Legislature(1999 - 2000)
02/24/2000 03:06 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
February 24, 2000
3:06 p.m.
MEMBERS PRESENT
Representative Fred Dyson, Chairman
Representative Jim Whitaker
Representative Joe Green
Representative Carl Morgan
Representative Tom Brice
Representative Allen Kemplen
Representative John Coghill
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 321
"An Act relating to the confidentiality of investigations, court
hearings, and court and public agency information in child in
need of aid matters; relating to immunity regarding disclosure of
information in child in need of aid matters; amending Rules 3 and
22, Alaska Rules of Child in Need of Aid; and providing for an
effective date."
- HEARD AND HELD
HOUSE BILL NO. 300
"An Act relating to the establishment and enforcement of medical
support orders for children; and providing for an effective
date."
- HEARD AND HELD
HOUSE BILL NO. 257
"An Act relating to funding for school districts operating
secondary school boarding programs; and providing for an
effective date."
- MOVED CSHB 257(HES) OUT OF COMMITTEE
HOUSE BILL NO. 325
"An Act relating to priorities, claims, and liens for payment for
certain medical services provided to medical assistance
recipients; and providing for an effective date."
- MOVED CSHB 325(HES) OUT OF COMMITTEE
PREVIOUS ACTION
BILL: HB 321
SHORT TITLE: CONFIDENTIALITY OF CINA HEARINGS & RECORD
Jrn-Date Jrn-Page Action
1/26/00 2009 (H) READ THE FIRST TIME - REFERRALS
1/26/00 2009 (H) HES, JUD, FIN
1/26/00 2009 (H) 3 FISCAL NOTES (2 DHSS, LAW)
1/26/00 2009 (H) 3 ZERO FISCAL NOTES (2 ADM, DPS)
1/26/00 2009 (H) GOVERNOR'S TRANSMITTAL LETTER
1/26/00 2009 (H) REFERRED TO HES
2/17/00 (H) HES AT 3:00 PM CAPITOL 106
2/17/00 (H) Heard & Held
2/24/00 (H) HES AT 3:00 PM CAPITOL 106
BILL: HB 300
SHORT TITLE: MEDICAL SUPPORT ORDERS FOR CHILDREN
Jrn-Date Jrn-Page Action
1/21/00 1962 (H) READ THE FIRST TIME - REFERRALS
1/21/00 1962 (H) HES, JUD, FIN
1/21/00 1962 (H) ZERO FISCAL NOTE (REV)
1/21/00 1962 (H) GOVERNOR'S TRANSMITTAL LETTER
1/21/00 1962 (H) REFERRED TO HES
2/24/00 (H) HES AT 3:00 PM CAPITOL 106
BILL: HB 257
SHORT TITLE: BOARDING SCHOOL FUNDING
Jrn-Date Jrn-Page Action
1/10/00 1886 (H) PREFILE RELEASED 12/30/99
1/10/00 1887 (H) READ THE FIRST TIME - REFERRALS
1/10/00 1887 (H) HES, FIN
2/24/00 (H) HES AT 3:00 PM CAPITOL 106
BILL: HB 325
SHORT TITLE: MEDICAL ASSISTANCE:LIENS & CLAIMS
Jrn-Date Jrn-Page Action
2/02/00 2061 (H) READ THE FIRST TIME - REFERRALS
2/02/00 2061 (H) HES, JUD, FIN
2/02/00 2061 (H) FISCAL NOTE (DHSS)
2/02/00 2061 (H) GOVERNOR'S TRANSMITTAL LETTER
2/24/00 (H) HES AT 3:00 PM CAPITOL 106
WITNESS REGISTER
DOUG WOOLIVER, Administrative Attorney
Office of the Administrative Director
Alaska Court System
820 West Fourth Avenue
Anchorage, Alaska 99501
POSITION STATEMENT: Testified on HB 321.
KAREN PERDUE, Commissioner
Department of Health & Social Services
PO Box 110601
Juneau, Alaska 99811
POSITION STATEMENT: Testified on HB 321 and HB 325.
BARBARA MIKLOS, Director
Central Office
Child Support Enforcement Agency
Department of Revenue
550 West Seventh Avenue, Suite 310
Anchorage, Alaska 99501
POSITION STATEMENT: Presented HB 300.
REPRESENTATIVE JEANNETTE JAMES
Alaska State Legislature
Capitol Building, Room 102
Juneau, Alaska 99801
POSITION STATEMENT: Presented HB 257 as sponsor.
JOHN ANGAIAK
PO Box 1233
Bethel, Alaska 99559
POSITION STATEMENT: Testified in support of HB 257.
BOB KNIGHT, Mayor
City of Nenana
PO Box 70
Nenana, Alaska 99760
POSITION STATEMENT: Testified in support of HB 257.
TERRY BENTLEY, Superintendent
Nenana City Schools
PO Box 10
Nenana, Alaska 99760
POSITION STATEMENT: Testified in support of HB 257.
EDDY JEANS, Manager
School Finance and Facilities Section
Education Support Services
Department of Education & Early Development
801 West Tenth Street, Suite 200
Juneau, Alaska 99801
POSITION STATEMENT: Testified on HB 257.
JOHN CYR, President
National Education Association (NEA)-Alaska
114 Second Street
Juneau, Alaska 99801
POSITION STATEMENT: Testified on HB 257.
BOB MEDINGER, Principal
Bethel Alternative Boarding School
PO Box 1858
Bethel, Alaska 99559
POSITION STATEMENT: Testified in support of HB 257.
JON SHERWOOD, Program Officer
Division of Medical Assistance
Department of Health & Social Services
PO Box 110660
Juneau, Alaska 99811
POSITION STATEMENT: Presented HB 325.
LISA KIRSCH, Assistant Attorney General
Human Services Section
Civil Division (Juneau)
Department of Law
PO Box 110300
Juneau, Alaska 99811
POSITION STATEMENT: Answered questions on HB 325.
LEONARD ANDERSON, Attorney
Davis & Davis, PC
405 West 36th Avenue
Anchorage, Alaska 99503
POSITION STATEMENT: Testified in support of HB 325.
ACTION NARRATIVE
TAPE 00-21, SIDE A
Number 0001
CHAIRMAN FRED DYSON called the House Health, Education and Social
Services Standing Committee meeting to order at 3:06 p.m.
Members present at the call to order were Representatives Dyson
and Coghill. Representatives Whitaker, Green, Morgan, Brice and
Kemplen arrived as the meeting was in progress.
HB 321 - CONFIDENTIALITY OF CINA HEARINGS & RECORD
Number 0088
CHAIRMAN DYSON announced the first order of business as House
Bill No. 321, "An Act relating to the confidentiality of
investigations, court hearings, and court and public agency
information in child in need of aid matters; relating to immunity
regarding disclosure of information in child in need of aid
matters; amending Rules 3 and 22, Alaska Rules of Child in Need
of Aid; and providing for an effective date."
DOUG WOOLIVER, Administrative Attorney, Office of the
Administrative Director, Alaska Court System, came forward to
testify. He indicated that the court doesn't take a position on
HB 321 one way or another, but HB 321 makes a lot of changes that
will affect the court system. In most courts, the CINA [Child in
Need of Aid] records are kept in the "one child, one file rule,"
so the delinquency file is with the CINA file if it is joint.
Procedurally the court will separate all of those type of files
into two separate files, and then separate the CINA files based
on what parts are open or closed.
MR. WOOLIVER explained that the clerks will need to be trained on
what information is going to be confidential and how to handle
records requests. When someone requests a CINA file, it could be
a simple process, or it could be an enormous process. Not only
are there certain documents that are entirely confidential, there
are lots of documents that are only confidential in part. If
there is any confidential information in the document, it would
have to be redacted. The clerk will have to go through the
document page by page to make sure there isn't any confidential
information mentioned anywhere in the document. There are many
unknowns in this process. The court is assuming there won't be a
huge interest in the records requests; if the court is wrong, his
fiscal note is inadequate. If 80 percent of the hearings are in
fact going to be closed, that will add a great deal of time to
the process. Another unknown is how much motion practice there
will be.
MR. WOOLIVER noted that the pilot project on this in Minnesota
didn't get as bad as previously thought. However, Alaska may
have a completely different approach. Oregon has open hearings
because of the way their court interpreted Oregon's constitution;
it wasn't a statute that their legislature passed opening the
hearings.
Number 0574
CHAIRMAN DYSON expressed his concern about the unsubstantiated
information in the CINA files in the department. He asked Mr.
Wooliver if he understood that the unsubstantiated records would
remain closed.
MR. WOOLIVER answered he didn't look at the provisions that
govern the agency records closely. If it were to become part of
a court record, it would be open. He is not sure how the agency
handles unsubstantiated reports and whether the records end up in
a court proceeding or court record. He understands that the
agency records wouldn't release the unsubstantiated reports of
harm, but he doesn't know the likelihood of those making it into
a subsequent court record. Those records have always been
confidential so it hasn't been an issue.
CHAIRMAN DYSON asked Mr. Wooliver about the fiscal note.
MR. WOOLIVER indicated there is a $116,000 fiscal note. There is
$33,000 for training the court clerks, magistrates, judges and
developing the new filing procedures. The ongoing costs are
$83,000 for part-time clerks to be distributed around the state
where the needs are.
KAREN PERDUE, Commissioner, Department of Health & Social
Services (DHSS), came forward to testify on HB 321. She
indicated that she had participated in the two-year process that
brought this bill forward. The bill provides for open court
proceedings, open court records and the fact that the
confidentiality of the child should be protected at all times.
It gives the court the ability to not release certain records
that are confidential as well. There is some increased openness
of agency records, but by in large, agency records are to remain
closed because there are unsubstantiated records and confidential
information about reporters.
COMMISSIONER PERDUE explained that the task force looked at what
was going on in other states. Alaska would be on the leading
edge in terms of openness with this bill, but the task force
picked up some ideas from the other states. It complies with the
federal law which says information should be released on the
agency's activities if a child died who was in state custody
within the past 12 month;, it brings the department into
compliance with CAPTA [Child Abuse Prevention and Treatment Act]
in that area.
COMMISSIONER PERDUE stated this will be a major change in
practice for the department. The bill before the committee is a
carefully crafted compromise in weighing the privacy needs of a
child and the public's ability to know.
CHAIRMAN DYSON asked Commissioner Perdue if the department is
saying "pass this law or we're going to get in trouble with the
feds because we will not be legal under state law to release
information they're requiring, and they're going to get us."
COMMISSIONER PERDUE answered no, that is not being said. She
wasn't sure if it is close. She will have to check to see if any
state has been sanctioned under the capital law, but she doesn't
believe so.
CHAIRMAN DYSON asked Commissioner Perdue if a parent involved a
CINA case has counsel, what agency records can the attorney not
get under discovery.
COMMISSIONER PERDUE replied she didn't know the answer to that
question.
CHAIRMAN DYSON asked her to get that answer in writing so he can
distribute it to the committee members.
CHAIRMAN DYSON asked Commissioner Perdue what is gained by having
the openness permitted in HB 321.
COMMISSIONER PERDUE replied that the public can see how the child
protection system operates including seeing the judge has certain
responsibilities to make a decision, seeing there is counsel for
the parent and the state and seeing a lot of things people do not
understand about the system. There are multiple parts and all
those parts have to work together to do the best job for the
public in protecting children and protecting the rights of
parents. There is so much mystery around the process, and people
need to see it. However, the line must be drawn to protect the
child and family.
She agreed with Chairman Dyson that the main thing gained will be
a better informed public and some more accountability.
CHAIRMAN DYSON asked Commissioner Perdue to let the committee
know what the priority is for HB 321 because it will be difficult
to get through all the legislation for DHSS this year. [HB 321
was heard and held.]
HB 300 - MEDICAL SUPPORT ORDERS FOR CHILDREN
Number 1440
CHAIRMAN DYSON announced the next order of business as House Bill
No. 300, "An Act relating to the establishment and enforcement of
medical support orders for children; and providing for an
effective date."
Number 1467
BARBARA MIKLOS, Director, Central Office, Child Support
Enforcement Agency (CSED), Department of Revenue, came forward to
present HB 300. Her agency has requested that this legislation
be introduced because it will better serve the public. The bill
makes three changes to existing statute. First it allows the
CSED to establish a medical support order only. Right now the
courts and the CSED establish financial support orders that
require a monthly support obligation, and in conjunction with
that, there is a medical support order. There isn't the option
under state law just to establish a medical support order. This
becomes a problem for some people in Medicaid or Denali KidCare
because the federal government requires CSED to have a medical
support order. When the order is established, it comes along
with a monthly support obligation which is not necessarily what
the parents want.
MS. MIKLOS explained that a medical support order would order
either parent to provide health insurance for the child if it is
available to the parent at reasonable cost. The federal
definition of reasonable is health insurance available through
the parent's employer. The state has further defined it by
saying if it is available through work but may be expensive, it
wouldn't necessarily be considered reasonable. As far as the
federal government is concerned, if someone has health insurance
available, he/she must provide it. If it's not available, it
doesn't mean he/she can't provide it. There are still other ways
to provide cost of medical care, and that is defined in some of
the child support orders. The intent is the public will not pay
for the child's health care if the parents can provide for the
child.
MS. MIKLOS said the way it is now, when the orders are done, the
financial order comes along with it. Some people don't want to
go on Medicaid or Denali KidCare because they don't want a child
support order. The CSED prefers to give the parents that choice
but cannot give them that choice right now under state law.
Sometimes when people go on Medicaid, they'll have a financial
support order, and the CSED will not enforce that order, and the
obligation will continue to accumulate. The CSED would like to
make it simpler by having the option of just doing a medical
support order.
MS. MIKLOS explained the second change in the law says that
either parent may be required to provide health insurance, not
just the obligor. Court Rule 90.3, Guidelines for Child Support,
already says that; the CSED would like to have that in statute.
MS. MIKLOS said the third change just clarifies that the order
may be established before the order is in place, but the order is
not in effect until the insurance is in place.
MS. MIKLOS summarized that HB 300 helps the public, helps the
CSED and is consistent with federal law.
Number 1722
REPRESENTATIVE GREEN asked if a family couldn't afford insurance,
would it be in contempt if insurance wasn't provided.
MS. MIKLOS replied no, not at all. Insurance is only required if
it is available at reasonable cost. The original intent when
Congress passed this years ago was that if someone had a first
family, and that first family didn't have insurance available and
had public insurance, but then the person had a second family on
insurance, then the children from the first family would be
included on the insurance.
REPRESENTATIVE GREEN asked who determines reasonable cost.
MS. MIKLOS answered CSED would make that original determination.
Someone may appeal that decision through a hearing within the
Department of Revenue or further through the court. People have
an opportunity to say it is not reasonable. She further
explained there are circumstances when parents work things out
and would choose not to be involved and choose not to get a
financial support order, and the CSED would like to honor those
requests.
CHAIRMAN DYSON asked how someone would accumulate a debt from the
support orders.
MS. MIKLOS explained in order to do a medical support order now,
the CSED also has to put on a financial obligation. The CSED is
not enforcing the financial obligation, so the debt for the
monthly support obligation still accumulates. There are rules
that must be done consistently so the amount for the financial
order could not be zero; the obligation is based on how much
money is earned by the parent. The CSED doesn't want to be in
the position of collecting a debt that no one wanted in the first
place, and HB 300 will do that. If the bill doesn't pass, the
CSED has to continue to put on debts.
CHAIRMAN DYSON asked if the state starts supporting a custodial
parent and children, and a debt starts accumulating to the non-
custodial parent, and the children are covered under Denali
KidCare, does the non-custodial parent owe a debt to reimburse
the state and the federal government for the insurance costs
obligated under Denali KidCare.
MS. MIKLOS answered no.
CHAIRMAN DYSON asked Ms. Miklos why does it say "insurance"
instead of just saying the parents have to provide for the
children's medical needs.
Number 2175
MS. MIKLOS admitted it never occurred to them. In terms of child
support, the CSED has gone as far as required by the federal
government which is that the insurance be available. In terms of
providing for medical care, there could be a lot of problems, but
it wouldn't necessarily be a child support issue. The CSED is
only trying to separate out the medical support order from the
financial support order to make it easier for people.
CHAIRMAN DYSON said it sounds like the bill is trying to remove
the administrative barrier to get children signed up for Denali
KidCare.
MS. MIKLOS agreed that might be one of the things, but it is not
the only thing. It is also that there are debts accumulating in
existing cases in the Medicaid program; a debt goes on that no
one really wanted in the first place. In response to a question
by Representative Coghill, Ms. Miklos explained that if any
family goes on Medicaid, CSED must go after medical support, and
that is why the CSED is involved.
Number 2284
REPRESENTATIVE KEMPLEN asked Ms. Miklos how the CSED will address
the orders that have been accumulating but not enforced under HB
300.
MS. MIKLOS said ways are being looked at to reestablish an order
that would be medical support only if it can be done.
MS. MIKLOS explained the intent of a financial support order
originally was to reimburse the state and federal government for
public assistance, and a medical support order was for medical
assistance. The first choice is for the parents to support the
children.
TAPE 00-21, SIDE B
Number 2364
REPRESENTATIVE WHITAKER asked Ms. Miklos for clarification on the
connection of a parent providing health coverage if it is at a
reasonable cost and Denali KidCare.
MS. MIKLOS said she is not the expert on Denali KidCare so she
can only go so far. The idea is if someone is on the Medicaid
program, the state's obligation for that program would be reduced
if there is other insurance available. She doesn't know if the
obligation goes totally away; all she knows is the state's
obligation is reduced.
REPRESENTATIVE WHITAKER asked if he heard correctly that there
was an inference that this was somehow tantamount to increasing
the number of children on Denali KidCare.
MS. MIKLOS stated that HB 300 would not make more people qualify
for Denali KidCare. It's just that there may be people that
wouldn't get involved at all because of the financial issue.
Number 2215
CHAIRMAN DYSON informed the committee he does not intend to move
HB 300 out today so there will be time to have other questions
answered.
REPRESENTATIVE KEMPLEN asked how the CSED will deal with the
paper debts that have been accumulating.
MS. MIKLOS answered as long as the custodial parent does not want
CSED to enforce the paper debt, it won't. If the custodial
parent asked CSED to enforce the paper debt, it would have to.
REPRESENTATIVE KEMPLEN commented he would like CSED to commit to
getting those paper debts off the books if HB 300 passes.
CHAIRMAN DYSON asked Ms. Miklos for responses on the following:
1) Representative Kemplen's last question; 2) where and why in
the law it says "medical insurance" and doesn't say "medical
care"; 3) the portion of the bill that fixes the accumulating
paper debt; 4) the definition of the criteria of "reasonable";
why isn't it a certain percentage of the income.
REPRESENTATIVE COGHILL said he was interested to know if a debt
on responsible health care delivery can be levied against the
obligor.
Number 2086
REPRESENTATIVE GREEN asked if the accumulated paper debts include
some bad debts that shouldn't be eliminated.
MS. MIKLOS said the bad debts will not be eradicated. That is
why the bill would not be effective the day the Governor signs
it. If possible, the old order would be vacated and a new order
established separating those debts out. She cannot definitely
answer that will be done, but that is what is being looked at.
CHAIRMAN DYSON asked if the paper debts were accumulating with
interest and penalties.
Number 1919
MS. MIKLOS answered yes.
CHAIRMAN DYSON suspended the hearing on HB 300. [HB 300 was
heard and held.]
HB 257 - BOARDING SCHOOL FUNDING
Number 1898
CHAIRMAN DYSON announced the next order of business as House Bill
No. 257, "An Act relating to funding for school districts
operating secondary school boarding programs; and providing for
an effective date."
Number 1877
REPRESENTATIVE JEANNETTE JAMES, Alaska State Legislature,
sponsor, came forward to present HB 257. She prefaced her
remarks with the fact that she has supported regional boarding
schools for 15-20 years. When Nenana was in her district, she
tried to get some support for a boarding school which was
unsuccessful. Now things are in place for a dormitory for the
boarding school in Nenana; the school could have twice the
population without additional teachers or funding. She
principally filed this bill for them. However, she knew there
would be other beneficiaries if this bill passed.
REPRESENTATIVE JAMES explained that under the current law,
boarding students who don't have the opportunity to go to school
in their own district can go to a boarding school and get stipend
rates for their room and board. This bill would allow students
who don't qualify because there is a school in their district to
attend boarding school. She found out Bethel has a boarding
school that is operating on a very low budget; the school leases
a four-plex for the students to live in. The 30 students at the
Bethel Alternative Boarding School are students that wouldn't be
going to school otherwise; the Bethel Alternative Boarding School
is a safety net for students. The school has been getting some
grants but is at the "bottom of the barrel" as far as getting
grants. If it doesn't get some assistance some way, this school
may not be able to continue.
REPRESENTATIVE JAMES has consistently said that the goal of the
legislature and the state should be to determine what is the best
way to deliver education to the many different students in
different parts of the state with different needs and different
kinds of learning abilities. The boarding school wouldn't be for
everyone. Not everyone can make it in a regular classroom, and
those students need to have this opportunity.
REPRESENTATIVE JAMES indicated that the fiscal note for the first
year would be about $600,000, which is a small price to pay for
these students have this opportunity. She urged the committee to
consider this legislation.
Number 1666
REPRESENTATIVE KEMPLEN asked Representative James if she had any
letters of support from school districts that would use this
option. He didn't see any backup information in the packet.
REPRESENTATIVE JAMES answered she doesn't; she hasn't solicited
any. Most of the support she has been given has been verbal.
She could get that if it were required.
CHAIRMAN DYSON asked Representative James if this bill passes,
the existing boarding schools will gain more resources.
Number 1567
REPRESENTATIVE JAMES answered for the most part, yes. Galena
does have five students who qualify under existing law, but the
rest of the boarding schools will get resources to assist with
room and board.
CHAIRMAN DYSON said when SB 36 was discussed two years ago, the
legislature was told that SB 36 would force the closure of some
schools and would force Native students to go to boarding
schools. He asked Representative James if she has gotten
feedback from the Native community to see if there is going to be
resistance to this bill.
Number 1519
REPRESENTATIVE JAMES commented that there would always be that
concern, but she has heard more that it is an opportunity for
students. She's heard of places that wish there were more of
those opportunities for their children. It is a mixed bag out
there. The Native communities really want the best education for
their children. She believes there is big support out there for
this school system as a way to deliver education.
CHAIRMAN DYSON asked her if this bill affects Mt. Edgecumbe High
School.
REPRESENTATIVE JAMES answered no, unless some of the students who
currently attend Mt. Edgecumbe go somewhere else closer to home.
She further explained that this bill gives the other boarding
schools approximately half of what Mt. Edgecumbe gets.
REPRESENTATIVE GREEN asked Representative James about the
additional cost of room and board for the other boarding schools.
REPRESENTATIVE JAMES indicated that the boarding schools would
have to find that funding elsewhere; the parents might have to
pay something. The stipend is not enough to cover the whole
cost; it just assists with the cost. Without the stipend, the
schools might not be able to do it. She further explained that
the stipend is paid monthly based on the actual count of who is
at the school. The stipend does not fall into the count taken in
the fall. She went on the answer Chairman Dyson that the
Department of Education & Early Development has not submitted a
fiscal note because the proposed committee substitute has not
been adopted.
Number 1251
REPRESENTATIVE COGHILL made a motion to adopt the proposed
committee substitute (CS) for HB 257, version 1-LS1055\I, Ford,
2/2/00, as a work draft. There being no objection, that proposed
CS was before the committee.
CHAIRMAN DYSON asked what committee referrals HB 257 has.
REPRESENTATIVE JAMES answered the HES committee and the Finance
Committee.
REPRESENTATIVE COGHILL asked if there is a wait list at Mt.
Edgecumbe.
REPRESENTATIVE JAMES replied yes.
Number 1138
JOHN ANGAIAK testified via teleconference from Bethel. He
expressed his support for HB 257. He explained his reasons for
support which included the school districts being reimbursed for
some expenses in running these schools which often offer a second
chance to some students. The Bethel Alternative Boarding School
serves 30 students whose lives have been changed. Room and board
is a costly item. He believes if this becomes law, the state
will save money in the long run because students will be turned
around and will become productive adults.
REPRESENTATIVE KEMPLEN asked Mr. Angaiak what his connection is
to the educational system in Bethel.
MR. ANGAIAK answered he is speaking as a committed parent. He
was on the school board last year. His commitment is unending to
improve the educational situation for the students whether or not
he is on the board.
Number 0865
BOB KNIGHT, Mayor, City of Nenana, testified via teleconference
from Nenana. He expressed his support for HB 257. He believes
this will be an opportunity for students in the state to increase
their potential for their education, and it will give the
students in Nenana a chance to intermingle with the rest of the
state.
Number 0767
TERRY BENTLEY, Superintendent, Nenana City Schools, testified via
teleconference from Nenana. He expressed support for HB 257.
Nenana is trying to get a boarding school going, and the stipend
will allow Nenana, Bethel, Galena and Takotna a chance to recoup
some money for the student's room and board. Each boarding
school runs a different style of program. These boarding schools
give the students choices about where they want to go. He
believes that Nenana can offer a good program by offering the
students a choice.
Number 0624
EDDY JEANS, Manager, School Finance and Facilities Section,
Education Support Services, Department of Education & Early
Development (EED), came forward to testify. He referred to the
spreadsheet that was handed out to committee members. He told
the committee that since the proposed CS has been adopted, he
will prepare and submit a fiscal note immediately. He reviewed
the five different residential programs around the state that are
shown on the spreadsheet. The five schools are located in
Bethel, Nenana, Galena, Takotna [Iditarod REAA District] and St.
Paul.
MR. JEANS pointed out that 123 students are being served by these
five schools, and if they receive the current stipend rate for
boarding homes, it will cost approximately $540,000. When an
average figure of $500 is figured in for airfare, the cost goes
up to $601,671. When the enrollment projections are figured, the
total cost in FY 2002 could be approximately $1.4 million. He
explained other districts could start other programs, but the
figures on the spreadsheet are the ones out there right now.
Number 0430
REPRESENTATIVE KEMPLEN asked Mr. Jeans if the EED has a position
on HB 257.
MR. JEANS said that the EED supports choice; but the department
has not had the legislative meeting to establish a policy on
this. That meeting will be this week, and he could report back
after the meeting.
REPRESENTATIVE KEMPLEN stated he felt the EED's comments would be
relevant especially since concern was expressed several years ago
on SB 36 about schools closing in villages and the students
having to attend boarding schools. He would like to allay any
concerns about those issues. He asked Mr. Jeans how the stipend
rate is determined.
Number 0336
MR. JEANS explained that the stipend rate was established by the
department years ago, and it is set out in regulation. The rates
are not included in regulation but are included in the boarding
home application packet. He didn't know the actual origination
of the rates.
REPRESENTATIVE COGHILL asked if schools are shutting down, would
this allow more latitude to open a high school in a REAA [Rural
Education Attendance Area]; could this be a cost saving in that
area that has to be done.
MR. JEANS explained that SB 36 changed the funding mechanism for
schools serving less than ten children, which basically did not
give the schools enough money to operate. The local school board
makes the decision to continue to operate using resources
generated by other schools or whether the school needs to be
closed. He said since SB 36 passed, a number of schools closed,
but a number have convinced their school boards to remain open to
show that the student population would come back and get back the
funding. The communities have to work through the school boards
to make the ultimate decision. This bill allows parents and
students more choice. The choice is already happening, but HB
257 will provide some additional revenue to those districts to
defray the residential component of their program.
REPRESENTATIVE BRICE asked Mr. Jeans if SB 36 didn't give the
school districts enough to operate, why did the EED support it.
MR. JEANS replied the legislature made a decision that it didn't
want to provide the same level of funding to schools that served
less than ten students. It was the legislature that made the
decision that the threshold would be ten students. It still
provides the school with revenue, just not enough to operate an
independent school at the level the school was accustomed to.
TAPE 00-22, SIDE A
Number 0001
JOHN CYR, President, National Education Association (NEA)-Alaska,
came forward to testify. He indicated that the NEA-Alaska has
not taken a formal position on HB 257, but NEA-Alaska does
support more boarding schools, more flexibility and more choice
within the public school system. If this bill is going to be
used in the future to close local schools, obviously NEA-Alaska
is not in favor of local schools closing. The NEA-Alaska does
believe HB 257 is a good idea. It gives added potential to help
students who need help.
Number 0173
REPRESENTATIVE BRICE asked Mr. Jeans if a school with less than
ten students brought in a number of boarding students to raise
the enrollment number, how would the stipend and funding be
affected.
MR. JEANS noted that would be dealt with through regulation and
may have to be addressed. He gave a brief explanation of the
foundation funding formula.
REPRESENTATIVE WHITAKER asked why small schools would be
discouraged from attracting more students.
Number 0583
REPRESENTATIVE JAMES pointed out that the stipend is for room and
board, not the cost of running the school. She sees that as
mixing apples and oranges.
REPRESENTATIVE BRICE said that was the point he was trying to
have clarified.
Number 0629
BOB MEDINGER, Principal, Bethel Alternative Boarding School,
testified via teleconference from Fairbanks. He told the
committee that the Bethel Alternative Boarding School has been in
operation since August 1998, and the program is meeting student
needs that weren't addressed in regular programs. The Bethel
Alternative Boarding School is having difficulty with the funding
formula because it is treated as a classroom on the biggest
school in its community. By not having the site allocation, the
school board has had to subsidize the boarding school for the
boarding portion. There aren't grants available to fund
residential programs under state school districts. The boarding
school has had to come up with about $150,000-$165,000 a year to
operate the boarding portion. The need is greater than
anticipated, and the school could serve more students if there
were an avenue to fund this program. Mr. Medinger stated that
the Bethel Alternative Boarding School is desperate for funding.
He expressed strong support for HB 257.
Number 0776
CHAIRMAN DYSON closed the public hearing on HB 257. The
committee took an at-ease from 4:51 p.m. to 4:52 p.m.
REPRESENTATIVE BRICE made a motion to move CSHB 257, version 1-
LS1055\I, Ford, 2/2/00, out of committee with individual
recommendations with accompanying fiscal note. There being no
objection, CSHB 257(HES) moved from the House Health, Education
and Social Services Committee.
HB 325 - MEDICAL ASSISTANCE:LIENS & CLAIMS
Number 0838
CHAIRMAN DYSON announced the next order of business as House Bill
No. 325, "An Act relating to priorities, claims, and liens for
payment for certain medical services provided to medical
assistance recipients; and providing for an effective date."
Number 0847
JON SHERWOOD, Program Officer, Division of Medical Assistance,
Department of Health & Social Services, came forward to present
HB 325. He explained that HB 325 proposes to make improvements
to the Medical Assistance program in the third-party recovery and
a timely filing of medical claims by the provider to the
department. When a person applies for medical assistance in
Alaska, he/she assigns his/her right to third-party recovery to
the state. Under Medicaid, this is a federal requirement as
well. Over the years, the contractor, who does much of the
third-party recovery, has identified weaknesses in the present
law that limit the department's ability to recover against the
third-party claims. There is usually litigation involved, either
against an insurance company or an individual, in these type of
claims.
MR. SHERWOOD offered an example: Someone is hit by a drunk
driver, and the medical care is paid by Medicaid; the person
makes a claim against the drunk driver or the drunk driver's
insurance company. This bill would improve the department's
ability to recover money in these situations. It would require
recipients to notify the department of recovery actions; it
creates the authority for the state to place a lien upon such
recoveries that are made and establishes a precedent; and gives
the department the ability to take its own action against the
third party if the individual doesn't pursue it themselves.
MR. SHERWOOD explained that additionally, HB 325 is intended to
bring medical assistance statutes "in sync" with current practice
of other health care payers. Right now the department gives
providers six months to make claims for payment for medical
assistance; twelve months if the recipient has private insurance
that must be billed first. The industry standard generally gives
people 12 months to file claims. The twelve-month period will
give providers an opportunity to identify those claims and make
claims against the department within the timely filing limits.
The bill would also amend the law to allow the department to pay
for 100 percent of a claim when it finds that a provider missed
the timely filing deadline with good cause. Currently under
statute, if the department makes that finding, it can only pay 50
percent of the claim.
Number 1075
REPRESENTATIVE BRICE commented that he had dealt with
constituents on a similar drunk driving case in which the victim
received close to a $300,000 court award against someone. The
department came in and took every penny of it, and the victim had
to go back on medical assistance. He asked Mr. Sherwood how HB
325 fixes that situation.
MR. SHERWOOD answered that HB 325 is intended to give the state a
clear position in making a claim. When someone is reimbursed for
medical claims that the department has paid for, the department
wants to be reimbursed for those claims. There is a provision
under law that allows for attorneys' fees to be paid under the
court rules. In the situation he is familiar with in Fairbanks,
the department's eventual recovery was not 100 percent; it was
substantially less than 100 percent. He doesn't believe HB 325
would fix the problem in the sense that if the department has
paid for expenses and someone recovers on those expenses, the
department intends to be reimbursed for those expenses. The
money doesn't go to the recipient, even though the recipient may
have other valid uses for the money.
Number 1188
REPRESENTATIVE BRICE said he would feel better limiting what the
department can go after. If there were compensatory damages as
well as punitive damages, then the department could only go after
the compensatory damages.
MR. SHERWOOD indicated the department does not "go after the
victim." The department goes after the award that was made as
part of the settlement or the court case. In theory, it is
before any money goes to the victim. The department has a right
to collect reimbursement for the services it paid for. If an
award is paid, then the department is trying to collect those
funds for the services it paid for. He doesn't believe HB 325
will give the department any entitlement to a greater pool of
money; it simply improves and clarifies the ability to get the
money the department is already entitled to by law.
REPRESENTATIVE BRICE commented that basically this is turning
Medicaid and medical assistance programs into a low-interest loan
program.
MR. SHERWOOD said HB 325 would not create a low-interest loan
program. This bill does not create any special requirement that
a recipient pay back Medicaid; if there is a recovery against the
third party, on behalf of that recipient, Medicaid is entitled to
that part of the recovery for which the expenses have already
been paid.
Number 1354
CHAIRMAN DYSON asked Mr. Sherwood when the administration started
working on HB 325.
MR. SHERWOOD indicated it has been discussed over the past
several years. The bill was put forward this year, about in
November.
CHAIRMAN DYSON noted that it is almost word for word what came
out of the privatization commission.
Number 1392
COMMISSIONER PERDUE restated that the department has done third-
party recovery for about 15 to 20 years. This is not new; the
department simply wants to refine the way it is done.
CHAIRMAN DYSON asked Mr. Sherwood if the attorneys in the third-
party cases get paid before or after the state.
MR. SHERWOOD indicated there is a provision in the court rules
for the determination of attorneys' fees, and the fees come out
before the state makes its recovery. That determination is not
the attorney-client contingency fee; that's based on the court
rule formula for determining the allowable attorney fees.
Number 1461
REPRESENTATIVE COGHILL said according to section 2, the
department would be the first right of payer and the hospital
would stand in line. He asked how the percentages of the total
costs that the hospital would get affects the accounting.
MR. SHERWOOD clarified that when the department pays a bill under
Medicaid, the provider accepts this payment in full for the
service with the exception of some small co-payments and
deductibles. If the provider has accepted payment from Medicaid
for the service, even though the department might not reimburse
for the full charge, the provider has no claim for the additional
percentage of what the department didn't pay for. It is a
condition of participation; the provider has to accept the
department's payment as payment in full.
REPRESENTATIVE COGHILL asked about the rates.
MR. SHERWOOD agreed that there are slightly different
reimbursement rates for different kinds of providers.
REPRESENTATIVE COGHILL asked what the process of payout would be.
MR. SHERWOOD said he believes the department's lien would come
first; if there were funds left over, the next lien would be
paid.
CHAIRMAN DYSON offered some amendments to discuss. On page 3,
line 7, strike the period after liable and add "for cause."
Number 1641
LISA KIRSCH, Assistant Attorney General, Human Services Section,
Civil Division (Juneau), Department of Law, came forward to
answer questions. She responded to the amendment. She said it
doesn't appear to be problematic; she is not sure it changes
things much. She wondered what he was trying to correct or
achieve.
CHAIRMAN DYSON said he will go through all the amendments and
then Ms. Kirsch can decide if there are any problems.
Number 1664
CHAIRMAN DYSON offered the following amendments:
Page 3, lines 5 and 9, strike the word "payor" and insert
"tort-feasor";
Page 4, line 25, strike "and" after assistance, insert "that
are";
Page 4, line 28, insert "that are" after "services";
Page 4, lines 28-29, delete "for which the medical services
were provided";
Page 4, line 9, delete "has not been" and insert "is not".
CHAIRMAN DYSON referred to page 4, line 6. He asked for an
explanation of what is the effect of an action that has been
filed but is not in effect.
MS. KIRSCH explained that is the notice provision which is
designed to assure that everyone who is involved in the lawsuit,
if there is a lawsuit, is aware that the lien exists. The second
sentence modifies the first. If the notice provision is not met,
then the lien is not enforceable.
Number 1864
CHAIRMAN DYSON asked what "perfected" means.
MS. KIRSCH said it doesn't imply any particular action other than
that the lien is not legally enforceable until it is perfected.
She indicated that the chronological order is probably reversed
from the way it appears in this paragraph. That provision is in
there so everyone involved is aware of the lien, so people aren't
going into settlement negotiations, and the plaintiff compromises
their claim based on a belief that they are going to receive all
of the funds. If they know about the lien, that will affect how
they posture in a settlement proceeding because it has the
potential of reducing the ultimate recovery.
Number 1919
LEONARD ANDERSON, Attorney, Davis & Davis, PC, testified via
teleconference from Anchorage. He explained that he has been the
state's contractor for about 2.5 years and supports HB 325. Over
those years, he has had many conversations and correspondences
with plaintiffs related to the State of Alaska's subrogation
rights under the current statute. A problem was encountered in
recovering an amount that Medicaid recipients promised to pay
back if the Medicaid recipients have a claim, if they bring a
claim against a liable third party, is that the Medicaid
recipients will reimburse the State of Alaska. The problem has
been under the current statute, it gives a subrogation claim to
the State of Alaska. The result has been that the state has
compromised for probably the past 12-14 years or longer amounts
that it recovered under the current statute.
MR. ANDERSON indicated that the bill before the committee will
allow the state to have a lien right that it does not currently
have under AS 47.05.070. By giving the state that lien right, it
forces attorneys representing Medicaid recipients in personal
injury cases to add it to the checklist to ask their clients if
they've received Medicaid; unfortunately, his client has found
over the years that the attorneys don't always ask that question.
MR. ANDERSON reported that he has had counsel ask him if the
state actually has a lien right, and he had to answer, "Read the
statute, but I don't see it." The problem is if the state
doesn't have a lien right, the attorney doesn't have to add that
to his checklist to ask the client, and sometimes doesn't. His
client doesn't get notice that there's a possible pot of money to
recover amounts that Medicaid has paid for the treatment of the
recipient's injuries. Or, at the last minute, the contractor is
informed of a potential settlement that's happening right away,
and asked if the state will settle for "x" amount of dollars,
which is pennies on the dollar. The state has not had a
mechanism by which it has had any strong enforceable rights to go
out and disagree with the settlement amount. The state has
always opted to settle cases due to the weakness of the current
statute.
Number 2078
MR. ANDERSON commented on the proposed amendments. The reason
for the proposed change on page 3, lines 5 and 9, inserting
"tort-feasor" is the state won't have privity or the state won't
have a contract with a third party payor, possibly an insurance
company. Since the state isn't insured under the policy, it
doesn't have the contractual right to go back after that company.
The claim has to be actually brought against the liable third
party. Tort-feasor is a fancy name for the liable third party.
He noted that language is present also on page 4, line 3. If the
amendment is accepted, it ought to be changed there as well.
MR. ANDERSON referred to Representative Brice's comment about
making a loan provision. On page 3, line 26, section 8, there is
a hardship provision required by federal law that the current
state statute doesn't have. Under federal law, the state is
required to have a hardship provision so that the department can
waive any subrogation rights it has underneath this bill or any
new statute that's adopted.
CHAIRMAN DYSON asked Mr. Anderson to explain the proposed change
on page 4, line 9.
Number 2206
MR. ANDERSON indicated it is a grammatical change to use an
active voice instead of a passive voice. It is easier to read
and understand.
CHAIRMAN DYSON asked Mr. Anderson to explain the proposed changes
on page 4, line 25 and lines 28-29.
MR. ANDERSON said that didn't make any major change. That
proposed change is for clarity.
CHAIRMAN DYSON asked Mr. Anderson about the proposed change on
page 3, line 3.
MR. ANDERSON said he wasn't involved in that change. He believes
it read fine as it was.
Number 2287
MS. KIRSCH stated her only difficulty with the proposed
amendments were on page 3, lines 5 and 9. If it is changed to
tort-feasor, the ability to claim against a third-party insurer
is eliminated when there is no tort. For example, a person had a
claim against Medicaid at one time, but then there was some
insurer who was ultimately liable, maybe for cause or maybe not,
those amendments changing "payor" to "tort-feasor" and the
amendment, page 3, line [7] "for cause" might limit the ability
to recover in certain circumstances. She would resist those, but
the other proposed amendments for grammatical and clarity issues
are not a problem.
CHAIRMAN DYSON asked Mr. Anderson to respond to the comments on
substituting "tort-feasor" for "payor."
MR. ANDERSON said the point may be well taken for both "tort-
feasor" and "for cause"; however, he does see a potential problem
in trying to bring it against possibly just an insurer as opposed
to a liable third party. If there is an insurer out there from
whom a pot of money is being collected, he would have to believe
there is a liable third party being insured.
TAPE 00-22, SIDE B
Number 2341
REPRESENTATIVE GREEN made a motion to adopt the conceptual
amendments for clarity, which read:
Page 4, line 25, strike "and", insert "that are";
Page 4, line 28, insert "that are" after "services";
Page 4, lines 28-29, delete "for which the medical services
were provided";
Page 4, line 9, delete "has not been" and insert "is not".
CHAIRMAN DYSON asked if there was any objection. There being no
objection, the conceptual amendments were adopted.
Number 2327
REPRESENTATIVE BRICE made a motion to move HB 325, as amended,
from the committee with individual recommendations and fiscal
notes. There being no objection, CSHB 325(HES) moved from the
House Health, Education and Social Services Standing Committee.
ADJOURNMENT
There being no further business before the committee, the House
Health, Education and Social Services Standing Committee meeting
was adjourned at 5:31 p.m.
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