Legislature(1995 - 1996)
03/26/1996 03:04 PM House HES
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE HEALTH, EDUCATION AND SOCIAL SERVICES
STANDING COMMITTEE
March 26, 1996
3:04 p.m.
MEMBERS PRESENT
Representative Cynthia Toohey, Co-Chair
Representative Con Bunde, Co-Chair
Representative Gary Davis
Representative Norman Rokeberg
Representative Caren Robinson
Representative Tom Brice
MEMBERS ABSENT
Representative Al Vezey
COMMITTEE CALENDAR
* HOUSE BILL NO. 393
"An Act relating to managed care for recipients of medical
assistance; and providing for an effective date."
- PASSED CSHB 393(HES) OUT OF COMMITTEE
HOUSE BILL NO. 435
"An Act relating to employment contributions and to making the
state training and employment program a permanent state program;
and providing for an effective date."
- HEARD AND HELD
HOUSE BILL NO. 506
"An Act relating to establishment of a fire fighting and safety
training program by the University of Alaska."
- PASSED OUT OF COMMITTEE
CONFIRMATION HEARINGS:
Professional Teaching Practices Commission
Peggy E. Conner Jones
Bruce F. Johnson
Marsha K. Van Abel
Jacquie Whitmore
- CONFIRMATION FORWARDED
University of Alaska Board of Regents
Joe L. Hayes, Jr.
- CONFIRMATION FORWARDED
Board of Chiropractic Examiners
Pam Aldersebaes
- CONFIRMATION FORWARDED
Board of Clinical Social Work Examiners
Beverly Haywood
- CONFIRMATION FORWARDED
Board of Dispensing Opticians
Mary C. Seutter
- CONFIRMATION FORWARDED
Board of Marital and Family Therapy
Mercy Dennis
Dixie A. Hood
Sandra M. Samaniego
- CONFIRMATION FORWARDED
State Medical Board
Keith M. Brownsberger, MD
Beverly Fletcher
Donald G. Hudson, DO
Sarah A. Isto, MD
Suzanne H. Lombardi
Donald C. Olson, MD
Irvin A. Rothrock, MD
- CONFIRMATION FORWARDED
Board of Certified Direct-Entry Midwives
Marilyn Holmes
- CONFIRMATION FORWARDED
Board of Nursing
Josephine Malemute
CONFIRMATION FORWARDED
Board of Pharmacy
Chris E. Coursey
CONFIRMATION FORWARDED
State Physical Therapy and Occupational Therapy Board
Leslie F. Schwartz
CONFIRMATION FORWARDED
Board of Psychologist and Psychological Associate Examiners
Gail C. Shortell, Esq.
CONFIRMATION FORWARDED
HOUSE BILL NO. 529
"An Act giving notice of and approving the entry into, and the
issuance of certificates of participation in, a lease-purchase
agreement for a centralized public health laboratory."
- SCHEDULED BY NOT HEARD
HOUSE BILL NO. 535
"An Act relating to postsecondary education."
- SCHEDULED BUT NOT HEARD
(*First public hearing)
PREVIOUS ACTION
BILL: HB 393
SHORT TITLE: MANAGED CARE PROGRAM FOR MEDICAID
SPONSOR(S): REPRESENTATIVE(S) ROKEBERG
JRN-DATE JRN-PG ACTION
01/05/96 2369 (H) PREFILE RELEASED
01/08/96 2369 (H) READ THE FIRST TIME - REFERRAL(S)
01/08/96 2369 (H) HES, STATE AFFAIRS, FINANCE
03/21/96 (H) HES AT 3:00 PM CAPITOL 106
03/21/96 (H) MINUTE(HES)
03/26/96 (H) HES AT 3:00 PM CAPITOL 106
BILL: HB 435
SHORT TITLE: STATE TRAINING & EMPLOYMENT PROGRAM
SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR
JRN-DATE JRN-PG ACTION
01/19/96 2488 (H) READ THE FIRST TIME - REFERRAL(S)
01/19/96 2488 (H) LABOR & COMMERCE, HES, STA, FINANCE
01/19/96 2488 (H) 3 FISCAL NOTES (2-DCRA, LABOR)
01/19/96 2488 (H) GOVERNOR'S TRANSMITTAL LETTER
02/07/96 (H) L&C AT 3:00 PM CAPITOL 17
02/07/96 (H) MINUTE(L&C)
02/14/96 (H) L&C AT 3:00 PM CAPITOL 17
02/14/96 (H) MINUTE(L&C)
02/15/96 2772 (H) L&C RPT 2DP 3NR
02/15/96 2773 (H) DP: ELTON, KOTT
02/15/96 2773 (H) NR: ROKEBERG, KUBINA, PORTER
02/15/96 2773 (H) ZERO FISCAL NOTE (GOV)
02/15/96 2773 (H) 3 FNS (LABOR, 2-CRA) 1/19/96
03/21/96 (H) HES AT 3:00 PM CAPITOL 106
03/21/96 (H) MINUTE(HES)
03/26/96 (H) HES AT 3:00 PM CAPITOL 106
BILL: HB 506
SHORT TITLE: UNIVERSITY FIRE FIGHTING PROGRAM
SPONSOR(S): REPRESENTATIVE(S) NAVARRE,G.Davis,Phillips
JRN-DATE JRN-PG ACTION
02/12/96 2727 (H) READ THE FIRST TIME - REFERRAL(S)
02/12/96 2727 (H) HES, FINANCE
03/21/96 (H) HES AT 3:00 PM CAPITOL 106
03/21/96 (H) MINUTE(HES)
03/26/96 (H) HES AT 3:00 PM CAPITOL 106
WITNESS REGISTER
BOB LABBE, Director
Division of Medical Assistance
Department of Health & Social Services
P.O. Box 110660
Juneau, Alaska 99811-0660
Telephone: (907) 465-3355
POSITION STATEMENT: Testified on HB 393
JAY LIVEY, Deputy Commissioner
Department of Health & Social Services
P.O. Box 110601
Juneau, Alaska 99811-0601
Telephone: (907) 465-3030
POSITION STATEMENT: Testified on HB 393
HARLAN KNUDSON, Executive Director
Alaska State Hospital & Nursing Home Association
319 Seward Street, Suite 11
Juneau, Alaska 99801
Telephone: (907) 586-1790
POSITION STATEMENT: Testified in support of HB 393
DWIGHT PERKINS, Special Assistant
Office of the Commissioner
Department of Labor
P.O. Box 21149
Juneau, Alaska 99802-1149
Telephone: (907) 465-2700
POSITION STATEMENT: Testified in support of HB 435
REMOND HENDERSON, Director
Division of Administrative Services
Department of Community & Regional Affairs
P.O. Box 112100
Juneau, Alaska 99811-2100
Telephone: (907) 465-4708
POSITION STATEMENT: Answered questions on HB 435
DAVID STONE, President
Council of Alaska Producers
3100 Channel Drive, Suite 2
Juneau, Alaska 99801
Telephone: (907) 463-5704
POSITION STATEMENT: Testified in support of HB 435
MARK MICHAELSON, Coordinator
Service Delivery Area Program
Division of Community & Rural Development
Department of Community & Regional Affairs
P.O. Box 112100
Juneau, Alaska 99811-2100
Telephone: (907) 465-4891
POSITION STATEMENT: Answered questions on HB 435
TOM ACKERLY, Legislative Administrative Assistant
to Representative Mike Navarre
Alaska State Legislature
Capitol Building, Room 521
Juneau, Alaska 99801-1182
Telephone: (907) 465-3779
POSITION STATEMENT: Testified on HB 506
MARYLOU BURTON, Director of Statewide Budget
University of Alaska Statewide
Juneau, Alaska 99801
Telephone: (907) 463-3086
POSITION STATEMENT: Testified on HB 506
ACTION NARRATIVE
TAPE 96-33, SIDE A
Number 001
The House Health, Education and Social Services Standing Committee
was called to order by Co-Chair Cynthia Toohey at 3:04 p.m.
Members present at the call to order were Representatives Toohey,
Bunde, Rokeberg and Davis. Members absent were Representatives
Robinson, Brice and Vezey.
CO-CHAIR TOOHEY announced the agenda was HB 393, Managed Care
Program for Medicaid; HB 435, State Training & Employment Program;
HB 506, University Fire Fighting Program; and Confirmation
Hearings. She noted that HB 535 was rescheduled for Thursday,
March 28.
HB 393 - MANAGED CARE PROGRAM FOR MEDICAID
Number 123
REPRESENTATIVE NORM ROKEBERG, Sponsor, said House Bill 393 provides
for the establishment of a pilot program for managed care for
Medicaid recipients. He noted that managed care can mean many
different things to many different people. This particular bill
was brought forward for the precise reason of the legislature
taking an active role in the development and implementation of a
managed care plan and program for the state of Alaska. His
involvement stems from his concern that national legislation is
leading the way and in a certain sense, forcing the state to go
this direction on the one hand; on the other hand, it's also
potentially going to be giving the state an opportunity to embrace
some newer and innovative concepts in health delivery in the state.
REPRESENTATIVE ROKEBERG stated the Medigrant program that has been
proposed in Washington, D.C. is one form and there is also a per
capita type Medigrant program for Medicaid. Potentially, there is
the National Governor's Association compromise plan. All three of
these plans or basically a compromise, potentially could be coming
out of Congress this year, but if they do not do so this year for
partisan political purposes, he predicted it will happen within a
year or eighteen months, no matter who is elected President.
Therefore, he felt it was important for the state of Alaska to
prepare for a new era of managed care health delivery to the
Medicaid recipients of the state. He explained that the grants
would allow flexibility, whereas presently waivers have to be
applied for. Ninety-four percent of the rest of the states have
some sort of managed care in their health delivery systems for
Medicaid recipients. Managed care is a way to give high level of
care and quality services, while keeping the cost down. For
example, in the last four years the cost in the state of Alaska has
increased 50 percent. The gross total spending for FY 97 is $336
million; that's number 2 to education as a line item in the state's
budget. Much of that funding comes from the federal government,
but in the last year $145 million in general fund receipts went
into Medicaid services. Another way to look at that is there has
been an average increase over the last five years of 13.9 percent
growth. This is the fastest growing area of the state's budget, so
he felt it was important that something be done to try to contain
the cost increase.
REPRESENTATIVE CAREN ROBINSON arrived at 3:07 p.m.
Number 400
REPRESENTATIVE ROKEBERG pointed out that in 1994 the legislature
put intent language in the budget instructing the Department of
Health & Social Services to look into managed care. The department
has been actively pursuing development of managed care programs and
ideas. As a matter of fact, most recently they awarded a contract
to Fox Systems Health Management Associates in Scottsdale, Arizona
to review all the managed care options for the state. Also, the
division is giving special consideration to implementation this
next fiscal year of a managed care model called "Primary Care Case
Management (PCCM).
REPRESENTATIVE TOM BRICE arrived at 3:12 p.m.
REPRESENTATIVE ROKEBERG said his interest in the health care system
was primarily from the fact that as an independent businessman, he
was unable to obtain insurance, except at a very high cost. He,
like many others, thought that Alaska could not sustain and support
an HMO or a managed care type system because we lacked the
infrastructure, the size or the capabilities that many states have
to be able to implement such a system. He mentioned that he
attended a number of seminars last fall, including one on rural
managed health care, which convinced him that it could be done in
the state of Alaska. There was testimony from small areas of the
country that have developed either statewide, regional or even
small community plans and adapted managed health care into their
communities. He received a lot of information about how this plan
was implemented in the state of Arizona, which has 46 counties and
two competing managed care plans in each of the counties. So
essentially, even a Medicaid recipient has a choice of plans in the
counties in Arizona. He said it was interesting to note that
Arizona led the country in the development of their managed care
systems, since as a very conservative state politically, they for
years had not taken Medicaid money. Until about 15 years ago, they
did not take any federal funds for public health, and at that point
in time they realized their public health clinics were so
overburdened they couldn't supply the needed services to their
citizens. They got an 1115 Waiver and developed a managed care
plan, which has taken a number of years to develop, but now it is
the most successful in the country.
Number 605
REPRESENTATIVE ROKEBERG advised the committee he had also gotten
some information from the state of Oregon where they were serving
280,000 people before they implemented their managed care plan, but
because of the cost savings they were able achieve by implementing
a managed care plan, they've expanded that service to 400,000
people, which is a 43 percent increase. The biggest segment of the
population in the United States are the uninsured. They make just
enough money to get by, but they do not qualify for Medicaid or are
not fortunate enough to be involved in an insurance plan. The
biggest concern among most health care professionals right now is
that the people who don't have insurance aren't able to get it.
The state of Oregon is one example where the number of people
served was expanded and chipped away at the middle level of the
uninsured.
Number 672
REPRESENTATIVE ROKEBERG in conclusion said this bill before the
committee asks the department to come forward with a plan and new
legislation for the legislature's review. He said that's all this
bill does; it doesn't matter if you're for or against the concept
of managed care. The intent is that the legislature needs to be a
part of this process. It sets up a pilot project, gives certain
guidelines, has findings and asks the department to come back next
year with their plan.
CO-CHAIR TOOHEY asked if there were any questions of the sponsor.
Number 753
REPRESENTATIVE ROBINSON asked Representative Rokeberg why he
believed legislation was needed if the department was already
working on a plan.
REPRESENTATIVE ROKEBERG acknowledged there was a process the
department was going through, but it was being done on their own
time frame and based on decisions made by the department. He
reiterated the intent of this bill is to involve the legislature.
Additionally, one of his other motivations was to move this process
along because of the impact on the budget.
CO-CHAIR TOOHEY remarked that two years ago the legislature spent
a great deal of time on health care issues. She asked
representatives of the department to come forward to testify on HB
393.
Number 890
BOB LABBE, Director, Division of Medical Assistance, Department of
Health & Social Services, said the department has had some informal
discussions with Representative Rokeberg on HB 393 and provided
information as to what the department was working on in the area of
managed care. They have a contractor who is assisting the
department and he thought it had been primarily an educational
process for the staff. He said being somewhat removed from the
Lower 48 development of managed care, it takes some time to learn
and understand the new concepts. He noted that the department had
made some decisions which they believed were based on the 1994
legislation directing them to look into case management systems.
That was the basis for issuing the contract and they believe the
primary care case management option is consistent with that initial
direction and not inconsistent particularly with even the more full
blown capitation type model. The department felt they would start
with that and do some piloting around that concept. He noted in
that particular model, there's usually a physician, possibly a
nurse practitioner/physician assistant under contract with the
state to provide primary care services and act as a referral agent
for other specialty services. Clients are then enrolled with a
primary care case manager and need to get approval for an outside
referral. The payments are typically continuous fee for service
for the primary care case manager, as well as the specialty
services, hospital care, etc. There is not a lot of change in how
people are reimbursed. It starts organizing the system so there
are linkages between the providers. There's probably better access
in some ways for primary care services; typically one of the goals
is to have services provided without the use of an emergency room,
if the physician case manager is available or has to make
arrangements to be available. The department views this as a step
in the process and believes they can move in that direction.
They've been working with their current resources and trying to
reprogram their own staff. He said this bill as it's drafted, from
their purpose, seems to fit with their abilities to move ahead and
they could support it because it is in the interest of moving the
department along and getting another tool for improving management
of their program.
Number 1119
CO-CHAIR TOOHEY asked Mr. Labbe when the department's plan would
start functioning.
MR. LABBE said an actual target for enrollment hasn't been
determined. The department is gathering data and decisions will
need to be made about where to pilot the projects, which client
groups and which types of services will be included. He commented
that usually not every Medicaid service is put into this. The
department wanted to wait until the contract agency was finished,
which is expected to be around June 1, to make those decisions. It
is his hope to get something going in the next fiscal year. He
added that it would require involvement from the local community
providers, recipients and family members. The department has
announced the recruitment of a position in their Anchorage office
to focus on this.
Number 1170
REPRESENTATIVE BRICE asked if the department had taken any steps to
rectify the concerns raised over the optical hardware contract;
specifically the undermining of instate resident businesses by
shipping out of state.
Number 1227
JAY LIVEY, Deputy Commissioner, Department of Health & Social
Services, said two or three years ago under the Medicaid program,
the department decided it would be cost effective for Medicaid to
bid a contract for a company to provide eye glasses to Medicaid
recipients. The company that was awarded the competitive bid was
an out-of-state provider. It saved the department a considerable
amount of money in Medicaid service to do that. He thought that
Representative Brice was asking if there was a guarantee that under
future managed care programs the department would support the
Alaska infrastructure. He believed under a case management
proposal, as explained by Mr. Labbe, they would because they would
be signing up local Alaskan physicians to provide that particular
service.
CO-CHAIR TOOHEY asked if it would be under a competitive bid.
MR. LABBE responded that for the primary care case management
program, he would not anticipate a competitive bid. The department
would encourage providers to meet a set of standards that would be
established and then sign up. He said the plus side of having sort
of a performance expectation for the primary care case managers
goes beyond where we currently are with the fee for services, but
it's not to the point of having two or three plans that would
compete for best price. Based on his experience of working with
Oregon in the development of managed care, he wasn't sure he would
encourage competition initially. He added that if there were
already a number of commercial plans to select from, then he might
look at competition.
CO-CHAIR TOOHEY commented that it wasn't being narrowed down to one
hospital versus the other. She asked Mr. Labbe how this
legislation would help the department and if he felt it was
necessary.
REPRESENTATIVE ROBINSON inquired if anything would change if this
legislation did not make it through the process.
MR. LIVEY thought this bill provided some affirmation of the
direction the department is headed anyway, which he felt was
valuable in their discussions of managed care with providers and
clients. In the absence of this legislation, he believed the
department would proceed with their current project. He
reemphasized the bill does provide some impetus and general
direction for the department.
REPRESENTATIVE ROKEBERG commented the biggest difference and the
value of the bill is the speed at which things might get done,
which is a friendly intention.
Number 1453
HARLAN KNUDSON, Executive Director, Alaska State Hospital & Nursing
Home Association, testified in support of HB 393. The association
had three reasons for their desire to see this bill passed and
signed by Governor Knowles. The first is that managed care will
help control the Medicaid budget. It changes the total incentive
of the current health care system. Under a managed care system,
the incentive is on wellness. Second, it provides a boost for the
department to reach out and work with providers, which they feel is
very important. Third, it sets up pilot programs so instead of
attempting to move the whole system into managed care, it allows it
to be tried in both the rural and urban areas. Mr. Knudson said
there is managed care in the Native Health Service, and asked why
areas like Bethel, Nome, Dillingham couldn't put together a
contract on Medicaid with the department. In areas such as
Ketchikan or Kodiak where there isn't a prominence of a Native
system, why couldn't a managed program be put together and brought
back to the Indian Health Service or to the Medicaid system. He
concluded that HB 393 opens those kinds of doors for health care.
He believes it is a good bill and urged the committee's support.
Number 1547
CO-CHAIR BUNDE said he had heard anecdotally of a system like this
being put in for Medicaid in a larger urban center, doctors were
assigned that were difficult to reach and use of the emergency room
increased because people would wait until the problem was acute
instead of having to take a bus or drive several miles to get to
the doctor. He said he was describing the down side of managed
care for Medicaid and asked Mr. Knudson what his reaction was to
that.
MR. KNUDSON replied that Co-Chair Bunde's comment was well taken
and in the beginning of some of the Medicare managed care programs
they were aware of situations where the incentive had been to keep
the patient out of the system; in other words make it difficult for
the patient. He said that's growing pains and it is something that
Alaska will go through. He didn't feel that should be a concern,
as he believed there would be good, competent managed care, but the
risk is there of shutting some people out of the system.
CO-CHAIR BUNDE said his point was that they won't be shut out of
the system, they'll just go back to using the emergency room as
preventive care.
CO-CHAIR TOOHEY asked if under managed care there was a set price
for a particular service such as a broken leg that Medicaid would
pay and could be collected, would the patient be able to go to the
physician of their choice or would it have to be a physician in the
managed care program?
Number 1638
MR. LABBE responded that under the primary care case management
program, the client would have a choice of primary care providers,
and once the client had selected a primary care provider they would
stay with that primary care provider; in other words, that would be
their medical home. If the client wished access to specialty care,
a referral from their primary care provider would be needed.
CO-CHAIR TOOHEY noted for the record the Alaska State Medical
Association has taken no position on this bill.
REPRESENTATIVE ROKEBERG said he envisions this, because of the
rural nature of Alaska and the way many rural managed care
organizations are established in the Lower 48, as there being a
small core group of primary care providers, but there will be
backstops that will be networked in or have a relationship with a
tertiary care hospital in a large urban area. He asked Mr. Knudson
if he could envision the networking and ability to use the tertiary
hospitals throughout the state in coordination with the rural
clinics that exist today.
MR. KNUDSON said he could see Cordova for example, that is isolated
but has a big influx of population, having a major relationship
with one of the major hospitals in Anchorage and being able to
offer a contract to either Medicaid or Aetna on a per capita basis.
Number 1756
REPRESENTATIVE ROKEBERG said by networking there were certainly
creatively ways that could be workable in the state of Alaska.
MR. KNUDSON said with the regard to networking, the integration is
already going on. There is a lot of collaboration in every
community in the state. The Kenai Peninsula is way ahead on the
relationship between the doctors, the hospitals, the nursing home,
the community mental health center, local psychologist, etc., with
shared services, equipment and all those areas.
CO-CHAIR TOOHEY asked if anyone else wished to testify on HB 393.
Hearing none, she closed public testimony.
Number 1797
REPRESENTATIVE ROBINSON moved to adopt CSHB 393, Version F, dated
3/21/96. Hearing no objection, it was so ordered.
REPRESENTATIVE BRICE asked if the state would consider, for
example, a 5 percent for residents preference to providers who want
to bid competitively for these services?
REPRESENTATIVE ROKEBERG said that's why this legislation was before
the committee. That's why this bill is needed so if there is a
concern about procurement and the preference the legislature has a
voice in it. He's had discussions with the department about the
potentiality of exempting this particular provision from the
procurement code. One of his concerns in setting up a pilot
program is that he thought something very close to a Request for
Proposal (RFP) should be put together to get demonstrated interest.
However, the ability to just grant a contract to the lowest
performing bidder may not be in the best interest of the state on
the initial pilot level. He didn't think there should be too much
concern about not having local providers, except in the secondary
areas like optical, drugs, prosthesis and things of that nature
where there may be some outside contractors that may be able to
provide those services.
REPRESENTATIVE BRICE wanted some assurance, because it wasn't
spelled out in the bill, that the pilot program should have that.
CO-CHAIR TOOHEY said HB 393 requests the department to look into
this and urges the department to bring their plan before the
legislature.
REPRESENTATIVE BRICE wanted it to be clear on the record by both
the sponsor and himself that any deleterious effects to the
tertiary businesses associated with health care will be watched
with a great deal of scrutiny.
REPRESENTATIVE ROKEBERG said we want people to watch, that's the
whole idea of the bill.
REPRESENTATIVE ROBINSON made a motion to move CSHB 393(HES) out of
committee with attached zero fiscal notes and individual
recommendations.
CO-CHAIR TOOHEY objected and asked for a roll call vote. Voting in
favor of the motion were Representatives Rokeberg, Robinson, Davis
and Bunde. Voting against the motion were Representatives Brice
and Toohey.
HB 435 - STATE TRAINING & EMPLOYMENT PROGRAM
Number 2089
CO-CHAIR TOOHEY turned the gavel over to Co-Chair Bunde.
DWIGHT PERKINS, Special Assistant, Office of the Commissioner,
Department of Labor, read the following statement: "For the past
six years the State Training and Employment Program (STEP) has
temporarily existed as a contingent training and employment program
for Alaska's workers. The original 1989 legislation allowed the
state to collect from each worker in Alaska one-tenth of 1 percent
of their employee tax contribution to fund an alternative, flexible
training program designed with a threefold purpose: 1) to reduce
future claims against unemployment benefits; 2) to foster new jobs
for Alaskans by encouraging businesses to locate in Alaska due to
the availability of a skilled work force; and 3) to increase
training opportunities to Alaskans severely affected by economic
and technological fluctuations. Alaska private sector employers,
organized labor and the now-defunct Alaska Job Training Council are
in accord that STEP is a proven and valid approach to advancing
Alaska residents' opportunities for viable employment. In the six
years since its inception as a temporary measure, STEP has
demonstrated its efficiency. We know that STEP works for Alaskans.
The legislation before you will enable STEP to take its rightful
place as an established permanent program to keep Alaskans'
employment skills up-to-date and competitive in the rapidly
changing world of work." He introduced Rebecca Nance, Director of
Employment Security, and Arbe Williams, Director of Administrative
Services, who were available to answer questions.
CO-CHAIR BUNDE asked Mr. Perkins if he would like to speak to the
reason behind the two sets of fiscal notes.
MR. PERKINS replied Remond Henderson from the Department of
Community & Regional Affairs had drafted the fiscal notes and would
be happy to respond.
Number 2236
REMOND HENDERSON, Director, Division of Administrative Services,
Department of Community & Regional Affairs (DCRA), explained that
the original fiscal notes were prepared based on instructions the
department had received from the Office of Management & Budget,
which was to show these numbers for information purposes only and
to show negative amounts as to what would happen if the bill was
not passed. Those were the instructions from the DCRA's budget
analyst; Department of Labor on the other hand, got different
instructions and put their numbers in as positive numbers for
information purposes only. Mr. Henderson revised his fiscal note
to be consistent with the Department of Labor, and the amounts
indicated in the fiscal notes are the amounts in the respective
budgets for DCRA and the Department of Labor.
Number 2295
REPRESENTATIVE ROKEBERG asked if the figures had been changed on
the fiscal notes?
MR. HENDERSON responded affirmatively and explained the fiscal note
he prepared was based on the amount in DCRA's budget. There was a
budget amendment that was prepared to reduce the amount in their
budget so that it matched the amount that was in the Department of
Labor's budget that they were going to RSA (reimbursable service
agreement) to the DCRA. Now the amount in the fiscal note agrees
with the amount in the DCRA's budget and also agrees with the
amount the Department of Labor is transferring to the DCRA.
REPRESENTATIVE ROKEBERG asked if this was a wash transaction in
that regard.
MR. HENDERSON responded yes.
REPRESENTATIVE ROKEBERG presumed there was no fiscal impact per se
to the general fund.
MR. HENDERSON confirmed that.
Number 2335
DAVID STONE, President, Council of Alaska Producers, said the
council is a nonprofit corporation whose members are essentially
all of the major mining companies who are actively exploring,
developing and operating in Alaska today. Examples are Cominco and
the Red Dog Project, Kennicott and the Greens Creek Mine, Nevada
Gold Fields and Nixon Forks Mine. On behalf of the council, he
expressed the mining industry's support for the reauthorization of
the State Training and Employment Program. This program is and has
been business friendly and business accessible. The program
encourages businesses to invest in the skills of Alaskans.
TAPE 96-33, SIDE B
Number 001
MR. STONE continued this program helps the Alaskan work force keep
up-to-date with new technologies and techniques, keeping it
competitive in the world economy. The program is more flexible and
has less restrictions than most federal job training programs. The
primary reason for that is due to the fact that this program has
been designed and is administered by Alaskans. The program has
been well integrated with other existing employment and training
programs to the delivery of the already established and proven
private industry councils and complements those efforts. The STEP
has already trained Alaskans and resulted in jobs for Alaskans in
the mining industry such as the Nixon Forks mine in McGrath and the
Greens Creek Mine near Juneau. The program has also helped workers
who have lost their jobs. As the mining industry grows and
hopefully creates new high paying jobs in Alaska, STEP can help
ensure that it's Alaskans that are trained and qualified to fill
these jobs.
MR. STONE said the Council of Alaska Producers views STEP as a true
partnership between the state of Alaska and industry which will
result in the jobs being filled by Alaskans. He urged the
committee to pass HB 435.
Number 046
CO-CHAIR TOOHEY asked Mr. Stone if there was some reason he hadn't
mentioned Echo Bay.
MR. STONE said that Echo Bay has been very supportive of STEP
because those monies have been used for the mine training school in
Juneau at the University of Alaska Southeast. Echo Bay sees the
potential of 400 jobs for the AJ mine project, and in order to hire
Alaskans, there's going to be training involved and Echo Bay would
like to see STEP be a part of that training.
REPRESENTATIVE ROBINSON asked how the STEP integrated into the
university program as she understood the program was being shut
down.
MR. STONE responded the instructor is taking a leave of absence and
the university is willing to start the program again when Echo Bay
gives the go ahead that indeed they have the permits and are ready
to start training for those jobs.
REPRESENTATIVE ROBINSON understood that this training program took
place through the university.
MR. STONE said that was one aspect of the training. These monies
can be used for individuals to go to the Alaska Vocational
Technical Center (AVTC) as an example, depending on the type of
training. In the case of the underground mine training school,
these can monies can also be used for that.
Number 110
REPRESENTATIVE ROKEBERG asked if he understood correctly that there
has actually been a program in Juneau training miners for jobs that
don't exist.
MR. STONE said no, the university's mine training school is
basically going into a "mothball" state.
REPRESENTATIVE ROKEBERG said he was talking about previously.
MR. STONE explained the last class had trained workers here in
Juneau for the Nixon Fork mine in McGrath because this is the only
underground mine training school site. So people were trained for
jobs that did exist.
Number 135
CO-CHAIR BUNDE asked what kind of tuition the participants are
expected to pay.
MR. STONE said he didn't know the figure, but the council partners
with the university so the costs are quite reasonable.
Participants need appropriate clothing and tools to learn their
trade, some of which are provided by the mining industry.
CO-CHAIR BUNDE said he was curious about the industry's
contribution.
MR. STONE noted that the industry has contributed a great deal and
is ongoing, as long as the school exists. Industry has provided
heavy equipment, tools, spare parts, employees as trainers, etc.
He emphasized that it has been a true partnership arrangement.
CO-CHAIR TOOHEY asked if this was what she referred to as a
proprietary education, with a specified time period and the
participants graduating with a degree.
MR. STONE said this was a 6 week school and the participants
receive a 40-hour Mining Safety & Health Administration (MSHA)
certification which is an underground certification that is
required to go underground. The participants get basic exposure to
explosives, drilling and all the basics of underground mining, as
well as their math skills, etc. When they complete the training,
it conveys to the industry that these people are ready for work and
have the basic skills to be exposed to underground mining.
CO-CHAIR BUNDE clarified that proprietary schools are private for
profit schools; this is a certificate program through the
university.
CO-CHAIR TOOHEY said she understood that and asked if the
certificate was valid in other states. She inquired as to the cost
of the school.
MR. STONE responded that the certificate is valid in other states
and he guessed the cost to be somewhere in the neighborhood of
$1200 for the 6 weeks.
Number 237
REPRESENTATIVE ROBINSON asked Mr. Stone to explain how it would
work when Greens Creek, for example was ready to start training.
MR. STONE gave a hypothetical situation where the Kensington
project is the next one; Kensington says they will have a need for
a certain number of entry level employees and they'd like them to
be Alaskans. The university then will actually recruit for the
program and run that program when it is filled with approximately
20 students. That is how it has been done in the past. When Nixon
Forks notified the university of their need to train locally,
residents from McGrath were brought to Juneau, trained and those
individuals who graduated were able to get jobs.
Number 282
REPRESENTATIVE ROKEBERG referenced the supporting documents in
committee members' packets which indicated that some of the state
training was conducted out of state. He asked what the breakdown
was regarding the location of the training that had taken place.
MR. PERKINS explained that the first three pages of the supporting
documents were current expenditures; the estimated FY 97 budget,
the estimated FY 96 budget and the FY 95 actuals. He directed the
committee's attention to the documents pertaining to the
Anchorage/Mat-Su area which listed the vendor's name, the type of
training and the amount.
REPRESENTATIVE ROKEBERG asked if the assistance and the training
were summed together for a total of $453,000 for Anchorage or was
it $253,000?
MR. PERKINS said the FY 95 actuals were $253,819 for training and
$200,351 for employee assistance. He commented that Mark
Michaelson or Remond Henderson could probably give a more detailed
answer.
CO-CHAIR BUNDE asked Mr. Henderson if he had an answer to
Representative Rokeberg's question.
MR. HENDERSON referred to the FY 95 actual amounts with a summary
schedule for the three service delivery areas. The first one was
the Alaska Statewide Service Delivery Area which represented the
amount spent by the Alaska Statewide Service Delivery areas handled
by Mark Michaelson.
Number 468
MARK MICHAELSON, Coordinator, Service Delivery Area Program,
Division of Community & Rural Development, Department of Community
& Regional Affairs, said the packet of information before the
committee needed to be viewed in the context under which programs
and services were provided. The State Training & Employment
Program was established six year ago in the attempt not to
duplicate any existing programs or services offered by the federal
program, but to complement and supplement. The administrative
structure selected was one set up by the Job Training Partnership
Act (JTPA). That particular federal program recognized three
distinct areas in the state of Alaska: The Anchorage/ Mat-Su
consortium, the Fairbanks Private Industry Council, and the
statewide, which as Mr. Henderson indicated, is what the DCRA works
with. The information before the committee references activity,
expenditures and services provided within those three
jurisdictions. He explained that he is a state employee located in
Juneau, but his counterparts are not state employees; they are
employees of the Fairbanks Productivity Improvement Center (PIC)
and have an affiliation with the local government, as well as in
Anchorage where there is an affiliation with the municipality of
Anchorage.
MR. MICHAELSON said that Representative Rokeberg had referenced
some out of state expenses or training outside the state of Alaska
and added that activity is not prohibited with the STEP program nor
is it prohibited with the JTPA, the federal source; however, the
policy taken is that people will only be sent to out of state
training if comparable training for a particular occupation is not
available for a particular individual and under some circumstances.
For example, if the wait was going to be 9 to 12 months to get
someone into a university program, then out of state training would
be looked at. He added those decisions are made after an
individual assessment of that particular person's request. The
greatest amount of training takes place instate with Alaska
institutions and often times with the support and participation of
Alaskan businesses.
REPRESENTATIVE ROKEBERG said it appeared to him that Anchorage or
the Kenai Peninsula would be allocated under the statewide
appropriation. He asked if the Department of Community & Regional
Affairs was only a part of this program?
MR. HENDERSON interjected he believed Representative Rokeberg was
asking in terms of what Anchorage gets, how are the funds allocated
to the geographical locations within the Anchorage area, how does
Fairbanks allocate their funds, and how does the balance of the
state allocate their funds.
REPRESENTATIVE ROKEBERG said actually it's how much each area got.
MR. MICHAELSON said the total allocation of the total STEP
resources is determined by an unemployment figures formula applied
by the Department of Labor. It's based upon population,
unemployment and those types of data. He wasn't able to provide
specific details, but thought perhaps representatives from the
Department of Labor could provide additional information.
REPRESENTATIVE ROKEBERG asked how much of the $3.4 million budget
was paid by the employees of the state and how much by the federal
government.
MR. MICHAELSON responded with that particular budget, the entire
cost is incurred by the State Training & Employment Program. There
are additional programs and services made available through the
federal Job Training Partnership Act. He asked committee members
to bear in mind that the JTPA serves approximately 4 to 5 percent
of those individuals potentially eligible, so there is not a
plethora of resources and training dollars available for people who
are looking for assistance.
Number 674
CO-CHAIR BUNDE noted that Representative Rokeberg had asked how
much was the student's responsibility.
REPRESENTATIVE ROKEBERG interjected he was referring to employees
of the state. He asked where was the money coming from?
MR. HENDERSON said the unemployment insurance trust fund. One-
tenth of one percent of the....
REPRESENTATIVE ROKEBERG asked if that was funded 100 percent?
MR. HENDERSON said this comes directly from the unemployment
insurance trust fund - one-tenth of 1 percent; the entire amount
that is spent by the DCRA for this program comes from that fund.
REPRESENTATIVE ROKEBERG asked if 100 percent of all these dollars
are coming from the paychecks of the employees of this state or is
there a federal contribution.
MR. HENDERSON remarked he thought there was a federal contribution.
REPRESENTATIVE ROKEBERG noted that the people of the state are
paying a contribution.
Number 748
REPRESENTATIVE DAVIS presented a scenario where AVTC in Seward
wanted to establish a police training standards school, where all
the state troopers, city policeman and correctional officers could
be trained. He asked how they would go about getting funds for
that, other than drawing from the those departments who have a
current budget to do that. He said they pay for the training of
troopers and correctional officers and then they give them a job.
He asked how would that scenario fit in?
MR. MICHAELSON said he could give Representative Davis a real life
example that involved another industry. A few years ago with the
advent of the community development quota program for the fisheries
in the Bering Sea, AVTC wanted to participate and industry needed
trained workers. There was an opportunity to put together a
customized program for residents primarily in the Bering Sea
coastal communities. AVTC bid on a competitive Request for
Proposal. He noted the department lets their money out on a
competitive RFP for approximately 70 percent of the training
resources and the balance is made available for individual referral
for a direct referral to a preexisting program. With the
competitive RFP, AVTC did bid and was awarded training funds. In
turn they provided a very valuable training program with in excess
of 100 western Alaskans going through that program and being able
to secure employment.
REPRESENTATIVE DAVIS asked if there was an opportunity to charge a
tuition, also?
MR. MICHAELSON responded that was correct.
Number 890
CO-CHAIR BUNDE commented that if there were a number of in-depth
questions still remaining about this proposal, he would rather they
be addressed to the various departments and the bill would be
brought up again on Thursday, March 28.
REPRESENTATIVE ROKEBERG stated he would like a breakdown on the
statistics for the Anchorage area and the statewide delivery area.
He was curious if the Kenai Peninsula and Mat-Su were considered
part of the Anchorage delivery area or if they were part of the
statewide area. He also requested information on the formula based
on unemployment and population statistics.
Number 933
CO-CHAIR BUNDE asked the representatives from the various
departments to address Representative Rokeberg's questions. He
announced that HB 435 would be held over until Thursday.
HB 506 - UNIVERSITY FIRE FIGHTING PROGRAM
Number 963
TOM ACKERLY, Legislative Administrative Assistant to Representative
Mike Navarre, said that HB 506 attempts to make a separate entity
out of the Mining and Petroleum Training Service (MAPTS) which is
currently a university program. The purpose of doing that is to
ensure that its funding is secure and not used by other parts of
the university program. In several past sessions there have been
stipulations on the university budget that MAPTS would be able to
keep at least $150,000 of the money it makes during the course of
the year for the purpose of improving its program and keeping it a
state of the art program. Another part of this is they not only
need the carry forward ability, but they also need the ability to
accumulate funds because some years they may need $50,000 while in
other years they may need $200,000. Representative Navarre was
hopeful that through legislative efforts, MAPTS could be made a
stand alone, autonomous program still affiliated with the
university, but ensure its perpetual funding.
CO-CHAIR BUNDE asked Marylou Burton to present the university's
position on HB 506.
Number 1083
MARYLOU BURTON, Director of Statewide Budget, University of Alaska
Statewide, said the university is neutral on HB 506. It doesn't
appear to expand the university's existing authority to run an
effective MAPTS program. However, the university is supportive of
Representative Navarre's intent which they believe is to encourage
the industry to support instate training and instate facilities to
conduct that training. The university has no stand on the bill
beyond that.
CO-CHAIR TOOHEY asked if the MAPTS program collects fees?
MS. BURTON responded affirmatively.
CO-CHAIR TOOHEY asked if the fees go into the university budget?
MS. BURTON replied yes.
CO-CHAIR TOOHEY asked if that gave the MAPTS program some degree of
comfort they would be there forever?
MS. BURTON suspected this bill would give some comfort. On the
other hand, to her knowledge the fees that are collected relative
to this program go right into the program. For example, the
program last year was subsidized with general funds; the amount
that was collected relative to the program went into the program,
and the university put in approximately another $300,000 last year.
CO-CHAIR TOOHEY said she would like some assurance that the
university was aware of the program and would indeed continue to
fund the program.
MS. BURTON said it was her assumption the university would continue
to fund the program.
Number 1158
REPRESENTATIVE DAVIS thought this legislation gave a comfort level
to the MAPTS program as to their ability to plan. The
opportunities are becoming more and more abundant as to who they
can draw from; their training is becoming necessary worldwide and
they've gained the reputation of being able to provide a service.
He added that if there is a competitive spirit among the
university, then the best proposal wins.
CO-CHAIR BUNDE asked if there was further testimony. Hearing none,
public testimony was closed.
Number 1225
REPRESENTATIVE ROKEBERG moved to pass HB 506 out of committee with
individual recommendations and attached zero fiscal note. Hearing
no objection, it was so ordered.
Number 1283
CO-CHAIR BUNDE announced the committee would be considering
confirmations appointments. The first appointment before the HESS
Committee was for the Professional Teaching Practices Commission.
The slate was Peggy Conner Jones, Anchorage; Bruce F. Johnson,
Kodiak; Marsha K. Van Abel, Anchorage; and Jacquie Whitmore,
Anchorage.
Number 1332
REPRESENTATIVE ROKEBERG moved to forward the appointment of Peggy
Conner Jones, Bruce F. Johnson, Marsha K. Van Abel and Jacquie
Whitmore, Professional Teaching Practices Commission. Hearing no
objection, it was so ordered.
Number 1371
REPRESENTATIVE ROKEBERG moved to forward the appointment of Joe L.
Hayes, Jr. of Fairbanks, University of Alaska Board of Regents.
Hearing no objection, it was so ordered.
Number 1383
CO-CHAIR TOOHEY moved to forward the appointment of Pam Aldersebaes
of Juneau, Board of Chiropractic Examiners. Hearing no objection,
it was so ordered.
Number 1397
REPRESENTATIVE ROKEBERG moved to forward the appointment of Beverly
Haywood of Juneau, Board of Clinical Social Work Examiners.
Hearing no objection, it was so ordered.
Number 1406
REPRESENTATIVE ROKEBERG moved to forward the appointment of Mary C.
Seutter of Wasilla, Board of Dispensing Opticians. Hearing no
objection, it was so ordered.
Number 1417
REPRESENTATIVE ROKEBERG moved to forward the appointment of Mercy
Dennis, Anchorage; Dixie A. Hood, Juneau; and Sandra M. Samaniego,
Fairbanks, Board of Marital and Family Therapy. Hearing no
objection, it was so ordered.
Number 1443
CO-CHAIR TOOHEY moved to forward the appointment of Keith M.
Brownsberger, MD, Anchorage; Beverly Fletcher, Juneau; Donald G.
Hudson, DO, Anchorage, Sarah A. Isto, MD, Juneau; Suzanne H.
Lombardi, Anchorage; Donald C. Olson, MD, Nome; and Irvin A.
Rothrock, MD., Fairbanks, State Medical Board. Hearing no
objection, it was so ordered.
Number 1457
REPRESENTATIVE ROKEBERG moved to forward the appointment of Marilyn
Holmes of Juneau, Board of Certified Direct-Entry Midwives.
Hearing no objection, it was so ordered.
Number 1461
REPRESENTATIVE ROKEBERG moved to forward the appointment of
Josephine Malemute of Fairbanks, Board of Nursing. Hearing no
objection, it was so ordered.
Number 1467
REPRESENTATIVE ROKEBERG moved to forward the appointment of Chris
E. Coursey of Eagle River, Board of Pharmacy. Hearing no
objection, it was so ordered.
Number 1475
REPRESENTATIVE ROKEBERG moved to forward the appointment of Leslie
F. Schwartz of Petersburg, State Physical Therapy and Occupational
Therapy Board. Hearing no objection, it was so ordered.
Number 1486
CO-CHAIR TOOHEY moved to forward the appointment of Gail C.
Shortell, Esq., of Anchorage, Board of Psychologist and
Psychological Associate Examiners. Hearing no objection, it was so
ordered.
Number 1514
CO-CHAIR BUNDE announced that all the confirmations before the HESS
Committee had been moved forward.
Number 1519
CO-CHAIR TOOHEY noted that she had sent out questionnaires to the
boards and associations the confirmation nominees were associated
with. She received an affirmative response of every nominee.
CO-CHAIR BUNDE announced a Joint House/Senate HESS Committee
meeting the following day at 9:00 a.m. in the Butrovich Room.
Number 1559
CO-CHAIR BUNDE adjourned the House Health, Education & Social
Service Committee at 4:28 p.m.
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