  
      options  through a  web-based  information  source  that                                                                  
      makes  clear the  cost,  availability,  and  quality  of                                                                  
      those options.                                                                                                            
                                                                                                                                
      3. Encourage  healthy  competition  among  providers  of                                                                  
      health  care  so  that   consumer  choice  rather   than                                                                  
      government and court  intervention determines the  cost,                                                                  
      availability and quality  of health care by eliminating                                                                   
      Certificate of Need program.                                                                                              
                                                                                                                                
 The original bill had seven hearings in the House Health  and                                                                  
 Social  Services  committee  that  resulted  in  the  current                                                                  
 version of the bill.                                                                                                           
                                                                                                                                
 Ms.  Jackson  presented  a  sectional  analysis  of  HB  337,                                                                  
 Version N (copy on file).                                                                                                      
                                                                                                                                
   Section 1                                                                                                                    
      Provides for Legislative findings and intent to  mandate                                                                  
      an evaluation of the state's health care needs,  propose                                                                  
      reforms,  and   improve  health   care   in  Alaska   by                                                                  
      establishing the Alaska  Health Care Commission for  the                                                                  
      purpose  of  developing  a  comprehensive  policy   that                                                                  
      better meets  the  current and  long-range  health  care                                                                  
      needs in the state.                                                                                                       
                                                                                                                                
  Sec. 2 AS 18.05.010(b)                                                                                                        
      Requires the  Department of Health  and Social Services                                                                   
      to implement  a statewide  health plan  under AS  18.09,                                                                  
      which is a new chapter  creating the Alaska Health  Care                                                                  
      Commission.                                                                                                               
                                                                                                                                
 Sec. 3 AS 18.07.031(e)                                                                                                         
     Amends   definition    of   "expenditure"    under   the                                                                   
     Certificate of Need program.                                                                                               
                                                                                                                                
 Sec. 4 AS 18.07.111(8)                                                                                                         
     Under  the  Certificate  of Need  program,  applies  the                                                                   
     definition  of "health care  facility," if the  hospital                                                                   
     facility  or  center is  located  in a  municipality  or                                                                   
     borough that has a critical  access hospital or that has                                                                   
     a  population  of  60,000 or  fewer  persons  (excluding                                                                   
     recipients of  military or Indian Health  Service health                                                                   
     care);  and   nursing  homes,  residential   psychiatric                                                                   
     treatment  centers;  excludes   Alaska  Pioneers  Homes,                                                                   
     offices of private physicians  or dentists, and military                                                                   
     and tribal health entities.                                                                                                
                                                                                                                                
 Sec. 5 AS 18.07.111                                                                                                            
     Amends  definitions of facilities  in which  Certificate                                                                   
     of   Need  applies,   including:   ambulatory   surgical                                                                   
     facility,   critical   access    hospital,   independent                                                                   
     diagnostic    testing   facility,   intermediate    care                                                                   
     facility, kidney  dialysis center, nursing  home, office                                                                   
     of private physicians (50  percent owned and operated by                                                                   
     physicians), and psychiatric hospital.                                                                                     
                                                                                                                                
 Sec. 6 AS 18                                                                                                                   
     Adds  new   Chapter  9,  Statewide   Health  Information                                                                   
     Office; Article 1. Sec. 18.09.100  Establishes an Alaska                                                                   
     Health  Care Information  Office  in  the Department  of                                                                   
     Health  and  Social  Services  to  provide  consistently                                                                   
     updated   health  care  facility   information   to  aid                                                                   
     consumers  of health care  services, and information  to                                                                   
     encourage  personal  responsibility  in  prevention  and                                                                   
     healthy living.                                                                                                            
                                                                                                                                
 Sec. 18.09.110                                                                                                                 
  Requires the department to establish and maintain a                                                                           
     database  on  an  Internet  website  about  health  care                                                                   
     facilities  services and cost.  Information in  the data                                                                   
     base includes  health care facility  information; health                                                                   
     care providers  licensed in Alaska;  a list of  not more                                                                   
     than 1500  commonly prescribed medications  in the state                                                                   
     and the cost; a list of not  more than 250 most commonly                                                                   
     conducted medical procedures  in the state and the cost;                                                                   
     hospital  ratings;  consumer  education  information  on                                                                   
     health,  insurance information,  clinics  that cater  to                                                                   
     uninsured and  self-pay patients; and quality  of health                                                                   
     care  facilities; and  information regarding  prevention                                                                   
     and healthy living.                                                                                                        
                                                                                                                                
 Sec. 18.09.120                                                                                                               
     Requires   health  care   facilities   to  provide   the                                                                   
     department information related  to the facility's health                                                                   
      care services  for placement on  the database developed                                                                   
      under AS 18.09.110.                                                                                                       
                                                                                                                                
   Sec. 18.09.130                                                                                                             
      The Department  of  Administration,  the  Department  of                                                                  
      Commerce, Community  and Economic  Development, and  the                                                                  
      Department of Labor  and Workforce Development, and  the                                                                  
      Department  of   Law  shall   provide  information   for                                                                  
      placement  on the  database  regarding  adverse  actions                                                                  
      taken  against  a  health   care  facility  or   against                                                                  
      licensed  professionals   practicing   in  health   care                                                                  
      facilities  in   the  state  and   cooperate  with   the                                                                  
      department  in  performance  of  its  duties  under   AS                                                                  
      18.09.100-18.09.130.                                                                                                      
                                                                                                                                
 Article 2                                                                                                                      
                                                                                                                                
  Sec. 18.09.900                                                                                                                
      Allows the Department of  Health and Social Services  to                                                                  
      adopt regulations under  AS 44.62 to carry out  purposes                                                                  
      of this chapter.                                                                                                          
                                                                                                                                
  Sec. 18.09.990                                                                                                                
      Provides  definitions  of  facilities  from  which   the                                                                  
      department would collect information.                                                                                     
                                                                                                                                
 1:50:43 PM                                                                                                                   
                                                                                                                                
  Sec. 7                                                                                                                        
      Establishes a  16-member Alaska  Health Care Commission                                                                   
      within the  Department of  Health and  Social  Services.                                                                  
      The  purpose  of  the  Commission  is  to  consider  the                                                                  
      spectrum of  health care  related issues  and  formulate                                                                  
      policy   recommendations  to   be   presented   to   the                                                                  
      legislature  and   executive   branch;  to   develop   a                                                                  
      statewide plan  to  address the  quality, accessibility                                                                   
      and affordability  of health  care for  all citizens  of                                                                  
      the  state;  to   provide  an  annual   report  to   the                                                                  
      legislature  that  includes  a  comprehensive   list  of                                                                  
      policy options  considered  by  the commission;  and  to                                                                  
      review and approve facility health care information  for                                                                  
      placement   on  the   department's   Internet   database                                                                  
      established under AS 18.09.110.                                                                                           
                                                                                                                                
  Section 2                                                                                                                     
      Specifies that  the plan  contain a  health care  policy                                                                  
      and a strategy for encouraging: personal responsibility                                                                   
      and reductions  in  health care  costs; access  to  safe                                                                  
      water  and   wastewater   systems;  development   of   a                                                                  
      sustainable health  care workforce;  accessible  quality                                                                  
      health care; and an increase in the number of residents                                                                   
      who are covered by insurance.                                                                                             
                                                                                                                                
Ms. Blaisdell described that the membership of the                                                                              
commission includes:                                                                                                            
                                                                                                                                
          1. The department medical director (chair)                                                                            
          2. A representative of the Mental Health Trust                                                                        
     Authority, appointed by the authority                                                                                      
          3. A representative of the University of Alaska                                                                       
     health  education and  training  programs appointed,  by                                                                   
     the university                                                                                                             
          4. Seven public members including:                                                                                    
               a. one  member representing the  Alaska Native                                                                   
               Tribal  Health  Consortium  appointed  by  the                                                                   
               consortium                                                                                                       
               b. one member representing  the Alaska Primary                                                                   
               Care    Association,    appointed    by    the                                                                   
               association                                                                                                      
               c.  one member  representing the Alaska  State                                                                   
               Nurses    Association,   appointed    by   the                                                                   
               association                                                                                                      
               d.   one   member  representing   the   health                                                                   
               insurance industry appointed by the governor                                                                     
               e.  two  health  care consumers  or  advocates                                                                   
               appointed  by the governor,  one of  whom will                                                                   
               be a small business owner in the state                                                                           
               f.  six  members  of  the  legislature,  three                                                                   
               appointed  by the president of the  senate and                                                                   
               three  appointed by the  speaker of  the house                                                                   
               of representatives.                                                                                              
                                                                                                                                
Ms.  Blaisdell   remarked  that  the  terms   of  office  are                                                                   
staggered  terms   of  three   years.  She  noted   that  the                                                                   
commission shall  employ an executive  director who is  not a                                                                   
member of the  commission. She stressed that  the Health Care                                                                   
Commission will sunset on June 30, 2014.                                                                                        
                                                                                                                                
 Sec. 8                                                                                                                         
     Directs  the commissioner  of the  Department of  Health                                                                   
     and   Social  Services   and   Department   of  Law   to                                                                   
     immediately  take  steps to  seek dismissal  of  pending                                                                   
     administrative appeals and  court actions concerning the                                                                   
     issuance of certificates  of need, as appropriate, under                                                                   
     AS 18.07, as amended.                                                                                                      
                                                                                                                                
 Sec. 9                                                                                                                         
     Allows the  Department of Health and Social  Services to                                                                   
     adopt  regulations  that   are  necessary  to  implement                                                                   
     changes made by this Act.                                                                                                  
                                                                                                                                
 Sec. 10                                                                                                                        
     Provides for  the department of contract  with an entity                                                                   
     to conduct  a comprehensive study of the  effects of the                                                                   
     certificate of need program  in the state, and provide a                                                                   
     copy of the study to the legislature.                                                                                      
                                                                                                                                
  Sec. 11                                                                                                                       
      Section 9 takes effect immediately (for the development                                                                   
      of regulations).                                                                                                          
                                                                                                                                
  Sec. 12                                                                                                                       
   Except as provided in sec. 11, the Act takes effect July                                                                     
   1, 2008.                                                                                                                     
                                                                                                                                
 1:53:34 PM                                                                                                                   
                                                                                                                                
 Ms. Jackson  summarized that the  bill would  put together  a                                                                  
 health commission and  an outline for  an information  office                                                                  
 to  move  Alaskans  toward  a  better  health  care   system.                                                                  
 However, as originally  crafted, the  Governor's Health  Care                                                                  
 Transparency Act  repeals the  CON program  moving Alaska  to                                                                  
 full competition  in the  health care  market  and away  from                                                                  
 thirty years of a government  controlled and, most  recently,                                                                  
 court-determined health care  delivery system that is one  of                                                                  
 the most expensive and least accessible in the country.                                                                        
                                                                                                                                
 1:54:57 PM                                                                                                                   
                                                                                                                                
 Co-Chair Meyer questioned why the Commission would sunset.                                                                     
                                                                                                                                
 Ms. Jackson agreed this was  a good question and admitted  to                                                                  
 being happier if it was not there.                                                                                             
                                                                                                                                
 1:55:48PM                                                                                                                    
                                                                                                                                
 Representative Gara asked what prevents this Commission  from                                                                  
 studying things but not implementing anything. He noted  that                                                                  
 the  Governor   appointed  a   Commission   last  year   that                                                                  
 recommended changes  to  the Denali  KidCare program  to  two                                                                  
 hundred percent eligibility  but a bill  never came from  the                                                                  
 Governor's Office.                                                                                                             
                                                                                                                                
 Ms. Jackson  responded that  the first  task  force was  time                                                                  
 limited. The task  force looked  at the long  and short  term                                                                  
 strategies that could be developed  but did not have time  to                                                                  
 put fiscal notes to the policies. One of the recommendations                                                                   
 included an ongoing  Commission to provide  an annual  report                                                                  
 with  policy  recommendations  to  the  Legislature  and  the                                                                  
 Governor. The difference  with this Commission  would be  the                                                                  
 deliverance of a report every year.                                                                                            
                                                                                                                                
 1:57:32 PM                                                                                                                   
                                                                                                                                
 Representative Gara  noted that  the Commission  proposal  on                                                                  
 Denali KidCare  at two hundred  percent was  known but  never                                                                  
 acted upon.                                                                                                                    
                                                                                                                                
 Ms. Jackson  responded that there  were many  issues to  deal                                                                  
 with in regard to health  reform. The health care commission                                                                   
insures  that all  the different  strategies  and goals  have                                                                   
timelines and a possibility of being implemented over time.                                                                     
                                                                                                                                
Representative  Gara disagreed  and  thought Denali  KidCare,                                                                   
with  a known  fiscal  note,  should  not wait  from  another                                                                   
report   from  another   Commission.  He   referred  to   the                                                                   
Commission    composition   as    being   heavy   in    group                                                                   
representation but  little representation from  the consumers                                                                   
affected.                                                                                                                       
                                                                                                                                
Ms. Jackson responded  that the original legislation  did not                                                                   
have  the  specific seats  but  was  the evolution  of  seven                                                                   
meetings.  She  believed   this  to  be  a   balance  of  all                                                                   
suggestions. She  shared his concerns to make  sure consumers                                                                   
were involved but  suggested that any work by  the Commission                                                                   
would include public testimony.                                                                                                 
                                                                                                                                
2:01:14 PM                                                                                                                    
                                                                                                                                
Representative   Gara  requested   to  see  the   alternative                                                                   
proposals  for the  board. He  believed  the suggested  board                                                                   
would  not  be reflective  of  the  vast majority  of  people                                                                   
without health insurance.                                                                                                       
                                                                                                                                
2:01:50 PM                                                                                                                    
                                                                                                                                
Ms.  Jackson  pointed  out  that   the  Alaska  Primary  Care                                                                   
Association  does work toward  trying to  make sure  that the                                                                   
uninsured have insurance.                                                                                                       
                                                                                                                                
2:02:18 PM                                                                                                                    
                                                                                                                                
ROD  BETIT,  PRESIDENT,  ALASKA  HOSPITAL  AND  NURSING  HOME                                                                   
ASSOCIATION    supported    the   legislation    with    some                                                                   
reservations.  The Association  supported  Sections  1 and  2                                                                   
which  they believed  would improve  the  functioning of  the                                                                   
department. The  Association opposed  Section 3 and  believed                                                                   
the current  language  is recommended  over the new  proposed                                                                   
language.                                                                                                                       
                                                                                                                                
2:05:46 PM                                                                                                                    
                                                                                                                                
Mr.  Betit  signified  concern   in  Section  4  in  that  it                                                                   
redefined the definition of a  health care facility. The bill                                                                   
states this  is a  way to increase  competition and  decrease                                                                   
costs but the Association believed  this would have the exact                                                                   
opposite effect.  He stated  the repeal of  the CON  would be                                                                   
detrimental to  Alaska consumers.  A 2001 study  by Chrysler,                                                                   
Ford  and General  Motors  examined  health care  costs  over                                                                   
several  years in  eight  states and  found  that costs  were                                                                   
eleven  to  thirty-nine  percent  lower in  states  with  CON                                                                   
requirements  than in  those without  it. The  amount of  bad                                                                   
debt  increased  fifty  five   percent  in  Alaska  hospitals                                                                   
between 2006 and 2007. Mr. Betit  stressed that the repeal of                                                                   
 CON would  reduce  hospitals  revenue  from  more profitable                                                                   
 service  areas used  to  offset  part  of  growing  bad  debt                                                                  
 problem.                                                                                                                       
                                                                                                                                
 2:07:59 PM                                                                                                                   
                                                                                                                                
 Mr.  Betit  referred  to  Section  5  and  the  proposed  new                                                                  
 definitions.   Definition   #13   deals   with   Independent                                                                   
 Diagnostic Testing Facility versus a physician practice  with                                                                  
 imagining equipment.  He believed  Definition  #13 should  be                                                                  
 replaced  with language  from  HB  345  that  clarifies  when                                                                  
 imaging  equipment purchased  for  a  physician's  office  is                                                                  
 exempt  from  CON  review.  He  speculated  that  this  added                                                                  
 language would eliminate eighty  percent of the lawsuits  and                                                                  
 appeals currently before the state on imaging CON decisions.                                                                   
 He believed  Definition  #17 should  be entirely  deleted  as                                                                  
 there is no useful purpose  for attempting to define what  is                                                                  
 or is not a physician  office. Physician offices have  always                                                                  
 been exempt from CON in  Alaska and this proposed definition                                                                   
 would simply create interpretive  complexity to an area  that                                                                  
 is already  very clear. Mr.  Betit observed  Section 6  deals                                                                  
 with  the  Health  Care  Information  Office  and  mandatory                                                                   
 reporting.  The  Association  strongly  supports  efforts  to                                                                  
 provide consumers  with  better information  to  guide  their                                                                  
 health  care  purchases   with  a  few  additional   language                                                                  
 clarification amendments.                                                                                                      
                                                                                                                                
 2:11:29 PM                                                                                                                   
                                                                                                                                
 Mr. Betit referred to Section  7 that establishes the  Health                                                                  
 Care  Commission  and   remarked  the  Association   strongly                                                                  
 supports this commission but strongly recommends amending  it                                                                  
 to give  the Commission  authority  to define  the reporting                                                                   
 requirements for  each health care  category. The Commission                                                                   
 is the more  appropriate body  for determining  what is  most                                                                  
 useful to consumers  in weighing health  care decisions  that                                                                  
 must be made.                                                                                                                  
                                                                                                                                
 2:12:49 PM                                                                                                                   
                                                                                                                                
 Mr. Betit  discussed the  importance of  the  sunset for  the                                                                  
 Commission. He remarked the Commission needs to be monitored                                                                   
 to see if it is fulfilling its purpose. If the Commission  is                                                                  
 not  fulfilling   its  purpose,   it  would   go  away.   The                                                                  
 Association does  not  support Sections  8  and 9.  He  noted                                                                  
 Section  10  strongly  supports  competition  of  an   Alaska                                                                  
 specific CON study to address  the question of what impact  a                                                                  
 CON repeal  would have in  Alaska. The  Association does  not                                                                  
 support  any  repeal  of  CON  and therefore   believed  this                                                                  
 diction should be deleted. In Section 11, which deals  with a                                                                  
 mandatory reporting  date,  the Association  believes  it  is                                                                  
 unrealistic to  expect  for receiving  and  posting  reported                                                                  
 information prior to July 1, 2009.                                                                                             
                                                                                                                                
2:14:21 PM                                                                                                                    
                                                                                                                                
Representative  Gara inquired  if  the Committee  decided  to                                                                   
pass part  of this bill  and passed the consumer  information                                                                   
sections  6 and  7 would  the Association  support this.  Mr.                                                                   
Betit said yes.                                                                                                                 
                                                                                                                                
2:14:49 PM                                                                                                                    
                                                                                                                                
PAUL  MORRIS, CFO,  ALASKA REGIONAL  HOSPITAL supported  this                                                                   
legislation as a  great first step in Alaska  Health care. An                                                                   
independent study  is needed to  evaluate where the  state is                                                                   
going,  the  language  used,  and  how  it  will  affect  the                                                                   
consumer.  He   listed  several  pro  and  CON   studies  and                                                                   
overwhelmingly each group decided  to retain the CON. He also                                                                   
referenced the definition of physician practice.                                                                                
                                                                                                                                
2:18:20 PM                                                                                                                    
                                                                                                                                
Representative Gara inquired if  Mr. Morris would support the                                                                   
bill if two sections, the Health  Information Section and the                                                                   
Planning  Commission  were  passed   and  then  a  study  was                                                                   
initiated on the  CON. Mr. Morris agreed. He  agreed that all                                                                   
three components  are good but more detailed  data collection                                                                   
on the CON was needed.                                                                                                          
                                                                                                                                
Representative Gara requested  where the CON study was in the                                                                   
bill. Representative Hawker replied it was in Section 10.                                                                       
                                                                                                                                
2:20:00 PM                                                                                                                    
                                                                                                                                
Mr. Morris  referred to the extensive  study in the  state of                                                                   
Maine that indicated the CON should be retained.                                                                                
                                                                                                                                
Representative  Gara agreed  but was  troubled by each  group                                                                   
wanting  their view  to be  represented but  he believed  the                                                                   
greater importance  was what is  best for the state.  A study                                                                   
could provide an independent judgment on the best decision.                                                                     
                                                                                                                                
2:21:06 PM                                                                                                                    
                                                                                                                                
Mr. Morris agreed  with Representative Gara that  a study was                                                                   
needed and if one  was not done, then the problem  would keep                                                                   
reoccurring and the debate would continue.                                                                                      
                                                                                                                                
2:21:42 PM                                                                                                                    
                                                                                                                                
PAUL  FUHS, ALASKA  OPEN IMAGING  CENTER,  remarked that  all                                                                   
agree  on  defining  an  individual   independent  diagnostic                                                                   
testing facility  and physician's  office. The result  of not                                                                   
having a  good definition is  having nine lawsuits  filed. In                                                                   
order  to come  under the  $1 million  threshold, people  are                                                                   
turning  to old  technology and  equipment.  He believed  the                                                                   
Medicare services  guidelines should be followed  that do not                                                                   
 require any  percentage  of  ownership. He  noted  the  fifty                                                                  
 percent number was added because people did not want  a store                                                                  
 front taking imagining with no doctor on premises.                                                                             
                                                                                                                                
 2:24:51 PM                                                                                                                   
                                                                                                                                
 Mr. Fuhs  continued that  data  collection is  important  for                                                                  
 people  to  be  able  to make  informed  choices,   otherwise                                                                  
 medical expenses are being driven up.                                                                                          
                                                                                                                                
 2:25:29 PM                                                                                                                   
                                                                                                                                
 JOEL GILBERTSON,  REGIONAL  DIRECTOR,  STRATEGIC DEVELOPMENT                                                                   
 AND  ADMINISTRATION,  PROVIDENCE   HOSPITAL  (testified   via                                                                  
 teleconference),  shared that  healthcare  is  becoming  more                                                                  
 unaffordable  throughout  the   nation  and  the  state.   He                                                                  
 believed a  clear  first step  would  be  the creation  of  a                                                                  
 Commission. He  agreed  that more  information is  needed  to                                                                  
 represent the consumers  for recommendations  in health  care                                                                  
 reform. The information needs to be relevant and accurate  to                                                                  
 make better decisions. Health  care costs are driven by  what                                                                  
 is ordered and charged by physicians and facilities.                                                                           
                                                                                                                                
 2:29:24 PM                                                                                                                   
                                                                                                                                
 Mr. Gilbertson  signified that  Providence  does not  support                                                                  
 the proposed language  to repeal the  Certificate of Need  in                                                                  
 communities over 60,000.  He believed this eliminates  public                                                                  
 participation  and   input  in  health   care  planning   and                                                                  
 infrastructure in the communities. There is research  for and                                                                  
 against the  CON. The Task  Force agreed  that the  CON is  a                                                                  
 relevant public policy  tool that needs  to be preserved.  He                                                                  
 supported a study to be completed on the CON.                                                                                  
                                                                                                                                
 Representative Gara asked if  that if there was an  agreement                                                                  
 on how to rewrite  the CON law would  he support a bill  that                                                                  
 passed out with the Health  Care Office, the Commission,  and                                                                  
 the CON study.  Mr. Gilbertson  agreed that  with some  minor                                                                  
 amendments    they    would    support    the   legislation.                                                                   
 Representative  Gara  remarked  that  the  Commission   would                                                                  
 address the availability of  medical care. He contended  that                                                                  
 one of the big  indicators for keeping  a doctor in state  is                                                                  
 whether they can  attend a residency  program in this  state.                                                                  
 He noted that Mr. Gilbertson has a family practice residency                                                                   
 that may be expanding. Representative Gara inquired  how many                                                                  
 people annually come out of  this practice and if it was  the                                                                  
 only one in the state.                                                                                                         
                                                                                                                                
 2:32:54 PM                                                                                                                   
                                                                                                                                
 Mr. Gilbertson  answered that  there was  only one  residency                                                                  
 program in  Alaska. It  is a  three-year program  with  eight                                                                  
 residents and  is subsidized  by Providence.  Providence  has                                                                  
prioritized  growing  the  program;  the  current  first-year                                                                   
class has  12 residents.  National studies  show that  one of                                                                   
the leading determinants  of where a physician  will practice                                                                   
is where  they did  their residency.  However, the  residency                                                                   
program loses  money. It  is a  working clinic for  uninsured                                                                   
and  Medicaid/Medicare  patients, and  is  subsidized by  the                                                                   
hospital at $2 million per year.                                                                                                
                                                                                                                                
Representative  Gara offered to  work with Mr.  Gilbertson on                                                                   
the subject.                                                                                                                    
                                                                                                                                
Vice-Chair Stoltze stated concerns.                                                                                             
                                                                                                                                
2:35:44 PM                                                                                                                    
                                                                                                                                
ROBERT   CIMASI,  PRESIDENT,   HEALTH  CAPITAL   CONSULTANTS,                                                                   
MISSOURI (testified via teleconference),  spoke in support of                                                                   
HB 337.  He summarized  his written  report to the  Committee                                                                   
("Alaska  Health, Education  and  Social Services  Committee,                                                                   
Testimony on Certificate of Need," Copy on File).                                                                               
                                                                                                                                
Mr. Cimasi referred to the many  studies done on CON programs                                                                   
and cautioned  the Committee to  read them carefully  as they                                                                   
each address different issues.                                                                                                  
                                                                                                                                
Mr.  Cimasi  thought   that  health  care  should   be  about                                                                   
providing care  to patients and their families.  He addressed                                                                   
cross subsidization  as a "hidden  tax." Hospitals  provide a                                                                   
broad range of  services. Those with CON raise  prices. Costs                                                                   
go up on the  promise that there will be  cross subsidization                                                                   
of  other services.  He referred  the Committee  to a  Health                                                                   
Affairs article  by Clark Havighurst, who states  that health                                                                   
insurance  greatly increases the  profitability of  monopoly.                                                                   
If costs are allowed to be raised  and there is no commitment                                                                   
against cross subsidization, the  result is higher costs with                                                                   
no benefit to anyone.                                                                                                           
                                                                                                                                
Mr.  Cimasi referred  to an  extensive study  by the  Federal                                                                   
Trade Commission,  "Hospital Competition  and Charity  Care,"                                                                   
which states there is a lack of  statistical evidence for the                                                                   
cross subsidization  hypothesis. Other studies  support that.                                                                   
He  asked the  Committee to  focus  on the  consumer and  the                                                                   
patient.  CON  regulation  is  favorable  to  hospitals,  not                                                                   
consumers.                                                                                                                      
                                                                                                                                
2:47:12 PM                                                                                                                    
                                                                                                                                
NANCY    CROSS,   PHYSICIAN,    FAIRBANKS   (testified    via                                                                   
teleconference),  spoke in  support of  HB 337.  She has  not                                                                   
been able  to secure  privileges at  the local hospital.  She                                                                   
cannot do hospital  based procedures, but must  take patients                                                                   
to  Anchorage, which  limits patients  who  cannot afford  to                                                                   
travel.  She   described  the   long  process  of   applying,                                                                   
 inquiring and being  given privileges  and having them  taken                                                                  
 away.                                                                                                                          
                                                                                                                                
 2:51:46 PM                                                                                                                   
                                                                                                                                
 DR. LARRY STINSON, ANCHORAGE (testified via teleconference),                                                                   
 spoke  in  favor  of  the  bill.  He  thought  it  had   been                                                                  
 demonstrated  to  be  effective  other  places.  In   current                                                                  
 literature  CON hasn't  been  shown  to be  of  benefit,  but                                                                  
 drives up costs.  The state program has  been in place  since                                                                  
 1986. Each year  the study is delayed  it hurts the  patient.                                                                  
 He is wary of a study if it does not represent the consumer.                                                                   
 Hospitals in other states without CON still make profits.                                                                      
                                                                                                                                
 2:55:33 PM                                                                                                                   
                                                                                                                                
 GRANT   RODERER,   PHYSICIAN,   ANCHORAGE   (testified    via                                                                  
 teleconference), asked  the Committee to  repeal the CON.  He                                                                  
 would like the population limit lowered.                                                                                       
                                                                                                                                
 JOANNE SMITH, WASILLA  (testified via teleconference),  spoke                                                                  
 in favor  of  the  bill.  The  current  CON  regulations  are                                                                  
 outdated and should be  repealed. The population base  should                                                                  
 be eliminated.  Alaska  has  the  highest  price  and  lowest                                                                  
 quality in  health care, and  a shortage  of physicians.  CON                                                                  
 was repealed  on  the federal  level  over twenty  years  ago                                                                  
 because it  did not  work.  Competition is  a good  thing  in                                                                  
 health  care. She  thought  more  physicians  would  come  to                                                                  
 Alaska after CON was repealed.                                                                                                 
                                                                                                                                
 3:01:57 PM                                                                                                                   
                                                                                                                                
 RICHARD   COBDEN,   PHYSICIAN,   FAIRBANKS   (testified   via                                                                  
 teleconference), spoke in  support the legislation with  some                                                                  
 reservations,  including  eliminating  MatSu,  Anchorage  and                                                                  
 Fairbanks from  the process.  He  agrees that  CON increases                                                                   
 costs without  increasing care.  There has  been no  consumer                                                                  
 input on  the Commission.  He  thought legislators  have  the                                                                  
 responsibility to tax but  are abrogating that to hospitals.                                                                   
 He wanted to address the problems of health care directly.                                                                     
                                                                                                                                
 3:06:30 PM                                                                                                                   
                                                                                                                                
 KEVIN DOREY, FAIRBANKS (testified via teleconference),  spoke                                                                  
 in support of the bill as  a consumer and economist. The  CON                                                                  
 law as  applied in  Alaska is  a violation  of federal  anti-                                                                  
 trust law.  He thought  there would  be more  opportunity  to                                                                  
 move forward  if the  State did  not wait  until the  federal                                                                  
 government removed  CON. He  did not  think  Fairbanks was  a                                                                  
 rural community and did not  need the protections of the  CON                                                                  
 system. When  individuals  have applied  for CON,  they  have                                                                  
 been saddled with endless lawsuits.                                                                                            
                                                                                                                                
MIKE POWERS, CEO, FAIRBANKS MEMORIAL  HOSPITAL (testified via                                                                   
teleconference),  opposed  all  sections in  the  legislation                                                                   
that  support CON.  He listed  his  thoughts on  each of  the                                                                   
sections.  He spoke to  the other  testifiers who had  issues                                                                   
with the Fairbanks hospital.                                                                                                    
                                                                                                                                
3:15:12 PM                                                                                                                    
                                                                                                                                
JILL   THORVALD,   EXECUTIVE  DIRECTOR,   MEDICAL   FACILITY,                                                                   
FAIRBANKS   (testified   via    teleconference),   gave   her                                                                   
perspective  as  an  operator  in  a  private  facility.  She                                                                   
supports  the Governor's  bill on CON.  Physicians will  view                                                                   
Alaska as more attractive without  CON. More specialties will                                                                   
keep  money  in  Fairbanks  instead   of  patients  traveling                                                                   
outside Alaska and  to Anchorage. She thought  Medicare is an                                                                   
entirely  different  issue  that   needs  to  be  dealt  with                                                                   
separately.  She did  not see  the bill  as an  anti-hospital                                                                   
bill.                                                                                                                           
                                                                                                                                
3:19:36 PM                                                                                                                    
                                                                                                                                
STEPHEN  SUTLEY, FAIRBANKS  (testified  via  teleconference),                                                                   
spoke in support the legislation,  although he considers it a                                                                   
poor  compromise as  populations  are not  well defined.  The                                                                   
health care  issue is  major in  the national elections,  and                                                                   
thought it  should be an issue  in the state  elections. Well                                                                   
documented studies from many organizations  show that the CON                                                                   
does not work as it stifles free  market enterprise, consumer                                                                   
choice,  and physician  recruitment. Fairbanks  is among  the                                                                   
fastest  growing   cities  in   the  nation,  yet   it  lacks                                                                   
physicians.                                                                                                                     
                                                                                                                                
3:25:06 PM                                                                                                                    
                                                                                                                                
SCOTT  BELL,  FAIRBANKS MEMORIAL  HOSPITAL  FOUNDATION  BOARD                                                                   
(testified via  teleconference), supported many  parts of the                                                                   
bill,  but was  very opposed  to Sec.  4 which  would have  a                                                                   
strong  negative  impact  on   the  quality  of  health  care                                                                   
available.  He spoke  to  an award  the  hospital had  gotten                                                                   
recognizing its  commitment to community health.  He felt CON                                                                   
is  important  in  providing high  quality  health  care.  He                                                                   
highlighted  a  wide  range  of  services  at  the  Fairbanks                                                                   
hospital.                                                                                                                       
                                                                                                                                
3:28:22 PM                                                                                                                    
                                                                                                                                
MAREE     BARNEY-SUTLEY,     FAIRBANKS     (testified     via                                                                   
teleconference),  spoke as a consumer  and senior  in support                                                                   
of eliminating CON. She urged  the Committee to move the bill                                                                   
through.                                                                                                                        
                                                                                                                                
RYAN   SMITH,   CEO,  HOSPITAL,   SOLDOTNA   (testified   via                                                                   
teleconference), supported the  study but not the elimination                                                                   
of CON. The  hospital does not have a parent  company outside                                                                   
 of Alaska.  He  thought  the regulation  committee  had  been                                                                  
 poorly  represented.  The  group  voted  against  CON   being                                                                  
 removed.                                                                                                                       
                                                                                                                                
 3:31:10 PM                                                                                                                   
                                                                                                                                
 ROMAN  STEVENS,   CEO,  MAT-SU   MEDICAL  CENTER,  FAIRBANKS                                                                   
 (testified  via  teleconference),  said  the  committee   was                                                                  
 balanced and  thought  it was  misrepresented. He  wanted  to                                                                  
 maintain the  CON and  protect  community hospitals.  He  was                                                                  
 supportive of the study.                                                                                                       
                                                                                                                                
 MIKE   MCNAMARA,    SURGEON,   ANCHORAGE    (testified    via                                                                  
 teleconference), spoke in opposition  of the bill. He  agreed                                                                  
 with the need for  further information on  CON, and with  the                                                                  
 plan  to  create  a   Commission.  Regarding  CON,  none   of                                                                  
 Anchorage centers  are full  capacity. The  have become  very                                                                  
 specialized  and  rarely  have  to  send  people  outside  of                                                                  
 Alaska. He thought  more centers would  dilute that care  and                                                                  
 worried about losing peer oversight of big centers.  There is                                                                  
 a shortage of  nursing in  all centers. If  CON is repealed,                                                                   
 then centers will  be competing for  specialty nursing  staff                                                                  
 and  physicians.  The  larger  centers  have  the  power   to                                                                  
 negotiate contracts  with  insurance  companies  and  unions,                                                                  
 which brings costs down.                                                                                                       
                                                                                                                                
 3:36:56 PM                                                                                                                   
                                                                                                                                
 MARK    WADE,    SURGEON,     FAIRBANKS    (testified     via                                                                  
 teleconference),  spoke in  support  of the  legislation.  He                                                                  
 told his experience with CON.  He had been given one to  open                                                                  
 a center, but could not build  the center as he has lawsuits                                                                   
 against him. He believes that  freedom of choice is best  for                                                                  
 the people of Alaska. He  resigned from the committee,  where                                                                  
 citizens were not represented. He wanted a free market.                                                                        
                                                                                                                                
 3:42:14 PM                                                                                                                   
                                                                                                                                
 MURRAY  RICHMOND,  CHAPLAIN,   FAIRBANKS  MEMORIAL   HOSPITAL                                                                  
 (testified via teleconference),  spoke in  opposition to  the                                                                  
 legislation. He spoke  to the variety  of excellent  services                                                                  
 in Fairbanks  and  thought the  system  was working  for  the                                                                  
 consumer. He did not  want health care  to be subject to  the                                                                  
 forces of the market.                                                                                                          
                                                                                                                                
 CARONE  STURM,  FAIRBANKS  (testified  via  teleconference),                                                                   
 spoke as a consumer  in Fairbanks in  support of HB 337.  She                                                                  
 wants the  CON  repealed. She  has  a child  with  a  serious                                                                  
 health concern and said the costs are very high.                                                                               
                                                                                                                                
 3:46:31 PM                                                                                                                   
                                                                                                                                
 MIKE MADDOX, FAIRBANKS (testified via teleconference),  spoke                                                                  
 in support of the  bill. Fairbanks is  the only community  in                                                                  
the  country of  its  size with  one  hospital.  He spoke  to                                                                   
decreased service  to the community.  Fairbanks has  only one                                                                   
image  center. Costs  in some  cases  are doubled  (testimony                                                                   
garbled due to technical difficulties).                                                                                         
                                                                                                                                
3:50:44 PM                                                                                                                    
                                                                                                                                
JENNINE  HINMAN,  HEALTH CARE  CONSULTANT,  ADVANCED  MEDICAL                                                                   
CENTERS OF  ALASKA, WASILLA  (testified via  teleconference),                                                                   
spoke in favor  of the bill. Instead of getting  another task                                                                   
force, she  suggested repealing the  CON and providing  for a                                                                   
review of  that in five years.  She spoke to the  future need                                                                   
for care for disabled veterans from Iraq.                                                                                       
                                                                                                                                
PUBLIC TESTIMONY CLOSED.                                                                                                        
                                                                                                                                
HB  337  was   HEARD  and  HELD  in  Committee   for  further                                                                   
consideration.                                                                                                                  
                                                                                                                                
RECESS         3:56:17 PM                                                                                                     
                                                                                                                                
RECONVENE      7:23:52 PM                                                                                                     
                                                                                                                                
SENATE BILL NO. 229                                                                                                           
                                                                                                                                
     "An Act relating  to the Tanana Valley  State Forest and                                                                   
     to assignment of certain  forest land to the Minto Flats                                                                   
     State  Game  Refuge;  and  providing  for  an  effective                                                                   
     date."                                                                                                                     
                                                                                                                                
SENATOR JOE THOMAS,  SPONSOR, explained that  the bill amends                                                                   
the boundaries  of the Tanana  Valley State Forest  by adding                                                                   
and   deleting   boundaries  to   the   legal   descriptions,                                                                   
increasing it  by around 35,000  acres. The legislation  also                                                                   
moves approximately  4300 acres from the state  forest to the                                                                   
Minto Flats  State Game  Refuge (Sponsor  Statement,  Copy on                                                                   
File). The  forest is open  to mining and other  development.                                                                   
He described  the history  of the state  forest and  its many                                                                   
uses. He has received no negative comments on the bill.                                                                         
                                                                                                                                
7:27:09 PM                                                                                                                    
                                                                                                                                
Co-Chair  Chenault  applauded  the  bill  and  asked  if  the                                                                   
changes affect  ability for  oil and  gas exploration  on the                                                                   
lands.                                                                                                                          
                                                                                                                                
MARTY FREEMAN,  DIVISION OF  FORESTRY, DEPARTMENT  OF NATURAL                                                                   
RESOURCES, clarified  that there is  no change to  the status                                                                   
of the  land going  into the Tanana  Valley State  Forest. It                                                                   
continues to  be open  for oil, gas  and mining leasing.  The                                                                   
land  going  into the  refuge  is  closed  to mining.  It  is                                                                   
primarily managed for wildlife habitat.                                                                                         
                                                                                                                                
 Co-Chair Chenault  asked  how much  land  would go  into  the                                                                  
 reserve. Senator Thomas answered 4300 acres.                                                                                   
                                                                                                                                
 PUBLIC TESTIMONY CLOSED.                                                                                                       
                                                                                                                                
 Vice-Chair Stoltze MOVED  to REPORT SB  229 out of Committee                                                                   
 with individual recommendations and with accompanying  fiscal                                                                  
 notes. There being NO OBJECTION, it was so ordered.                                                                            
                                                                                                                                
 SB 229  was  REPORTED  out  of Committee  with  a  "do  pass"                                                                  
 recommendation  and   with  zero  fiscal   note  #1  by   the                                                                  
 Department of Natural  Resources and zero  fiscal note #2  by                                                                  
 Department of Fish and Game.                                                                                                   
                                                                                                                                
 AT EASE        7:30:56 PM                                                                                                    
                                                                                                                                
 RECONVENE      7:44:57 PM                                                                                                    
                                                                                                                                
 SENATE JOINT RESOLUTION NO. 17                                                                                               
                                                                                                                                
      Urging the  United States  Congress to  provide a  means                                                                  
      for consistently sharing,  on an ongoing basis,  revenue                                                                  
      generated from  oil  and gas  development on  the  outer                                                                  
      continental  shelf  with  all coastal  energy-producing                                                                   
      states to  ensure that  those states  develop,  support,                                                                  
      and  maintain  necessary  infrastructure  and   preserve                                                                  
      environmental integrity.                                                                                                  
                                                                                                                                
 Co-Chair Meyer noted for the record that he works for  an oil                                                                  
 company that does offshore exploring in Alaska.                                                                                
                                                                                                                                
 SENATOR BILL  WIELECHOWSKI, SPONSOR,  explained  that SJR  17                                                                  
 urges  Congress to  provide  Alaska  with  a  fair  share  of                                                                  
 federal revenue from oil and gas leasing and development  off                                                                  
 Alaska's coast. Under current law, Alaska receives virtually                                                                   
 no revenue  from oil  and gas  leasing and  development  that                                                                  
 occurs  more than  six  miles  off  the  coast.  The  federal                                                                  
 government has allowed other states 37.5 percent of  revenues                                                                  
 from newly  leased  federal  waters off  their  coasts.  Like                                                                  
 other energy-producing  states,  Alaska  bears the  costs  of                                                                  
 infrastructure  in  support  of  offshore  development,   and                                                                  
 coastal resources  and  residents bear  the impacts  of  that                                                                  
 development. (Sponsor Statement, Copy on File)                                                                                 
                                                                                                                                
 7:48:30 PM                                                                                                                   
                                                                                                                                
 Co-Chair Meyer  asked  if  Cook Inlet  was  considered  state                                                                  
 waters. Senator  Wielechowski thought  Cook  Inlet was  state                                                                  
 waters. He said the states  get no revenues after 6 miles.  A                                                                  
 lot of  leases occur 60  miles out  in the  Chukchi Sea.  Co-                                                                  
 Chair Meyer asked  if Representative  Joule's district  would                                                                  
 be affected. Senator Wielechowski said it would be.                                                                            
                                                                                                                                
Vice-Chair  Stoltze asked  about  sending  the Resolution  to                                                                   
delegations of  other states.  Senator Wielechowski  said the                                                                   
other state most affected by the issue is California.                                                                           
                                                                                                                                
7:50:06 PM                                                                                                                    
                                                                                                                                
Representative Gara  wondered if Alaska would get  any of the                                                                   
money retroactively.                                                                                                            
                                                                                                                                
Vice-Chair Stoltze spoke to the polar bear issue.                                                                               
                                                                                                                                
Vice-Chair Stoltze  MOVED to REPORT  SJR 17 out  of Committee                                                                   
with  individual recommendations  and  with the  accompanying                                                                   
fiscal note. There being NO OBJECTION, it was so ordered.                                                                       
                                                                                                                                
SJR  17  was REPORTED  out  of  Committee  with a  "do  pass"                                                                   
recommendation  and with zero  fiscal note  #1 by the  Senate                                                                   
Resources Committee.                                                                                                            
                                                                                                                                
CS FOR SENATE BILL NO. 185(STA)(title am)                                                                                     
                                                                                                                                
     "An  Act  relating  to  the   central  registry  of  sex                                                                   
     offenders and  child kidnappers and to  the registration                                                                   
     requirements  for sex  offenders  and child  kidnappers;                                                                   
     and providing for an effective date."                                                                                      
                                                                                                                                
SENATOR  WIELECHOWSKI,  SPONSOR,   explained  that  the  bill                                                                   
requires sexual  offenders and  child kidnappers  to register                                                                   
their email addresses and other  internet identifiers. Alaska                                                                   
has the  highest percentage  of internet  use in the  country                                                                   
and the highest percentage of sexual offenders.                                                                                 
                                                                                                                                
7:54:03 PM                                                                                                                    
                                                                                                                                
Representative   Gara  asked  if   page  2,  line   25,  made                                                                   
additional requirements  related to drivers  license numbers.                                                                   
Senator  Wielechowski  explained  that section  as  technical                                                                   
clean-up.                                                                                                                       
                                                                                                                                
Representative  Hawker stated that  he is uncomfortable  with                                                                   
the  bill. Page  3,  lines  27-31, essentially  requires  the                                                                   
Department of Public Safety (DPS)  to publish the list in its                                                                   
entirety.  He  thought that  gave  the Department  too  broad                                                                   
authority. It  could help sexual  offenders connect  with one                                                                   
another. Senator  Wielechowski responded  that the  intent is                                                                   
to allow  parents of children  to type in someone's  name and                                                                   
find out  if they  are a registered  sex offender.  He wanted                                                                   
DPS to  be able  to communicate  with internet providers  and                                                                   
organizations so  that they can  prohibit sex  offenders from                                                                   
having websites.  MySpace prohibits  convicted sex  offenders                                                                   
from having sites. He was open  to the will of the Committee.                                                                   
                                                                                                                                
7:57:17 PM                                                                                                                    
                                                                                                                                
 PUBLIC TESTIMONY CLOSED.                                                                                                       
                                                                                                                                
 SB  185  was  HEARD  and   HELD  in  Committee  for   further                                                                  
 consideration.                                                                                                                 
                                                                                                                                
 CS FOR SENATE BILL NO. 265(FIN)                                                                                              
                                                                                                                                
      "An  Act relating  to  the  payment  of  permanent  fund                                                                  
      dividends to  certain individuals  required to  register                                                                  
      as  sex  offenders  or  child kidnappers;   relating  to                                                                  
      execution  upon permanent  fund  dividends  by  civilian                                                                  
      process servers  using electronic  procedures;  amending                                                                  
      Rule 89, Alaska Rules of Civil Procedure; and providing                                                                   
      for an effective date."                                                                                                   
                                                                                                                                
 7:59:28 PM                                                                                                                   
                                                                                                                                
 TREVOR FULTON, STAFF,  SENATOR LESIL  MCGUIRE, explained  the                                                                  
 bill's intent  to bring  sex offenders  into compliance  with                                                                  
 the state  sex offender  registry. Approximately  one out  of                                                                  
 ten convicted  sex offenders  in the  state is non-compliant                                                                   
 with the  registry. The  bill would  withhold Permanent  Fund                                                                  
 Dividends  (PFD) from  anyone  not  properly  registered  and                                                                  
 would allow the  Permanent Fund Division  to issue the  writs                                                                  
 electronically.  Currently  there  are  approximately   4,200                                                                  
 people on the registry.                                                                                                        
                                                                                                                                
 8:02:00 PM                                                                                                                   
                                                                                                                                
 Representative Nelson asked  for clarification regarding  the                                                                  
 writs. Mr.  Fulton explained writs  as court  orders for  the                                                                  
 Division to sign over a PFD check to a debtor.                                                                                 
                                                                                                                                
 DEBBIE   RICHTER,   DIRECTOR,   PERMANENT   FUND   DIVISION,                                                                   
 DEPARTMENT OF  REVENUE, explained  that a writ  is the  court                                                                  
 document issued when a person owes any debt. It functions  as                                                                  
 permission for an agency or bank to pay the funds elsewhere.                                                                   
                                                                                                                                
 8:05:33 PM                                                                                                                   
                                                                                                                                
 There  was  a  discussion   about  PFD  payment  related   to                                                                  
 eligibility and compliancy.                                                                                                    
                                                                                                                                
 8:07:04 PM                                                                                                                   
                                                                                                                                
 Co-Chair Chenault  asked if  police agencies  have access  to                                                                  
 the PFD database.  Ms. Richter  answered that  they could  if                                                                  
 they had a  memorandum of  agreement with  the Division.  Co-                                                                  
 Chair Chenault stated concerns.                                                                                                
                                                                                                                                
 Representative  Gara  asked  for  clarification.  Mr.  Fulton                                                                  
 explained that a  person could  not get the  PFD if they  had                                                                  
not registered or if they were  out of compliance. The intent                                                                   
was to  have DPS and  the Division  of Motor Vehicles  (DMV),                                                                   
which houses the sex offender registry, run a check.                                                                            
                                                                                                                                
8:11:13 PM                                                                                                                    
                                                                                                                                
KATHRYN MONFREDA, CHIEF, CRIMINAL  RECORDS AND IDENTIFICATION                                                                   
BUREAU, DIVISION OF STATEWIDE  SERVICES, DEPARTMENT OF PUBLIC                                                                   
SAFETY  (testified  via  teleconference),   stated  that  she                                                                   
managed the sex  offender registry. She explained  that there                                                                   
are numerous ways to be out of  compliance. Sex offenders are                                                                   
required  to register  quarterly  and can  go in  and out  of                                                                   
compliance repeatedly. Efforts  are made monthly to get local                                                                   
police department to locate people and get them to comply.                                                                      
                                                                                                                                
8:14:34 PM                                                                                                                    
                                                                                                                                
Representative   Hawker  questioned   what  the  bill   would                                                                   
accomplish  since most of  the people  don't qualify  for the                                                                   
PFD anyway.  Mr. Fulton said  that the sex offender  registry                                                                   
examined some of  the data and found that two-thirds  of out-                                                                   
of-compliance  sex offenders  filed  for the  PFD last  year.                                                                   
There was further discussion about  compliance and dividends.                                                                   
                                                                                                                                
8:18:19 PM                                                                                                                    
                                                                                                                                
PUBLIC TESTIMONY CLOSED.                                                                                                        
                                                                                                                                
Representative Joule asked about the fiscal note.                                                                               
                                                                                                                                
Ms. Richter explained that all  of the funding supporting the                                                                   
dividend  program comes  from  the earnings  before they  are                                                                   
distributed.                                                                                                                    
                                                                                                                                
Representative  Crawford asked who  the dividend would  go to                                                                   
if it is under garnishment. Ms.  Richter said that a dividend                                                                   
that has  not been paid  cannot be garnished.  Representative                                                                   
Crawford stated concerns.                                                                                                       
                                                                                                                                
8:22:01 PM                                                                                                                    
                                                                                                                                
Representative  Gara was concerned  about the Division  using                                                                   
resource unnecessarily.  Ms. Richter said  the identification                                                                   
of  people who  would be  affected  would be  done through  a                                                                   
computer data match. The people  identified would be flagged.                                                                   
The Division  would be dealing  with only a small  segment of                                                                   
applicants. There was further discussion about the process.                                                                     
                                                                                                                                
CSSB 265  (FIN) was HEARD and  HELD in Committee  for further                                                                   
consideration.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
 The meeting was adjourned at 8:26 PM.                                                                                          
                                                                                                                                

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