Legislature(2017 - 2018)SENATE FINANCE 532
05/02/2018 09:30 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB193 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 193 | TELECONFERENCED | |
| += | HB 135 | TELECONFERENCED | |
| += | HB 346 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE FINANCE COMMITTEE
May 2, 2018
9:34 a.m.
9:34:10 AM
CALL TO ORDER
Vice-Chair Bishop called the Senate Finance Committee
meeting to order at 9:34 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Click Bishop, Vice-Chair
Senator Peter Micciche
Senator Donny Olson
Senator Gary Stevens
Senator Natasha von Imhof
MEMBERS ABSENT
Senator Anna MacKinnon, Co-Chair
ALSO PRESENT
Heather Carpenter, Staff, Senator Pete Kelly; James Harvey,
Assistant Director, Division of Employment Training
Services, the Department of Labor and Workforce
Development; Dan Robinson, Research Chief, Division of
Research and Analysis, Department of Labor and Workforce
Development; Shawnda O'Brien, Assistant Commissioner,
Department of Health and Social Services.
PRESENT VIA TELECONFERENCE
David Morgan, Self, Anchorage.
SUMMARY
SB 193 MED. ASSISTANCE WORK REQUIREMENT
CSSB 193(HESS) was REPORTED out of committee with
a "do pass" recommendation and with one
previously published fiscal impact note:
FN8(LWF); and one new indeterminate fiscal note
from the Department of Administration, and three
new fiscal impact notes from the Department of
Health and Social Services.
SENATE BILL NO. 193
"An Act requiring the Department of Health and Social
Services to apply for a waiver to establish work
requirements for certain adults who are eligible for
the state medical assistance program."
9:34:29 AM
Vice-Chair Bishop noted that the committee heard the bill
on April 12, 2018 and May 1, 2018; and had taken public
testimony.
9:35:38 AM
HEATHER CARPENTER, STAFF, SENATOR PETE KELLY, explained
that the bill would ask the Department of Health and Social
Services (DHSS) to apply for the 1115 Medicaid waiver to
establish a work requirement for able-bodied adults in the
Medicaid population. She reported that to maintain
eligibility in the Medicaid program, able-bodied
participants would be required to volunteer, or engage in
subsistence or work activities for at least 20 hours each
week. She noted that pregnant women, children, elderly,
disabled, and certain caregivers would be exempted.
Vice-Chair Bishop recalled discussion from the previous day
that identified the target population at 10 percent of the
22,500 Medicaid recipients.
Senator Micciche thought it would be beneficial to hear
from the Department of Labor and Workforce Development
(DOL).
9:38:02 AM
AT EASE
9:38:19 AM
RECONVENED
Senator Micciche stated that the bill considered asking DOL
to assist in identifying gaps in employment and training
throughout the state. He thought that the state had
"perpetually accepted nonworking healthy Alaskans for the
long-term" and some of us would like to change the trend to
help individuals reach their full potential. He asked how
DOL envisioned assisting DHSS in a work program for
Medicaid recipients that would promote financial
independence and less dependence on the government.
JAMES HARVEY, ASSISTANT DIRECTOR, DIVISION OF EMPLOYMENT
TRAINING SERVICES, DEPARTMENT OF LABOR AND WORKFORCE
DEVELOPMENT, asserted that the "question was ongoing" and
that DOL currently partnered with the Division of Public
Assistance (DPA) to work with the Temporary Assistance to
Needy Families (TANF) population on the TANF Work Services
program through its job centers. He explained that the
DOL's job centers located throughout the state provided
access to online resources or in-person resources, staff
assisted self-help and services, case management, and
enrollment in certain federal and state job training
programs for qualified individuals. The work had been
ongoing, and he envisioned continued similar collaboration
on the bill's proposed program.
9:40:43 AM
Senator Micciche discussed the rate of unemployment in the
state. He recalled seeing a statistic that less than half
of Alaskans were working. He noted the seasonal nature of
employment in the state contributing to the statistic. He
asked why the state listed 7.1 percent employment rate when
less than half the state was working. He wondered how to
engage individuals that were no longer on unemployment
rolls to help them reach their full potential.
DAN ROBINSON, RESEARCH CHIEF, DIVISION OF RESEARCH AND
ANALYSIS, DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT,
offered to answer the question regarding DOL data. He
acknowledged that the state did have the highest
unemployment rate in the country at 7.3 percent. However,
the unemployment rate was not high relative to Alaskan
historical averages (7.2 percent over 10 years). He
delineated that the unemployment rate was calculated by the
Bureau of Labor Statistics and designed to move slowly and
smoothly; it was slow to reflect economic distress. He
thought a better macro-indicator was the number of jobs and
job loss. He stated the state was losing jobs but not
significantly, however, DOL still considered the state in a
recession. He indicated that in order to be counted as
unemployed, one had to be actively seeking work, which he
thought was challenging to discern. He considered the
"employment to population ratio" a better indicator that
showed what percentage of the working-age population was
working and recalled that in 2017, 62 percent of the
civilian population was working in Alaska. The ranking was
the 20th highest in the nation.
9:44:29 AM
Mr. Robinson continued his remarks and noted that parts of
rural Alaska had very low employment to population ratios
and the highest unemployment rates in the nation.
Senator Micciche asked what the government could do as a
team. He thought the issue was larger than that of work
requirements for Medicaid. He asked if DOL had a team
assembled and wondered how the legislature could assist DOL
in its endeavors to create employment opportunities for
different parts of the state. He mentioned social problems
and social ills. He thought there was enormous talent
throughout the state in the ranks of the unemployed. Mr.
Robinson reminded the committee that his division produced
data, and he recommended that the legislature access the
data to help inform policy. He offered that the legislature
could request all sorts of data from the division that
could help produce desired outcomes. He offered that the
division analyzed why Alaska's unemployment rate was 2 or 3
percentage points higher than the national rate. He shared
that seasonality and structural unemployment were factors.
He described structural unemployment as not having workers
with the skills needed for the jobs being produced in the
state. He noted that there was a tremendous amount of jobs
in parts of the state in which it was necessary to import
workers and vice versa. He reiterated that his division
could help with data related questions in the formulation
of policy.
9:47:57 AM
Mr. Harvey echoed the remarks of Mr. Robinson regarding
utilizing data, which could identify barriers to
employment. He stated that the department was very adept at
handling some barriers to employment, such as the
application process and types of training. He thought job
centers might not be the most adept at addressing other
types of barriers to employment and noted the value of
partnerships. He offered that the job centers did a
"wonderful job" of outreach and awareness of job
opportunities and in preparation for the job openings.
He reported that currently there were non-stop recruitment
efforts in areas such as the seafood industry and some
centers were operating at "standing room only" capacity.
9:49:57 AM
Senator von Imhof referenced Mr. Harvey's comment about
working with different stakeholders in the state to create
job opportunities. She listed the myriad of entities in the
state that were stakeholders: United Way, Foraker Group,
Career Academy, union trade groups, University of Alaska
adjunct classes, YWCA, Alaska Vocational Technical Center
(AVTEC), and the Cook Inlet Tribal Corporation (CITC). In
addition, she discussed the Department of Commerce,
Community and Economic Development's (DCCED) loan programs,
business assistance center, intrastate crowd funding, and
work readiness programs. She thought that the state needed
to pair DOL with the existing organizations, and DHSS to
fully engage and leverage assets that currently existed.
She referenced the associated fiscal note that requested 49
positions. She asked whether leveraging the existing assets
were factored into the equation of the fiscal note. She
emphasized that all the organizations, existing programs
and resources, institutional knowledge, and brain power
needed to be utilized to better help the Medicaid work
program.
9:52:17 AM
Senator Stevens asked Mr. Robinson how data pertaining to
seasonal work fit in. He noted that there was much seasonal
work in his district. Mr. Robinson stated that the data was
collected, compiled, and disseminated monthly. He informed
the committee that areas such as Kodiak, Aleutians East and
West, Bristol Bay, Skagway, and Denali Borough had very low
unemployment rates during the peak of seasonal activities.
He stated that in single industry communities like Skagway
the unemployment rate increased significantly in the off
season. Kodiak had a big enough (more so than other fishing
communities in the state) population to provide for local
workers. He reported that his division compiled the data
monthly and it was possible to see large seasonal swings.
Senator Stevens asked whether the monthly data was compiled
in the annual reports. Mr. Robinson answered in the
affirmative.
9:54:29 AM
Co-Chair Hoffman asked DOL to address the population
downturn in the state. He thought it could be directly
attributed to the economic downturn in the state. He
wondered how long individuals were looking for jobs before
leaving the state. Mr. Robinson reported that the state
experienced five years in a row with net migration losses
(more people moving out of the state than into the state)
representing 30 thousand individuals. However, the
migration losses did not equate to net population losses
due to the birth to death ratio of 35,000. He noted that
2017 was the only year there had been actual population
loss. He remarked that the migration loss pattern remained
and historically, more people in their 20's through mid-
40's years of age moved to Alaska than left the state. In
recent years, more people in their 30 years of age and
children in grades K-12 were leaving the state than coming
into the state. He thought it was notable that the state
was losing more working age people.
9:56:34 AM
Senator Olson thought the goal of the bill was to lessen
government dependency. He thought that the goal seemed more
difficult to accomplish in rural Alaska where less
opportunity existed. He asked how many of those affected by
the bill live in rural Alaska.
SHAWNDA O'BRIEN, ASSISTANT COMMISSIONER, DEPARTMENT OF
HEALTH AND SOCIAL SERVICES, did not have the data
available, but offered to provide the information later.
9:57:45 AM
Senator Micciche assumed that the state's unemployment rate
calculation was based on a federal formula. Mr. Robinson
informed the committee that each state had its own
unemployment rate calculation model. He asserted that it
was hard to determine if those people not working should be
counted as unemployed and mentioned groups such as stay-at-
home parents and retirees; people who did not work due to a
lack of jobs. Senator Micciche thought a data conversion
was required to truly understand the employment
information. Mr. Robinson offered that the state's economy
challenged the models. He used the big inflow of workers
for Bristol Bay seafood processing jobs as an example of
the challenge. Hew reiterated that he "discouraged" use of
the state's unemployment rate as the "best measure of the
state's economic health." Senator Micciche pointed out that
nearly one-third of Alaska's population or 218,000
individuals were on Medicaid at a cost to the state of $12
thousand per capita. He acknowledged that the bill was
costly and viewed the bill as moving people from a lifetime
of dependency to "helping folks succeed." He thought that
the state needed to "shift toward teaching a man to fish"
rather than expend funds on dependent systems.
10:00:59 AM
Senator Stevens appreciated Senator Micciche's remarks. He
asked for a list of reasons why working was advantageous
aside from economic reasons. Mr. Robinson referenced a
recent study the division undertook using the Department of
Corrections (DOC) data, which dealt with the effect of
employment on recidivism. He was surprised to find that
most of the released prisoners had worked, but unless the
job was high paying it did not affect recidivism. He noted
the different "levels of employment" and the importance to
analyze "distribution." He elucidated that much research
existed that jobs mattered psychologically and economically
"but not just any job." There were many jobs that did not
produce the same noneconomic benefits as higher paying jobs
did. Senator Stevens appreciated Mr. Robinson's remarks.
Senator Micciche clarified that he would rather spend the
same amount of funds to provide "meaningful employment
opportunities" than on Medicaid. He maintained that the
state had to utilize every tool to reduce DHSS
expenditures.
10:04:48 AM
Senator von Imhof commented on Mr. Robinson's remarks about
meaningful jobs showing less recidivism. She hoped that the
message was not to shun jobs with less pay and less hours.
She wanted to ensure that the message was to find a job
that offered experience and increased opportunity for
advancement and pay raises. Mr. Robinson clarified that his
division was policy-neutral and did not message anything.
He referenced a study that showed the outcomes of retail
employment over 10 years. He noted that the study showed
the outcomes that Senator von Imhof discussed. He stated
that retail jobs lead to other jobs. He pointed out that
retail workers that stayed in retail jobs had substantial
increases in income 10-years later.
10:06:45 AM
Vice-Chair Bishop moved to invited testimony.
DAVID MORGAN, SELF, ANCHORAGE (via teleconference), relayed
that he was a healthcare economist and had lived in Alaska
since 1984. He discussed his employment history in the
healthcare field and reported that he was a member of the
Healthcare Commission for 5 years. He discussed statistics
from the State of Kentucky. He reported statistics on the
Kentucky Medicaid population. Roughly 1.3 million
individuals were receiving Medicaid and approximately 350
individuals were eligible for the work program. He stated
that roughly 40 percent of eligible individuals on Medicaid
worked; 18 percent worked part-time, 12 percent were
exempt, and 6 percent were in school. The program focused
on the 7 to 10 percent who could work given the
opportunity.
10:11:14 AM
Mr. Morgan continued with his testimony. He referenced
President Bill Clinton's Welfare-to-Work program, which he
believed had been successful. He mentioned other states
that were attempting to utilize the program. The states
believed that an underclass was being created that was
"living off of the public domain" and was unhealthy for the
individual and the economy. He delineated that the Clinton
plan had welfare agencies identify individuals for the
program and treated the individual as if she was newly
unemployed through the labor department, which required
some amount of data programming. He stated that the 1996
Clinton plan was not "touch feely." The state of Kentucky
was anticipating reductions in Medicaid enrollment by
95,000 over 5 years that represented roughly $2 billion in
savings. He stated that he would provide contact
information for individuals involved in the program in
Kentucky. Mr. Morgan concluded that a "dependent community
was not healthy one."
10:16:41 AM
Vice-Chair Bishop asked Mr. Morgan to submit his written
testimony through the office of the co-chair.
10:17:25 AM
Senator Stevens had heard stories of individuals that had
chosen to stay on welfare due to low income jobs. He asked
whether there was an average income at which people were
incentivized to move off welfare or whether the answer was
even quantifiable. Mr. Robinson stated that data existed on
the duration of unemployment, but not on a number and the
answer would be complex.
Vice-Chair Bishop commented that the meeting had lasted for
50 minutes. He thought the dialogue was worthy and was
deserving of a longer conversation. He thought the subject
of TANIF alone warranted additional dialogue. He relayed
that the Tanana Chiefs Conference had lowered their TANF
enrollment number by working with DOL. He thought the state
was fortunate to have an exemplary analysis division in
DOL. He thought Alaskan employment did not fit in the box
of "big labor" regarding how the state counted
unemployment. He thought by having the two agencies, DHSS
and DOL working together the outcome would be beneficial.
10:21:15 AM
Senator Micciche discussed the fiscal notes. He stated that
the committee's intent was to edit the fiscal notes to
reflect the cost for competing the waiver application only.
He furthered that an indeterminate cost would be provided
for the outyears. The current outyear's estimates were
based on assumptions from national actuarial studies
applied to 2017 Alaska data. The committee wanted DHSS to
work with DOL to determine whether existing programs met
the federal requirements. The committee requested that DHSS
provide the hard costs for completing the waiver
application process in a revised fiscal note.
Senator Micciche MOVED to report CSSB 193(HSS) out of
Committee with individual recommendations and the
forthcoming fiscal notes. There being NO OBJECTION, it was
so ordered.
CSSB 193(HESS) was REPORTED out of committee with a "do
pass" recommendation and with one previously published
fiscal impact note: FN8(LWF); and one new indeterminate
fiscal note from the Department of Administration, and
three new fiscal impact notes from the Department of Health
and Social Services.
10:22:36 AM
AT EASE
10:24:09 AM
RECONVENED
Vice-Chair Bishop informed that the committee would be
drafting a Letter of Intent to convey the following:
It is the intent of the Alaska State Legislature that
the Department of Health and Social Services work with
the Department of Labor and Workforce Development to
complete a needs-based analysis on workforce
development and employability of the target population
outlined in the fiscal notes for Senate Bill 193. The
goal of the analysis was to further refine cost
estimates associated with this legislation to help
promote successful outcomes.
Vice-Chair Bishop discussed the agenda for the afternoon
meeting.
ADJOURNMENT
10:25:23 AM
The meeting was adjourned at 10:25 a.m.
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