Legislature(1993 - 1994)
03/03/1994 03:00 PM House HES
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE HEALTH, EDUCATION AND SOCIAL SERVICES
STANDING COMMITTEE
March 3, 1994
3:00 p.m.
MEMBERS PRESENT
Rep. Cynthia Toohey, Co-Chair
Rep. Con Bunde, Co-Chair
Rep. Gary Davis, Vice Chair
Rep. Al Vezey
Rep. Pete Kott
Rep. Harley Olberg
Rep. Irene Nicholia
Rep. Tom Brice
MEMBERS ABSENT
Rep. Bettye Davis (Excused)
OTHER LEGISLATORS PRESENT
Rep. Jim Nordlund
COMMITTEE CALENDAR
*HB 337: "An Act relating to the possession of controlled
substances within 500 feet of recreation and youth
centers."
PASSED OUT OF COMMITTEE
*HJR 52: Urging the Congress to amend the Social Security
Act so that the higher cost of living in Alaska is
reflected when the per capita income of the state
is used as a factor in determining the federal
share of Medicaid costs."
PASSED OUT OF COMMITTEE
*HB 356: "An Act relating to living wills and do not
resuscitate orders; and providing for an effective
date."
HEARD AND HELD
*HB 506: "An Act relating to student loans; to sanctions
for defaulting on a student loan, including denial
of a state occupational license or disbursement of
state money; and providing for an effective date."
HEARD AND HELD
WITNESS REGISTER
KIM BUSCH, Director
Division of Medical Assistance
Department of Health and Social Services
P.O. Box 110660
Juneau, Alaska 99811-0660
Phone: (907) 456-33552
Position Statement: Testified in support of HJR 52
MARK JOHNSON, Chief
Emergency Medical Services
Department of Health and Social Services
P.O. Box 110616
Juneau, Alaska 99811-0616
Phone: (907) 463-5807
Position Statement: Testified in support of HB 356
VONA HALL, Member
American Association of Retired Persons
9416 Long Run Rd.
Juneau, Alaska 99801
Phone: (907) 789-7422
Position Statement: Testified in support of HB 356
CRAIG LEWIS, Executive Director
Interior Region Emergency Medical Services Council
1881 Marika St.
Fairbanks, Alaska 99709
Phone: (907) 456-3978
Position Statement: Testified in support of HB 356
(Spoke via offnet)
ERNEST LINE
2645 Whispering Woods
Wasilla, Alaska 99645
Phone: (907) 376-6709
Position Statement: Testified in support of HB 356
(spoke via teleconference)
SANDY TACKETT, Nurse
Petersburg Hospital
P.O. Box 589
Petersburg, Alaska 99833
Phone: (907) 772-4291
Position Statement: Testified in support of HB 356
(spoke via teleconference)
JULIE RENWICK, Coordinator of Social Services
Wesley Rehabilitation and Care Center
P.O. Box 1066
Seward, Alaska 99664
Phone: (907) 224-5241
Position Statement: Testified in support of HB 356
(spoke via teleconference)
LINDA SWENSON, Nurse
Seward General Hospital
P.O. Box 365
Seward, Alaska 99664
Phone: (907) 225-5205
Position Statement: Testified in support of HB 356
(spoke via teleconference)
RICHARD JONES, Administrator
Wesley Rehabilitation and Care Center
P.O. Box 1066
Seward, Alaska 99664
Phone: (907) 224-5241
Position Statement: Testified in support of HB 356
(spoke via teleconference)
NANCY JO BLEIER, Director of Social Services
Southeast Alaska Regional Health Corporation
3245 Hospital Dr.
Juneau, Alaska 99801
Phone: (907) 463-4040
Position Statement: Testified in support of HB 356
(spoke via teleconference)
CAPTAIN STEVE IHA, EMS Coordinator
Capital City Fire/Rescue
820 Glacier Hwy.
Juneau, Alaska 99801
Phone: (907) 586-5322
Position Statement: Testified in support of HB 356
JOE MCCORMICK, Executive Director
Alaska Commission on Postsecondary Education
3030 Vintage Blvd.
Juneau, Alaska 99801-7109
Phone: (907) 465-6740
Position Statement: Testified in support of HB 506
BRIAN BRUBAKER, Coordinator
University of Alaska Coalition of Student Leaders
P.O. Box 84791
Fairbanks, Alaska 99708
Phone: (907) 474-5156
Position Statement: Testified on HB 506
(spoke via teleconference)
NICHOLAS ABRAMCZYK, Member
Associated Students of the
University of Alaska, Fairbanks
P.O. Box 99775
Fairbanks, Alaska 99775
Phone: (907) 474-5156
Position Statement: Testified on HB 506
(spoke via teleconference)
ANDREA PAIGE ADAMS, Vice-President
United Students of University of Alaska, Southeast
222 Tongass
Sitka, Alaska 99835
Phone: (907) 966-8413
Position Statement: Testified on HB 506
(spoke via teleconference)
BARBARA GABIER, Program Coordinator
Division of Occupational Licensing
Department of Commerce and Economic Development
P.O. Box 110806
Juneau, Alaska 99811-0806
Phone: (907) 465-2534
Position Statement: Testified on HB 506
PREVIOUS ACTION
BILL: HB 337
SHORT TITLE: DRUG FREE RECREATION AND YOUTH CENTERS
SPONSOR(S): REPRESENTATIVE(S) NORDLUND,Porter,Finkelstein,
Martin,Brown,Ulmer,Brice,Hudson,Menard,Sitton,Navarre,
Phillips,B.Davis,Green,Nicholia
JRN-DATE JRN-PG ACTION
01/03/94 2015 (H) PREFILE RELEASED
01/10/94 2015 (H) READ THE FIRST TIME/REFERRAL(S)
01/10/94 2015 (H) HES, JUDICIARY
01/13/94 2055 (H) COSPONSOR(S): B. DAVIS
01/14/94 2084 (H) COSPONSOR(S): GREEN
01/18/94 2101 (H) COSPONSOR(S): NICHOLIA
03/02/94 (H) HES AT 03:00 PM CAPITOL 106
03/02/94 (H) MINUTE(HES)
BILL: HJR 52
SHORT TITLE: DETERMINING FEDERAL SHARE OF MEDICAID
SPONSOR(S): REPRESENTATIVE(S) NORDLUND,Brice,Foster,Larson,
Finkelstein,Toohey,Hanley,Nicholia,B.Davis,Davidson
JRN-DATE JRN-PG ACTION
01/21/94 2123 (H) READ THE FIRST TIME/REFERRAL(S)
01/21/94 2123 (H) HEALTH, EDUCATION & SOCIAL
SERVICES
01/26/94 2159 (H) COSPONSOR(S): HANLEY
02/02/94 2230 (H) COSPONSOR(S): NICHOLIA,
B. DAVIS
02/03/94 2247 (H) COSPONSOR(S): DAVIDSON
03/02/94 (H) HES AT 03:00 PM CAPITOL 106
03/02/94 (H) MINUTE(HES)
BILL: HB 356
SHORT TITLE: LIVING WILLS AND MEDICAL CARE ORDERS
SPONSOR(S): HEALTH, EDUCATION AND SOCIAL SERVICES
JRN-DATE JRN-PG ACTION
01/10/94 2021 (H) READ THE FIRST TIME/REFERRAL(S)
01/10/94 2021 (H) HES, JUDICIARY
03/03/94 (H) HES AT 03:00 PM CAPITOL 106
BILL: HB 506
SHORT TITLE: STUDENT LOAN PROGRAM
SPONSOR(S): HEALTH, EDUCATION AND SOCIAL SERVICES BY REQUEST
JRN-DATE JRN-PG ACTION
02/16/94 2416 (H) READ THE FIRST TIME/REFERRAL(S)
02/16/94 2416 (H) HES, L&C, FINANCE
03/03/94 (H) HES AT 03:00 PM CAPITOL 106
ACTION NARRATIVE
TAPE 94-35, SIDE A
Number 000
CHAIR BUNDE called the meeting to order at 3:06 p.m., noted
members present and announced the calendar. He brought HB
337 to the table.
HB 337 - DRUG FREE RECREATIONAL AND YOUTH CENTERS
REP. JIM NORDLUND, Prime Sponsor of HB 337, addressed his
bill. He stated that in current law there are provisions
for drug free school zones that increase the penalties for
individuals who are arrested for possession of drugs in
school areas. He said the proposal would expand the zone to
include recreation and youth centers. He indicated that his
committee substitute (CS) would specify those recreation and
youth centers as those operated by the municipality or the
state. He referred to the sponsor statement and said that
within his district the legislation would address the
problems in the Spenard, Fairview, and Mountainview
Recreational Centers. He indicated that the Chief of
Police, Kevin O'Leary, maintains that the areas around
recreation and youth centers are fertile ground for those
who promote and sell drugs to children. He also indicated
that police officer Patrick O'Brien, school liaison officer,
asserts that the parking lot of the Fairview Recreation
Center is the sight of a huge drug trade.
REP. NORDLUND stated that HB 337 has no fiscal note. He
indicated that the CS would narrow the zones down to
recreational centers operated by the municipality or the
state. Also, the CS would make provisions to allow centers
operated by the municipality the option of posting signs
indicating drug free zones.
Number 170
REP. TOOHEY asked how a person would know an area is a drug
free zone.
REP. NORDLUND said when some of the violators are arrested,
they will learn that the penalties are more severe than they
used to be. Also, media sources and the general public will
help to disseminate the provisions of the new law.
Number 192
(CHAIR BUNDE indicated that Rep. Vezey arrived at 3:09 p.m.
and both Rep. Nicholia and Rep. Brice arrived at 3:11 p.m.)
REP. TOOHEY asked how much a sign would cost.
REP. NORDLUND said he did not know.
CHAIR BUNDE stated that all-weather signs are approximately
$200 apiece.
REP. TOOHEY suggested that the recreation centers have a
bake sale to raise money for the signs. She felt that the
signs needed to be seen.
Number 215
CHAIR BUNDE clarified that the CS narrows the zones to
municipal and state recreation and youth centers.
REP. NORDLUND agreed.
REP. TOOHEY made a motion to adopt the CS as a working
draft.
CHAIR BUNDE, hearing no objections, said the CS for HB 337
was before the committee and asked for further testimony.
Number 249
REP. NORDLUND stated that he did not bring other witnesses
to testify because he felt the concept of the bill is
simplistic and does not need much explanation. He indicated
a number of letters of support in the committee bill
packets.
CHAIR BUNDE asked for further questions. He then asked the
pleasure of the committee.
REP. BRICE made a motion to pass the CS for HB 337 out of
committee with individual recommendations and accompanying
fiscal note.
CHAIR BUNDE, hearing no objections, declared that the CS for
HB 337 was so moved. He brought HJR 52 to the table.
HJR 52 - INCREASE IN FEDERAL MEDICAID FUNDING
Number 309
REP. JIM NORDLUND, Prime Sponsor of HJR 52, addressed the
resolution. He stated that the resolution deals with the
issue of fairness regarding the state of Alaska. He said
currently the federal Medicaid rates vary nationwide from
50% to 70% based on relative per capita income of the
various states. He explained that Alaska's high cost of
living is not taken into account when reimbursement is set.
The purpose of the resolution is to amend the Social
Security Act to take into account Alaska's high cost of
living and to set the differential accordingly. He pointed
out another disadvantage in the way Medicaid rates are set
for the state. He said, "although, the cost of living is
considered in terms of deciding who is eligible to receive
Medicaid, therefore increasing the Medicaid pool, in turn we
do not receive the difference... in receiving the greater
amount of money... or that's not taking into
consideration... the cost of living is not taken into
consideration in setting the rate." He said that if the
state had a 25% increase, which is approximately what the
cost of living difference is for the state, it would mean an
additional $31 million dollars to the state of Alaska.
REP. NORDLUND indicated that the resolution also recognizes
the work that Senator Stevens has been doing in Congress to
make the necessary changes.
Number 387
CHAIR BUNDE asked for testimony from Kim Busch.
Number 390
KIM BUSCH, Director, Division of Medical Assistance,
Department of Health and Social Services, testified in
support of HJR 52. She stated that the Medicaid federal
matching percentage is based on per capita income with a
floor of 50%. She said if the floor did not exist, Alaska
would receive an even lower match rate. She said the
formula is also used for AFDC, the JOBS program, and other
federally funded programs. She explained that the
government uses a 25% cost of living differential to set the
poverty level in Alaska. She said the result for FY 94 is
$48.8 million that are not coming into Alaska. Medicaid
would receive an extra $33 million and AFDC would receive
$15.7 million.
MS. BUSCH felt it was critical to insert the provisions in
Title 19 of the Social Security act now, because all of the
health care reform legislation that is before Congress is
using the same formula and Alaska is seriously
disadvantaged.
Number 487
REP. TOOHEY asked when the resolution would take effect.
Number 490
MS. BUSCH said it would take effect when the legislature
adopts it. She said if Congress moves the resolution, it
would take effect this fall.
CHAIR BUNDE closed public testimony.
Number 512
REP. BRICE made a motion to pass the CS for HJR 52 out of
committee with individual recommendations.
CHAIR BUNDE objected as to explain his no vote. He stated
that the additional funds from the federal government would
still be taken from the general public's pockets. He said
it is not free money. He maintained that the Medicaid
program is wildly out of control and he thought Alaska
should lead by example and not ask for extra money.
Number 538
REP. VEZEY asked what would happen if the cost of living in
Anchorage turned out to be lower than Washington, D.C.
MS. BUSCH stated if the cost of living changed dramatically
and was no longer higher than most, the state would not need
the differential. She asserted that the situation currently
is grossly unfair. She also said that Congress must find
savings in order to fund the increase, indicating that
savings would be found within Title 19 to fund increase for
Alaska. She said that many other congressmen have been able
to act to get consideration for increases for their state.
Number 606
REP. BRICE said, "Better to buy... have this money come to
the state in the form of extra federal money for Medicaid,
Medicare, whatever, than to be buying whatever on the East
Coast for nonproductive use, which is another thing that our
federal government is known for. Buicks or bombs, that's
what I say."
CHAIR BUNDE said, "It's federal, it's free."
Number 623
REP. G. DAVIS agreed with Chair Bunde's point, but said the
system is a match program that is mandated by the federal
government. He said, "It's a mandate from the feds, and
it's a match program. So it's costing state dollars. At
the current rate the mandate from the feds is mandating that
the state spend so many dollars. Under this resolution the
mandate is that the state will not need to spend so much
dollars. So, I can certainly agree with that."
Number 641
REP. NICHOLIA stated that there is definitely a higher cost
of living in the rural areas. She said it is very expensive
for rural residents to go to Anchorage and Fairbanks for
medical treatment, citing that many forgo medical treatment
until the illness has gone past the point of medical care,
resulting in people dying unnecessarily. She felt that
Medicaid dollars could go far for those people. She also
reminded the committee that a large percentage of people on
Medicaid are children. She said a no vote would deny
children better medical services. She further stated that
in regards to the JOBS program there are a limited number of
people who are allowed to go to job training, and she felt
that number would increase as a result of the resolution.
Number 685
CHAIR BUNDE asked if most Natives are covered under the
Native Health Service.
Number 688
REP. NICHOLIA indicated that federal funding is also limited
for Indian Health Services. She said a lot of people are
turning to Medicaid. She then pointed out that the interior
has the highest cancer rate for the whole state of Alaska.
Number 710
CHAIR BUNDE, hearing no further discussion, called for the
vote. Representatives Toohey, Gary Davis, Kott, Olberg,
Nicholia and Brice voted yea; and Representatives Bunde and
Vezey voted nay. Chair Bunde indicated that the CS for HJR
52 was so moved. He then brought HB 356 to the table.
HB 356 - LIVING WILLS AND MEDICAL CARE ORDERS
REP. CYNTHIA TOOHEY stated that HB 356 complements current
statutes pertaining to the rights of the terminally ill by
adding specific recognition of do not resuscitate (DNR)
orders to the existing legislation with regards to the
rights of the terminally ill to make a declaration relating
to the use of life-sustaining procedures. She said a new
section, Section 18.12.035, that allows attending physicians
to issue DNR orders requires the Department of Health and
Social Services (DHSS), with the approval of the State
Medical Board, to issue regulations adopting a standardized
protocol governing the withholding of CPR by physicians and
other health care providers and establishes the requirements
under which health care providers other than physicians must
comply with DNR orders.
REP. TOOHEY further stated that Section 18.12.037 requires
the DHSS to develop standardized designs for DNR
identification cards, forms, necklaces, and bracelets to
indicate that the person who is in possession of one of the
items has executed a living will or that a DNR order has
been issued by a physician. Other provisions of the bill
amend existing provisions by including DNRs along with
living wills in areas such as immunities for health care
providers, acting under the provisions of living wills, DNR
orders, and penalties. Rep. Toohey maintained that DNR
orders are issued only in the case of terminal illness.
REP. TOOHEY explained that under existing practice,
emergency response providers are required to institute CPR
on site even if the person has a living will. She indicated
that a properly executed DNR order and procedural protocol,
recognized by all concerned parties, would help to avoid
futile and unwanted interventions. Similarly, within health
care institutions, DNR orders are necessary in the absence
of a living will when attempts at resuscitation serve only
to prolong the process of dying.
CHAIR BUNDE indicated that there would be testimony via
teleconference.
REP. BRICE asked if the memo from Craig Lewis would be
addressed.
CHAIR BUNDE indicated that Mr. Lewis was on teleconference.
Number 825
REP. VEZEY asked Rep. Toohey to explain the penalty section,
Section 5.
REP. TOOHEY stated that if an individual at a hospital,
where fees are being charged, resuscitates a person against
a DNR order, the individual will not be paid.
REP. VEZEY referred to the $1000 civil penalty.
REP. TOOHEY stated that the penalty is in existing law.
REP. VEZEY said he failed to see the merit of mandating a
$1000 civil penalty. He asked Rep. Toohey if she thought
that was in the best interest of the bill.
REP. TOOHEY deferred the question to Craig Lewis.
Number 861
CHAIR BUNDE indicated that Mr. Lewis would address that
question during public testimony. He said that Fairbanks,
Mat-Su, Petersburg, Seward, and Sitka were on
teleconference.
Number 865
MARK JOHNSON, Chief, Emergency Medical Services, Department
of Health and Social Services, testified in Juneau in
support of HB 356. He stated that emergency care providers
are trained to aggressively care for patients, but he also
felt there are terminally ill patients whose discomfort
should not be prolonged. He said when such patients, in
consultation with their physician, choose to have a DNR
order in place, the emergency medical providers would prefer
to respect those wishes.
Number 910
CHAIR BUNDE explained to the teleconference listeners that
HB 506 would probably be brought to the table by 4:00 p.m.
Number 921
VONA HALL, Member, Legislative Task Force for the American
Association of Retired Persons (AARP), testified in Juneau
in support of HB 356. She stated that she had been told the
meeting was the prior day, and at that time, had planned to
give a very elaborate speech including horror stories about
the financial and emotional expense endured by clients who
have had devastating effects from too much terminal care.
She stated that her testimony would be brief as she had
found her husband the day before with a broken hip on the
ice in the driveway and she was due at the hospital as he
was undergoing surgery. She said her husband was alive and
indicated that under different circumstances the DNR
legislation could have played an important role in their
lives. She also said that the legislation is not just for
old people. She suggested that it is for everybody that
goes snowmobiling, drives a car, or perhaps walks in front
of a car. She said her children and friends are aware of
her do not resuscitate orders. She strongly emphasized the
importance of the living will.
Number 995
REP. TOOHEY asked how her husband was.
MS. HALL said he was undergoing surgery right then.
CHAIR BUNDE expressed his appreciation for her testimony,
and wished Ms. Hall's husband the best.
Number 018
CRAIG LEWIS, Executive Director, Interior Region Emergency
Medical Services Council (IREMSC), testified via offnet in
support of HB 356. He stated that he had several
suggestions to make that perhaps would improve the
legislation and asked if he should summarize or do a line by
line analysis.
CHAIR BUNDE asked him to summarize and said the committee
would ask specific questions if necessary.
MR. LEWIS indicated that the words "attending physician,"
which are used throughout the bill, should be enhanced
because in some rural areas there is no attending physician.
He asked that the definition of attending physician be
expanded and clarified. He also explained that the term
cardiopulmonary resuscitation (CPR) is a process of hands on
patient care. Regarding the term, he suggested that
artificial exchange of oxygen needed to be specified. He
said that if the change is not made, an emergency care
provider may conclude that an oxygen mask should not be put
on the patient's face. He said that withholding
resuscitation needs to be very specific.
MR. LEWIS expressed his concern that the legislation is not
as "rurally oriented" as it could be. He said a very
specific mechanism needs to be in place to address the
unique emergency treatment needs of rural areas. Mr. Lewis
explained that an Emergency Medical Technician (EMT) could
have administered hours of aggressive treatment and not be
able to get the patient anywhere near a physician, let alone
an "attending physician."
TAPE 94-35, SIDE B
Number 000
MR. LEWIS further indicated that on page 2, lines 11-17, the
word "qualified" was very unclear.
Number 050
REP. TOOHEY stated that the word "qualified" means that the
person who possibly would be undergoing emergency treatment
has already signed a living will and has proof on their body
that they do not want resuscitation.
MR. LEWIS read lines 11-17 on page 2 to indicate the
vagueness of the term qualified. He continued on with his
summary and stated that he did not want the legislation to
only address health care facilities. He said rural Alaska
has many situations where DNR orders are relevant and
appropriate. Rural Alaska does not have health care
facilities if the definition means hospital or multi-
physician clinic. He felt that the definition had to be
more rurally oriented.
MR. LEWIS further suggested that the provision on page 3,
lines 10-12, is not a realistic approach in rural settings.
He said he was unsure of the necessity of the provision on
page 4, lines 7-15. Mr. Lewis expressed further concern
regarding page 5, lines 4-8, which addresses the issue of
complying with the DNR orders from other states. He said to
his understanding the legislation would allow an Alaskan
medical provider to recognize other DNR orders from other
states. He felt that it may be a regulation issue and
related that EMTs are trained to aggressively treat
patients, not to withhold treatment.
Number 195
ERNEST LINE, Concerned Citizen, testified via teleconference
in support of HB 356. He stated that the committee should
consider possible future legislation regarding physician
assisted suicide. He then addressed the bill. He
maintained that the State Medical Board may be opposed to
the provision on page 1, line 9. He suggested that the
legislature could approve the regulations. He further
indicated that on page 2, line 18, the provision would
actually compel compliance if the facility is a state run
operation. Mr. Line suggested that the phrase "shall not
attempt resuscitation until all provisions of Section 3,
paragraph b, are exhausted" should be inserted. Mr. Line
also supported the idea of increasing the $1000 fine to
violators of DNR orders, citing that it would ensure
compliance.
Number 300
REP. TOOHEY asked if Mr. Line knew of people whose DNR
orders were not carried out. She asked if he thought it was
a major problem in medical facilities.
MR. LINE stated that he has read about cases where the
physician did not personally believe in DNR orders.
Number 327
SANDY TACKETT, Nurse, testified via teleconference in
support of HB 356. She stated that health care people
needed to have the information within HB 356 to carry out
the wishes of a patient.
Number 345
CHAIR BUNDE asked witnesses to limit their testimony by
associating themselves with the similar positions of prior
testifiers and by adding any yet unheard testimony.
Number 350
JULIE RENWICK, Coordinator of Social Services, Wesley
Rehabilitation and Care Center, testified via teleconference
in support of HB 356. She stated that she was concerned
about the definition of qualified patient. She indicated
that she originally thought the legislation was only
addressing the terminally ill. She also said she hoped the
provision regarding protocol would be written to protect the
wishes of the individual and/or family guardian. She also
said in Section 3 individuals need to be more involved with
the decision making with the doctor. She further stated in
regards to DNRs in other states that there is a nationwide
organization called Right to Life that issues small living
will cards to people who travel throughout the nation. She
questioned whether the cards would comply with any single
state with living will provisions.
Number 424
LINDA SWENSON, Nurse, Seward General Hospital, testified via
teleconference in support of HB 356. She stated that in
regard to the oral DNR order provided for on page 2, line 2,
the DNR order should never be given orally in an urban
hospital. She also expressed concern as to what is a
qualified patient. She stated that people make living wills
with DNR orders anticipate that they, at some time, will not
be able to speak for themselves.
Number 475
RICHARD JONES, Administrator, Wesley Rehabilitation and Care
Center, testified via teleconference in support of HB 356.
He asked what protocol would be if an individual who had
previously provided a DNR order is in need of emergency
treatment at a hospital and is unable to express their
wishes at that time. He asked if the prior DNR order would
be honored or would a physician have to order another DNR.
He asked who was responsible for the legislation, and
expressed his thanks.
Number 526
CHAIR BUNDE stated that Rep. Toohey was responsible for
introducing HB 356.
Number 528
NANCY JO BLEIER, Director of Social Services, Southeast
Alaska Regional Health Corporation, testified in support of
HB 356. She stated that she also had concerns with the
terms "qualified" and "health care facility."
Number 570
REP. TOOHEY read for the record from statute 18.15.010: "A
qualified patient means a patient who has executed a
declaration in accordance with this chapter and who has been
determined by an attending physician to be in terminal
condition."
CHAIR BUNDE said his understanding of the issue is that the
legislation addresses terminal patients only and perhaps it
could also include someone who is in the peak of health but
meets with a catastrophic accident.
Number 587
CAPTAIN STEVE IHA, EMS Coordinator, Capital City
Fire/Rescue, testified in Juneau in support of HB 356. He
stated that Juneau has had DNR protocol in place for 3-1/2
years, and it has been quite successful. He said it was his
understanding that a living will can be initiated by anyone
regardless of that person's health condition. However, he
said the living will is not enacted until a physician (or
perhaps two) determines that the patient is terminally ill.
He said that stipulation creates a Catch 22 situation. He
asked what protocol would be in the case of a healthy, 35
year old man who chokes on a piece of meat. He said that
technically he could be in a DNR state. He felt that the
legislation needs to be more specific.
CAPT. IHA also said there is no way for EMTs to really know
the validity of an out-of-state DNR order. He said that for
the most part his EMTs honor DNR orders within the Juneau
system. He suggested that the term "qualified" be more
clear.
Number 648
REP. TOOHEY asked what the medical protocol would be if
Capt. Iha found a person collapsed on the street corner of
the capitol with a DNR arm band on.
CAPT. IHA said there is no protocol for such an instance.
He stated that the DNR patients in Juneau have been
determined to be terminally ill by a physician and have
filled out a form that has been sent to Fire/Rescue
dispatch. He said that it is understood that those patients
on the DNR list at dispatch would be responded to at their
home.
REP. VEZEY asked what the protocol would be if he choked on
a piece of meat. He asked how an EMT would know he had a
living will.
CAPT. IHA said, "If you're talking about putting do not
resuscitate type bracelets or identifications, then it would
become an issue."
REP. VEZEY said that he never thought that executing a
living will would put himself in the position of not
receiving medical attention.
CAPT. IHA said if DNR orders are part of the living will, it
must be very clear.
Number 696
CHAIR BUNDE said there is a difference. He then asked Rep.
Toohey how she would like to address all the aforementioned
concerns.
REP. OLBERG said that Rep. Vezey would fall under the Do Not
Resuscitate Legislators provision.
CHAIR BUNDE said he wanted to amend that to specify minority
legislators.
REP. TOOHEY clarified that the legislation is a companion
bill to a living will in a hospital. It would allow EMTs
who have found a terminally ill person collapsed on the
street corner to respect that person's DNR order.
Number 744
MR. JOHNSON stated that all the aforementioned concerns
could be dealt with quite easily. He referred to testimony
from Mr. Line and indicated that he has every confident in
working with the medical board and felt there would be no
problems in doing so.
CHAIR BUNDE closed public testimony on HB 356.
HB 506 - STUDENT LOAN PROGRAM
CHAIR BUNDE then brought HB 506 to the table and turned the
gavel over to Rep. Toohey to preside over the remainder of
the meeting.
CHAIR TOOHEY took a brief at-ease from 4:08 p.m. to 4:20
p.m.
Number 795
REP. BUNDE addressed HB 506. He stated that Joe McCormick
would further address the bill.
REP. BRICE stated for the record that he presently has an
active student loan, and indicated that there might be a
conflict of interest.
CHAIR TOOHEY thanked Rep. Brice and said his comment was so
noted.
REP. BUNDE stated that the legislation would attempt to make
the student loan "a little more business-like." He said
administratively progress has been made, but he would like
to see even more progress to maintain the student loan
program, and indicated that as it exists, it costs more
money to bond the program than is being received. He said
under those circumstances, the program would eventually run
out of money. He indicated that the bill addresses seven
items within the loan program:
1. It would change the interest rate from a fixed rate
to a variable rate.
2. It would allow for restrictions for eligibility of
a loan if an individual has had a prior loan
written off as a bad debt.
3. It would allow wages to be garnished.
4. It would deny state licensure if an individual is
in default of a student loan.
5. It would also deny state warrants.
6. It would allow for the refinancing of student
loans.
7. It would allow for an expanded family education
loan eligibility.
Number 870
REP. BUNDE asked if there were any questions.
TAPE 94-36, SIDE A
Number 000
REP. OLBERG asked if the interest rate would have a floor or
could it go down to 1%.
Number 050
JAMES MCCORMICK, Executive Director, Alaska Commission on
Postsecondary Education, testified in Juneau in support of
HB 506. He stated that it does not have a floor, but would
be tied to the cost of the money that is secured in the bond
market. He said it would be unrealistic to assume that the
cost of money would go down to 1% or less.
REP. OLBERG asked if the rate would have a cap.
MR. MCCORMICK said no.
REP. OLBERG asked what the interest rate is based on.
MR. MCCORMICK replied that it is based on the cost of money
when bonds are issued to replace the capital of the loan
fund. He said the interest rate from loans disbursed from
the bond proceeds would be tied to the cost of the bond
proceeds.
REP. OLBERG asked if the rate could be annually adjusted.
MR. MCCORMICK said it could be a possibility. He said the
problem would be that a greater administrative burden would
be put upon the entity that would administer the loan fund,
because the interest rate would change from year to year.
Number 076
REP. OLBERG said he felt that the software required for that
process would not be a difficult transition. He then asked
if teaching certificates would be included under denial of
licensure.
Number 085
MR. MCCORMICK answered that he had a friendly amendment to
restrict the impact of Section 1 to only persons licensed
for professional or occupational licenses only. He then
stated that he was unsure if teaching certificates would
fall under the provision.
REP. BUNDE stated that he currently sits on a committee that
is rewriting the provisions for granting a teacher's
license. He felt that a teaching certificate would fall
under that section, and he would encourage the amendment.
Number 121
REP. OLBERG agreed with the amendment.
REP. BUNDE maintained that there are many other student loan
programs that offer a lower interest rate and that students
should be encouraged to shop around.
REP. VEZEY asked what the average maturity date of a student
loan is.
MR. MCCORMICK responded by saying the average student is in
school 2-1/2 years with one year grace and a standard ten
year repayment. He said that many students qualify for
extended repayment plans of 15 years. He stated that the
average is 12 to 13 years.
REP. VEZEY said, "paying on the loan or have the loan out."
MR. MCCORMICK said, "paying on the loan."
REP. VEZEY clarified that the average loan has a 15 year
life.
MR. MCCORMICK added that there is no stated forgiveness on
the loan, so it could be an outstanding balance for an
indefinite amount of time.
Number 188
REP. VEZEY asked what kind of maturity was on the bonds that
are issued.
MR. MCCORMICK stated that the bonds have approximately a 10
year maturity.
REP. VEZEY questioned whether it would be prudent to take
out a long term, variable rate loan.
MR. MCCORMICK maintained that the legislation provides for a
fixed rate loan, fixed to the cost of that money for that
bond issue. The rate would not change for the bond issue.
REP. VEZEY clarified that money would be available one year
at one rate and at another rate the next year, but the rate
would be fixed for the life of each individual loan.
MR. MCCORMICK agreed. He also said that it is possible to
have a variable rate bond and a variable rate interest on
the loan. He indicated that it would require more
sophisticated software.
REP. VEZEY suggested that if the loans went to a variable
rate, investments would need to be accessed to ensure that
there would be no exposure to an arbitrage situation.
MR. MCCORMICK agreed and said language within the bill
states that the commission will ensure that the rate covers
the administrative cost of the loan. He asserted that the
thrust of the bill is to recognize the actuarial soundness
of the loan fund and specified that an interest rate must be
actuarially sound given the terms of the loan.
Number 321
REP. VEZEY stated that the student loan program did not have
a loan forgiveness program.
MR. MCCORMICK explained that there is no loan forgiveness on
loans that are currently being granted, but there is loan
forgiveness for loans that have been made in the past that
will continue into the future for which there is no offset.
He said currently no fees are charged and no premiums are
collected to cover the loan forgiveness, and he anticipated
there would be a depletion in the fund annually as students
qualify for forgiveness.
REP. VEZEY asked if there is a significant depletion in the
loan reserve.
MR. MCCORMICK said historically there has been a significant
depletion, but it has slowed. He further stated that money
is lost in three areas -- interest not charged to a borrower
(in school plus one year of grace), loans that default, and
loans that have forgiveness provisions.
REP. OLBERG suggested that the term of the loan be tied to
the source of the funds, and explained that if there are ten
year bonds, there should be ten year term loans.
MR. MCCORMICK stated that the term of the loan is dealt with
in the section pertaining to refinancing. He also said that
in current statute there is a provision that allows up to 15
years if the student has an extremely high debt. He felt
the terms of the loan will be much more flexible when there
is a consolidation provision that would allow students to
collapse various loans into one new promissory note at a new
interest rate which would be tied to the bond issue.
REP. BUNDE stated that the current interest rate is 8%, but
if all the interest free time that a student has is
considered, it is actually closer to 5%. The loan was
bonded at 6%, indicating a loss.
CHAIR TOOHEY said that forgiveness loans are dying out as
the practice stopped in 1987.
REP. VEZEY suggested that the student loan program showed a
positive cash flow.
MR. MCCORMICK agreed, but he indicated that when he used the
term "actuarially sound," he was talking in terms of the
total life of the loans and total life of the bonds, not
just what the balance sheet reflects for one particular
year.
REP. VEZEY asked if, at the current fixed rate of 8% with
forgiveness periods and the cost of funds, is the program
operating in the black?
MR. MCCORMICK said yes.
REP. BRICE asked Mr. McCormick what constitutes a defaulted
loan. He also asked if he knew of the University of Alaska
Coalition of Student Leaders (UACSL) and of their position
on the bill.
CHAIR TOOHEY asked if Rep. Brice would hold his questions to
allow for teleconference testimony.
Number 500
BRIAN BRUBAKER, Coordinator, University of Alaska Coalition
of Student Leaders, testified via teleconference on HB 506.
He stated that the coalition favors a cap to be put on the
variable rate, as well as provisions for exceptions on a
case by case basis. He also said that the withholding of
licensure should also be dealt with on a case by case basis.
He stated that the coalition has become involved as a result
of past problems with the time frame that loans were being
delivered in. He also said that the student loan program
does need to move ahead to a more business like approach,
citing that as being one reason they support the variable
rate with a ceiling. He further stated that a major portion
of university money comes from student loans, and indicated
that next year the cost of a credit will be $67. He then
asked how the Alaska Commission on Postsecondary Education
(ACPE) would ensure that the lowest interest rates would be
offered.
Number 618
NICHOLAS ABRAMCZYK, Member, Associated Students of the
University of Alaska, Fairbanks, testified via
teleconference on HB 506. He stated that a student must
fill out the same application year after year. He felt that
some type of consolidation process should be used to avoid
redundancy, and suggested that it would steer the program
toward a more business like program. He said he supported a
cap on a variable rate.
Number 669
ANDREA PAIGE ADAMS, Vice-President, United Students of
University of Southeast, Sitka, testified via teleconference
on HB 506. She stated that she has been working with Mr.
McCormick to keep him informed of the students' ideas. She
said that on February 20, 1994, the students passed a
resolution in support of ACPE's recommendations for HB 506.
She said she would like to see the recommendations go
through.
Number 692
CHAIR TOOHEY closed teleconference testimony and asked that
Rep. Brice's questions be addressed.
REP. BUNDE asked that someone address the fiscal note.
MR. MCCORMICK said he understood the student's concern for
capping the interest rate, but it would defeat the purpose
of going to a variable rate in the context of not having to
come before a legislative body to change the rate again. He
said, because the program is audited by the state and
private firms, and financial advisors are hired to advise
administration on the cost of money and the issuance of
bonds, the public can be assured that students are receiving
the lowest possible interest rate. He further stated that
the program must be operated in such a way that students
will want to borrow from the program. The rate will have to
be competitive with that of other loans. He also indicated
that the process must competitive and indicated that a new
application would be coming out in the following weeks that
would simplify the application process. He maintained that
the bill would allow for the simplification of repayment of
a loan and urged that there be appropriate administrative
funds to make the process work.
Number 779
CHAIR TOOHEY complimented Mr. McCormick on being a fine
caretaker of the state's money.
REP. BUNDE, referring to the students asking for a cap on
the interest rate, said that they can't take advantage of
low interest rates when they are available and not pay their
fair share when they are higher. He further stated that
Alaskan students are paying only 23% of the actual cost of
their education.
Number 816
REP. BRICE asserted that the government's role is to help
students along. He felt there should be a cap, especially
if the prime rate does go up to 21% again. He felt the cap
should be at 15% and explained that the state must make the
loans attractive to students. He suggested an amendment to
Section 2 that would establish a ceiling at 15%.
REP. BUNDE said that he sympathized with the student's
plight, but indicated that there is a provision within the
bill for refinancing.
Number 885
REP. BRICE asked if the provisions for refinancing were only
for certain circumstances.
REP. BUNDE observed that if the cost of money went over 15%,
money to operate the program would come out of general
funds. He then reminded the committee that the "sympathy
for running this program in the legislature under general
funds is waning." He indicated that there are legislators
that would like to eliminate or privatize the program.
MR. MCCORMICK asserted that there has been no general fund
expenditures for the loan program since 1993.
Number 908
REP. BRICE asked under what circumstances can a person
refinance, and what is the limit to the amount of times a
person can refinance?
MR. MCCORMICK replied that there would be no limitations
specified in the language of the bill. He said that
typically when a student wants to refinance, there is a cash
flow problem. The student would then collapse the loans
into one, and the individual payment would be less than the
total amount of payments of the individual loans. He
further stated that the refinancing terms should not be
dictated by the bill itself. He felt that the language was
flexible enough as to have a viable refinancing structure.
He asserted that there are appeal mechanisms in place that
would be implemented when a student challenges the denial of
a license.
MR. MCCORMICK made reference to a friendly amendment that
would be submitted to Rep. Bunde at a later time. He
suggested that the Department of Commerce would need the
authority to require applicants for professional licenses to
disclose their social security numbers so computer matches
could be done between the two departments.
REP. BUNDE asked if there was someone from Occupational
Licensing to address the fiscal note. He then made a
suggestion to continue discussions of HB 506 the following
day.
Number 965
BARBARA GABIER, Program Coordinator, Division of
Occupational Licensing, Department of Commerce and Economic
Development, testified in Juneau on HB 506. She stated that
there would be 1800 matches of professional licenses for
matches on loans. Of that 1800, there is a potential for
10% default. Hence, she said that there would be possibly
180 persons that would be sought after for revocation of
license. She anticipated that 90 of those persons would ask
to have a hearing, and a hearing costs $3,000. She further
stated that through streamlining procedures the cost could
be cut down to approximately $500 per hearing and related
that cost to the fiscal note.
REP. BUNDE asked what would be the net gain or loss for
tracking down those who are in default.
MR. MCCORMICK maintained that to break even he would have to
collect 20 loans. He said that if the average loan is $5000
per person, 20 people would figure to $100,000. He further
stated that any loans collected beyond the 20 students would
be above a break even figure. He felt the thrust of the
revocation provision is not the actual seizure of a license,
but is the psychology of the threat of denial or revocation
of licensure if a loan is in default.
MS. GABIER said, "We have built into the fiscal note...
reviewing it annually and recovering only the costs that...
are actually incurred by the division."
Number 068
REP. VEZEY asked if the Department of Commerce requires
people to disclose their social security number.
MS. GABIER said no.
REP. BUNDE suggested that if disclosure of the social
security number is refused, perhaps licensure could be
refused.
CHAIR TOOHEY asked for further testimony. There was none.
She then asked the pleasure of the committee.
REP. VEZEY asked if he could propose an amendment.
CHAIR TOOHEY asked if it was an involved amendment.
REP. VEZEY said yes.
CHAIR TOOHEY asked that the amendment be proposed at the
next hearing of HB 506.
Seeing no further business before the committee, CHAIR
TOOHEY ADJOURNED the meeting at 5:02 p.m.
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