Legislature(2005 - 2006)CAPITOL 17

05/04/2005 02:00 PM House LABOR & COMMERCE


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05:15:53 PM Start
05:16:45 PM SB130
07:14:30 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Please Note Time Change --
*+ HB 295 UNIFORM FRAUDULENT TRANSFER ACT TELECONFERENCED
Scheduled But Not Heard
+ SB 130 WORKERS' COMPENSATION/ INSURANCE TELECONFERENCED
Moved HCS CSSB 130(L&C) Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                                                                         
                          May 4, 2005                                                                                           
                           5:15 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Tom Anderson, Chair                                                                                              
Representative Pete Kott                                                                                                        
Representative Gabrielle LeDoux                                                                                                 
Representative Bob Lynn                                                                                                         
Representative Norman Rokeberg                                                                                                  
Representative Harry Crawford                                                                                                   
Representative David Guttenberg                                                                                                 
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
CS FOR SENATE BILL NO. 130(FIN) am                                                                                              
"An Act relating  to a special deposit  for workers' compensation                                                               
and  employers' liability  insurers;  relating  to assigned  risk                                                               
pools; relating  to workers'  compensation insurers;  stating the                                                               
intent  of   the  legislature,   and  setting   out  limitations,                                                               
concerning the  interpretation, construction,  and implementation                                                               
of workers'  compensation laws; relating  to the  Alaska Workers'                                                               
Compensation   Board;    assigning   certain    Alaska   Workers'                                                               
Compensation  Board   functions  to  the  division   of  workers'                                                               
compensation   in  the   Department   of   Labor  and   Workforce                                                               
Development and to that department,  and authorizing the board to                                                               
delegate administrative  and enforcement duties to  the division;                                                               
providing for workers' compensation  hearing officers in workers'                                                               
compensation  proceedings; establishing  a Workers'  Compensation                                                               
Appeals  Commission; relating  to  workers' compensation  medical                                                               
benefits and to  charges for and payment of fees  for the medical                                                               
benefits;   relating  to   agreements  that   discharge  workers'                                                               
compensation   liability;  relating   to  workers'   compensation                                                               
awards;  relating to  reemployment benefits  and job  dislocation                                                               
benefits; relating  to coordination of workers'  compensation and                                                               
certain  disability benefits;  relating to  division of  workers'                                                               
compensation records;  relating to release of  treatment records;                                                               
relating to an  employer's failure to insure and  keep insured or                                                               
provide  security;   providing  for  appeals   from  compensation                                                               
orders; relating to  workers' compensation proceedings; providing                                                               
for  supreme  court jurisdiction  of  appeals  from the  Workers'                                                               
Compensation Appeals  Commission; providing for a  maximum amount                                                               
for  the  cost-of-living  adjustment  for  workers'  compensation                                                               
benefits;  relating to  attorney  fees with  respect to  workers'                                                               
compensation;  providing   for  the  department  to   enter  into                                                               
contracts  with nonprofit  organizations  to provide  information                                                               
services   and  legal   representation   to  injured   employees;                                                               
providing  for administrative  penalties for  employers uninsured                                                               
or without adequate security  for workers' compensation; relating                                                               
to fraudulent acts or false  or misleading statements in workers'                                                               
compensation and penalties for the  acts or statements; providing                                                               
for members of  a limited liability company to be  included as an                                                               
employee for  purposes of  workers' compensation;  establishing a                                                               
workers' compensation  benefits guaranty fund;  making conforming                                                               
amendments;  providing for  a  study and  report  by the  medical                                                               
services  review  committee;  establishing   the  Task  Force  on                                                               
Workers' Compensation; and providing for an effective date."                                                                    
                                                                                                                                
     - MOVED HCS CSSB 130(L&C) OUT OF COMMITTEE; ADOPTED A HOUSE                                                                
     CONCURRENT RESOLUTION ALLOWING THE TITLE CHANGE                                                                            
                                                                                                                                
HOUSE BILL NO. 295                                                                                                              
"An  Act  adopting  the  Uniform   Fraudulent  Transfer  Act  and                                                               
relating to fraudulent transfers of property."                                                                                  
                                                                                                                                
     - SCHEDULED BUT NOT HEARD                                                                                                  
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: SB 130                                                                                                                  
SHORT TITLE: WORKERS' COMPENSATION/ INSURANCE                                                                                   
SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
03/03/05       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/03/05       (S)       L&C, FIN                                                                                               
03/08/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/08/05       (S)       Heard & Held                                                                                           
03/08/05       (S)       MINUTE(L&C)                                                                                            
03/10/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/10/05       (S)       Heard & Held                                                                                           
03/10/05       (S)       MINUTE(L&C)                                                                                            
03/15/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/15/05       (S)       Heard & Held                                                                                           
03/15/05       (S)       MINUTE(L&C)                                                                                            
03/17/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/17/05       (S)       Heard & Held                                                                                           
03/17/05       (S)       MINUTE(L&C)                                                                                            
03/22/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/22/05       (S)       Heard & Held                                                                                           
03/22/05       (S)       MINUTE(L&C)                                                                                            
03/24/05       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
03/24/05       (S)       Heard & Held                                                                                           
03/24/05       (S)       MINUTE(L&C)                                                                                            
03/29/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/29/05       (S)       -- Meeting Canceled --                                                                                 
03/31/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/31/05       (S)       Moved CSSB 130(L&C) Out of Committee                                                                   
03/31/05       (S)       MINUTE(L&C)                                                                                            
04/01/05       (S)       L&C RPT CS  2DP 1NR 2AM             NEW                                                                
                         TITLE                                                                                                  
04/01/05       (S)       DP: BUNDE, STEVENS B                                                                                   
04/01/05       (S)       NR: SEEKINS                                                                                            
04/01/05       (S)       AM: DAVIS, ELLIS                                                                                       
04/01/05       (S)       JUD REFERRAL ADDED AFTER L&C                                                                           
04/05/05       (S)       JUD AT 8:30 AM BUTROVICH 205                                                                           
04/05/05       (S)       Heard & Held                                                                                           
04/05/05       (S)       MINUTE(JUD)                                                                                            
04/06/05       (S)       JUD AT 8:30 AM BUTROVICH 205                                                                           
04/06/05       (S)       Heard & Held                                                                                           
04/06/05       (S)       MINUTE(JUD)                                                                                            
04/07/05       (S)       JUD AT 8:30 AM BUTROVICH 205                                                                           
04/07/05       (S)       Heard & Held                                                                                           
04/07/05       (S)       MINUTE(JUD)                                                                                            
04/08/05       (S)       JUD RPT CS FORTHCOMING 1DP 4NR                                                                         
04/08/05       (S)       DP: SEEKINS                                                                                            
04/08/05       (S)       NR: FRENCH, GUESS, THERRIAULT, HUGGINS                                                                 
04/08/05       (H)       JUD AT 8:00 AM CAPITOL 120                                                                             
04/08/05       (S)       Moved CSSB 130(JUD) Out of Committee                                                                   
04/08/05       (S)       MINUTE(JUD)                                                                                            
04/08/05       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
04/08/05       (S)       <Pending Referral>                                                                                     
04/11/05       (S)       FIN     RPT    CS     5DP    1NR     1AM                                                               
                         NEW TITLE                                                                                              
04/11/05       (S)       DP:   GREEN,   WILKEN,   BUNDE,   DYSON,                                                               
                         STEDMAN                                                                                                
04/11/05       (S)       NR: HOFFMAN                                                                                            
04/11/05       (S)       AM: OLSON                                                                                              
04/11/05       (S)       JUD              CS             RECEIVED                                                               
                         NEW TITLE                                                                                              
04/11/05       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
04/11/05       (S)       Moved CSSB 130(FIN) Out of Committee                                                                   
04/11/05       (S)       MINUTE(FIN)                                                                                            
04/14/05       (S)       TRANSMITTED TO (H)                                                                                     
04/14/05       (S)       VERSION: CSSB 130(FIN) AM                                                                              
04/15/05       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/15/05       (H)       L&C, JUD, FIN                                                                                          
04/15/05       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
04/15/05       (S)       Moved Out of Committee 4/11                                                                            
04/15/05       (S)       MINUTE(FIN)                                                                                            
05/04/05       (H)       L&C AT 2:00 PM CAPITOL 17                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
GREG O'CLARAY, Commissioner                                                                                                     
Department of Labor & Workforce Development                                                                                     
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:                                                                                                             
                                                                                                                                
RICHARD CATTANACH, Executive Director                                                                                           
Associated General Contractors of Alaska (ACG);                                                                                 
Management Co-Chair, Workers' Compensation Ad Hoc Committee                                                                     
(No address provided)                                                                                                           
POSITION STATEMENT:                                                                                                             
                                                                                                                                
PAUL LISANKIE, Director                                                                                                         
Division of Workers' Compensation                                                                                               
Department of Labor & Workforce Development                                                                                     
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Reviewed the  summary document comparing HCS                                                               
CSSB 130, Version I, and CSSB 130(FIN)am.                                                                                       
                                                                                                                                
TIM KELLY, Lobbyist                                                                                                             
Alaska State Medical Association                                                                                                
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Provided comments on SB 130.                                                                               
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
                                                                                                                                
CHAIR TOM ANDERSON  called the House Labor  and Commerce Standing                                                             
Committee  meeting  to  order at  5:15:53  PM.    Representatives                                                             
Anderson, Kott,  LeDoux, Rokeberg, Crawford, and  Guttenberg were                                                               
present at  the call  to order.   Representative Lynn  arrived as                                                               
the meeting was in progress.                                                                                                    
                                                                                                                                
SB 130-WORKERS' COMPENSATION/ INSURANCE                                                                                       
                                                                                                                                
CHAIR ANDERSON  announced that the  only order of  business would                                                               
be  CS FOR  SENATE BILL  NO. 130(FIN)am  [long title  provided in                                                               
committee calendar].                                                                                                            
                                                                                                                                
5:16:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KOTT  moved  to   adopt  HCS  CSSB  130,  Version                                                               
GS1112\L, Bullock, 5/4/05, as the  working document.  There being                                                               
no objection, Version L was before the committee.                                                                               
                                                                                                                                
GREG  O'CLARAY, Commissioner,  Department  of  Labor &  Workforce                                                               
Development (DLWD),  suggested that since  Version L is  "hot off                                                               
the presses" it should be addressed  by a team of the individuals                                                               
[involved] in  its drafting.   He further suggested  that someone                                                               
from the  labor/management group  of the  ad hoc  committee could                                                               
address the legislation.                                                                                                        
                                                                                                                                
CHAIR ANDERSON agreed with Commissioner O'Claray's suggestion.                                                                  
                                                                                                                                
5:19:16 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KOTT  pointed out that Version  L includes several                                                               
components  that were  provided as  part  of an  ad hoc  package.                                                               
However,  he  opined  that only  two-thirds  of  the  legislation                                                               
relates to the earlier version.                                                                                                 
                                                                                                                                
5:19:56 PM                                                                                                                    
                                                                                                                                
The committee to a brief at-ease.                                                                                               
                                                                                                                                
5:22:22 PM                                                                                                                    
                                                                                                                                
CHAIR  ANDERSON pointed  out  that the  committee  should have  a                                                               
document  entitled, "Summary  Comparison of  CSSB 130(FIN)am  and                                                               
Draft HCS  5/1/05".   Although the HCS  5/1/05, Version  I, isn't                                                               
completely parallel  with Version  L, it's  close enough  to work                                                               
for analysis purposes.                                                                                                          
                                                                                                                                
RICHARD   CATTANACH,  Executive   Director,  Associated   General                                                               
Contractors  of  Alaska   (ACG);  Management  Co-Chair,  Workers'                                                               
Compensation  Ad Hoc  Committee, informed  the committee  that he                                                               
prepared the  summary document to which  Chair Anderson referred.                                                               
He noted  that the  summary document is  a comparison  of Version                                                               
24-GS1112\I, Bullock, 5/1/05, and CSSB 130(FIN)am.                                                                              
                                                                                                                                
REPRESENTATIVE KOTT interjected that  [the majority of Version L]                                                               
should be  on track  with Version  I.  He  suggested that  he and                                                               
Representative LeDoux could help  the committee with the portions                                                               
of Version L that diverge from Version I.                                                                                       
                                                                                                                                
PAUL  LISANKIE,  Director,  Division  of  Workers'  Compensation,                                                               
Department of Labor & Workforce  Development, explained that with                                                               
the summary document  he noted the following:   the corresponding                                                               
sections   between  [Version   I]   and   CSSB  130(FIN)am,   the                                                               
differences  are highlighted  in bold.   Therefore,  he suggested                                                               
that he could review the areas  where there are differences.  The                                                               
first  section of  the  summary  comparison addresses  protecting                                                               
workers' benefits  and jobs.   He  noted that  Section 2  of CSSB
130(FIN)am has been resolved now.                                                                                               
                                                                                                                                
REPRESENTATIVE LEDOUX asked if the  language in Section 2 of CSSB
130(FIN)am is already in the law.                                                                                               
                                                                                                                                
MR.  LISANKIE  related  his  understanding  that  Version  L  has                                                               
addressed the problems  with [Section 2 of CSSB  130(FIN)am].  He                                                               
added  that   there  was   going  to  be   a  new   section  that                                                               
collateralized some additional loss  reserves, which isn't in the                                                               
draft  CS.   As  Representative  LeDoux alluded  to,  there is  a                                                               
provision in the current statute  for deposits that are currently                                                               
being made.   The  language in  Version I  referred to  the wrong                                                               
subsection, now  that the change has  been made to "(b)"  it does                                                               
track back to the statute.                                                                                                      
                                                                                                                                
5:27:13 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE pointed out that  the [HCS, Version I] has increased                                                               
the number  of the task  force members and  added representatives                                                               
of  the   Alaska  Chiropractic   Society  and   a  rehabilitation                                                               
specialist.    The report  back  date  has  been pushed  back  to                                                               
December  1, 2006.   Furthermore,  the  provision specifies  that                                                               
legislative administrative  support staff will be  appointed.  He                                                               
related his understanding  that the makeup of the  task force has                                                               
been slightly changed in Version L.                                                                                             
                                                                                                                                
CHAIR ANDERSON inquired  as to where the task  force is discussed                                                               
in Version L.                                                                                                                   
                                                                                                                                
MR. LISANKIE specified that it's on page 34, Section 69.                                                                        
                                                                                                                                
5:28:14 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KOTT explained  that there  will be  an amendment                                                               
the intent of  which is to identify the major  issues for which a                                                               
consultant could gather  the research.  He suspected  it would be                                                               
done over  the summer months  and the  data would be  provided to                                                               
the  membership  of the  task  force  in  order that  they  could                                                               
commence  work September  1, 2005,  and then  report back  to the                                                               
legislature by the end of the year.                                                                                             
                                                                                                                                
5:30:59 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LYNN  inquired as  to how  often there  are claims                                                               
against chiropractors as opposed to medical doctors.                                                                            
                                                                                                                                
MR.  LISANKIE said  that although  he didn't  have hard  numbers,                                                               
chiropractors provide  a considerable  amount of care  to injured                                                               
workers  in  the  state  under  the  Workers'  Compensation  Act.                                                               
Furthermore, chiropractors  have been acknowledged  as physicians                                                               
in Alaska.                                                                                                                      
                                                                                                                                
5:31:59 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  ROKEBERG related  his significant  disappointment                                                               
with regard  to the  lack of a  small business  representative on                                                               
the  task  force.   He  opined  that the  task  force  is out  of                                                               
balance.                                                                                                                        
                                                                                                                                
5:32:30 PM                                                                                                                    
                                                                                                                                
MR. CATTANACH  pointed out that  with two people  being appointed                                                               
from the  ad hoc  committee for the  management and  labor slots,                                                               
the current  makeup of the  entire ad  hoc committee is  that all                                                               
five members are from small  businesses.  No large businesses are                                                               
represented.                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROKEBERG said that he  would like to see the names                                                               
and affiliations of those members [of small businesses].                                                                        
                                                                                                                                
MR. CATTANACH noted that the  University of Alaska is represented                                                               
on the task force.                                                                                                              
                                                                                                                                
5:33:28 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE turned  attention to page 2 of  the summary document                                                               
and  highlighted that  the  Public  Employees' Retirement  System                                                               
(PERS) is  the same  in that  it allows  the one-time  payment of                                                               
attorney fees.   However,  under [Version  I] DLWD  wouldn't have                                                               
the authority to contract with  a nonprofit organization in order                                                               
to provide  information and legal  assistance to  injured workers                                                               
unable to  obtain private  counsel.   Furthermore, there's  not a                                                               
broad permission of authority to  the director of the Division of                                                               
Workers' Compensation,  although there  are a  substantial number                                                               
of specific delegations that are  included in [Version I].  There                                                               
is no corresponding provision in Version L, he noted.                                                                           
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
5:36:08 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE,  in response  to  Chair  Anderson, clarified  that                                                               
under Version L,  DLWD would not have authority  to contract with                                                               
a  nonprofit  organization  to   provide  information  and  legal                                                               
assistance to  injured workers unable to  obtain private counsel.                                                               
Furthermore,  there isn't  a  corresponding  broad delegation  of                                                               
authority  from  the  Workers' Compensation  Board  down  to  the                                                               
division  director, although  there are  a significant  number of                                                               
individual delegations in [Version L].                                                                                          
                                                                                                                                
MR. CATTANACH explained  that the ad hoc  committee was unanimous                                                               
in  its  belief  that  the  department  shouldn't  provide  legal                                                               
assistance to  injured workers.   The purpose of  the legislation                                                               
was to speed  up the process and reduce the  costs.  However, the                                                               
ad hoc committee  didn't see how attorneys could do  either.  The                                                               
ad hoc  committee didn't see a  need for such, and  therefore the                                                               
provision was dropped.                                                                                                          
                                                                                                                                
5:38:00 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LEDOUX related her  understanding that the working                                                               
group  intended  for  Section  8   of  [CSSB  139(FIN)am]  to  be                                                               
included, although she couldn't find it in [Version L].                                                                         
                                                                                                                                
5:38:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX stated  that the  delegation of  authority                                                               
was  accidentally left  out.   Therefore, she  suggested that  it                                                               
should be reinserted.                                                                                                           
                                                                                                                                
MR.  CATTANACH agreed,  adding that  the delegation  of authority                                                               
should be included because it speeds the process.                                                                               
                                                                                                                                
REPRESENTATIVE LEDOUX  moved that the committee  adopt Conceptual                                                               
Amendment 1, which would reinsert  Section 8 of [CSSB 130(FIN)am]                                                               
into Version L.                                                                                                                 
                                                                                                                                
REPRESENTATIVE  CRAWFORD  related  his  understanding,  from  Mr.                                                               
Cattanach's testimony, that  [the ad hoc committee]  did not want                                                               
the entire  Section 8.   Furthermore, he didn't believe  that was                                                               
what Representative LeDoux wanted either.                                                                                       
                                                                                                                                
5:41:42 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  LEDOUX clarified  her  earlier  motion such  that                                                               
[Conceptual]  Amendment  1  would   insert  "The  board  may,  by                                                               
regulation,  delegate authority  to  the director  to assist  the                                                               
board in administering and enforcing this chapter."                                                                             
                                                                                                                                
CHAIR  ANDERSON objected.   Upon  gaining  an understanding  from                                                               
Representative  LeDoux  as  to   where  this  language  would  be                                                               
inserted and acknowledging that the  representative of the ad hoc                                                               
committee   approved  of   this,  Chair   Anderson  removed   his                                                               
objection.                                                                                                                      
                                                                                                                                
There being  no further objection,  [Conceptual] Amendment  1 was                                                               
adopted.                                                                                                                        
                                                                                                                                
5:43:22 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE continued  with his  comparison  using the  summary                                                               
document.   He explained that  under CSSB 130(FIN)am,  Section 10                                                               
allows injured  workers represented by  Alaska-licensed attorneys                                                               
to   settle  their   claims  without   review  by   the  Workers'                                                               
Compensation  Board,  unless  the  injured  worker  is  a  minor,                                                               
incompetent, [or  unrepresented by counsel].   However, Section 7                                                               
of Version I  adds to the disputes that may  not be settled, even                                                               
when represented by  an attorney, for a dispute that  calls for a                                                               
waiver   of   medical   benefits.     He   indicated   that   the                                                               
aforementioned was maintained in Version L as well.                                                                             
                                                                                                                                
MR. CATTANACH concurred  with the analysis and  what's in Section                                                               
7 of Version L [page 4, lines 22-23].                                                                                           
                                                                                                                                
CHAIR  ANDERSON noted,  for the  record, that  representatives of                                                               
the   ad   hoc  committee   were   indicating   support  of   the                                                               
aforementioned change.                                                                                                          
                                                                                                                                
5:45:58 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE  pointed out  that Section 4  of [Version  I] echoes                                                               
the requirement for the use  of hearing officers and the adoption                                                               
of  conflict  of  interest  regulations   as  specified  in  CSSB
130(FIN)am.    However,  [Section  4 of  Version  I]  includes  a                                                               
provision that  adds three workers' compensation  hearing panels,                                                               
which would increase the total to 10.                                                                                           
                                                                                                                                
5:47:19 PM                                                                                                                    
                                                                                                                                
MR.  CATTANACH,  in response  to  Chair  Anderson, said  that  he                                                               
wasn't aware of  any change to [what was in  Section 4 of Version                                                               
I].                                                                                                                             
                                                                                                                                
CHAIR ANDERSON opined  that it looks as if [Section  4 of Version                                                               
I is the same in Version L].                                                                                                    
                                                                                                                                
5:47:55 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KOTT  explained that  the  number  of boards  was                                                               
increased in  order to  reduce the backlog,  which he  likened to                                                               
what the RCA experienced.  He  suggested that once the backlog is                                                               
reduced, the  task force  could determine  whether the  number of                                                               
boards should be decreased.                                                                                                     
                                                                                                                                
MR. CATTANACH concurred.                                                                                                        
                                                                                                                                
5:48:56 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE turned  to the second page of  the summary document,                                                               
and drew  attention to the  heading "FAIR BENEFITS  AT REASONABLE                                                           
EMPLOYER COST".   The first two sections  specified are identical                                                           
under both Version I and  CSSB 130(FIN)am.  The first significant                                                               
benefit  is  related  to  the   fact  that  Section  37  of  CSSB
130(FIN)am requires  a coordination of payments  between workers'                                                               
compensation benefits  and disability benefits that  are provided                                                               
under a  plan to  which an  employer has  also contributed.   The                                                               
aforementioned  is  done so  that  the  combined benefit  doesn't                                                               
exceed  the injured  workers  take-home pay.    Version I  didn't                                                               
maintain that provision.                                                                                                        
                                                                                                                                
5:49:47 PM                                                                                                                    
                                                                                                                                
CHAIR ANDERSON highlighted that on  page 25 of Version L, Section                                                               
48,  states:   "(c)    The department  [BOARD]  shall provide  by                                                           
regulation for  the determination and comparison  of living costs                                                               
for this  state and  the other areas  in which  recipients reside                                                               
and  for the  [ANNUAL]  redetermination and  comparison of  these                                                               
costs every three years."                                                                                                   
                                                                                                                                
MR.   CATTANACH  noted   that  he   concurred  [with   the  above                                                               
provision].                                                                                                                     
                                                                                                                                
5:50:20 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE  moved on  to page  3 of  the summary  document, and                                                               
informed the committee that CSSB  130(FIN)am had a provision that                                                               
incrementally  reduced benefit  costs  by redefining  compensable                                                               
injuries and  restricting the compensability of  certain injuries                                                               
that  were   the  result   of  aggravations,   accelerations,  or                                                               
combinations of a preexisting condition.   The aforementioned was                                                               
attempted  through  the  use  of  a  "major  contributing  cause"                                                               
standard.  Version I deleted the aforementioned changes.                                                                        
                                                                                                                                
MR.  CATTANACH  confirmed  that  the  aforementioned  is  not  in                                                               
Version L.                                                                                                                      
                                                                                                                                
5:51:25 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE  moved on  to the  anti-fraud provision,  which only                                                               
changes the definitions of "person"  and "compensation" to follow                                                               
the language proposed by the ad hoc committee.                                                                                  
                                                                                                                                
CHAIR ANDERSON  clarified that Section  56 of Version L  seems to                                                               
mirror Section 56 of Version I.                                                                                                 
                                                                                                                                
5:52:25 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CRAWFORD pointed  out that there was  a "part (c)"                                                               
that was part of  the ad hoc bill that's no  longer included.  He                                                               
asked if that was of concern.                                                                                                   
                                                                                                                                
MR.  CATTANACH  said  that  he  was  concerned  with  that.    He                                                               
explained that "part  (c)" addressed civil damages.   [Version L]                                                               
requires  that the  department hire  two fraud  investigators and                                                               
also  requires  the  Department  of  Law  to  have  one  attorney                                                               
assigned, at least on a  half-time basis.  Mr. Cattanach informed                                                               
the  committee  that  civil  damages  were  desired  because  the                                                               
administration doesn't prosecute these and  it was felt that with                                                               
civil damages the  injured worker might pursue a  case on his/her                                                               
own.  "But I think we should try this," he said.                                                                                
                                                                                                                                
5:53:25 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KOTT agreed  with Mr.  Cattanach's thoughts.   He                                                               
related  his understanding  that there  is one  [investigator] in                                                               
the  department and  since he/she  didn't have  any investigative                                                               
authority, it was granted and a second [investigator] was added.                                                                
                                                                                                                                
5:54:27 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE pointed out that [Version  I] still has a Section 57                                                               
[part (c)].   Unlike CSSB 130(FIN)am, [Version  I] does authorize                                                               
courts  in  a civil  proceeding  to  award compensatory  damages,                                                               
punitive damages,  as well  as attorneys  fees for  violations of                                                               
fraud.                                                                                                                          
                                                                                                                                
CHAIR  ANDERSON pointed  out  that  Section 57  of  Version L  is                                                               
different than that specified in Section 57 of Version I.                                                                       
                                                                                                                                
MR.  CATTANACH interjected  that the  subject [of  Section 57  in                                                               
Version L] is the same [as that  in Section 57 of Version I], but                                                               
the language [in Version L] is substantially refined.                                                                           
                                                                                                                                
CHAIR ANDERSON read Section 57 in Version I and Version L.                                                                      
                                                                                                                                
5:56:17 PM                                                                                                                    
                                                                                                                                
MR. CATTANACH said that Section 57 in Version L would be fine.                                                                  
                                                                                                                                
REPRESENTATIVE  GUTTENBERG  asked  if   Section  56  pertains  to                                                               
insurance companies.                                                                                                            
                                                                                                                                
REPRESENTATIVE  LEDOUX  opined  that the  language  "any  entity"                                                           
would include insurance companies.                                                                                              
                                                                                                                                
REPRESENTATIVE GUTTENBERG  asked if  that would also  include the                                                               
insurance company's employees and representatives.                                                                              
                                                                                                                                
5:57:46 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE returned the committee's  attention to page 3 of the                                                               
summary  document,   which  highlights  four  sections   of  CSSB
130(FIN)am and Version I that  refer to limited liability company                                                               
members,  release   of  medical  records,   confidentiality,  and                                                               
banning  the division  from  assembling  or providing  individual                                                               
records  for  commercial purposes.    He  noted that  these  four                                                               
sections  are  practically identical.    However,  Section 34  of                                                               
Version  I referred  to  "individually identifiable"  information                                                               
about employees and employers that  are not public record subject                                                               
to disclosure  under the Public  Record Act.   The aforementioned                                                               
is an addition to CSSB 130(FIN)am.                                                                                              
                                                                                                                                
5:58:43 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE continued  with  page 4  of  the summary  document,                                                               
which addressed improving return-to-work  benefits.  He explained                                                               
that CSSB 130(FIN)am allowed reductions  in delays in determining                                                               
certain reemployment  benefits eligibility  and costs  by workers                                                               
and employers  to stipulate to  the injured  workers' eligibility                                                               
to that benefit.  He  related that the aforementioned was deleted                                                               
from Version I.                                                                                                                 
                                                                                                                                
MR. CATTANACH confirmed that  the aforementioned provision [isn't                                                               
included] in Version L.                                                                                                         
                                                                                                                                
5:59:56 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE explained that since  [Section 3 of CSSB 130(FIN)am]                                                               
was deleted  in Version I,  it also  deletes the portion  of that                                                               
provision  calling  for   simplified  standards  for  determining                                                               
entitlement to  evaluation.   He pointed out  that Section  15 of                                                               
CSSB 130(FIN)am was not included in Version I.                                                                                  
                                                                                                                                
CHAIR ANDERSON  noted that  [Section 15  of CSSB  130(FIN)am] was                                                               
not included in Version L either.                                                                                               
                                                                                                                                
MR.  CATTANACH agreed  that the  aforementioned section  isn't in                                                               
Version L, but added that he didn't know why it was eliminated.                                                                 
                                                                                                                                
6:01:30 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LYNN  inquired as  to the  problem if  an employer                                                               
and an employee both stipulate.                                                                                                 
                                                                                                                                
MR. CATTANACH  agreed, and  then added that  [Section 15  of CSSB
130(FIN)am] may have  been deleted because it was  a subject that                                                               
the ad hoc committee hadn't  considered.  However, he opined that                                                               
the aforementioned doesn't mean it's bad.                                                                                       
                                                                                                                                
6:02:21 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE  continued by highlighting  that Section 17  of CSSB
130(FIN)am and  Section 15 of  Version I are  the same.   He then                                                               
pointed  out that  Version  I does  not  include a  corresponding                                                               
provision to Section 13 of CSSB 130(FIN)am.                                                                                     
                                                                                                                                
6:03:12 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE moved on to  pages 5-6, which addresses the Workers'                                                               
Compensation  Appeals  Commission  that   was  included  in  CSSB
130(FIN)am.    Version I  doesn't  include  any of  the  sections                                                               
having to do with the  aforementioned commission.  In response to                                                               
Chair   Anderson,  Mr.   Lisankie  explained   that  under   CSSB
130(FIN)am   the  appeals   commission   would  be   established.                                                               
Therefore,  the  commission  was  substituted  for  the  Superior                                                               
Court.   Version L  has deleted the  appeals commission,  but the                                                               
ability to  appeal to the  Superior Court and the  Supreme Court,                                                               
if one so chooses, would remain.                                                                                                
                                                                                                                                
CHAIR  ANDERSON  mentioned  that the  governor's  representatives                                                               
have  stated  that  the  aforementioned  impedes  an  expeditious                                                               
process.                                                                                                                        
                                                                                                                                
6:04:59 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE  turned the committee's  attention to page 7  of the                                                               
summary document  and the heading, "MAINTAINING  MEDICAL BENEFITS                                                           
WHILE REDUCING  COSTS".  He  highlighted that Section 51  of CSSB
130(FIN)am  repealed  all the  provisions  in  Section 27  if  no                                                               
action was  taken by June  30, 2007.  There  is no Section  27 in                                                               
[Version  I] so  there  is  no need  for  Section  51.   However,                                                               
Section  32 of  CSSB 130(FIN)am  would cap  fees for  health care                                                               
providers  at  the current  levels  established  in the  Workers'                                                               
Compensation Board medical fee schedule dated 12/1/04.                                                                          
                                                                                                                                
6:06:11 PM                                                                                                                    
                                                                                                                                
CHAIR ANDERSON  inquired as to  how far  Section 32 of  Version L                                                               
would reach in regard to a physician's ability to charge.                                                                       
                                                                                                                                
6:06:40 PM                                                                                                                    
                                                                                                                                
TIM KELLY,  Lobbyist, Alaska  State Medical  Association, related                                                               
his understanding  that Section 32  would freeze medical  fees at                                                               
current rates.   He pointed out that a later  section repeals the                                                               
freeze in  June of  2007.  He  further related  his understanding                                                               
that Section 32  is a point of discussion that  can be worked out                                                               
depending upon other sections of SB 130.                                                                                        
                                                                                                                                
6:08:59 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LYNN  expressed concern with freezing  prices, and                                                               
therefore he inquired as to what  happens with the pent up demand                                                               
once  the freeze  is lifted.   He  stressed that  there are  many                                                               
factors that contribute to increased medical cost.                                                                              
                                                                                                                                
CHAIR ANDERSON  highlighted that  the next committee  of referral                                                               
for  SB  130 is  the  House  Judiciary  Standing Committee.    He                                                               
related his  belief that those  effected by this  legislation can                                                               
bring   forward  comments   in  the   House  Judiciary   Standing                                                               
Committee.                                                                                                                      
                                                                                                                                
REPRESENTATIVE  CRAWFORD also  expressed concern  with regard  to                                                               
freezing medical costs and the pent up demand.                                                                                  
                                                                                                                                
6:11:07 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE continued  with his  comparison  on page  7 of  the                                                               
summary document.   He pointed  out that CSSB 130(FIN)am  had the                                                               
commissioner  of   DLWD  appoint  a  medical   review  committee.                                                               
However,  Version I  specifies  that the  AWCB  will appoint  the                                                               
medical review committee and the  makeup of the AWCB, and Version                                                               
L  eliminates language  in current  statute  indicating that  the                                                               
AWCB can contract with organizations to assist it.                                                                              
                                                                                                                                
REPRESENTATIVE ROKEBERG questioned  whether the aforementioned is                                                               
like having the fox guard the henhouse.                                                                                         
                                                                                                                                
6:12:39 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE turned  attention to Section 71 of  Version I, which                                                               
changes the  date that the  report must  be given from  the first                                                               
week of the Twenty-Fifth Legislative Session to May 15, 2006.                                                                   
                                                                                                                                
CHAIR ANDERSON informed the committee  that the aforementioned is                                                               
now encompassed in Section 74 in Version L.                                                                                     
                                                                                                                                
MR. CATTANACH opined that [May 15, 2006] isn't soon enough.                                                                     
                                                                                                                                
6:13:56 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KOTT  commented that much  of this is going  to be                                                               
contingent on a couple of  amendments that address the task force                                                               
and  reporting.   Representative Kott  said that  he wouldn't  be                                                               
adverse to the reporting date being  earlier.  The main charge of                                                               
the medical  review panel  was to  establish guidelines  and then                                                               
report  those to  the task  force.   Therefore, there  would also                                                               
need  to be  amendments  to require  the  medical review  panel's                                                               
report to be submitted earlier, such as September 15 [2006].                                                                    
                                                                                                                                
6:15:25 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE, still referring to  page 7 of the summary document,                                                               
turned  to  Section 24  of  CSSB  130(FIN)am, which  proposed  to                                                               
incrementally restrict compensable  palliative care under certain                                                               
limitations.  However,  that section was not  included in Version                                                               
I.                                                                                                                              
                                                                                                                                
MR. CATTANACH noted that he concurred with the deletion.                                                                        
                                                                                                                                
MR.  LISANKIE continued  with  page 8  of  the summary  document.                                                               
Section 26 of  CSSB 130(FIN)am proposed that the  state adopt the                                                               
American College  of Occupational Environmental  Medicine (ACOEM)                                                               
treatment guidelines and to provide  that injuries not covered by                                                               
that would then  have other guidelines determined  and adopted by                                                               
the Workers' Compensation Board.   Version I doesn't include that                                                               
provision.                                                                                                                      
                                                                                                                                
6:16:49 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GUTTENBERG inquired as  to the guidelines that are                                                               
used in its place.                                                                                                              
                                                                                                                                
MR. CATTANACH explained  that the idea is to  have some treatment                                                               
guidelines.  However,  he informed the committee of  a Rand study                                                               
that found  that in California,  the only state that  has adopted                                                               
ACOEM  guidelines,  ACOEM guidelines  worked  for  just under  50                                                               
percent of  the workers' compensation  injuries.   Therefore, the                                                               
ad hoc  committee felt that  a full  set of guidelines  should be                                                               
defined, Mr. Cattanach related.                                                                                                 
                                                                                                                                
6:18:06 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  ROKEBERG asked  if the  50 percent  to which  the                                                               
Rand  study referred  was in  reference  to the  caseload or  the                                                               
diagnostics.                                                                                                                    
                                                                                                                                
MR. CATTANACH said that he could  provide the committee a copy of                                                               
the Rand  study.  He  noted that the  study reviewed a  number of                                                               
treatment guidelines and weighed them in terms of effectiveness.                                                                
                                                                                                                                
6:18:51 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE concluded  with  page 9  of  the summary  document,                                                               
which documents provisions that were  not in CSSB 130(FIN)am, but                                                               
were added to Version I.                                                                                                        
                                                                                                                                
6:19:32 PM                                                                                                                    
                                                                                                                                
MR. CATTANACH  pointed out that Section  6 of Version I  came out                                                               
of the  ad hoc  process and  was intended  to speed  the process.                                                               
Hearings on things that are  perfunctory and pro forma take time,                                                               
and therefore  it was agreed that  some of these could  be agreed                                                               
on beforehand and  the hearing officer could hear them.   He then                                                               
turned to  Section 24 of  Version I and  related that the  ad hoc                                                               
committee  was   concerned  with  regard  to   employers  without                                                               
insurance.   The desire  was to  speed the  process by  which the                                                               
[employer  without  insurance]  is  stopped and  made  to  obtain                                                               
insurance.   Therefore, Section  24 allows  the director  to make                                                               
the decision to move along the process.                                                                                         
                                                                                                                                
6:20:41 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KOTT  interjected that under both  cases one still                                                               
has  to  go  through  a  hearing.   Those  cases  that  are  more                                                               
administrative  are  brought to  the  attention  of the  director                                                               
before the board,  and therefore [Section 24] would  speed up the                                                               
process.                                                                                                                        
                                                                                                                                
6:21:35 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CRAWFORD informed  the  committee  that he  would                                                               
like to add [to Section 24  in Version L] the following language:                                                               
"An employer who  fails to properly classify an  employee for the                                                               
purposes  of  obtaining  workers' compensation  insurance  or  to                                                               
furnish to  the division".   He explained  that he wanted  to add                                                               
that  language because  those  who  are knowingly  misclassifying                                                               
employees in order to obtain  cheaper workers' compensation rates                                                               
are robbing the system.   Therefore, the director should have the                                                               
ability  to do  something about  that.   Such an  amendment would                                                               
save a lot of money.                                                                                                            
                                                                                                                                
6:23:21 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   CRAWFORD   moved   that  the   committee   adopt                                                               
Conceptual Amendment 2, which read:                                                                                             
                                                                                                                                
     Page 12, following line 5:                                                                                                 
          Insert a new bill section to read:                                                                                    
       "*Sec. 24. AS 23.30.075 is amended by adding a new                                                                     
     subsection to read:                                                                                                        
                    (c) An employer who fails to properly                                                                       
     classify  an  employee  for the  purpose  of  obtaining                                                                    
     workers' compensation insurance or  to furnish proof to                                                                    
     the  division of  the employer's  financial ability  to                                                                    
     pay  compensation directly  fails  to  comply with  the                                                                    
     requirements in (a) of this section."                                                                                      
                                                                                                                                
6:24:05 PM                                                                                                                    
                                                                                                                                
MR. CATTANACH  opined that workers' compensation  is very complex                                                               
and  an employer  may  unintentionally  misclassify an  employee.                                                               
The problem,  he further  opined, is with  intent.   However, Mr.                                                               
Cattanach said that  at this time he doesn't have  a problem with                                                               
Conceptual Amendment 2.                                                                                                         
                                                                                                                                
The committee took an at-ease from 6:25 p.m. to 6:27 p.m.                                                                       
                                                                                                                                
6:27:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CRAWFORD explained  that  Conceptual Amendment  2                                                               
allows  the director,  if he  so chooses,  the power  to use  the                                                               
provision suggested.  He opined that  it would only be used in an                                                               
egregious case.                                                                                                                 
                                                                                                                                
6:28:53 PM                                                                                                                    
                                                                                                                                
CHAIR ANDERSON objected for discussion purposes.                                                                                
                                                                                                                                
MR. CATTANACH  turned to Section  56 paragraph (3) of  Version L,                                                               
which  he  believes  covers   [what  Representative  Crawford  is                                                               
attempting to address].                                                                                                         
                                                                                                                                
REPRESENTATIVE  KOTT agreed  with Mr.  Cattanach, and  added that                                                               
Conceptual Amendment 2 isn't necessary.                                                                                         
                                                                                                                                
6:31:01 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CRAWFORD  highlighted  that  once  employees  are                                                               
misclassified, the employer  is only ever required  to makeup the                                                               
premiums when someone is hurt.   Therefore, he said he wanted the                                                               
director to  have the ability  to stop such practices.   Although                                                               
Representative Crawford characterized the  language in Section 56                                                               
paragraph (3) to  be great language, he emphasized  that thus far                                                               
it hasn't been enforced.                                                                                                        
                                                                                                                                
6:32:27 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GUTTENBERG suggested  that inserting language that                                                               
relates that  the employer has "frequently,  often, consistently"                                                               
misclassified employees  in order  to get at  flagrant violators.                                                               
Therefore,  Representative Guttenberg  moved  that the  committee                                                               
adopt  the following  amendment to  Conceptual Amendment  2, such                                                               
that subsection (c) would read:                                                                                                 
                                                                                                                                
     (c)  An  employer  who  flagrantly  fails  to  properly                                                                    
     classify  an  employee  for the  purpose  of  obtaining                                                                    
     workers' compensation insurance or  to furnish proof to                                                                    
     the  division of  the employer's  financial ability  to                                                                    
       pay compensation directly fails to comply with the                                                                       
     requirements in (a) of this section.                                                                                       
                                                                                                                                
There being  no objection, the amendment  to Conceptual Amendment                                                               
2 was adopted.                                                                                                                  
                                                                                                                                
6:33:07 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   LEDOUX  opined   that  the   difference  between                                                               
Sections 24 and  56 is that Section 56 allows  for civil remedies                                                               
while  Section  24 allows  for  the  director  to shut  down  the                                                               
employer who  is misclassifying employees.   Furthermore, Section                                                               
56 refers to "knowingly misclassifies employees".                                                                               
                                                                                                                                
6:34:06 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GUTTENBERG   opined  that  employers   have  been                                                               
consistently  misclassifying employees  and  have paid  decreased                                                               
[workers'  compensation]  rates,  which   results  in  an  uneven                                                               
playing field for contactors.                                                                                                   
                                                                                                                                
REPRESENTATIVE  CRAWFORD  moved  that   the  committee  adopt  an                                                               
amendment  to Conceptual  Amendment  2 such  that subsection  (c)                                                               
would delete  "flagrantly" and insert  "knowingly" in  its place.                                                               
There being  no objection, the amendment  to Conceptual Amendment                                                               
2 was adopted.                                                                                                                  
                                                                                                                                
CHAIR ANDERSON  maintained his objection to  Conceptual Amendment                                                               
2, as amended.                                                                                                                  
                                                                                                                                
REPRESENTATIVE  ROKEBERG related  his belief  that the  statutory                                                               
provisions  specify that  misclassification is  illegal, although                                                               
he indicated  that there  is an enforcement  issue.   However, he                                                               
pointed out that the legislation  calls for two investigators and                                                               
an attorney.                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CRAWFORD  related   his  understanding  that  the                                                               
language  in  Section  56  refers  to  fraud  related  to  unfair                                                               
billings rather than "shutting people down  on the job."  All the                                                               
proposed Conceptual  Amendment 2 would  do is allow  the director                                                               
the  ability to  shut  down  an employer  found  to be  knowingly                                                               
misclassifying employees.                                                                                                       
                                                                                                                                
6:36:14 PM                                                                                                                    
                                                                                                                                
MR. CATTANACH deferred to the committee's wishes.                                                                               
                                                                                                                                
A  roll  call vote  was  taken.   Representatives  Lynn,  LeDoux,                                                               
Guttenberg, and  Crawford voted in favor  of Conceptual Amendment                                                               
2,  as amended.    Representatives Rokeberg,  Kott, and  Anderson                                                               
voted  against  it.    Therefore,   Conceptual  Amendment  2,  as                                                               
amended, was adopted by a vote of 4-3.                                                                                          
                                                                                                                                
6:37:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  ROKEBERG directed  the  committee's attention  to                                                               
Section 23 of Version L,  which references [AS 23.30.075(a)].  He                                                               
opined  that   it  doesn't  accomplish  what   was  desired  with                                                               
Conceptual  Amendment 2,  [as amended],  and doesn't  provide any                                                               
sanction.                                                                                                                       
                                                                                                                                
CHAIR  ANDERSON  suggested  that   the  aforementioned  could  be                                                               
addressed  as  the  legislation  moves  to  the  House  Judiciary                                                               
Standing Committee.                                                                                                             
                                                                                                                                
MR. LISANKIE then continued with Section  31 in Version I, and it                                                               
was determined that it still remains in Version L.                                                                              
                                                                                                                                
6:39:04 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KOTT moved  that the  committee adopt  Conceptual                                                               
Amendment 3,  which would  delete Section  31 of  Version L.   He                                                               
explained that  the provision is convoluted,  and furthermore the                                                               
entity which will pay isn't defined.                                                                                            
                                                                                                                                
There being no objection, Conceptual Amendment 3 was adopted.                                                                   
                                                                                                                                
6:40:10 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE  moved  on  to  Section  41  of  Version  I,  which                                                               
establishes  penalties  for  late payment  for  compensation  due                                                               
without a board  order and specifies that it will  be paid to the                                                               
person who should've been paid in the first place.                                                                              
                                                                                                                                
MR. CATTANACH said that he didn't have any problem with that.                                                                   
                                                                                                                                
MR. LISANKIE explained that under Section  42 of Version I is the                                                               
parallel   provision  for   the  payment   of  compensation   for                                                               
compensation due under a board order.                                                                                           
                                                                                                                                
6:40:50 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE  moved  on  to  Section  49  of  Version  I,  which                                                               
indicates   that   an   employer  need   not   make   retroactive                                                               
compensation rate adjustments if  the annual recalculation of the                                                               
state  average  weekly  wage  that  DLWD is  required  to  do  by                                                               
December  of each  year is  instead  done between  January 1  and                                                               
April 1 of the following year.                                                                                                  
                                                                                                                                
6:41:13 PM                                                                                                                    
                                                                                                                                
MR.  CATTANACH  explained that  the  aforementioned  is an  issue                                                               
because,  for a  variety  of reasons,  the  recalculation of  the                                                               
state  average  weekly  wage  isn't  [provided  by  December  1].                                                               
However,  the employer  is still  required to  make the  payments                                                               
effective January 1.   Therefore, the employer  continues to make                                                               
the  payments  and when  the  state  issues  the new  wages,  the                                                               
employer has to  issue small checks.   The aforementioned results                                                               
in a  costly system to  the employers  through no fault  of their                                                               
own.   Section 49  allows for  the reality  of the  first quarter                                                               
such that  the employer  doesn't have to  makeup payments  if the                                                               
state takes that  long, but any time after the  first quarter the                                                               
employer will have to makeup the difference.                                                                                    
                                                                                                                                
6:42:21 PM                                                                                                                    
                                                                                                                                
MR. LISANKIE  turned attention  to Section  51, which  includes a                                                               
phase out of the second injury fund.                                                                                            
                                                                                                                                
CHAIR  ANDERSON  noted  that  it  seems  to  be  consistent  with                                                               
[Section 51] of Version L.                                                                                                      
                                                                                                                                
6:43:09 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CRAWFORD related  his preference  for the  second                                                               
injury fund, and therefore he preferred to delete Section 51.                                                                   
                                                                                                                                
6:43:48 PM                                                                                                                    
                                                                                                                                
MR.  CATTANACH explained  that the  ad hoc  committee recommended                                                               
phasing out  the second injury  fund because in order  to qualify                                                               
for the  second injury fund,  the employer has to  knowingly hire                                                               
someone who  was previously  injured.   If that  person reinjures                                                               
the original injury, the second  injury fund takes over after one                                                               
year  of payments.   However,  due to  federal law  an [employer]                                                               
can't  ask  [a  prospective  employee] whether  he/she  has  been                                                               
previously injured  because it's  viewed as  screening employees.                                                               
Therefore, very  few new cases  are going into the  second injury                                                               
fund.   Mr.  Cattanach emphasized  that although  the idea  for a                                                               
second  injury fund  is good,  what is  currently in  place isn't                                                               
working.   He noted that  he had spoken with  Representative Kott                                                               
about reviewing the entire issue of reemployment.                                                                               
                                                                                                                                
MR.  CATTANACH opined  that eliminating  the  second injury  fund                                                               
admits that it isn't working.                                                                                                   
                                                                                                                                
REPRESENTATIVE  CRAWFORD  agreed  to  continue to  work  on  that                                                               
issue.                                                                                                                          
                                                                                                                                
6:45:37 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GUTTENBERG  inquired as  to how  often [employees]                                                               
who have applied  for the second injury fund  have received funds                                                               
from it.   He related his  impression that it's difficult  to get                                                               
to the second injury fund.                                                                                                      
                                                                                                                                
MR.  LISANKIE  agreed with  that  impression.   He  informed  the                                                               
committee  that   currently  about  130  individuals   are  being                                                               
reimbursed from the  second injury fund.  However,  he noted that                                                               
those would be  over a significant number of  years because these                                                               
are usually the most serious cases.                                                                                             
                                                                                                                                
6:46:54 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE continued  his  review  of page  9  of the  summary                                                               
document.  He turned to Section  52 of Version I, which addresses                                                               
how  certain compensation  rates will  be calculated  for certain                                                               
groups  of workers.   He  specified  that the  groups of  workers                                                               
addressed are as  follows:  workers paid  by the hour/day/output;                                                               
workers in exclusively seasonal  or temporary employment; workers                                                               
who  are  minors,  apprentices,  and  trainees  in  a  formalized                                                               
training program.                                                                                                               
                                                                                                                                
MR. CATTANACH informed the committee  that [Section 52 of Version                                                               
I] is  a proposal  of the ad  hoc committee and  was part  of its                                                               
legislation, although it wasn't included in CSSB 130(FIN)am.                                                                    
                                                                                                                                
REPRESENTATIVE GUTTENBERG  requested that the model  of how those                                                               
compensation rates are calculated be provided at some point.                                                                    
                                                                                                                                
6:48:24 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROKEBERG,  turning attention  to the notes  on the                                                               
analysis for [Section  52], said that it appears  that the Alaska                                                               
Supreme  Court overturned  an earlier  1995 statutory  change and                                                               
recently  affirmed that.   Therefore,  he surmised  that [Section                                                               
52] is  a reaction to  the final  judgment by the  Alaska Supreme                                                               
Court.                                                                                                                          
                                                                                                                                
MR.  LISANKIE  explained   that  there  was  a   version  of  how                                                               
compensation rates  should be calculated  for state  workers, and                                                               
that was  overturned by the Alaska  Supreme Court.  In  1995, the                                                               
legislature adopted  what are essentially the  current provisions                                                               
in statute.   Those provisions were  taken from a model  act that                                                               
was published  a number of  years ago.  Subsequently,  the Alaska                                                               
Supreme Court said  that the legislature's adoption  of the model                                                               
act was  appropriate and correct.   Therefore, Mr.  Lisankie said                                                               
that  [Section 52]  is a  departure from  what the  Supreme Court                                                               
said is acceptable.                                                                                                             
                                                                                                                                
6:50:12 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE reminded  the  committee that  Sections  60 and  64                                                               
address requiring the division to  have the following:  two full-                                                               
time   investigators   investigating  fraud,   sufficient   staff                                                               
support, a  publicized toll  free report number,  as well  as not                                                               
less than one-half of an attorney position.                                                                                     
                                                                                                                                
MR. CATTANACH concurred [with Sections 60 and 64].                                                                              
                                                                                                                                
6:51:34 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KOTT moved  that the  committee adopt  Conceptual                                                               
Amendment 4, which read [original punctuation provided]:                                                                        
                                                                                                                                
     Page 34, Line 6;                                                                                                           
     Delete, "and insurance"                                                                                                    
                                                                                                                                
     Page 34, Lines 8-9;                                                                                                        
      Delete, "an analysis and assessment of proposals for                                                                      
    workers'   compensation   and   workers'   compensation                                                                     
     liability insurance reform in Alaska;                                                                                      
     (3)"                                                                                                                       
                                                                                                                                
     Page 34, Line 10;                                                                                                          
     Delete, "benefits and"                                                                                                     
     Insert, "medical"                                                                                                          
                                                                                                                                
     Page 34, Line 13;                                                                                                          
        Delete, "(4) a review of compliance with current                                                                        
     Alaska workers' compensation laws;"                                                                                        
        Insert, "(3) a review of the ACOM guidelines and                                                                        
     effect in other states;"                                                                                                   
                                                                                                                                
     Page 34, Line 14;                                                                                                          
     Delete, "(5)"                                                                                                              
     Insert, "(4)"                                                                                                              
                                                                                                                                
     Page 34, Line 16;                                                                                                          
        Insert, "(6) review of current Alaska, and other                                                                        
     states', vocational rehabilitation and return to work                                                                      
     programs."                                                                                                                 
                                                                                                                                
     Page 34, Line 16;                                                                                                          
     Delete, "(6)"                                                                                                              
     Insert, "(7)"                                                                                                              
                                                                                                                                
CHAIR ANDERSON objected for discussion purposes.                                                                                
                                                                                                                                
REPRESENTATIVE KOTT  explained that Conceptual Amendment  4 would                                                               
establish  some clear  guidelines with  regard to  what the  task                                                               
force is to review.                                                                                                             
                                                                                                                                
6:52:11 PM                                                                                                                    
                                                                                                                                
MR.  CATTANACH  said  that  the ad  hoc  committee  concurs  with                                                               
Conceptual Amendment 4, but suggested  that the inserted language                                                               
on  page  34,   line  13,  should  refer   to  medical  treatment                                                               
guidelines not just ACOM guidelines.                                                                                            
                                                                                                                                
REPRESENTATIVE KOTT said that was an oversight.                                                                                 
                                                                                                                                
6:52:56 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  ROKEBERG  offered   an  amendment  to  Conceptual                                                               
Amendment 4,  such that the  language being inserted on  page 34,                                                               
line 13, would say "a  review of medical guidelines including the                                                               
ACOM guidelines ...;"                                                                                                           
                                                                                                                                
There  being  no  objection,   the  aforementioned  amendment  to                                                               
Conceptual  Amendment  4  was  adopted.    Therefore,  Conceptual                                                               
Amendment 4, as amended, was before the committee.                                                                              
                                                                                                                                
CHAIR ANDERSON  removed his objection to  Conceptual Amendment 4,                                                               
as amended.                                                                                                                     
                                                                                                                                
There  being no  further  objection, Conceptual  Amendment 4,  as                                                               
amended, was adopted.                                                                                                           
                                                                                                                                
6:53:58 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KOTT moved  that the  committee adopt  Conceptual                                                               
Amendment 5, which read [original punctuation provided]:                                                                        
                                                                                                                                
     Page 35, Line 12;                                                                                                          
     Insert, "(4)  The Task  Force on  Workers' Compensation                                                                    
     shall  contract  with   a  consultant  specializing  in                                                                    
     workers'  compensation   issues  for  the   purpose  of                                                                    
     researching  information and  conducting a  comparative                                                                    
     analysis from other states on  topics listed in section                                                                    
     (a).  Such  information shall be presented  to the Task                                                                    
     Force on or before September 1, 2005.                                                                                      
                                                                                                                                
     Renumber subsections accordingly                                                                                           
                                                                                                                                
REPRESENTATIVE KOTT  explained that the consultant  would analyze                                                               
the statement  of work specified  on [page  34 of Version  L] and                                                               
thus  the  task  force  would  have  the  information  available.                                                               
Therefore, the process could be sped  up such that the task force                                                               
would be  able to report  back to the  legislature by the  end of                                                               
December.  He suggested that much information will be submitted.                                                                
                                                                                                                                
There being no objection, Conceptual Amendment 5 was adopted.                                                                   
                                                                                                                                
REPRESENTATIVE  KOTT moved  that the  committee adopt  Conceptual                                                               
Amendment 6, which read as follows:                                                                                             
                                                                                                                                
     Page 36, line 31:                                                                                                          
     Delete "May 15, 2006"                                                                                                      
     Insert "September 30, 2005"                                                                                                
                                                                                                                                
REPRESENTATIVE  KOTT   explained  that   with  the   adoption  of                                                               
Conceptual  Amendment   6  the  information  from   [the  medical                                                               
services  review committee]  would  be provided  around the  same                                                               
time  the  consultant  would  be   expected  to  provide  his/her                                                               
information.                                                                                                                    
                                                                                                                                
There being no objection, Conceptual Amendment 6 was adopted.                                                                   
                                                                                                                                
CHAIR ANDERSON closed public testimony.                                                                                         
                                                                                                                                
6:57:21 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  ROKEBERG reiterated  his concern  with regard  to                                                               
the composition  of the task  force and  the date of  its report,                                                               
which is  December 1, 2006.   Therefore, he offered to  work with                                                               
the drafter and  the House Judiciary Standing  Committee on those                                                               
matters.   He opined  that it's inappropriate  to wait  until the                                                               
session is over to make a report to the legislature.                                                                            
                                                                                                                                
6:58:14 PM                                                                                                                    
                                                                                                                                
MR. CATTANACH  suggested that  due to  the change  encompassed in                                                               
Conceptual  Amendment 6,  the same  date needs  to be  changed on                                                               
page 37, lines 4-5, in order to be consistent.                                                                                  
                                                                                                                                
REPRESENTATIVE  KOTT moved  that the  committee adopt  Conceptual                                                               
Amendment 7, which read as follows:                                                                                             
                                                                                                                                
     Page 37, lines 4-5:                                                                                                        
     Delete "May 15, 2006"                                                                                                      
     Insert "September 30, 2005"                                                                                                
                                                                                                                                
REPRESENTATIVE  LEDOUX objected  for  discussion  purposes.   She                                                               
pointed out  that the date on  page 37, lines 4-5,  refers to the                                                               
medical services  review committee that  has to provide  a report                                                               
to the task force.                                                                                                              
                                                                                                                                
6:59:53 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KOTT withdrew Conceptual Amendment 7.                                                                            
                                                                                                                                
7:00:21 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KOTT  turned to Representative  Rokeberg's concern                                                               
and offered New Conceptual Amendment 7, as follows:                                                                             
                                                                                                                                
     Page 35, line 14:                                                                                                          
     Delete "December 1"                                                                                                        
     Insert "prior to the first day of the convening of the                                                                     
     Twenty-Fifth Legislature"                                                                                                  
                                                                                                                                
REPRESENTATIVE KOTT explained that the  task force would have its                                                               
work completed by  the end of [2005] and then  submit a report to                                                               
the legislature.                                                                                                                
                                                                                                                                
There  being  no  objection,  New   Conceptual  Amendment  7  was                                                               
adopted.                                                                                                                        
                                                                                                                                
7:02:06 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KOTT moved  that the  committee adopt  Conceptual                                                               
Amendment 8, as follows:                                                                                                        
                                                                                                                                
     Page 35, line 15                                                                                                           
     Delete "2007"                                                                                                              
     Insert "2006"                                                                                                              
                                                                                                                                
REPRESENTATIVE  CRAWFORD objected  for discussion  purposes.   He                                                               
questioned  whether any  legislation [addressing  this] would  be                                                               
prepared  in that  first month  of the  Twenty-Fifth Legislature.                                                               
Therefore, he suggested maintaining the  task force until the end                                                               
of the legislature.                                                                                                             
                                                                                                                                
REPRESENTATIVE  KOTT opined  that the  report would  be available                                                               
before  the legislature  convenes, and  therefore the  task force                                                               
members could be  available for questions in that  first month of                                                               
session.                                                                                                                        
                                                                                                                                
REPRESENTATIVE CRAWFORD withdrew his objection.                                                                                 
                                                                                                                                
There  being no  further  objection, Conceptual  Amendment 8  was                                                               
adopted.                                                                                                                        
                                                                                                                                
[There  was discussion  regarding whether  the date  on the  next                                                               
page, page  37, was  changed.  The  discussion indicated  that it                                                               
was changed, although the motion to do so was withdrawn.]                                                                       
                                                                                                                                
7:05:06 PM                                                                                                                    
                                                                                                                                
MR. CATTANACH pointed out that  [Version L] seems to have dropped                                                               
a  provision addressing  [AS 23.30.041(c)]  that was  included in                                                               
[Version I  and CSSB 130(FIN)am].   The  aforementioned provision                                                               
allows an employer and an  employee to stipulate to an employee's                                                               
eligibility for reemployment benefit.   The aforementioned speeds                                                               
up the  qualification time of  an injured worker by  allowing the                                                               
employer to  say that there is  no question that the  worker will                                                               
qualify and start the process.                                                                                                  
                                                                                                                                
7:06:30 PM                                                                                                                    
                                                                                                                                
MR.  LISANKIE  clarified  that  the  aforementioned  statute  was                                                               
interpreted to  not be in statute  and thus was included  in CSSB
130(FIN)am, but not maintained in Version L.                                                                                    
                                                                                                                                
REPRESENTATIVE KOTT  pointed out that  it was Section 13  of CSSB
130(FIN)am.                                                                                                                     
                                                                                                                                
The committee took a brief at-ease from 7:07 p.m. to 7:08 p.m.                                                                  
                                                                                                                                
7:08:58 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROKEBERG [moved that the committee adopt]                                                                        
Conceptual Amendment 9, as follows:                                                                                             
                                                                                                                                
Page 7, after line 30:                                                                                                          
Insert the following new section;                                                                                               
                                                                                                                                
     "* Sec. 13.  AS  23.30.041(c) is repealed and reenacted                                                                  
     to read:                                                                                                                   
      (c)  An employee and  an employer may stipulate to the                                                                    
     employee's  eligibility  for reemployment  benefits  at                                                                    
     any time.  If an  employee suffers a compensable injury                                                                    
     and,  as  a  result  of the  injury,  the  employee  is                                                                    
     totally unable,  for 45 consecutive days,  to return to                                                                    
     the employee's  employment at the  time of  injury, the                                                                    
     administrator   shall  notify   the  employee   of  the                                                                    
     employee's  rights under  this section  within 14  days                                                                    
     after the 45th day.   If the employee is totally unable                                                                    
     to  return   to  the   employee's  employment   for  60                                                                    
     consecutive  days  as  a  result  of  the  injury,  the                                                                    
     employee  or   employer  may  request   an  eligibility                                                                    
     evaluation.    The  administrator   may    approve  the                                                                    
     request  if  the   employee's  injury  may  permanently                                                                    
     preclude  the  employee's   return  to  the  employee's                                                                    
     occupation at the time of  the injury.  If the employee                                                                    
     is  totally   unable  to   return  to   the  employee's                                                                    
     employment   at  the   time  of   the  injury   for  90                                                                    
     consecutive  days  as  a  result  of  the  injury,  the                                                                    
     administrator  shall,    without a  request,  order  an                                                                    
     eligibility  evaluation   unless  a  stipulation     of                                                                    
     eligibility  was  submitted.     If  the  administrator                                                                    
     approves   a   request   or  orders an  evaluation, the                                                                    
     administrator  shall,  on  a  rotating  and  geographic                                                                    
     basis,  select  a  rehabilitation specialist  from  the                                                                    
     list  maintained  under  (b)(6)   of  this  section  to                                                                    
     perform  the eligibility  evaluation.    If the  person                                                                    
     that  employs a  rehabilitation specialist  selected by                                                                    
     the administrator to  perform an eligibility evaluation                                                                    
     under this  subsection is performing any  other work on                                                                    
     the  same  workers'  compensation claim  involving  the                                                                    
     injured  employee,  the  administrator shall  select  a                                                                    
     different rehabilitation specialist."                                                                                      
                                                                                                                                
 There being no objection, Conceptual Amendment 9 was adopted.                                                                  
                                                                                                                                
7:11:57 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CRAWFORD remarked that  he has lots of trepidation                                                               
about forwarding  this legislation, although he  characterized it                                                               
as a  much better bill.   He  noted his appreciation  to everyone                                                               
who has worked  on this and expressed his hope  that the ultimate                                                               
legislation looks like Version L.                                                                                               
                                                                                                                                
7:13:13 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CRAWFORD moved  to report  HCS CSSB  130, Version                                                               
24-GS1112\L, Bullock,  5/4/05, as amended, out  of committee with                                                               
individual  recommendations, the  accompanying fiscal  notes, and                                                               
[HCR 19]  allowing the title  change.  There being  no objection,                                                               
HCS CSSB 130(L&C) was reported  from the House Labor and Commerce                                                               
Standing Committee.                                                                                                             
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Labor and  Commerce Standing Committee  meeting was  adjourned at                                                               
7:14:30 PM.                                                                                                                   

Document Name Date/Time Subjects