Legislature(2007 - 2008)CAPITOL 106

02/09/2008 09:00 AM HEALTH, EDUCATION & SOCIAL SERVICES


Download Mp3. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Please Note Time Change --
+= HB 337 HEALTH CARE: PLAN/COMMISSION/FACILITIES TELECONFERENCED
Heard & Held
*+ HB 345 MEDICAL FACILITY CERTIFICATE OF NEED TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
 HOUSE HEALTH, EDUCATION AND SOCIAL SERVICES STANDING COMMITTEE                                                               
                        February 9, 2008                                                                                        
                           9:03 a.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Peggy Wilson, Chair                                                                                              
Representative Bob Roses, Vice Chair                                                                                            
Representative Anna Fairclough                                                                                                  
Representative Wes Keller                                                                                                       
Representative Paul Seaton                                                                                                      
Representative Sharon Cissna                                                                                                    
Representative Berta Gardner                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                              
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."                                                                   
                                                                                                                                
     - HEARD AND HELD                                                                                                           
                                                                                                                                
HOUSE BILL NO. 345                                                                                                              
"An Act amending the certificate  of need requirements to exclude                                                               
expenditures   for  diagnostic   imaging  equipment   in  certain                                                               
circumstances."                                                                                                                 
                                                                                                                                
     - HEARD AND HELD                                                                                                           
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 337                                                                                                                  
SHORT TITLE: HEALTH CARE: PLAN/COMMISSION/FACILITIES                                                                            
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
01/22/08       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/22/08       (H)       HES, FIN                                                                                               
01/24/08       (H)       HES AT 3:00 PM CAPITOL 106                                                                             
01/24/08       (H)       Heard & Held                                                                                           
01/24/08       (H)       MINUTE(HES)                                                                                            
01/31/08       (H)       HES AT 3:00 PM CAPITOL 106                                                                             
01/31/08       (H)       Heard    &   Held    --   Assigned    to                                                               
                         Subcommittee                                                                                           
01/31/08       (H)       MINUTE(HES)                                                                                            
02/09/08       (H)       HES AT 9:00 AM CAPITOL 106                                                                             
                                                                                                                                
BILL: HB 345                                                                                                                  
SHORT TITLE: MEDICAL FACILITY CERTIFICATE OF NEED                                                                               
SPONSOR(s): REPRESENTATIVE(s) KELLY                                                                                             
                                                                                                                                
01/30/08       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/30/08       (H)       HES, FIN                                                                                               
02/09/08       (H)       HES AT 9:00 AM CAPITOL 106                                                                             
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
KARLEEN JACKSON, Commissioner                                                                                                   
Department of Health and Social Services                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Presented HB 337 on behalf of the governor.                                                              
                                                                                                                                
JAY BUTLER, M.D.; Chief Medical Officer                                                                                         
Department of Health and Social Services                                                                                        
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Participated in the presentation of HB 337.                                                              
                                                                                                                                
JEANNINE HINMAN, Health Care Legal Consultant                                                                                   
Advanced Medical Centers of Alaska                                                                                              
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT:  Testified in support of HB 337.                                                                          
                                                                                                                                
NORMAN STEPHENS, Chief Executive Officer                                                                                        
Mat-Su Regional Health Care Center                                                                                              
Palmer, Alaska                                                                                                                  
POSITION STATEMENT:  Testified during the hearing on HB 337.                                                                  
                                                                                                                                
PAULA EASLEY, Member                                                                                                            
Alaska Mental Health Trust Authority Board of Directors                                                                         
Department of Revenue                                                                                                           
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified during the hearing on HB 337 on                                                                
behalf of the Alaska Mental Health Trust Authority (AMHTA).                                                                     
                                                                                                                                
ROB GOULD, Chief Financial Officer; Head of Operations                                                                          
Fairbanks Memorial Hospital and Denali Center                                                                                   
Fairbanks, Alaska                                                                                                               
POSITION STATEMENT:  Testified during the hearing on HB 337.                                                                  
                                                                                                                                
BOB URATA, M. D.; Member                                                                                                        
Bartlett  Regional  Hospital  Board  of  Directors;  Health  Care                                                               
Strategies Planning Council                                                                                                     
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified during the hearing on HB 337.                                                                  
                                                                                                                                
ROB BETIT, Chief Executive Officer                                                                                              
Alaska State Hospital and Nursing Home Association (ASHNHA)                                                                     
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   Testified during  the hearing  on HB  337,                                                             
representing  ASHNHA,   and  answered  a   question  representing                                                               
himself.                                                                                                                        
                                                                                                                                
JOEL GILBERTSON, Representative                                                                                                 
Providence Health & Services Alaska                                                                                             
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified during the hearing on HB 337.                                                                  
                                                                                                                                
REPRESENTATIVE MIKE KELLY                                                                                                       
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Introduced HB 345 as the sponsor.                                                                        
                                                                                                                                
DEREK MILLER, Staff                                                                                                             
to Representative Mike Kelly                                                                                                    
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:   Presented  the sectional  analysis for  HB                                                             
345, Version E, on behalf of Representative Kelly, sponsor.                                                                     
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
CHAIR PEGGY WILSON called the  House Health, Education and Social                                                             
Services  Standing  Committee meeting  to  order  at 9:03:38  AM.                                                             
Representatives Wilson,  Roses, Seaton, Gardner,  Fairclough, and                                                               
Keller were present at the  call to order.  Representative Cissna                                                               
arrived as the meeting was in progress.                                                                                         
                                                                                                                                
HB 337-HEALTH CARE: PLAN/COMMISSION/FACILITIES                                                                                
                                                                                                                                
9:05:18 AM                                                                                                                    
                                                                                                                                
CHAIR WILSON announced that the  first order of business would be                                                               
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."                                                                                                                
                                                                                                                                
9:05:51 AM                                                                                                                    
                                                                                                                                
CHAIR WILSON described the procedure for witness testimony.                                                                     
                                                                                                                                
9:07:28 AM                                                                                                                    
                                                                                                                                
KARLEEN JACKSON,  Commissioner, Department  of Health  and Social                                                               
Services,  informed  the  committee   that  the  mission  of  the                                                               
Department of  Health and  Social Services  (DHSS) is  to promote                                                               
and protect  the health and well  being of Alaskans.   House Bill                                                               
337, The Health Care Transparency  Act, accomplishes this because                                                               
it gives  Alaskans the tools  to responsibly manage  their health                                                               
care.   Two  items form  the  basis of  this act:  a health  care                                                               
committee to  oversee health planning  and develop a  health care                                                               
plan,  and  the creation  of  an  easily accessible  and  updated                                                               
website to  provide evidence based price  and quality information                                                               
about  health  care  providers and  services.    The  information                                                               
office would  begin work on July  1, 2008, to consolidate  all of                                                               
the data on health care facilities for Alaska consumers.                                                                        
                                                                                                                                
9:09:52 AM                                                                                                                    
                                                                                                                                
COMMISSIONER JACKSON continued to explain  that the third part of                                                               
HB 337 was  the repeal of the Certificate of  Need (CON) program.                                                               
She  observed that  the health  council addressed  the underlying                                                               
purpose  of the  CON program,  which was  to reduce  the cost  of                                                               
health  care and  improve  access to  health  care for  Alaskans.                                                               
Commissioner   Jackson  acknowledged   that  the   Alaska  Social                                                               
Services  Certificate of  Need Negotiated  Rule Making  Committee                                                               
did  not recommend  repealing the  CON program;  however, it  did                                                               
review  several   factors  that  suggested  a   higher  level  of                                                               
enforcement  by the  DHSS was  warranted  if the  program was  to                                                               
continue.                                                                                                                       
                                                                                                                                
9:11:36 AM                                                                                                                    
                                                                                                                                
COMMISSIONER JACKSON recalled that the  CON program was a federal                                                               
mandate  in the  1970's.   Since  that time,  market forces  have                                                               
changed, along  with the health  care industry.  Today,  with the                                                               
diversity   of  services   and  the   variety  of   technological                                                               
approaches, many states have modified  or repealed CON laws.  The                                                               
negotiated  rule  making  committee recommended  that  the  state                                                               
collect  additional  data  on  the  CON  program.    Commissioner                                                               
Jackson  opined that  collecting data  for the  consumer website,                                                               
instead, will  help Alaskans become  more informed  consumers and                                                               
more  responsible for  their health  care.   The negotiated  rule                                                               
making committee also recommended that  the voices of health care                                                               
consumers need to be heard;  in fact, the governor's bill focuses                                                               
on health care  from the consumer's perspective.  This  is one of                                                               
the reasons for the wide diversity  of opinions on the bill.  She                                                               
then  assured the  committee that  the  committee substitute  has                                                               
addressed  the   needs  of  small  community   hospitals  by  the                                                               
exception of  residential psychiatric treatment  centers, nursing                                                               
homes, and critical access hospitals from repeal of the CON.                                                                    
                                                                                                                                
9:15:16 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER observed that  the complexity of the issue                                                               
warrants  a  complete  study  of  CON  laws  in  Alaska,  as  the                                                               
materials available to the committee  are from other states.  She                                                               
stated  her  support  for a  data  driven,  independent,  quality                                                               
study, perhaps  by the new  health care commission, but  would be                                                               
unable  to support  a  bill  of any  kind  based  on her  current                                                               
knowledge.                                                                                                                      
                                                                                                                                
9:17:27 AM                                                                                                                    
                                                                                                                                
JAY  BUTLER, M.D.;  Chief Medical  Officer, Department  of Health                                                               
and Social Services, supported  Representative Gardner's call for                                                               
additional study  of the CON  issue; however, he opined  that the                                                               
new   health  care   task  force   will  have   too  many   other                                                               
responsibilities to complete this additional  task.  He clarified                                                               
that  one role  of  the  health information  office  would be  to                                                               
provide  information   on  the  prevention  of   disease  and  to                                                               
encourage personal health  responsibility. Additional information                                                               
will be phased  in as the feasibility and success  of the program                                                               
allow.   Dr. Butler described  different uses of  the information                                                               
system  and  stated  that  an informed  patient  is  a  healthier                                                               
patient.   Finally, he  commented that  the content  disclosed by                                                               
the  health information  office  would create  a  hub for  useful                                                               
advice for consumers.                                                                                                           
                                                                                                                                
9:20:47 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER  suggested that  the University  of Alaska                                                               
could  facilitate  a study  of  the  CON  program in  Alaska  and                                                               
indicated  concern with  eliminating or  making major  changes in                                                               
the current system in the absence of data.                                                                                      
                                                                                                                                
9:21:25 AM                                                                                                                    
                                                                                                                                
CHAIR WILSON called  the committee's attention back  to the first                                                               
and second parts of the bill.                                                                                                   
                                                                                                                                
9:21:50 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROSES asked whether  the information that would be                                                               
required to  be reported to  the health information  office under                                                               
HB 337, is now being required under a CON application.                                                                          
                                                                                                                                
COMMISSIONER JACKSON answered  that what is required  for the CON                                                               
program is  focused on the need  to build a specific  facility to                                                               
provide  a   service  and  the   financial  impact   on  existing                                                               
facilities. Information  for the health information  office would                                                               
be focused  on the  consumer's perspective  as to  where services                                                               
are located, at what cost, and the expected outcomes.                                                                           
                                                                                                                                
9:23:33 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROSES  asked whether  the DHSS  would be  ready to                                                               
gather data and implement the provisions in the bill in July.                                                                   
                                                                                                                                
COMMISSIONER JACKSON  responded that  on July 1,  the information                                                               
office would  start hiring staff  and the commission  would begin                                                               
its  work on  the  website.   She estimated  that  data would  be                                                               
posted on the website within one year.                                                                                          
                                                                                                                                
9:24:33 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  ROSES  encouraged  the committee  to  create  the                                                               
commission prior to making decisions  on the other aspects of the                                                               
bill.    The  commission  could then  address  the  many  details                                                               
surrounding the information  office and deal with the  CON.  This                                                               
issue  has a  tremendous amount  of interest  and affects  health                                                               
care   across   the   state    for   providers   and   consumers.                                                               
Representative Roses  opined that  the members of  the commission                                                               
will be best qualified to make these decisions.                                                                                 
                                                                                                                                
9:27:27 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CISSNA  expressed her belief  that a study  of the                                                               
CON  program in  Alaska  could be  done  simultaneously with  the                                                               
formation of the commission.                                                                                                    
                                                                                                                                
9:28:41 AM                                                                                                                    
                                                                                                                                
COMMISSIONER  JACKSON noted  that fiscal  considerations are  the                                                               
reason that HB  337 contains three purposes.  She  cited the cost                                                               
impact of  outstanding lawsuits, in  addition to the cost  of the                                                               
CON program, and pointed out  that proceeding with the commission                                                               
and the  information office, without addressing  the CON program,                                                               
would have a significant fiscal impact.                                                                                         
                                                                                                                                
9:29:31 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROSES  expressed his belief that  concern over the                                                               
lawsuits should be  set aside, as that should not  be the driving                                                               
force behind the decisions that  establish health care policy for                                                               
the citizens of the state.                                                                                                      
                                                                                                                                
9:30:37 AM                                                                                                                    
                                                                                                                                
COMMISSIONER JACKSON re-stated that the  issue with the law suits                                                               
is the cost and  that the purpose of the program  is to lower the                                                               
cost of health care.                                                                                                            
                                                                                                                                
9:30:55 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON asked  whether  the fiscal  impact of  the                                                               
lawsuits  on the  DHSS is  the dollar  cost or  the diversion  of                                                               
resources.                                                                                                                      
                                                                                                                                
COMMISSIONER JACKSON said both.                                                                                                 
                                                                                                                                
9:31:32 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON remarked:                                                                                                 
                                                                                                                                
     As  I  see  it,  Section 1  has  you,  the  department,                                                                    
     charged  with doing  the health  care plan.   And  that                                                                    
     wouldn't be the  charge really of the  commission.  So,                                                                    
     I'm trying to  figure out, if we would  go forward with                                                                    
     Section 2 and establish  the commission, without having                                                                    
     the policy decision made  for the transparency section,                                                                    
     ...  then  the  commission's  role  would  be  to,  um,                                                                    
     assess,  through the  full range  of things  that might                                                                    
     influence costs in  the state, and then  come back with                                                                    
        a policy question.  Is that where we'd be if we                                                                         
      institute Section 1 without, the commission, without                                                                      
     the policy choice being made by the legislature?                                                                           
                                                                                                                                
9:33:02 AM                                                                                                                    
                                                                                                                                
COMMISSIONER    JACKSON   asked    Representative   Seaton    for                                                               
clarification of the question.                                                                                                  
                                                                                                                                
9:33:25 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON  further  stated  that, in  the  web  base                                                               
program, it appears that a policy  choice would be made about the                                                               
responsibilities  of the  commission,   but on  page 3  it states                                                               
that "the  commission is going  to be looking  at recommendations                                                               
to foster  development of statewide  plan and to  review facility                                                               
care information."   He then  asked whether  Commissioner Jackson                                                               
saw  any  difference  in  the  charge  if  the  legislature  only                                                               
institutes that as a policy.                                                                                                    
                                                                                                                                
COMMISSIONER JACKSON answered that  there would be differences if                                                               
the transparency  piece was not  there to focus on  the consumer.                                                               
The health  plan would then  be focused  on facilities, as  it is                                                               
now, rather than the comparison of prices for the consumer.                                                                     
                                                                                                                                
9:34:55 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON  further asked whether the  sections of the                                                               
bill could  be broken apart  to establish the  commission without                                                               
the information office.   If so, would that  affect the direction                                                               
of the bill.                                                                                                                    
                                                                                                                                
COMMISSIONER  JACKSON stated  that  the  commission, without  the                                                               
information  office,   would  not   be  able  to   implement  its                                                               
recommendations.   There would  not be  the ability  to implement                                                               
the policy decisions and make a direct connection to Alaskans.                                                                  
                                                                                                                                
DR. BUTLER reiterated  that, to begin the work  of the commission                                                               
without the  tool of the  health information office,  could limit                                                               
its effectiveness.                                                                                                              
                                                                                                                                
9:36:51 AM                                                                                                                    
                                                                                                                                
CHAIR  WILSON expressed  her understanding  that the  health care                                                               
commission would  evaluate health care,  in Alaska on  the whole,                                                               
and  make  recommendations for  improvements.    The health  care                                                               
information office would be responsible  for providing the public                                                               
with  information to  allow individuals  to  make wise  decisions                                                               
about  their  personal   health  care.    She   opined  that  the                                                               
responsibilities  of the  commission and  the information  office                                                               
are not the same.                                                                                                               
                                                                                                                                
COMMISSIONER JACKSON agreed.                                                                                                    
                                                                                                                                
9:38:41 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON   asked  whether  enacting   the  sections                                                               
separately would mean  that the policy choice  for the commission                                                               
can not include transparency for consumers.                                                                                     
                                                                                                                                
9:39:14 AM                                                                                                                    
                                                                                                                                
CHAIR  WILSON  opined that  the  commission  and the  information                                                               
office are  two separate entities  operating, for the  most part,                                                               
in two separate realms.                                                                                                         
                                                                                                                                
9:39:37 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON  surmised that doing one  without the other                                                               
indicates  that the  commission  was tasked  to  bring forward  a                                                               
plan.   The  committee  was  not making  a  policy decision  that                                                               
consumers should  have individual information; that  was a policy                                                               
decision   that  the   commission   would   integrate  into   its                                                               
recommendations.                                                                                                                
                                                                                                                                
9:40:21 AM                                                                                                                    
                                                                                                                                
CHAIR WILSON  asked whether Representative Seaton  was suggesting                                                               
putting everything into one.                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON  related that the suggestion  has been made                                                               
to only pass the commission,  without policy direction.  He noted                                                               
that the commission's  plan may or may not  have the transparency                                                               
focus and  he wished to  ensure that  the commission does  have a                                                               
policy direction integrated into their charge.                                                                                  
                                                                                                                                
9:41:57 AM                                                                                                                    
                                                                                                                                
CHAIR  WILSON recalled  her experience  on the  governor's health                                                               
care  council.   She  opined  that  the  commission would  be  an                                                               
extension   of   the  health   care   council   and  would   make                                                               
recommendations  that  may  be  developed   into  policy  by  the                                                               
legislature. The formation of the  health care information office                                                               
would be  the result of  policy decisions by the  legislature and                                                               
the DHSS.                                                                                                                       
                                                                                                                                
9:43:52 AM                                                                                                                    
                                                                                                                                
DR. BUTLER expressed his concern  about splitting the information                                                               
office.  The  details of what the health  information office does                                                               
should be  part of the  charge of  the commission, as  the health                                                               
information office is  answerable to the commission.   Dr. Butler                                                               
opined  that the  commission and  the  health information  office                                                               
would not function well completely independent of one another.                                                                  
                                                                                                                                
9:44:42 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  ROSES called  the  committee's  attention to  the                                                               
task  of   the  commission   as  written  in   the  bill.     The                                                               
responsibility of the  DHSS is also established by the  bill.  He                                                               
opined  that   transparency  is  an  overused   term,  and  that,                                                               
unfortunately, the  public does  not see  all of  the information                                                               
about government.  Keeping the  public informed is important, but                                                               
there  is so  much  data  that some  confusion  is  certain.   He                                                               
stressed  that,  if the  commission  is  established solely,  the                                                               
department still  has a responsibility  for its tasks.   In fact,                                                               
the  commission will  decide what  needs to  be changed  and what                                                               
strategies will  be used.   He re-stated his suggestion  to allow                                                               
the  commission  to  develop its  goals  independently  from  the                                                               
legislature.  He cautioned against  writing legislation that does                                                               
not solve the problem.                                                                                                          
                                                                                                                                
9:48:28 AM                                                                                                                    
                                                                                                                                
CHAIR WILSON  asked whether Representative Roses  wanted to delay                                                               
part two.                                                                                                                       
                                                                                                                                
REPRESENTATIVE  ROSES  said no.    He  explained that  the  state                                                               
already has  the responsibility, outlined by  [eleven paragraphs]                                                               
in the bill, that establishes  the strategy and the collaborative                                                               
approach  to improve  health  care.   He  drew  attention to  the                                                               
[paragraphs] and  stated that the commission's  responsibility is                                                               
to  make  recommendations  for  changes   in  the  plan  to  help                                                               
implement the plan  and to ensure that the information  is on the                                                               
website for consumers.                                                                                                          
                                                                                                                                
9:50:30 AM                                                                                                                    
                                                                                                                                
CHAIR WILSON pointed  out that the  first section  of the bill is                                                               
in current statute  and the only change was the  addition on page                                                               
2, lines [8 through 10] that read:                                                                                              
                                                                                                                                
        (A) a statewide health plan under AS 18.09 based                                                                    
          on recommendations of the Alaska Health Care                                                                      
     Commission established in AS 18.09.010;                                                                                
                                                                                                                                
9:51:10 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CISSNA  stated her support for  the commission and                                                               
for a health information office;  however, the information office                                                               
should not  only be available  electronically.  She  expects that                                                               
the  commission would  explore other  sources of  information and                                                               
work  to  eliminate    duplicity.    Representative  Cissna  then                                                               
expressed  her support  for  enacting the  purposes  of the  bill                                                               
separately.                                                                                                                     
                                                                                                                                
9:52:46 AM                                                                                                                    
                                                                                                                                
COMMISSIONER JACKSON  disagreed, and stated that  she expects the                                                               
information  office  to  immediately  begin to  work  with  other                                                               
sources of information, while the  commission is determining what                                                               
is  missing.     In   addition,  she   noted  that   health  care                                                               
transparency is a national term in use in many states.                                                                          
                                                                                                                                
9:53:20 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KELLER stated  that  he has  participated in  the                                                               
health council meetings and expressed  his support for addressing                                                               
the two parts  of the issue, an overall look  and the perspective                                                               
of the  consumer, in one  bill.  He pointed  out that there  is a                                                               
disconnect between the  parties in the health  care situation and                                                               
expressed his interest in keeping the bill intact.                                                                              
                                                                                                                                
9:54:53 AM                                                                                                                    
                                                                                                                                
CHAIR WILSON informed  the committee that HB 337 and  HB 345 were                                                               
held over for further discussion.                                                                                               
                                                                                                                                
9:55:37 AM                                                                                                                    
                                                                                                                                
CHAIR WILSON  opened public testimony  on the first  two sections                                                               
of HB 337.                                                                                                                      
                                                                                                                                
9:56:17 AM                                                                                                                    
                                                                                                                                
JEANNINE HINMAN,  Health Care Legal Consultant,  Advanced Medical                                                               
Centers of Alaska,  pointed out that there  have been restrictive                                                               
CON laws  in Alaska  for decades  and stated  her support  for HB                                                               
337.                                                                                                                            
                                                                                                                                
9:57:13 AM                                                                                                                    
                                                                                                                                
NORMAN STEPHENS, Chief Executive  Officer, Mat-Su Regional Health                                                               
Care Center, informed the committee  that he was a participant in                                                               
the  CON task  force.    He supported  the  idea  of slowing  the                                                               
process  down and  cautioned the  committee against  creating the                                                               
commission and  rushing ahead  with an  information office.   Mr.                                                               
Stephens opined  that hospitals are  now in competition  to lower                                                               
the cost of  contracts and keep costs low. On  the Medicare side,                                                               
cost  reports  are already  mandated  to  be public  information;                                                               
however, they  are very complicated and  difficult to understand.                                                               
Mr.  Stephens  concluded by  pointing  out  that statistics  from                                                               
smaller  hospitals, that  perform  fewer operations,  can not  be                                                               
fairly compared to statistics from large hospitals.                                                                             
                                                                                                                                
9:59:59 AM                                                                                                                    
                                                                                                                                
PAULA EASLEY, Member, Alaska Mental  Health Trust Authority Board                                                               
of Directors, Department  of Revenue, testified on  behalf of the                                                               
Alaska Mental  Health Trust Authority (AMHTA)  and requested that                                                               
HB  337 include  a representative  of  AMHTA on  the health  care                                                               
commission.   She noted that  the AMHTA, in conjunction  with the                                                               
DHSS, develops a  comprehensive five year mental  health plan and                                                               
advises the state on mental  health program funding that amounted                                                               
to approximately $27  million this year.  In  addition, the AMHTA                                                               
leads  system planning  in many  areas related  to beneficiaries.                                                               
Ms. Easley stated other goals of  the AMHTA and stressed that, in                                                               
the process  of its duties,  it collects a significant  amount of                                                               
research.  This  research would be invaluable to the  work of the                                                               
health care commission.  Turning to  the issue of the health care                                                               
information office, she  advised the committee of  the new United                                                               
Way statewide  referral service.   Ms. Easley listed many  of the                                                               
services  provided  via  the  Alaska  211  telephone  number  and                                                               
recommended that the  information office establish a  link to the                                                               
services provided on the phone  line, thus saving duplication and                                                               
a considerable amount of money.                                                                                                 
                                                                                                                                
10:04:06 AM                                                                                                                   
                                                                                                                                
ROB  GOULD,   Chief  Financial   Officer;  Head   of  Operations,                                                               
Fairbanks  Memorial  Hospital  and   Denali  Center,  stated  his                                                               
support for the commission and  opposition to the creation of the                                                               
health care information  office.  He opined  that the information                                                               
that would  be posted would  be incomplete and would  not provide                                                               
transparency.  In  addition, Alaska is a data rich  state and the                                                               
DHSS already has relevant information.                                                                                          
                                                                                                                                
10:06:19 AM                                                                                                                   
                                                                                                                                
BOB URATA,  M. D.,  Member, Bartlett  Regional Hospital  Board of                                                               
Directors  and  the  Health  Care  Strategies  Planning  Council,                                                               
stated  his  support   for  the  creation  of   the  health  care                                                               
commission and the  information office.  He recalled  that one of                                                               
the goals  of the Health  Care Strategies Planning Council  is to                                                               
develop   [a  vehicle   to]   provide   information  to   support                                                               
consumerism in  the health  care system.   In fact,  Medicare now                                                               
requires information,  on the Internet,  about how  hospitals are                                                               
doing  in certain  health  areas.   He  related  the Health  Care                                                               
Strategies Planning  Council's hope  that this  information would                                                               
be  expanded  to  include   hospitals  and  physician's  offices.                                                               
Turning to the health care  commission, he opined that the health                                                               
care  problems  in  the  state   will  take  time  to  solve  and                                                               
recommended that  more stakeholders  should be included  to serve                                                               
on the commission.                                                                                                              
                                                                                                                                
10:09:46 AM                                                                                                                   
                                                                                                                                
CHAIR WILSON stated  her appreciation for Dr.  Urata's support of                                                               
the bill.                                                                                                                       
                                                                                                                                
10:10:13 AM                                                                                                                   
                                                                                                                                
DR.  URATA opined  that many  hospital representatives  feel that                                                               
there is  an unlevel playing  field.  The commission  can address                                                               
this problem, if all parties are represented.                                                                                   
                                                                                                                                
10:10:55 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  GARDNER  asked Dr.  Urata  to  submit a  list  of                                                               
parties who should be included in the commission.                                                                               
                                                                                                                                
10:11:21 AM                                                                                                                   
                                                                                                                                
ROB  BETIT, Chief  Executive Officer,  Alaska State  Hospital and                                                               
Nursing Home  Association (ASHNHA),  informed the  committee that                                                               
the members of  the ASHNHA support the creation  of the statewide                                                               
health  plan  and  the  health  care  commission.    However,  he                                                               
recommended  changes  in  the membership  of  the  commission  to                                                               
ensure a  more balanced representation.   Also, he  expressed his                                                               
belief  that   the  reporting  provision   of  the   health  care                                                               
information office should include pharmacies and physicians.                                                                    
                                                                                                                                
10:15:01 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  ROSES  asked Mr.  Betit  for  the charge  of  the                                                               
health care commission on which he served in Utah.                                                                              
                                                                                                                                
MR. BETIT  stated that the  Utah commission addressed  the issues                                                               
of  access,  insurance  coverage,   and  cost.    The  commission                                                               
consisted  of  six  public  members,  six  legislators,  and  was                                                               
initially  chaired  by the  governor.    During its  tenure,  the                                                               
commission created  a road  map of issues  and staff  support was                                                               
provided  by an  information  office at  the  Utah department  of                                                               
health.  Mr. Betit related the successes of the commission.                                                                     
                                                                                                                                
10:16:53 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE ROSES  further asked  whether the  Utah commission                                                               
outlined medical protocol and procedures for testing.                                                                           
                                                                                                                                
MR.  BETIT  answered  that  the   commission  set  a  policy  for                                                               
physicians  to   follow,  but  the  details   were  developed  by                                                               
physicians and ethicists.                                                                                                       
                                                                                                                                
10:18:05 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  ROSES  then  asked  whether  the  protocols  were                                                               
established for the state.                                                                                                      
                                                                                                                                
MR.  BETIT  said that  protocols  recognized  by the  physician's                                                               
community and by the national  heath sciences group were embraced                                                               
by the Utah commission.                                                                                                         
                                                                                                                                
10:18:35 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE SEATON  asked whether  there should  be additional                                                               
representation by the legislature on the commission.                                                                            
                                                                                                                                
MR.  BETIT, speaking  now only  as an  individual, advised  that,                                                               
without the  governor's support, the health  care commission will                                                               
not  make   progress.    In   addition,  representation   by  the                                                               
legislature is  required to  ensure support  and funding  for the                                                               
commission's  policy   recommendations.    He  opined   that  the                                                               
legislature needs additional representation on the commission.                                                                  
                                                                                                                                
10:20:49 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE CISSNA asked  for a description of  the members of                                                               
the Utah commission.                                                                                                            
                                                                                                                                
10:21:22 AM                                                                                                                   
                                                                                                                                
MR.  BETIT answered  that there  were two  members each  from the                                                               
majority and minority  parties of each body, who  were chosen for                                                               
their interest and commitment to health care.                                                                                   
                                                                                                                                
10:22:05 AM                                                                                                                   
                                                                                                                                
JOEL  GILBERTSON, Representative,  Providence  Health &  Services                                                               
Alaska,  stated his  support for  the commission  as well  as the                                                               
information office.   However, he cautioned that  it is important                                                               
to consider  the membership of  the commission.  He  opined that,                                                               
in order to  promote health care reform  in Alaska, stakeholders,                                                               
providers, employers,  consumers, and  government representatives                                                               
would all be needed.   Also, he cautioned that oversimplification                                                               
of the information  provided by the information  office would not                                                               
be  valuable   to  the  consumer,  especially   without  data  on                                                               
physician's costs.                                                                                                              
                                                                                                                                
10:25:31 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  GARDNER   asked  Mr.   Gilbertson  how   large  a                                                               
commission could be and still be workable.                                                                                      
                                                                                                                                
MR. GILBERTSON  suggested that the  commission should  consist of                                                               
11 to 12 members.                                                                                                               
                                                                                                                                
10:26:21 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE KELLER  asked whether there is  the possibility of                                                               
a [commission] made of two layers of representation.                                                                            
                                                                                                                                
MR.   GILBERTSON    stressed   that    individuals   representing                                                               
conflicting  interests   would  be   needed  to  work   out  real                                                               
solutions.   He  stated  that  he was  unfamiliar  with a  tiered                                                               
approach to the problem.                                                                                                        
                                                                                                                                
10:28:33 AM                                                                                                                   
                                                                                                                                
CHAIR WILSON  closed public testimony  on the first two  parts of                                                               
HB 337.                                                                                                                         
                                                                                                                                
[HB 337 was held over.]                                                                                                         
                                                                                                                                
10:28:52 AM                                                                                                                   
                                                                                                                                
HB 345-MEDICAL FACILITY CERTIFICATE OF NEED                                                                                   
                                                                                                                                
10:29:12 AM                                                                                                                   
                                                                                                                                
CHAIR WILSON announced that the  final order of business would be                                                               
HOUSE  BILL NO.  345, "An  Act amending  the certificate  of need                                                               
requirements  to  exclude  expenditures  for  diagnostic  imaging                                                               
equipment in certain circumstances."                                                                                            
                                                                                                                                
10:29:42 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  MIKE KELLY,  Alaska State  Legislature, disclosed                                                               
his  uncompensated service  to  the  Greater Fairbanks  Community                                                               
Hospital Foundation  and to the  Committee on Governance  for the                                                               
American  Hospital  Association.    He,  as  the  prime  sponsor,                                                               
introduced HB 345  and stated that the bill is  a compromise that                                                               
attempts  to  eliminate   the  CON  program  for   a  portion  of                                                               
businesses, thus is  a step in the direction  of more competition                                                               
in the  health care industry.   Representative Kelly  pointed out                                                               
that provisions for a [health  care commission] and a health care                                                               
information office are  not included in HB 345,  and he expressed                                                               
his concerns  that both of these  provisions constitute increased                                                               
government  involvement  in  private business.  In  addition,  he                                                               
opined that  50 percent of  the industry  is not included  in the                                                               
information office data.                                                                                                        
                                                                                                                                
10:3:55 AM                                                                                                                    
                                                                                                                                
CHAIR  WILSON noted  that, page  6,  [paragraph (2)]  of HB  337,                                                               
read:                                                                                                                           
                                                                                                                                
     The facility cost and provider cost...                                                                                   
                                                                                                                              
10:34:22 AM                                                                                                                   
                                                                                                                              
REPRESENTATIVE  KELLY opined  that  the  requirement to  disclose                                                               
costs by private sector businesses  was an "additional step."  He                                                               
then asked his staff to review HB 345.                                                                                          
                                                                                                                                
10:34:34 AM                                                                                                                   
                                                                                                                                
DEREK MILLER,  Staff to Representative  Mike Kelly,  Alaska State                                                               
Legislature,  presented  the  sectional   analysis  for  HB  345,                                                               
Version  E, on  behalf  of Representative  Kelly,  sponsor.   Mr.                                                               
Miller  informed  the committee  that  Section  1 adds  a  cross-                                                               
reference to an  additional exemption to the  Certificate of Need                                                               
process in existing statute.   Section 2 defines "critical access                                                               
hospital"  as  a  small,  rural,  hospital  that  is  financially                                                               
challenged given the  population that it serves.   Section 3 adds                                                               
an exemption that  permits a person to make an  expenditure of $1                                                               
million  or  more  for   diagnostic  imaging  equipment,  without                                                               
authorization under the terms of the  CON process, as long as the                                                               
equipment is located in a borough  with a population of 60,000 or                                                               
more, in  a city that does  not have a critical  access hospital,                                                               
and  is  at least  50  percent  owned  by  one or  more  licensed                                                               
physicians   who   are   qualified  to   and   actually   perform                                                               
interpretations  of   the  images   produced  at   the  facility.                                                               
Finally, Section  4 provides  applicability standards  for health                                                               
care  facilities in  existence  or proposed  after the  effective                                                               
date of the act.                                                                                                                
                                                                                                                                
10:36:19 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE   SEATON  asked   for   an   explanation  of   the                                                               
requirement  of  50  percent ownership,  by  physicians,  of  the                                                               
diagnostic imaging facility.                                                                                                    
                                                                                                                                
REPRESENTATIVE KELLY suggested that  the percentage was chosen as                                                               
a compromise between the opposing parties.                                                                                      
                                                                                                                                
10:38:43 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE   SEATON  further   asked  for   the  purpose   of                                                               
requiring physician  ownership, if the  intent of the bill  is to                                                               
open competition.                                                                                                               
                                                                                                                                
REPRESENTATIVE KELLY  explained that  physician ownership  is not                                                               
prevented,  but  if participation  is  less  than 50  percent  by                                                               
physicians, CON  laws still  apply.  The  intent is  to encourage                                                               
competition, as long as the two parties are working together.                                                                   
                                                                                                                                
10:40:53 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  GARDNER  asked  whether  this  was  a  compromise                                                               
between the hospitals and the physicians.                                                                                       
                                                                                                                                
REPRESENTATIVE  KELLY  said  that  the  bill  was  a  significant                                                               
compromise,  but the  dispute is  not entirely  between hospitals                                                               
and physicians.  House Bill 345  was a solution based on what has                                                               
been done in other states that have improved their CON laws.                                                                    
                                                                                                                                
10:42:04 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE GARDNER  asked for  the position of  the consumers                                                               
in the division between the hospitals and the doctors.                                                                          
                                                                                                                                
REPRESENTATIVE KELLY opined that it  depends on where the federal                                                               
government  leads  this  debate.   Unlike  fire,  car,  and  life                                                               
insurance,  the consumer  is  a  small part  of  health care  and                                                               
remains uninformed,  uninvolved, and under served.   In Anchorage                                                               
and Fairbanks,  physicians are  not accepting  Medicare patients;                                                               
this will soon  be a crisis as the number  of seniors will double                                                               
in Alaska  by 2030.   Representative Kelly  pointed out  that all                                                               
three aspects  of HB 337 would  not solve the issues  that HB 345                                                               
would solve by compromise.                                                                                                      
                                                                                                                                
10:45:50 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE GARDNER  asked whether  HB 345 would  resolve any,                                                               
or all, of the pending lawsuits.                                                                                                
                                                                                                                                
REPRESENTATIVE KELLY  expressed his understanding that  this bill                                                               
would settle from  75 percent to 90 percent of  the lawsuits.  He                                                               
blamed  weak  regulations for  the  legal  problems and  provided                                                               
analogies   to   the   California  power   system   deregulation.                                                               
Representative Kelly  predicted that a  sudden change in  the CON                                                               
system would cause a similar situation.                                                                                         
                                                                                                                                
10:49:49 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  CISSNA opined  that  one's health  is 80  percent                                                               
based on  personal choices and  learned habits.  She acknowledged                                                               
that the CON program needs  work, but expressed her concern about                                                               
the health of the hospitals  that are needed to provide emergency                                                               
care.   She  asked how  HB  345 will  safeguard the  health of  a                                                               
hospital.                                                                                                                       
                                                                                                                                
REPRESENTATIVE  KELLY  observed  that  HB  345  was  a  carefully                                                               
crafted  compromise.   He suggested  that, if  it is  not passed,                                                               
this struggle  will continue.   Furthermore, HB 345  is supported                                                               
by a large sector of the health care system.                                                                                    
                                                                                                                                
10:53:13 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE ROSES  expressed his  concern that  the limitation                                                               
on the cost of equipment may affect the quality of care.                                                                        
                                                                                                                                
REPRESENTATIVE  KELLY   agreed  and  pointed  out   that  HB  345                                                               
eliminates this possibility.                                                                                                    
                                                                                                                                
10:54:39 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE ROSES clarified his question.                                                                                    
                                                                                                                                
10:54:59 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE KELLY  confirmed that  the exemptions  provided by                                                               
HB 345 negate  the applicability of the CON  under the conditions                                                               
described by Representative Roses.                                                                                              
                                                                                                                                
10:55:21 AM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  ROSES  further  asked   whether  the  50  percent                                                               
ownership  requirement  was  supported  by  the  negotiated  rule                                                               
making committee.                                                                                                               
                                                                                                                                
REPRESENTATIVE KELLY  assured the  committee that the  support of                                                               
the  negotiated  rule  making committee  was  considered  in  the                                                               
drafting of HB 345.                                                                                                             
                                                                                                                                
10:56:34 AM                                                                                                                   
                                                                                                                                
CHAIR WILSON announced  that further testimony would  be heard on                                                               
the nineteenth of February, 2008.                                                                                               
                                                                                                                                
[HB 345 was held over.]                                                                                                         
                                                                                                                                
10:57:22 AM                                                                                                                   
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Health, Education and Social  Services Standing Committee meeting                                                               
was adjourned at 10:58:03 AM.                                                                                                 

Document Name Date/Time Subjects