02/09/2008 09:00 AM House HEALTH, EDUCATION & SOCIAL SERVICES
| Audio | Topic |
|---|---|
| Start | |
| HB337 | |
| HB345 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 337 | TELECONFERENCED | |
| *+ | HB 345 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE HEALTH, EDUCATION AND SOCIAL SERVICES STANDING COMMITTEE
February 9, 2008
9:03 a.m.
MEMBERS PRESENT
Representative Peggy Wilson, Chair
Representative Bob Roses, Vice Chair
Representative Anna Fairclough
Representative Wes Keller
Representative Paul Seaton
Representative Sharon Cissna
Representative Berta Gardner
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 337
"An Act establishing the Alaska Health Care Commission and the
Alaska health care information office; relating to health care
planning and information; repealing the certificate of need
program for certain health care facilities and relating to the
repeal; annulling certain regulations required for
implementation of the certificate of need program for certain
health care facilities; and providing for an effective date."
- HEARD AND HELD
HOUSE BILL NO. 345
"An Act amending the certificate of need requirements to exclude
expenditures for diagnostic imaging equipment in certain
circumstances."
- HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 337
SHORT TITLE: HEALTH CARE: PLAN/COMMISSION/FACILITIES
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
01/22/08 (H) READ THE FIRST TIME - REFERRALS
01/22/08 (H) HES, FIN
01/24/08 (H) HES AT 3:00 PM CAPITOL 106
01/24/08 (H) Heard & Held
01/24/08 (H) MINUTE(HES)
01/31/08 (H) HES AT 3:00 PM CAPITOL 106
01/31/08 (H) Heard & Held -- Assigned to
Subcommittee
01/31/08 (H) MINUTE(HES)
02/09/08 (H) HES AT 9:00 AM CAPITOL 106
BILL: HB 345
SHORT TITLE: MEDICAL FACILITY CERTIFICATE OF NEED
SPONSOR(s): REPRESENTATIVE(s) KELLY
01/30/08 (H) READ THE FIRST TIME - REFERRALS
01/30/08 (H) HES, FIN
02/09/08 (H) HES AT 9:00 AM CAPITOL 106
WITNESS REGISTER
KARLEEN JACKSON, Commissioner
Department of Health and Social Services
Juneau, Alaska
POSITION STATEMENT: Presented HB 337 on behalf of the governor.
JAY BUTLER, M.D.; Chief Medical Officer
Department of Health and Social Services
Anchorage, Alaska
POSITION STATEMENT: Participated in the presentation of HB 337.
JEANNINE HINMAN, Health Care Legal Consultant
Advanced Medical Centers of Alaska
Fairbanks, Alaska
POSITION STATEMENT: Testified in support of HB 337.
NORMAN STEPHENS, Chief Executive Officer
Mat-Su Regional Health Care Center
Palmer, Alaska
POSITION STATEMENT: Testified during the hearing on HB 337.
PAULA EASLEY, Member
Alaska Mental Health Trust Authority Board of Directors
Department of Revenue
Anchorage, Alaska
POSITION STATEMENT: Testified during the hearing on HB 337 on
behalf of the Alaska Mental Health Trust Authority (AMHTA).
ROB GOULD, Chief Financial Officer; Head of Operations
Fairbanks Memorial Hospital and Denali Center
Fairbanks, Alaska
POSITION STATEMENT: Testified during the hearing on HB 337.
BOB URATA, M. D.; Member
Bartlett Regional Hospital Board of Directors; Health Care
Strategies Planning Council
Juneau, Alaska
POSITION STATEMENT: Testified during the hearing on HB 337.
ROB BETIT, Chief Executive Officer
Alaska State Hospital and Nursing Home Association (ASHNHA)
Juneau, Alaska
POSITION STATEMENT: Testified during the hearing on HB 337,
representing ASHNHA, and answered a question representing
himself.
JOEL GILBERTSON, Representative
Providence Health & Services Alaska
Anchorage, Alaska
POSITION STATEMENT: Testified during the hearing on HB 337.
REPRESENTATIVE MIKE KELLY
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Introduced HB 345 as the sponsor.
DEREK MILLER, Staff
to Representative Mike Kelly
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented the sectional analysis for HB
345, Version E, on behalf of Representative Kelly, sponsor.
ACTION NARRATIVE
CHAIR PEGGY WILSON called the House Health, Education and Social
Services Standing Committee meeting to order at 9:03:38 AM.
Representatives Wilson, Roses, Seaton, Gardner, Fairclough, and
Keller were present at the call to order. Representative Cissna
arrived as the meeting was in progress.
HB 337-HEALTH CARE: PLAN/COMMISSION/FACILITIES
9:05:18 AM
CHAIR WILSON announced that the first order of business would be
HOUSE BILL NO. 337, "An Act establishing the Alaska Health Care
Commission and the Alaska health care information office;
relating to health care planning and information; repealing the
certificate of need program for certain health care facilities
and relating to the repeal; annulling certain regulations
required for implementation of the certificate of need program
for certain health care facilities; and providing for an
effective date."
9:05:51 AM
CHAIR WILSON described the procedure for witness testimony.
9:07:28 AM
KARLEEN JACKSON, Commissioner, Department of Health and Social
Services, informed the committee that the mission of the
Department of Health and Social Services (DHSS) is to promote
and protect the health and well being of Alaskans. House Bill
337, The Health Care Transparency Act, accomplishes this because
it gives Alaskans the tools to responsibly manage their health
care. Two items form the basis of this act: a health care
committee to oversee health planning and develop a health care
plan, and the creation of an easily accessible and updated
website to provide evidence based price and quality information
about health care providers and services. The information
office would begin work on July 1, 2008, to consolidate all of
the data on health care facilities for Alaska consumers.
9:09:52 AM
COMMISSIONER JACKSON continued to explain that the third part of
HB 337 was the repeal of the Certificate of Need (CON) program.
She observed that the health council addressed the underlying
purpose of the CON program, which was to reduce the cost of
health care and improve access to health care for Alaskans.
Commissioner Jackson acknowledged that the Alaska Social
Services Certificate of Need Negotiated Rule Making Committee
did not recommend repealing the CON program; however, it did
review several factors that suggested a higher level of
enforcement by the DHSS was warranted if the program was to
continue.
9:11:36 AM
COMMISSIONER JACKSON recalled that the CON program was a federal
mandate in the 1970's. Since that time, market forces have
changed, along with the health care industry. Today, with the
diversity of services and the variety of technological
approaches, many states have modified or repealed CON laws. The
negotiated rule making committee recommended that the state
collect additional data on the CON program. Commissioner
Jackson opined that collecting data for the consumer website,
instead, will help Alaskans become more informed consumers and
more responsible for their health care. The negotiated rule
making committee also recommended that the voices of health care
consumers need to be heard; in fact, the governor's bill focuses
on health care from the consumer's perspective. This is one of
the reasons for the wide diversity of opinions on the bill. She
then assured the committee that the committee substitute has
addressed the needs of small community hospitals by the
exception of residential psychiatric treatment centers, nursing
homes, and critical access hospitals from repeal of the CON.
9:15:16 AM
REPRESENTATIVE GARDNER observed that the complexity of the issue
warrants a complete study of CON laws in Alaska, as the
materials available to the committee are from other states. She
stated her support for a data driven, independent, quality
study, perhaps by the new health care commission, but would be
unable to support a bill of any kind based on her current
knowledge.
9:17:27 AM
JAY BUTLER, M.D.; Chief Medical Officer, Department of Health
and Social Services, supported Representative Gardner's call for
additional study of the CON issue; however, he opined that the
new health care task force will have too many other
responsibilities to complete this additional task. He clarified
that one role of the health information office would be to
provide information on the prevention of disease and to
encourage personal health responsibility. Additional information
will be phased in as the feasibility and success of the program
allow. Dr. Butler described different uses of the information
system and stated that an informed patient is a healthier
patient. Finally, he commented that the content disclosed by
the health information office would create a hub for useful
advice for consumers.
9:20:47 AM
REPRESENTATIVE GARDNER suggested that the University of Alaska
could facilitate a study of the CON program in Alaska and
indicated concern with eliminating or making major changes in
the current system in the absence of data.
9:21:25 AM
CHAIR WILSON called the committee's attention back to the first
and second parts of the bill.
9:21:50 AM
REPRESENTATIVE ROSES asked whether the information that would be
required to be reported to the health information office under
HB 337, is now being required under a CON application.
COMMISSIONER JACKSON answered that what is required for the CON
program is focused on the need to build a specific facility to
provide a service and the financial impact on existing
facilities. Information for the health information office would
be focused on the consumer's perspective as to where services
are located, at what cost, and the expected outcomes.
9:23:33 AM
REPRESENTATIVE ROSES asked whether the DHSS would be ready to
gather data and implement the provisions in the bill in July.
COMMISSIONER JACKSON responded that on July 1, the information
office would start hiring staff and the commission would begin
its work on the website. She estimated that data would be
posted on the website within one year.
9:24:33 AM
REPRESENTATIVE ROSES encouraged the committee to create the
commission prior to making decisions on the other aspects of the
bill. The commission could then address the many details
surrounding the information office and deal with the CON. This
issue has a tremendous amount of interest and affects health
care across the state for providers and consumers.
Representative Roses opined that the members of the commission
will be best qualified to make these decisions.
9:27:27 AM
REPRESENTATIVE CISSNA expressed her belief that a study of the
CON program in Alaska could be done simultaneously with the
formation of the commission.
9:28:41 AM
COMMISSIONER JACKSON noted that fiscal considerations are the
reason that HB 337 contains three purposes. She cited the cost
impact of outstanding lawsuits, in addition to the cost of the
CON program, and pointed out that proceeding with the commission
and the information office, without addressing the CON program,
would have a significant fiscal impact.
9:29:31 AM
REPRESENTATIVE ROSES expressed his belief that concern over the
lawsuits should be set aside, as that should not be the driving
force behind the decisions that establish health care policy for
the citizens of the state.
9:30:37 AM
COMMISSIONER JACKSON re-stated that the issue with the law suits
is the cost and that the purpose of the program is to lower the
cost of health care.
9:30:55 AM
REPRESENTATIVE SEATON asked whether the fiscal impact of the
lawsuits on the DHSS is the dollar cost or the diversion of
resources.
COMMISSIONER JACKSON said both.
9:31:32 AM
REPRESENTATIVE SEATON remarked:
As I see it, Section 1 has you, the department,
charged with doing the health care plan. And that
wouldn't be the charge really of the commission. So,
I'm trying to figure out, if we would go forward with
Section 2 and establish the commission, without having
the policy decision made for the transparency section,
... then the commission's role would be to, um,
assess, through the full range of things that might
influence costs in the state, and then come back with
a policy question. Is that where we'd be if we
institute Section 1 without, the commission, without
the policy choice being made by the legislature?
9:33:02 AM
COMMISSIONER JACKSON asked Representative Seaton for
clarification of the question.
9:33:25 AM
REPRESENTATIVE SEATON further stated that, in the web base
program, it appears that a policy choice would be made about the
responsibilities of the commission, but on page 3 it states
that "the commission is going to be looking at recommendations
to foster development of statewide plan and to review facility
care information." He then asked whether Commissioner Jackson
saw any difference in the charge if the legislature only
institutes that as a policy.
COMMISSIONER JACKSON answered that there would be differences if
the transparency piece was not there to focus on the consumer.
The health plan would then be focused on facilities, as it is
now, rather than the comparison of prices for the consumer.
9:34:55 AM
REPRESENTATIVE SEATON further asked whether the sections of the
bill could be broken apart to establish the commission without
the information office. If so, would that affect the direction
of the bill.
COMMISSIONER JACKSON stated that the commission, without the
information office, would not be able to implement its
recommendations. There would not be the ability to implement
the policy decisions and make a direct connection to Alaskans.
DR. BUTLER reiterated that, to begin the work of the commission
without the tool of the health information office, could limit
its effectiveness.
9:36:51 AM
CHAIR WILSON expressed her understanding that the health care
commission would evaluate health care, in Alaska on the whole,
and make recommendations for improvements. The health care
information office would be responsible for providing the public
with information to allow individuals to make wise decisions
about their personal health care. She opined that the
responsibilities of the commission and the information office
are not the same.
COMMISSIONER JACKSON agreed.
9:38:41 AM
REPRESENTATIVE SEATON asked whether enacting the sections
separately would mean that the policy choice for the commission
can not include transparency for consumers.
9:39:14 AM
CHAIR WILSON opined that the commission and the information
office are two separate entities operating, for the most part,
in two separate realms.
9:39:37 AM
REPRESENTATIVE SEATON surmised that doing one without the other
indicates that the commission was tasked to bring forward a
plan. The committee was not making a policy decision that
consumers should have individual information; that was a policy
decision that the commission would integrate into its
recommendations.
9:40:21 AM
CHAIR WILSON asked whether Representative Seaton was suggesting
putting everything into one.
REPRESENTATIVE SEATON related that the suggestion has been made
to only pass the commission, without policy direction. He noted
that the commission's plan may or may not have the transparency
focus and he wished to ensure that the commission does have a
policy direction integrated into their charge.
9:41:57 AM
CHAIR WILSON recalled her experience on the governor's health
care council. She opined that the commission would be an
extension of the health care council and would make
recommendations that may be developed into policy by the
legislature. The formation of the health care information office
would be the result of policy decisions by the legislature and
the DHSS.
9:43:52 AM
DR. BUTLER expressed his concern about splitting the information
office. The details of what the health information office does
should be part of the charge of the commission, as the health
information office is answerable to the commission. Dr. Butler
opined that the commission and the health information office
would not function well completely independent of one another.
9:44:42 AM
REPRESENTATIVE ROSES called the committee's attention to the
task of the commission as written in the bill. The
responsibility of the DHSS is also established by the bill. He
opined that transparency is an overused term, and that,
unfortunately, the public does not see all of the information
about government. Keeping the public informed is important, but
there is so much data that some confusion is certain. He
stressed that, if the commission is established solely, the
department still has a responsibility for its tasks. In fact,
the commission will decide what needs to be changed and what
strategies will be used. He re-stated his suggestion to allow
the commission to develop its goals independently from the
legislature. He cautioned against writing legislation that does
not solve the problem.
9:48:28 AM
CHAIR WILSON asked whether Representative Roses wanted to delay
part two.
REPRESENTATIVE ROSES said no. He explained that the state
already has the responsibility, outlined by [eleven paragraphs]
in the bill, that establishes the strategy and the collaborative
approach to improve health care. He drew attention to the
[paragraphs] and stated that the commission's responsibility is
to make recommendations for changes in the plan to help
implement the plan and to ensure that the information is on the
website for consumers.
9:50:30 AM
CHAIR WILSON pointed out that the first section of the bill is
in current statute and the only change was the addition on page
2, lines [8 through 10] that read:
(A) a statewide health plan under AS 18.09 based
on recommendations of the Alaska Health Care
Commission established in AS 18.09.010;
9:51:10 AM
REPRESENTATIVE CISSNA stated her support for the commission and
for a health information office; however, the information office
should not only be available electronically. She expects that
the commission would explore other sources of information and
work to eliminate duplicity. Representative Cissna then
expressed her support for enacting the purposes of the bill
separately.
9:52:46 AM
COMMISSIONER JACKSON disagreed, and stated that she expects the
information office to immediately begin to work with other
sources of information, while the commission is determining what
is missing. In addition, she noted that health care
transparency is a national term in use in many states.
9:53:20 AM
REPRESENTATIVE KELLER stated that he has participated in the
health council meetings and expressed his support for addressing
the two parts of the issue, an overall look and the perspective
of the consumer, in one bill. He pointed out that there is a
disconnect between the parties in the health care situation and
expressed his interest in keeping the bill intact.
9:54:53 AM
CHAIR WILSON informed the committee that HB 337 and HB 345 were
held over for further discussion.
9:55:37 AM
CHAIR WILSON opened public testimony on the first two sections
of HB 337.
9:56:17 AM
JEANNINE HINMAN, Health Care Legal Consultant, Advanced Medical
Centers of Alaska, pointed out that there have been restrictive
CON laws in Alaska for decades and stated her support for HB
337.
9:57:13 AM
NORMAN STEPHENS, Chief Executive Officer, Mat-Su Regional Health
Care Center, informed the committee that he was a participant in
the CON task force. He supported the idea of slowing the
process down and cautioned the committee against creating the
commission and rushing ahead with an information office. Mr.
Stephens opined that hospitals are now in competition to lower
the cost of contracts and keep costs low. On the Medicare side,
cost reports are already mandated to be public information;
however, they are very complicated and difficult to understand.
Mr. Stephens concluded by pointing out that statistics from
smaller hospitals, that perform fewer operations, can not be
fairly compared to statistics from large hospitals.
9:59:59 AM
PAULA EASLEY, Member, Alaska Mental Health Trust Authority Board
of Directors, Department of Revenue, testified on behalf of the
Alaska Mental Health Trust Authority (AMHTA) and requested that
HB 337 include a representative of AMHTA on the health care
commission. She noted that the AMHTA, in conjunction with the
DHSS, develops a comprehensive five year mental health plan and
advises the state on mental health program funding that amounted
to approximately $27 million this year. In addition, the AMHTA
leads system planning in many areas related to beneficiaries.
Ms. Easley stated other goals of the AMHTA and stressed that, in
the process of its duties, it collects a significant amount of
research. This research would be invaluable to the work of the
health care commission. Turning to the issue of the health care
information office, she advised the committee of the new United
Way statewide referral service. Ms. Easley listed many of the
services provided via the Alaska 211 telephone number and
recommended that the information office establish a link to the
services provided on the phone line, thus saving duplication and
a considerable amount of money.
10:04:06 AM
ROB GOULD, Chief Financial Officer; Head of Operations,
Fairbanks Memorial Hospital and Denali Center, stated his
support for the commission and opposition to the creation of the
health care information office. He opined that the information
that would be posted would be incomplete and would not provide
transparency. In addition, Alaska is a data rich state and the
DHSS already has relevant information.
10:06:19 AM
BOB URATA, M. D., Member, Bartlett Regional Hospital Board of
Directors and the Health Care Strategies Planning Council,
stated his support for the creation of the health care
commission and the information office. He recalled that one of
the goals of the Health Care Strategies Planning Council is to
develop [a vehicle to] provide information to support
consumerism in the health care system. In fact, Medicare now
requires information, on the Internet, about how hospitals are
doing in certain health areas. He related the Health Care
Strategies Planning Council's hope that this information would
be expanded to include hospitals and physician's offices.
Turning to the health care commission, he opined that the health
care problems in the state will take time to solve and
recommended that more stakeholders should be included to serve
on the commission.
10:09:46 AM
CHAIR WILSON stated her appreciation for Dr. Urata's support of
the bill.
10:10:13 AM
DR. URATA opined that many hospital representatives feel that
there is an unlevel playing field. The commission can address
this problem, if all parties are represented.
10:10:55 AM
REPRESENTATIVE GARDNER asked Dr. Urata to submit a list of
parties who should be included in the commission.
10:11:21 AM
ROB BETIT, Chief Executive Officer, Alaska State Hospital and
Nursing Home Association (ASHNHA), informed the committee that
the members of the ASHNHA support the creation of the statewide
health plan and the health care commission. However, he
recommended changes in the membership of the commission to
ensure a more balanced representation. Also, he expressed his
belief that the reporting provision of the health care
information office should include pharmacies and physicians.
10:15:01 AM
REPRESENTATIVE ROSES asked Mr. Betit for the charge of the
health care commission on which he served in Utah.
MR. BETIT stated that the Utah commission addressed the issues
of access, insurance coverage, and cost. The commission
consisted of six public members, six legislators, and was
initially chaired by the governor. During its tenure, the
commission created a road map of issues and staff support was
provided by an information office at the Utah department of
health. Mr. Betit related the successes of the commission.
10:16:53 AM
REPRESENTATIVE ROSES further asked whether the Utah commission
outlined medical protocol and procedures for testing.
MR. BETIT answered that the commission set a policy for
physicians to follow, but the details were developed by
physicians and ethicists.
10:18:05 AM
REPRESENTATIVE ROSES then asked whether the protocols were
established for the state.
MR. BETIT said that protocols recognized by the physician's
community and by the national heath sciences group were embraced
by the Utah commission.
10:18:35 AM
REPRESENTATIVE SEATON asked whether there should be additional
representation by the legislature on the commission.
MR. BETIT, speaking now only as an individual, advised that,
without the governor's support, the health care commission will
not make progress. In addition, representation by the
legislature is required to ensure support and funding for the
commission's policy recommendations. He opined that the
legislature needs additional representation on the commission.
10:20:49 AM
REPRESENTATIVE CISSNA asked for a description of the members of
the Utah commission.
10:21:22 AM
MR. BETIT answered that there were two members each from the
majority and minority parties of each body, who were chosen for
their interest and commitment to health care.
10:22:05 AM
JOEL GILBERTSON, Representative, Providence Health & Services
Alaska, stated his support for the commission as well as the
information office. However, he cautioned that it is important
to consider the membership of the commission. He opined that,
in order to promote health care reform in Alaska, stakeholders,
providers, employers, consumers, and government representatives
would all be needed. Also, he cautioned that oversimplification
of the information provided by the information office would not
be valuable to the consumer, especially without data on
physician's costs.
10:25:31 AM
REPRESENTATIVE GARDNER asked Mr. Gilbertson how large a
commission could be and still be workable.
MR. GILBERTSON suggested that the commission should consist of
11 to 12 members.
10:26:21 AM
REPRESENTATIVE KELLER asked whether there is the possibility of
a [commission] made of two layers of representation.
MR. GILBERTSON stressed that individuals representing
conflicting interests would be needed to work out real
solutions. He stated that he was unfamiliar with a tiered
approach to the problem.
10:28:33 AM
CHAIR WILSON closed public testimony on the first two parts of
HB 337.
[HB 337 was held over.]
10:28:52 AM
HB 345-MEDICAL FACILITY CERTIFICATE OF NEED
10:29:12 AM
CHAIR WILSON announced that the final order of business would be
HOUSE BILL NO. 345, "An Act amending the certificate of need
requirements to exclude expenditures for diagnostic imaging
equipment in certain circumstances."
10:29:42 AM
REPRESENTATIVE MIKE KELLY, Alaska State Legislature, disclosed
his uncompensated service to the Greater Fairbanks Community
Hospital Foundation and to the Committee on Governance for the
American Hospital Association. He, as the prime sponsor,
introduced HB 345 and stated that the bill is a compromise that
attempts to eliminate the CON program for a portion of
businesses, thus is a step in the direction of more competition
in the health care industry. Representative Kelly pointed out
that provisions for a [health care commission] and a health care
information office are not included in HB 345, and he expressed
his concerns that both of these provisions constitute increased
government involvement in private business. In addition, he
opined that 50 percent of the industry is not included in the
information office data.
10:3:55 AM
CHAIR WILSON noted that, page 6, [paragraph (2)] of HB 337,
read:
The facility cost and provider cost...
10:34:22 AM
REPRESENTATIVE KELLY opined that the requirement to disclose
costs by private sector businesses was an "additional step." He
then asked his staff to review HB 345.
10:34:34 AM
DEREK MILLER, Staff to Representative Mike Kelly, Alaska State
Legislature, presented the sectional analysis for HB 345,
Version E, on behalf of Representative Kelly, sponsor. Mr.
Miller informed the committee that Section 1 adds a cross-
reference to an additional exemption to the Certificate of Need
process in existing statute. Section 2 defines "critical access
hospital" as a small, rural, hospital that is financially
challenged given the population that it serves. Section 3 adds
an exemption that permits a person to make an expenditure of $1
million or more for diagnostic imaging equipment, without
authorization under the terms of the CON process, as long as the
equipment is located in a borough with a population of 60,000 or
more, in a city that does not have a critical access hospital,
and is at least 50 percent owned by one or more licensed
physicians who are qualified to and actually perform
interpretations of the images produced at the facility.
Finally, Section 4 provides applicability standards for health
care facilities in existence or proposed after the effective
date of the act.
10:36:19 AM
REPRESENTATIVE SEATON asked for an explanation of the
requirement of 50 percent ownership, by physicians, of the
diagnostic imaging facility.
REPRESENTATIVE KELLY suggested that the percentage was chosen as
a compromise between the opposing parties.
10:38:43 AM
REPRESENTATIVE SEATON further asked for the purpose of
requiring physician ownership, if the intent of the bill is to
open competition.
REPRESENTATIVE KELLY explained that physician ownership is not
prevented, but if participation is less than 50 percent by
physicians, CON laws still apply. The intent is to encourage
competition, as long as the two parties are working together.
10:40:53 AM
REPRESENTATIVE GARDNER asked whether this was a compromise
between the hospitals and the physicians.
REPRESENTATIVE KELLY said that the bill was a significant
compromise, but the dispute is not entirely between hospitals
and physicians. House Bill 345 was a solution based on what has
been done in other states that have improved their CON laws.
10:42:04 AM
REPRESENTATIVE GARDNER asked for the position of the consumers
in the division between the hospitals and the doctors.
REPRESENTATIVE KELLY opined that it depends on where the federal
government leads this debate. Unlike fire, car, and life
insurance, the consumer is a small part of health care and
remains uninformed, uninvolved, and under served. In Anchorage
and Fairbanks, physicians are not accepting Medicare patients;
this will soon be a crisis as the number of seniors will double
in Alaska by 2030. Representative Kelly pointed out that all
three aspects of HB 337 would not solve the issues that HB 345
would solve by compromise.
10:45:50 AM
REPRESENTATIVE GARDNER asked whether HB 345 would resolve any,
or all, of the pending lawsuits.
REPRESENTATIVE KELLY expressed his understanding that this bill
would settle from 75 percent to 90 percent of the lawsuits. He
blamed weak regulations for the legal problems and provided
analogies to the California power system deregulation.
Representative Kelly predicted that a sudden change in the CON
system would cause a similar situation.
10:49:49 AM
REPRESENTATIVE CISSNA opined that one's health is 80 percent
based on personal choices and learned habits. She acknowledged
that the CON program needs work, but expressed her concern about
the health of the hospitals that are needed to provide emergency
care. She asked how HB 345 will safeguard the health of a
hospital.
REPRESENTATIVE KELLY observed that HB 345 was a carefully
crafted compromise. He suggested that, if it is not passed,
this struggle will continue. Furthermore, HB 345 is supported
by a large sector of the health care system.
10:53:13 AM
REPRESENTATIVE ROSES expressed his concern that the limitation
on the cost of equipment may affect the quality of care.
REPRESENTATIVE KELLY agreed and pointed out that HB 345
eliminates this possibility.
10:54:39 AM
REPRESENTATIVE ROSES clarified his question.
10:54:59 AM
REPRESENTATIVE KELLY confirmed that the exemptions provided by
HB 345 negate the applicability of the CON under the conditions
described by Representative Roses.
10:55:21 AM
REPRESENTATIVE ROSES further asked whether the 50 percent
ownership requirement was supported by the negotiated rule
making committee.
REPRESENTATIVE KELLY assured the committee that the support of
the negotiated rule making committee was considered in the
drafting of HB 345.
10:56:34 AM
CHAIR WILSON announced that further testimony would be heard on
the nineteenth of February, 2008.
[HB 345 was held over.]
10:57:22 AM
ADJOURNMENT
There being no further business before the committee, the House
Health, Education and Social Services Standing Committee meeting
was adjourned at 10:58:03 AM.
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