Legislature(2003 - 2004)
02/23/2004 10:02 AM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
February 23, 2004
10:02 AM
TAPES
SFC-04 # 18, Side A
SFC 04 # 18, Side B
CALL TO ORDER
Co-Chair Gary Wilken convened the meeting at approximately 10:02
AM.
PRESENT
Senator Lyda Green, Co-Chair
Senator Gary Wilken, Co-Chair
Senator Con Bunde, Vice Chair
Senator Ben Stevens
Also Attending: JANE ALBERTS, Staff to Senator Con Bunde and Aide,
Senate Labor & Commerce Committee; JACQEULING TUPOU, Staff to
Senator Lyda Green; JON SHERWOOD, Department of Health and Social
Services; DAVE STANCLIFF, Staff to Senator Gene Therriault and
Aide, Administrative Regulation Review Committee; ANDY HEMENWAY,
Hearing Officer, Procurement & Longevity Bonus, Department of
Administration
Attending via Teleconference: From Anchorage: JOHANNA BALES,
Program Manager, Cigarette and Tobacco Products Excise Tax,
Department of Revenue; From Ketchikan: MIKE ELERDING, President,
Northern Sales Company Alaska, Inc.; From an Offnet Site: DAN
HOUGHTON, Representative, Alaska Regional Hospital
SUMMARY INFORMATION
SB 291-UNSTAMPED CIGARETTES
The Committee heard from the sponsor, the Department of Revenue and
the industry. The bill was reported from Committee.
SB 285-MEDICAL ASSISTANCE COVERAGE
The Committee heard from the sponsor and the Department of Health
and Social Services. The bill reported from Committee.
SB 203-OFFICE OF ADMINISTRATIVE HEARINGS
The Committee heard testimony from the sponsor, Department of
Administration, and took public industry. The bill was held in
Committee.
SENATE BILL NO. 291
"An Act extending the transition period for activities
involving unstamped cigarettes; and providing for an effective
date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated that the Senate Labor & Commerce Committee
is the sponsor of this legislation which would extend the
transition period for the sale of unstamped cigarettes that were in
the State prior to January 1, 2004, from March 31, 2004 to June 30,
2004. He noted that this extension would provide dealers and
distributors an additional 90 days to dispose of unstamped
cigarettes.
JANE ALBERTS, Staff to Senator Con Bunde and Aide, Senate Labor &
Commerce (L&C) Committee, explained that this bill is the result of
an "unforeseen and unexpected" situation relating to the adoption
of SB 168-CIGARETTE SALE/DISTRIBUTION during the 2003 Legislative
session that required cigarettes for sale in the State to display a
tax stamp which "would indicate that a tax had indeed been paid on
the product." She reminded that SB 168 specified the date of March
31, 2004 as the deadline by which dealers and distributors must
have disposed of any unstamped inventory purchased prior to January
1, 2004. She noted that, at the time SB 168 was adopted, this
timeframe, based on the recent enactment of similar legislation in
Hawaii, had been considered ample time for disposal. However, she
continued, the tobacco companies' "once liberal" and long-standing
supplier returned goods policy was changed in the fall of 2003 to a
more restrictive policy that "makes it almost impossible for the
dealers and distributors to return their cigarettes for full
credit." She noted that, had the tobacco companies' policy not
changed, the Department of Revenue could have issued credits for
previously taxed cigarettes and the retailers and wholesalers could
have repurchased cigarettes bearing the tax stamp. Therefore, she
stated, this legislation was developed to allow for the depletion
of the previously purchased inventory. In addition, she shared that
the tobacco industry has been unresponsive to the Department of
Revenue's request that their prior return policy be reinstated.
Ms. Alberts reminded that SB 168 also prohibits cigarettes from
being "loss leader," or reduced price, items. This restriction, she
stated, prevents dealers and distributors from being able to sell
their unstamped inventory more quickly. Therefore, she noted, were
this legislation not adopted, the unsold inventory would be
considered, as of March 31, 2004, as contraband and would be
subject to State seizure. She stated that this legislation is being
presented, at the recommendation of the Department of Revenue, in
order to extend the deadline to June 30, 2004 in order to provide
dealers and distributors time to sell their unstamped cigarette
inventory. She pointed out that the Members' packets contain
numerous letters in support of the legislation.
JOHANNA BALES, Program Manager, Cigarette and Tobacco Products
Excise Tax, Department of Revenue, testified via teleconference
from Anchorage and expressed that the Department has received in
excess of 50 communications from distributors and retailers voicing
concern regarding this situation. She relayed that as a result of
the Department's efforts to discuss the situation with tobacco
manufacturers, relief might be forthcoming to assist distributors
with the tax stamp situation. However, she noted, no remedy to
address the retailers' situation has been determined. She stated
that the Department supports this legislation.
MIKE ELERDING, President, Northern Sales Company Alaska, Inc.,
testified via teleconference from Ketchikan to voice that the
tobacco industry unanimously supports this legislation. He also
noted that he has submitted written testimony, dated February 23,
2004, [copy on file] in support of this bill.
Co-Chair Green moved to report the bill from Committee with
individual recommendations and accompanying fiscal note.
Senator Bunde stated that people like Mr. Elerding had assisted in
the original tax stamp legislation, and he assured that there was
no intent to have people like him "financially inconvenienced by
the process." Continuing, he requested that the passage of this
bill be expedited.
Co-Chair Wilken concurred and noted that the current situation was
"unintended" and were the result of "the rules" being changed.
There being no objection, SB 291 was REPORTED from Committee with
zero fiscal note #1, dated February 9, 2004, from the Department of
Revenue.
SENATE BILL NO. 285
"An Act relating to medical assistance coverage for targeted
case management services and for rehabilitative services
furnished or paid for by a school district on behalf of
certain children; and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken explained that this legislation would expand the
definition of the Department of Health and Social Services'
Targeted Case Management services as they relate to Medicaid
payments. He noted that the proposed changes could result in a
general funds savings of $270,000.
JACQUELINE TUPOU, Staff to Senator Lyda Green, the bill's sponsor,
specified that this bill would address two things: first, it would
expand the Department's authority to expand Targeted Case
Management Services beyond the currently specified three targeted
groups; and second, it would align the State's definition of
school-based rehabilitative services with the federal definition.
These changes, she continued would allow the State to be reimbursed
for expenditures associated with those services.
Co-Chair Green reminded the Committee that separate legislation has
been adopted that allowed school districts to be registered
Medicaid vendors. Continuing, she stated that in the process of
implementing that legislation, the Department of Health and Social
Services was informed by the federal program that one of its
definitions "was weak." This legislation, she continued, would
strengthen that [unspecified] definition so that, in the future, "a
great deal of income" could be provided to school districts that
choose to participate.
Co-Chair Wilken stated that this legislation could generate
millions of dollars.
Senator Bunde noted that a zero fiscal note accompanies this
legislation because the savings were calculated with the previously
adopted legislation. He declared that the program could result in
the receipt of several hundred million dollars.
Co-Chair Wilken recalled that the amount would be approximately
$4.5 million. He asked for confirmation that the federal money in
question would remain in the school districts' budgets rather than
being provided to the State.
Co-Chair Green stated that the funds would result in a net increase
to school districts' budgets. She specified that while the
Department of Health and Social Services and the Department of
Education and Early Development would assist school districts in
the process, this legislation would strengthen the targeted case
management definition so that districts' could receive the federal
cooperation.
JON SHERWOOD, Department of Health and Social Services, concurred
that the school-based services legislation would result in
approximately $4.5 million in new federal funding once the program
is fully operational. This legislation, he continued, would resolve
the problem with the Statute definition involving Targeted Case
Management to include additional targeted groups, which he
attested, would include groups already being served.
Co-Chair Wilken asked when the corresponding State regulations
would be completed as, he pointed out, that is required before the
school districts could move forward.
Mr. Sherwood understood that the regulations should be available by
the start of the upcoming school year. However, he clarified that
not all school districts would be ready at that time as development
of program support such as billing systems, could take some
districts additional time. He also noted that federal approval of
the State plan is also required.
Co-Chair Wilken asked for examples of Targeted Case Management.
Mr. Sherwood exampled that, in addition to the school based
services, other qualifying services include: families receiving
Family and Preservation Services through the Office of Children's
Services; some of the work conducted by public health nurses;
people in the Infant Learning Program; and some of the people in
Juvenile Justice who are in community placement as opposed to being
housed in a State facility which would make them ineligible for
Medicaid.
Co-Chair Green moved to report SB 285 from Committee with
individual recommendations and accompanying fiscal notes.
There being no objection, SB 285 was REPORTED from Committee with
zero fiscal notes #1 and #2, dated January 28, 2004, from the
Department of Health and Social Services.
CS FOR SENATE BILL NO. 203(JUD)
"An Act relating to administrative hearings, to hearing
officers, and to administrative law judges; establishing the
office of administrative hearings and relating to that office;
and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated that this bill, which is sponsored by the
Senate Rules Committee by Request, would create an independent
office of hearing officers, directed by a chief administrative law
judge, within the Department of Administration. Therefore, he
continued, the administrative hearing officer would be removed from
the affected State agency that writes, promulgates, and enforces
regulations. He noted that 25 other states have created similar
offices.
DAVE STANCLIFF, Staff to Senator Gene Therriault and Aide,
Administrative Regulation Review Committee, opined that "it is
infrequent" that issues are presented that are good for
constituents, good for the Government, good for the Legislature,
and good for judicial practice. He stated that this bill is
"considered a good government bill and has garnered bipartisan
support throughout the country and so far here in the Alaska State
Legislature." He noted that, to date, there has been no opposition
to the measure. He declared that the premise of the bill is that
"the people who challenge the laws and rules of government deserve
to have fair, impartial, and efficient and professionally conducted
hearings when they do make those challenges." He shared that these
challenges could originate from major corporations or from
individuals.
Mr. Stancliff pointed out that the idea "is to rebalance the powers
of our three branches of government" as presently, he noted, the
Administrative Branch "has legislative ability in its power to
write rules that become law." Furthermore, he attested, it has in
its power, an ability "that is normally reserved for the Judicial
Branch of government in that it has a form of captive judges within
the State administration" who are called hearing officers. He
specified that currently the State's hearing officer functions are
scattered throughout the State and are comprised of people who have
a variety of backgrounds, some with legal training and some with
none. In addition, he noted that some hearing officers work full
time, some part time, and that a variety of pay ranges are offered,
But, he explained, what makes this system "worthy of reform" is the
fact that "they work for the agency that signs their paycheck;
gather at the water cooler; and play golf on the weekends." He
stated that, "it has been discovered throughout the country" that
it is disconcerting to those challenging "a regulation or a rule of
law and discover that the person who is going to sit in judgment of
their appeal actually works for the agency they are challenging."
Mr. Stancliff stated that, in addition to being supported by Senate
President, Senator Gene Therriault, this legislation is supported
by Governor Frank Murkowski and Mike Miller, the Commissioner of
the Department of Administration. Continuing, he asserted that in
order "to work for Alaska," this legislation must minimize
disruptions as the change occurs.
Mr. Stancliff specified that the major change resulting from the
legislation would be the creation of a central model, independent
hearing office, in which the hearing officers would be re-titled
Administrative Law Judges. The Administrative Law Judges would
report, he continued, to a Chief Administrative Law Judge (Chief
ALJ) who would establish standards of conduct, similar to the
State's judicial system code of conduct. He stated that the Chief
ALJ's standard of conduct would have as its "primary goals," good
due process, high levels of adjudication, and an efficient system.
Mr. Stancliff specified "that once the upfront transition costs are
in place" and the model becomes operational, government agencies
could avail themselves to it. Furthermore, he commented that rather
than hearing officers working part time, the system would have full
time hearing officers, and instead of having hearing officers
specializing in one field, the hearing officers would be cross-
trained. These changes, he opined, would allow the hearing office
to become a very efficient unit of State government. He stated that
the fiscal savings would be better defined once the fiscal notes
are developed.
Mr. Stancliff stated that one of the "residual" effects of this
reform would be "that when you have high levels of adjudication,"
the people who conceive, write and enforce the regulations "start
doing their job differently because they no longer have in-house
hearing officers inclined to protect what they write and what they
enforce." He stated therefore, that businesses that have been tied
up in the regulatory process for up to ten years or more could
actually get through the administrative process quicker, get a
resolution, "and decide whether they want to take their case to
court or not." Additionally, he stated that the entire system, both
inside and outside the model, would start "to behave differently,"
because a new level of expertise would be required.
Mr. Stancliff explained that the new process would create a new
model that would absorb the hearing officers currently existing
within agencies, would serve to curb expense, would keep the model
flexible so that it could continue to work with other
Administrative Procedure Act (APA) hearing functions in the State;
and, "and most importantly," would provide the Chief ALJ with the
ability to have Statewide oversight whenever there is a complaint
filed or a problem arises outside the model. He informed that the
Chief ALJ would report to the Legislature on an annual basis and
discuss issues that must be addressed. Furthermore, he noted that
the Legislature would be able to include individuals in the hearing
process if so desired.
Mr. Stancliff pointed out that some states have established models
that "have "worked well to an extent, but has been problematic" in
that the rulings are not allowed to be challenged. The model
proposed in this legislation, he continued, would allow State
commissioners to overturn a decision based upon sound rather than
"arbitrary reasons." He expanded that the Commissioner would be
required to review the record and evidence "and put the reasons for
overturning the ruling into writing."
Mr. Stancliff declared that constituents have found the current
administrative hearing model "very difficult to exhaust" in that
"it is almost impossible to get beyond the administrative system in
the State of Alaska if the administrative system does not wish you
to get beyond it." He contended therefore that, "it is very
difficult to get your case before the courts." Continuing, he noted
that "what is even more damaging to small entrepreneurs and
business people is that the first time they confer with an attorney
or anyone who is familiar with the State system, the advise is that
"unless you have about five years of time and a lot of money to
invest," you may want to consider whether to challenge the ruling
or regulation. He stated that this situation, combined with the
desire to rebalance power, has been the driving force for this
legislation. He stated "that a bundle of horror stories" could have
been presented relating to previous administrative actions.
Mr. Stancliff contended that the model being presented in this bill
is a model that is being reviewed by numerous other states, as it
is a hybrid of many models. He requested that further changes to
this legislation be made either in the form of amendments or a new
committee substitute. He noted that some of the accompanying fiscal
notes "aren't exactly correct yet," as some of the departments have
developed fiscal notes based on incorrect "assumptions" about what
this legislation would or would not do. Therefore, he requested
that the fiscal notes be reviewed during future hearings on the
bill.
Co-Chair Wilken asked for a review of the changes made in the
Judiciary Committee's version of the bill.
Mr. Stancliff explained that the Department of Law had requested
each department affected by this legislation to determine how this
bill would affect current procedures and to identify any area that
might be problematic. One issue that was raised, he noted, involved
jurisdictional conflicts between those hearings operating under APA
law and those operating separate from the APA requirement.
Therefore, he continued, "the Judiciary Committee addressed those
mechanical changes that would make this new model and the authority
within it more user friendly for this Administration to put into
affect." Other concerns addressed in the Judiciary Committee
version of the bill, he continued, was how to provide the Chief ALJ
with the ability to allow an agency who needs a high level of
expertise "to come in and sit at the hearings," as well as how "to
allow agencies who are not swept into the model" to use the model
if they so choose. He pointed out that a component that is
garnering support on the national level is the fact that the State
has allowed its commissioners to voice their support of using the
Central model, and he continued, the commissioners voiced support
for allowing the Central model ruling be final rather than
requiring the commissioners to weigh in on the decision.
Furthermore, he noted, even though the Central Model's Chief ALJ
might have jurisdiction over an agency, a well-functioning,
existing hearing office could be allowed, after review, to continue
what its been doing.
Co-Chair Wilken agreed with Mr. Stancliff's comments that the
fiscal notes should be further reviewed as the fiscal notes "do not
jive" with the legislation's intent of being a consolidating bill.
Co-Chair Wilken inquired as to whether the average cost of
conducting a hearing is $10,000 or $100,000.
Mr. Stancliff responded that one of the determining factors would
be the length of time that the Administration "holds on to the
issue before it." He informed the Committee that neither the
hearing expenses nor the affect of the hearings on the public
sector are tracked. He stated that not only is the State unable to
ascertain how many contract hearing officers are being used, it is
also unable to ascertain the length of time required for them to
conduct their business. He stated that this information is being
sought, and if it were determined to be an accurate reflection, the
information would be supplied to the Committee. He pointed out that
one thing that could save the State money is that the Legislature
would be provided an annual review of the model, which could
include a public survey. He noted that because the Central Model is
funded separately from other agencies, the Legislature would be
able to get a good idea of what is being provided by the funding.
Mr. Stancliff shared knowledge of a situation in which the existing
model addressed a case for more than five years and, as a result,
caused the affected business to go bankrupt. In other cases, he
shared, delays regarding actions in which the State was found
liable for millions of dollars have not only tied up State employee
time, but are accruing liabilities which the State would eventually
be required to pay, perhaps with interest. He stressed that it is
not in the best interest of the State "to stall" through the
administrative process. In summary, he stated that he would attempt
to develop costs and time scenarios.
Senator Bunde asked whether there are any State divisions that
would be exempt from this bill.
Mr. Stancliff responded yes. He shared that the original
jurisdiction list was quite extensive and was projected to incur
more expensive startup costs than could be supported. Therefore, he
continued, the list has been pared down on three separate
occasions. He explained that as currently proposed, approximately
15 percent of hearing officers would be included in the new model.
However, he stated, all hearing officers would "be affected by the
general reforms that occur in the bill."
Senator Bunde inquired as to which of the plans in the "Independent
Administrative Hearings Through a Central Panel, Informal
Legislative Brief" provided by Senator Therriault, [copy on file]
has been chosen for this legislation's Central Panel model.
Mr. Stancliff responded that the plan that is being proposed would
involve "the building of a small model, put into it the
jurisdictions that you could afford to put in, give the model the
ability to render a decision that's final if the Commissioner does
not act within 30 days, and if it is going to be overturned,"
mandate that it be based on good reasons. Continuing, he noted that
the Chief ALJ must be provided the ability to come "to the
Legislature and the Administration and the attorney general and say
here's what's broken, here's what needs to be fixed, here's how the
APA needs to be amended to resolve some of the problems that are
occurring with hearing officers." So, he concluded, that the plan
being proposed is a "hybrid" consisting of many plans, without the
final authority, and encompassing in a select number of people as
authorized by the Administration.
Senator Bunde understood, therefore, that a hybrid of the various
plans is being presented rather than a single plan being
considered.
Mr. Stancliff concurred.
Senator B. Stevens understood that while the bill would affect all
State agencies, not all of them would be under the jurisdiction of
the new Central Panel hearing procedure. However, he questioned
whether the bill's language in Section 3, Subsection Sec.
44.21.550. Code of hearing officer conduct. located on page eight,
lines 6-10 indicates otherwise as it appears to state that "the
Chief Administrative Law Judge has maximum control over all other
hearing officers, even though they are not under the jurisdiction
of the agency." This language reads as follows.
…The code shall apply to the chief administrative law judge,
administrative law judges of the office, and hearing officers
of each other agency.
Mr. Stancliff stated that, "this has been the most difficult point
to resolve." He pondered how much authority should be given to the
Chief ALJ as were that person "given too much, the agencies get
very nervous." He noted that language to the affect of "to the
maximum extent possible, without conflicting with applicable
statutes" has been included in the bill to raise the comfort level
of agencies and to "sufficiently" assure the agencies that were
they doing their jobs well, that they could continue to do them
without the Chief ALJ saying "hey, its my domain, I'm taking over
now, step aside."
Senator B. Stevens reiterated that the question is whether the
Chief ALJ would have jurisdiction over agencies that are not listed
in Section 3 of the bill.
Mr. Stancliff stated that the language "does say that."
Senator B. Stevens asked the reason for this language being
included.
ANDY HEMENWAY, Hearing Officer, Procurement & Longevity Bonus,
Department of Administration, noted that Mr. Stancliff might have
misspoken in regards to this issue. He qualified that "the hearings
that are mandatorially within the jurisdiction of the Central
Panel, the Chief Administrative Law Judge would be able to issue
regulations governing the conduct of those hearings." Continuing,
he stated that this section would not apply to "other agencies that
are not within the mandatory jurisdictions."
Senator B. Stevens clarified therefore, that this section would not
apply to those not within the mandatory jurisdictions.
Mr. Hemenway concurred.
Mr. Hemenway noted that the applicable language in the bill is
located in Sec. 3, subsection Sec. 44.21.560, on page seven, line
31 through page eight, line 2 that reads as follows.
Sec. 44.21.560. Procedure for hearings. (a) The chief
administrative law judge shall, by regulation, establish
procedures for administrative hearings conducted by the
office…
Mr. Stancliff apologized as he had misunderstood the question.
Mr. Hemenway continued that the specific answer to the question is
included in the aforementioned Section 44.21.560 as follows.
…However, to the extent regulations adopted by an agency for
the conduct of an administrative hearing conflict with
regulations adopted by the chief administrative law judge
under this subsection, the regulation adopted by the chief
administrative law judge control to the maximum extend
possible without conflicting with applicable statures.
In other words, Mr. Hemenway continued, the Chief ALJ's regulations
would supercede regulations of the hearings within the jurisdiction
of the agencies that the Chief ALJ might adopt to govern.
Continuing, he clarified that the Chief ALJ's regulations would not
affect any agency's on-going proceedings or hearing functions that
are not included in the Central Panel. However, he noted that an
agency that is not included in the Central Panel could voluntarily
elect to send a case to the Central Panel, and that, as part of
their request, the agency or the Chief ALJ could specify that for
cases being referred, that agency's regulations would be used.
Mr. Stancliff added that the Chief ALJ would be able "to receive
input from people outside the process who might be having problems
with people outside the process and make recommendations to the
Administration and to the Legislature as to how to resolve those
problems." He asserted that the Chief ALJ would be "empowered with
a great deal of authority" within the Central Panel model.
Furthermore, he continued, the Central Panel's model' would create
a new atmosphere of how hearings are conducted and held outside of
the model. He stated that this point of balance proved the most
difficult to resolve within the Administration.
Senator B. Stevens asked for confirmation that the Chief ALJ's
procedures would supercede administrative hearing regulations that
an agency might currently have in place.
Mr. Stancliff responded that this would be true for those agencies
that are included in the model. He reiterated that those agencies
not jurisdictionally included in the model would not be subject to
the Chief ALJ's new procedures and regulations. He stated that this
was the compromise.
Senator B. Stevens understood therefore that the agencies not
specifically included in the Central Panel would not be subject to
the Chief ALJ's regulations and procedures.
Mr. Hemenway stated that the list of agencies included in Sec. 3,
subsection Sec. 44.21.530. Jurisdiction of the office, located on
page four and five of the bill, would be subject to the
jurisdiction of the Central Panel and the regulations and
procedures as determined by the Chief ALJ.
Senator B. Stevens asked for confirmation that the agencies not
listed in that section would not be required to report to the
Central Panel.
Mr. Hemenway concurred.
Co-Chair Wilken noted that Sec. 2, subsection (c), on page 2, line
21 specifies that the Chief ALJ could not serve in that capacity
for more than three five-year terms.
Mr. Stancliff commented that upon review of several other states'
models, it was determined that "institutionalizing the judges
within the Administrative system" might not serve the best
interests of the model. Therefore, he shared, that this term
timeframe was a compromise "between two schools of thought," in
that some states specified eight-year terms and others "forever."
Mr. Stancliff pointed out that "this new model is pretty much
insulated from Legislative" and Administrative influence, and he
noted that this new model is supported by people within the hearing
officer community as well as those who have retired from the
system, as it is felt that people cannot perform their job well
when under duress or threat. Therefore, he continued, once a code
is developed, and the hearing officers are protected and treated
"like true judicialists," then high levels of adjudication would
follow.
Co-Chair Wilken asked whether the Chief ALJ could be re-appointed
after the specified 15-year term.
Mr. Stancliff responded that while this is not specifically
addressed in the legislation, he understood the answer to be no.
Senator Bunde suspected that, in the future, the model would
expand, and that agencies could be influenced by it even were they
not directly controlled by it.
Mr. Stancliff responded that those agencies not desiring to be
"sweep into the model by the Legislation must do a better job
outside the Model." In addition, he noted, agencies might come to
the realization that the model "is working very well" and choose to
be included in it.
DAN HOUGHTON, Representative, Alaska Regional Hospital, testified
via teleconference from an offnet site and shared the hospital's
experience regarding the hospital's appeal, in 1994, pertaining to
the official rate settings established for the years 1991, 1992,
and 1993 year-ends. He noted that due to a number of different
issues, a hearing officer was unavailable for approximately two
years, and the appeal was not heard until March 1997. Continuing,
he stated that, in May 2000, the hearing officer issued a favorable
decision in favor of the hospital that involved approximately four
million dollars. He continued that in June 2000, the decision was
turned over to the Department of Health and Social Services, and
the Commissioner at the time, issued a decision that reversed the
majority of the hearing officer's decision. At the point, he noted,
the hospital appealed in April 2001, to the State's Superior Court,
issued its decision in January 2003.
SFC 04 # 18, Side B 10:50 AM
Mr. Houghton stated that the Superior Court ruling in favor of the
hospital was then submitted to Department of Health and Social
Services Commissioner, Joel Gilbertson, for action, and, he
continued, in March 2003, he re-manned the Superior Court decision
back to the hearing officer for further ruling or action.
Unfortunately, he continued, the hearing officer who had previously
worked on the issue was unavailable for health reasons, and the
oral arguments were again postponed and have, to date, not been
heard. Therefore, he summarized that eight years after the initial
hearing, the hospital is still "battling" through this
administrative process.
Mr. Houghton voiced support for SB 203, as the hospital's
experience attests to the fact that "a larger pool of hearing
officers" should be available to address the multitude of
professional issues that might arise rather than hearings being
delayed as the result of one hearing officer being familiar with an
issue.
Co-Chair Wilken stated that the bill would be HELD in Committee to
allow for further review and development of fiscal notes.
ADJOURNMENT
Co-Chair Gary Wilken adjourned the meeting at 10:53 AM
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