Legislature(2009 - 2010)SENATE FINANCE 532

04/07/2009 09:00 AM FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= SB 1 ALASKA MINIMUM WAGE TELECONFERENCED
Moved CSSB 1(FIN) Out of Committee
+ SB 170 UNEMPLOYMENT AMENDMENTS: FED STIMULUS TELECONFERENCED
Heard & Held
+ SB 133 ELECTRONIC HEALTH INFO EXCHANGE SYSTEM TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                   SENATE FINANCE COMMITTEE                                                                                     
                        April 7, 2009                                                                                           
                          9:04 a.m.                                                                                             
                                                                                                                                
9:04:02 AM                                                                                                                    
                                                                                                                                
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Stedman  called the  Senate Finance  Committee meeting                                                                 
to order at 9:04 a.m.                                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Lyman Hoffman, Co-Chair                                                                                                 
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Charlie Huggins, Vice-Chair                                                                                             
Senator Johnny Ellis                                                                                                            
Senator Donny Olson                                                                                                             
Senator Joe Thomas                                                                                                              
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Senator   Bill  Wielechowski;   Senator  Joe   Paskvan;  Darwin                                                                 
Peterson,  Staff  to  Co-Chair  Stedman;  Max  Hensley,  Staff,                                                                 
Senator Ellis;  Jake Hamburg,  Staff, Senator  Paskvan; William                                                                 
Streur,  Deputy Commissioner,  Medicaid &  Health Care  Policy,                                                                 
Department  of Health  and Social  Services; Mr.  Sam Trivette,                                                                 
Self.                                                                                                                           
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Pat  Luby, Advocacy  Director,  Alaska  Association of  Retired                                                                 
Persons  (AARP),  Anchorage;  Rebecca  Madison,  Alaska  Tribal                                                                 
Health   Consortium;  Shelly   Hughes,   Alaska  Primary   Care                                                                 
Associates.                                                                                                                     
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
SB 1      "An Act increasing the minimum hourly wage, and                                                                       
          creating an annual adjustment to the minimum hourly                                                                   
          wage based on the rate of inflation; and providing                                                                    
          for an effective date."                                                                                               
                                                                                                                                
          CSSB 1 (FIN) was REPORTED out of Committee with "no                                                                   
          recommendation" and with a previously published zero                                                                  
          fiscal note by the  Department of Labor and Workforce                                                                 
          Development.                                                                                                          
                                                                                                                                
SB 133    "An  Act  creating   a  statewide  electronic  health                                                                 
          information  exchange system;  and  providing for  an                                                                 
          effective date."                                                                                                      
                                                                                                                                
          SB 133  was HEARD and  HELD in Committee  for further                                                                 
          consideration.                                                                                                        
                                                                                                                                
SB 170    "An Act  modifying the Alaska  unemployment insurance                                                                 
          statutes  to  comply  with the  requirements  of  the                                                                 
          federal  economic  stimulus  bill by  redefining  the                                                                 
          base   period   for   determining   eligibility   for                                                                 
          unemployment   benefits;   and   providing   for   an                                                                 
          effective date."                                                                                                      
                                                                                                                                
          SB 170  was HEARD and  HELD in Committee  for further                                                                 
          consideration.                                                                                                        
                                                                                                                                
SENATE BILL NO. 1                                                                                                             
                                                                                                                                
     "An Act  increasing the minimum hourly  wage, and creating                                                                 
     an annual adjustment  to the minimum hourly  wage based on                                                                 
     the  rate of  inflation;  and providing  for an  effective                                                                 
     date."                                                                                                                     
                                                                                                                                
9:04:19 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman  noted that SB 1  is in its second  hearing in                                                                 
the  Senate Finance  Committee.  He stated  his  intent was  to                                                                 
adopt the committee substitute (CS)  and take additional public                                                                 
testimony.                                                                                                                      
                                                                                                                                
Co-Chair  Hoffman  MOVED to  ADOPT  CSSB  1 LS0006/T.  Co-Chair                                                                 
Stedman OBJECTED for explanation.                                                                                               
                                                                                                                                
DARWIN  PETERSON, STAFF  TO CO-CHAIR  STEDMAN, spoke  about the                                                                 
legislation. He informed that the  CS version C states that the                                                                 
Alaska  will  choose  the  greater of  the  state  and  federal                                                                 
minimum wages  until the effective  date of January 1,  2010 at                                                                 
which time  the state  minimum wage will  be increased  to $.50                                                                 
above  the  federal   minimum  wage  and  that   rate  will  be                                                                 
maintained.                                                                                                                     
                                                                                                                                
9:07:33 AM  AT EASE                                                                                                           
9:07:40 AM  RECONVENED                                                                                                        
                                                                                                                                
Co-Chair  Stedman  WITHDREW  his   OBJECTION.  There  being  NO                                                                 
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
SENATOR WIELECHOWSKI,  discussed the legislation.  He expressed                                                                 
appreciation   for  the   finance  committee's   work  on   the                                                                 
legislation. He stated that  the achieved compromise recognizes                                                                 
that there are people in  the community who are concerned about                                                                 
the  increases, as  well as  those who  believe that  the state                                                                 
needs an increase.  Alaska will fall below  the federal minimum                                                                 
wage in  July 2010 if  the current version  of the bill  is not                                                                 
accepted.  The bill  follows the  long standing  policy in  the                                                                 
state of remaining above $.50 over the federal minimum wage.                                                                    
                                                                                                                                
Co-Chair Stedman  MOVED to ADOPT Amendment  1. Co-Chair Stedman                                                                 
OBJECTED for discussion. He explained the Amendment.                                                                            
                                                                                                                                
     Page 1, lines 7 - 9:                                                                                                       
          Delete "the higher of $7.15 an hour or, for work                                                                      
     performed on or after the effective date of an actual                                                                      
     increase of the federal minimum wage to a rate higher                                                                      
     than $7.15 an hour,"                                                                                                       
          Insert "$7.25 an hour until December 31, 2009, and                                                                    
     thereafter not less than"                                                                                                  
                                                                                                                                
     Page 1, line 14:                                                                                                           
          Delete "January 1, 2010"                                                                                              
          Insert "July 24, 2009"                                                                                                
                                                                                                                                
9:10:30 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman  WITHDREW  his   OBJECTION.  There  being  NO                                                                 
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
9:11:43 AM                                                                                                                    
                                                                                                                                
Co-Chair Hoffman MOVED  to report CSSB 1 out  of Committee with                                                                 
individual  recommendations and  the accompanying  fiscal note.                                                                 
There being NO OBJECTION, it was so ordered.                                                                                    
                                                                                                                                
Co-Chair  Stedman  mentioned  the  zero fiscal  note  from  the                                                                 
Department of Labor (DOL).                                                                                                      
                                                                                                                                
CSSB  1   (FIN)  was  REPORTED   out  of  Committee   with  "no                                                                 
recommendation"  and with  a previously  published zero  fiscal                                                                 
note by the Department of Labor and Workforce Development.                                                                      
                                                                                                                                
SENATE BILL NO. 170                                                                                                           
                                                                                                                                
     "An  Act  modifying   the  Alaska  unemployment  insurance                                                                 
     statutes to  comply with the  requirements of  the federal                                                                 
     economic stimulus  bill by redefining the  base period for                                                                 
     determining  eligibility  for unemployment  benefits;  and                                                                 
     providing for an effective date."                                                                                          
                                                                                                                                
9:13:00 AM                                                                                                                    
                                                                                                                                
Senator Ellis  addressed the legislation and  the importance of                                                                 
quick action. He opined that  the millions of dollars available                                                                 
to the  state would  strengthen the state's  unemployment trust                                                                 
fund protecting business  and providing money for  one time job                                                                 
training  for Alaskans  who  are  unemployed. This  legislation                                                                 
creates a  minor change updating  the unemployment  law. Alaska                                                                 
has modernized the unemployment system for the state.                                                                           
                                                                                                                                
MAX HENSLEY, STAFF, SENATOR ELLIS, spoke to the legislation.                                                                    
                                                                                                                                
          Senate Bill 170 updates Alaska's unemployment                                                                         
     insurance statutes to conform  to the federal unemployment                                                                 
     insurance   modernization  provisions   included  in   the                                                                 
     American Recovery  and Reinvestment Act of  2009, commonly                                                                 
     known as  the federal stimulus  bill.  ARRA  provides over                                                                 
     $16  million in  funding to  support these  changes, which                                                                 
     includes   just   over   $1  million   in   administrative                                                                 
     assistance.   This  funding is  conditional on  making the                                                                 
     changes  included in  SB  170.   Of  the three  provisions                                                                 
     necessary to  receive this funding,  Alaska is  already in                                                                 
     compliance with the two more  difficult requirements.  The                                                                 
     bill   meets  the   final  requirement   by  creating   an                                                                 
     alternative  base   period  to  determine   an  unemployed                                                                 
     person's eligibility for unemployment insurance.                                                                           
                                                                                                                                
          Thirteen Governors (including seven Republicans)                                                                      
     from across the country  have expressed their intention to                                                                 
     make these changes, and four  states already comply.  Iowa                                                                 
     and  South  Dakota  have  already  passed  legislation  to                                                                 
     modernize their UI  systems and accept their  share of the                                                                 
     federal money,  and Georgia  is in  the process,  with the                                                                 
     support of each of their  Governors.   Any funding sources                                                                 
     Alaska  chooses  not to  take  advantage  of will  be  re-                                                                 
     allocated to  the federal UI  program that will put  it to                                                                 
     use  rather  than being  used  to  reduce federal  deficit                                                                 
     spending.                                                                                                                  
                                                                                                                                
           The Alaska Department of Labor estimated that the                                                                    
     alternative  base period  would  make approximately  1,300                                                                 
     more   Alaskans   eligible  for   unemployment   insurance                                                                 
     compensation each year.  This  change will help low-income                                                                 
     Alaskans  weather the  national economic  downturn without                                                                 
     placing  an   undue  hardship   on  employers   and  small                                                                 
     businesses that support the UI  trust fund.  The estimated                                                                 
     impact  on the  UI trust  fund in  calendar year  2008 had                                                                 
     this change  been in place  would have  been approximately                                                                 
     $1.9 million  in additional payments  (on top of  the $121                                                                 
     million paid  out already).   This amount is  small enough                                                                 
     in comparison to  the overall size of the  fund's corpus -                                                                 
     $351 million  at the end  of 2008 - the  annual investment                                                                 
     returns,  and the  additional  federal  funds which  would                                                                 
     become available, that the impact  on business taxes would                                                                 
     be negligible.                                                                                                             
                                                                                                                                
9:18:07 AM                                                                                                                    
                                                                                                                                
Co-Chair Hoffman  MOVED to ADOPT  CSSB 170 (FIN)  LS0762/S. Co-                                                                 
Chair Stedman OBJECTED for discussion purposes.                                                                                 
                                                                                                                                
Mr. Peterson  addressed the  CS and  the Amendment.  Alaska law                                                                 
must  comply  with  the  Federal  Unemployment  Tax  Act  as  a                                                                 
condition   of    certification   for    federal   unemployment                                                                 
compensation administrative  grants totaling  approximately $20                                                                 
million. If Alaska  were decertified due to a  failure to enact                                                                 
this  legislation, the  state risks  loosing  the full  federal                                                                 
unemployment tax  act credit  of 5.4  percent translating  to a                                                                 
loss  of  $111  million  in  annual  tax  credits  for  Alaskan                                                                 
employers.  The  Alaska  unemployment security  act  stipulates                                                                 
that   the   state   complies  with   federal   law   for   the                                                                 
administration  of the  unemployment insurance  program. Tribal                                                                 
entities'  services require  coverage and  federally recognized                                                                 
tribes  require  the  choice  to  become  federally  recognized                                                                 
employers for  the payment of unemployment  insurance taxes. He                                                                 
discussed the  letters available (Copy on  File) describing the                                                                 
need  for this  legislation and  citing the  prevailing federal                                                                 
law.  He  addressed  one  letter in  particular  by  the  Clark                                                                 
(Click)   Bishop,  Commissioner,   Department   of  Labor   and                                                                 
Workforce Development                                                                                                           
                                                                                                                                
Co-Chair  Stedman  WITHDREW  his   OBJECTION.  There  being  NO                                                                 
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
Senator Huggins  stated that he  assumed that  a representative                                                                 
from  the administration  would  come forward  before the  bill                                                                 
moves.                                                                                                                          
                                                                                                                                
9:22:57 AM                                                                                                                    
                                                                                                                                
Senator  Ellis MOVED  to ADOPT  Amendment  1. Co-Chair  Stedman                                                                 
OBJECTED for  discussion. Senator  Ellis explained  the change,                                                                 
which clarifies the title.                                                                                                      
                                                                                                                                
Page 1, lines 1 - 2:                                                                                                            
     Delete  "to comply  with the  requirements of  the federal                                                                 
     economic stimulus bill"                                                                                                    
                                                                                                                                
Co-Chair  Stedman  WITHDREW  his   OBJECTION.  There  being  NO                                                                 
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
9:24:30 AM                                                                                                                    
                                                                                                                                
Senator    Huggins   informed    about   concerns    from   the                                                                 
administration regarding the federal  stimulus funds. He opined                                                                 
that  most  Alaskans   appreciate  information  concerning  the                                                                 
administration's  position  on  the  stimulus  money.  Co-Chair                                                                 
Stedman  proposed that  representation from  the administration                                                                 
is encouraged when the bill returns to the finance committee.                                                                   
                                                                                                                                
Senator Ellis stated his thorough  understanding that the money                                                                 
is  available one  time only.  He concluded  that money  placed                                                                 
into the  unemployment trust fund  to aid employers  is helpful                                                                 
because  it  remains in  the  trust  fund contributing  to  the                                                                 
fund's  health. The  job training  money is  allocated for  job                                                                 
training centers.                                                                                                               
                                                                                                                                
SB  170   WAS  HEARD   AND  HELD   IN  COMMITTEE   FOR  FURTHER                                                                 
CONSIDERATION.                                                                                                                  
                                                                                                                                
9:25:51 AM  AT EASE                                                                                                           
9:28:22 AM  RECONVENED                                                                                                        
                                                                                                                                
SENATE BILL NO. 133                                                                                                           
                                                                                                                                
     "An   Act   creating   a   statewide   electronic   health                                                                 
     information   exchange  system;   and  providing   for  an                                                                 
     effective date."                                                                                                           
                                                                                                                                
9:31:55 AM                                                                                                                    
                                                                                                                                
Senator Joe Paskvan discussed the legislation.                                                                                  
     Alaska  health care  providers  and  patients continue  to                                                                 
     rely on  an outdated healthcare infrastructure,  with many                                                                 
     providers   using   only   paper  based   systems,   which                                                                 
     contributes   to  dangerous   drug  interactions,   missed                                                                 
     diagnoses,   costly   delays,    duplicate   testing   and                                                                 
     administrative  overhead. According  to national  studies,                                                                 
     these problems  contribute to  approximately 5%  of health                                                                 
     care expenditures  or $250 million annually  in Alaska and                                                                 
     unnecessarily degrade  the quality of health  care for all                                                                 
     Alaskans.                                                                                                                  
                                                                                                                                
     SB  133 modernizes  Alaska's healthcare  IT infrastructure                                                                 
     by  developing  a  secure  electronic  Health  Information                                                                 
     Exchange  (HIE)   system  to  improve  the   safety,  cost                                                                 
     effectiveness, and  quality of healthcare in  Alaska. This                                                                 
     standards-based  electronic  health   network  will  allow                                                                 
     individual  Alaskans to  have  their  own personal  health                                                                 
     record  and to  authorize their  health care  providers to                                                                 
     exchange electronic  medical records  in a  timely, secure                                                                 
     manner.                                                                                                                    
                                                                                                                                
     The  use of  such technology  requires careful  and strict                                                                 
     privacy  protection measures.  Current  Federal and  State                                                                 
     laws already  provide a number  of standards  protecting a                                                                 
     patient's  privacy and  personal information.  The privacy                                                                 
     and  security  rules  contained in  the  Health  Insurance                                                                 
     Portability and  Accountability Act (HIPAA)  most directly                                                                 
     and extensively  impact the HIE system.  HIPAA establishes                                                                 
     individuals' right  to review and  obtain a copy  of their                                                                 
     health information, requires  notice of privacy practices,                                                                 
     limits  the   use  of  records   and  the   disclosure  of                                                                 
    information, and institutes strict security standards.                                                                      
                                                                                                                                
     SB 133 establishes further strict  standards to secure and                                                                 
     protect  the confidentiality  of individually  identifying                                                                 
     health information  of a patient. These  standards include                                                                 
     a secure  and traceable  electronic audit system  to allow                                                                 
     patients to see who  has viewed their record, restrictions                                                                 
     on   how  information   may  be   used,  patient   consent                                                                 
     requirements,  an  ability  to   opt  out  of  the  health                                                                 
     information   exchange   system,   and   notification   of                                                                 
     confidentiality violations.                                                                                                
                                                                                                                                
     When  complete,  the  Health Information  Exchange  System                                                                 
     will have  the capability  to provide  any Alaskan  with a                                                                 
     secure  Personal  Health Record,  including  authorization                                                                 
     for their  health care  providers on  the network  to have                                                                 
     access to  electronic records  required for  continuity of                                                                 
     care,  such   as  hospitalization   records,  prescription                                                                 
     information,  vaccinations,  allergies,  imaging  records,                                                                 
     laboratory   results,  etc.   The  Network   will  support                                                                 
     telemedicine  services, the  transfer  of high  resolution                                                                 
     images  for patient  care, video  conferencing, and  Voice                                                                 
     over Internet applications for providers.                                                                                  
                                                                                                                                
     Over  300  health organizations  in  Alaska  are eager  to                                                                 
     participate in the  electronic Health Information Exchange                                                                 
     system.                                                                                                                    
                                                                                                                                
JAKE HAMBURG, STAFF, SENATOR  PASKVAN, presented the PowerPoint                                                                 
slide  show  "Deploying  a   Health  Information  Exchange  for                                                                 
Alaskans. He  began with  Slide 2 "Medical  Care From  Paper to                                                                 
Electronic":                                                                                                                    
                                                                                                                                
   „Alaska's health care providers are now making major                                                                        
     investments  ($100M+)  in  moving from  paper  records  to                                                                 
     Electronic Medical Records                                                                                               
                                                                                                                                
   „Alaska's health care providers are aligned in support of                                                                   
     creating a  statewide Health Information  Exchange network                                                               
     so  patient  records  may be  securely  exchanged  between                                                                 
     providers for timely and safe patient care                                                                                 
                                                                                                                                
   „State of Alaska plays a key role as a partner in Alaska's                                                                
     developing Health Information Exchange                                                                                     
                                                                                                                                
9:33:42 AM                                                                                                                    
                                                                                                                                
Mr. Hamburg discussed Slide 3, "Health Information Exchanges,                                                                   
National Effort: State Solutions":                                                                                              
                                                                                                                                
   „National Health Information Network" concept created in                                                                    
          Bush   administration    and   enhanced    in   Obama                                                                 
          administration through ARRA 2009 stimulus                                                                             
   „Successful State Models:                                                                                                   
        …DHIN - Delaware Health Information Network                                                                            
   „Statewide and regional health information exchanges                                                                        
          have developed over the last 10 years in other                                                                        
          states                                                                                                                
        …CalRHIO - California, Los Angeles County                                                                              
        …FHIN - Florida Health Information Network                                                                             
        …Regenstrief - Indiana Eight County Network                                                                            
                                                                                                                                
9:36:23 AM                                                                                                                    
                                                                                                                                
Alaska eHealth Network: Slide 5:                                                                                                
                                                                                                                                
   „Provide rapid access by authorized providers to critical                                                                   
     patient information at the point of care                                                                                   
     medical history          allergies                                                                                         
     medication status        laboratory reports                                                                                
     immunization status      imaging reports                                                                                   
   „Reduce redundancy in medical testing and procedures                                                                        
   „Improve   patient  safety   through  reducing   medication                                                                 
     reconciliation errors                                                                                                      
  „Reduce provider administrative costs for data management                                                                    
   „Expedited response to public health emergencies                                                                            
                                                                                                                                
9:36:56 AM                                                                                                                    
                                                                                                                                
Alaska eHealth Network.  Slide 6:                                                                                               
                                                                                                                                
   „Do   not  require   centralized   patient  health   record                                                                 
          repositories: health providers continue to own their                                                                  
          records                                                                                                               
                                                                                                                                
   „Facilitate  connectivity  with patient's  Personal  Health                                                                 
          Record choices                                                                                                        
                                                                                                                                
   „Respect   patient   decisions   to  opt-out   of   network                                                                 
          participation                                                                                                         
                                                                                                                                
   „Provide significant penalties for data breaches                                                                            
                                                                                                                                
9:37:15 AM                                                                                                                    
                                                                                                                                
Slide 7:                                                                                                                        
                                                                                                                                
   „Federal  and  private  research  projects  5%  savings  in                                                                 
     annual U.S. health care expenditures from full deployment                                                                  
     of inter-operable electronic medical records                                                                               
                                                                                                                                
   „For  Alaska's $5B  health  care  industry, annual  savings                                                                 
     could reach $250M.                                                                                                         
                                                                                                                                
   „For the State of  Alaska's $250M GF Medicaid expenditures,                                                                 
     annual savings could exceed $10M                                                                                           
                                                                                                                                
Slide 8:                                                                                                                        
                                                                                                                                
   „5  year $35  million project  to deploy  a secure  network                                                               
     supporting the exchange of electronic health records                                                                       
     between all Alaska health care providers                                                                                   
                                                                                                                                
   „$12.0 million currently awarded  through 2008 from Federal                                                               
     Communications Commission, US Dept. of Health and Human                                                                    
     Services, State of Alaska, Alaska Federal Health Care                                                                      
     Partnership                                                                                                                
                                                                                                                                
9:37:35 AM                                                                                                                    
                                                                                                                                
Board of directors.  Slide 9:                                                                                                   
                                                                                                                                
   „Incorporated non-profit August 2008                                                                                        
        …Alaska Native Tribal Health Consortium (designated                                                                    
          lead partner)                                                                                                         
        …Alaska State Hospitals and Nursing Homes Association                                                                  
        …Alaska Primary Care Association                                                                                       
        …Premera Blue Cross/Blue Shield                                                                                        
        …State of Alaska DHSS                                                                                                  
        …Alaska Federal Health Care Partnership (DOD, VA,                                                                      
          USCG, Indian Health Service)                                                                                          
        …University of Alaska                                                                                                  
        …Alaska E.H.R. Alliance (private physicians)                                                                           
        …American Association of Retired Persons                                                                               
                                                                                                                                
9:38:29 AM                                                                                                                    
                                                                                                                                
Next Steps: 2009-2010. Slide 16:                                                                                                
                                                                                                                                
   „Secure $1.3M for FY2010 and $1.0M in FY2011 from State of                                                                
     Alaska for network development                                                                                             
        …Ensures match for federal stimulus funds                                                                              
                                                                                                                                
   „Engage contractor/vendors to deploy Health Information                                                                   
     "bridging" software to interconnect Alaska's various                                                                     
     Electronic Medical Records systems                                                                                         
   „Align the Health Information Exchange with State systems:                                                                
     MMIS, API, Public Health data                                                                                              
   „Add Internet2 connectivity for telemedicine applications,                                                                
     teleconferencing, voice-over-internet,  and consults from                                                                  
     lower-48 academic/teaching hospitals                                                                                       
                                                                                                                                
9:39:22 AM                                                                                                                    
                                                                                                                                
Sustainability: Slide 17                                                                                                        
                                                                                                                                
     Establish the Alaska eHeath Network business structure to                                                                
     sustain network and software services through provider                                                                     
     and payor contributions                                                                                                    
     AeHN Estimated recurring costs after FY11: $5.0M                                                                         
               $1.3M administration/business operations                                                                         
               $3.7M    contractual   HIE    technical/software                                                                 
     services                                                                                                                   
     Estimated recurring AeHN revenues after FY11: $5.0M                                                                      
                                                                                                                                
        …$1.5M     1500+ physicians/clinicians                                                                                 
        …$0.5M     26 Hospitals                                                                                                
        …$0.5M     Laboratories/Pharmacies/Imaging Centers                                                                     
        …$1.0M     State of Alaska                                                                                             
        …$1.0M     Private Insurers                                                                                            
       …$0.5M     Alaska Federal Health Care partners                                                                          
                                                                                                                                
SB133 Facilitates HIE development: Slide 18.                                                                                    
                                                                                                                                
   „Positions Alaska for substantial stimulus funding                                                                          
   „Demonstrates state commitment to support and participate                                                                   
     in Alaska's Health Information Exchange development                                                                        
   „Provides for DHSS oversight, engagement, and long-term                                                                     
     participation plan                                                                                                         
   „Provides framework for designation of a qualified state                                                                    
     Health Information Exchange entity                                                                                         
   „Ensures privacy protections                                                                                                
                                                                                                                                
9:40:52 AM                                                                                                                    
                                                                                                                                
Summary recommendations: Slide 20:                                                                                              
                                                                                                                                
   „A. Passage of SB133                                                                                                        
   „B. State DHSS oversight, support, and  designation      of                                                                 
     HIE organization                                                                                                           
   „C. Provide stimulus match of $1.3M in  FY10 and $1.0M in                                                                   
     FY11                                                                                                                       
                                                                                                                                
The outcomes: Slide 21:                                                                                                         
                                                                                                                                
   „Timelier access to safer health care for Alaskans                                                                          
                                                                                                                                
   „$1M annual State investment yields ~5% savings in future                                                                   
     State expenses for Medicaid, employee health care, state-                                                                  
     operated health care programs                                                                                              
                                                                                                                                
                                                                                                                                
Co-Chair Hoffman  asked about  the $5  billion spent  on health                                                                 
care  and   potential  annual  savings  of   $250  million.  He                                                                 
requested more  information about the  amounts and how  much is                                                                 
dedicated  to personnel.  He asked  for  the breakdown  between                                                                 
private entities  versus the state's  savings. How much  of the                                                                 
savings will pertain to the state.                                                                                              
                                                                                                                                
Mr.  Hamburg answered  that  the cost  savings  to the  state's                                                                 
healthcare  system  is the  annual  $250  million. The  state's                                                                 
savings is $10 to $12 million dollars annually.                                                                                 
                                                                                                                                
9:42:46 AM                                                                                                                    
                                                                                                                                
Co-Chair  Hoffman  requested  identification  of  the  saving's                                                                 
location.  Mr.  Hamburg replied  that  the  state is  currently                                                                 
paying  for  duplicate  testing   existing  during  moves  from                                                                 
facility to  facility. Costs are reduced  by the implementation                                                                 
of a health information exchange system.                                                                                        
                                                                                                                                
Senator Paskvan  stated that Rebecca  Madison was  available to                                                                 
add specific detail to answer Co-Chair Hoffman's question.                                                                      
                                                                                                                                
Co-Chair  Stedman  noted  that the  fiscal  note  reflects  the                                                                 
assumption  that the  state will  accept  the federal  stimulus                                                                 
money. He asked about the  consequences of refusing the federal                                                                 
funds. Senator Paskvan replied that  the loss of stimulus funds                                                                 
equals $13 million dollars for  the current year and $7 million                                                                 
for the following year.                                                                                                         
                                                                                                                                
Co-Chair  Stedman asked  if the  amounts are  reflected in  the                                                                 
fiscal note.                                                                                                                    
                                                                                                                                
Mr.  Hamburg  added  that  the   capital  dollar  requests  are                                                                 
requested in  FY10 to ensure  that the state qualifies  for the                                                                 
greatest amount of federal dollars.                                                                                             
                                                                                                                                
9:44:35 AM                                                                                                                    
                                                                                                                                
Senator  Olson noted  that the  acceptance of  federal stimulus                                                                 
dollars will  prolong set up  of the program. He  wondered what                                                                 
supplemental amount  the state is  then responsible for  in the                                                                 
following year. Mr. Hamburg noted  that the state's involvement                                                                 
includes the capital funds and  either the designated operating                                                                 
cost or the user fees.                                                                                                          
                                                                                                                                
Senator   Olson   commented    that   some   private   practice                                                                 
practitioners might have difficulty  connecting to the network.                                                                 
Mr. Hamburg  explained that  the plan  requires five  years for                                                                 
full   implementation.   Senator   Olson  asked   if   a   solo                                                                 
practitioner will contribute via  affordable fee structure. Mr.                                                                 
Hamburg replied  that the  issue is  resolved in  regulation or                                                                 
non-profit solution.                                                                                                            
                                                                                                                                
9:46:23 AM                                                                                                                    
                                                                                                                                
Mr. Hamburg  stated that the  federal stimulus makes  it easily                                                                 
accessible for  providers to access involvement  in the system.                                                                 
Senator Olson  asked about rural clinics  and their involvement                                                                 
in the  program. Mr.  Hamburg answered that  there is  a native                                                                 
health  system developing  an electronic  health record  system                                                                 
and striving to network into the state system.                                                                                  
                                                                                                                                
Senator Thomas  understood that more than  one large depository                                                                 
is available. He  noted the fiscal note with  three dollars for                                                                 
every dollar that the state has spent.                                                                                          
                                                                                                                                
Mr. Hamburg answered that the fiscal  note is based on a $54.34                                                                 
million federal  match for  2012 and beyond.  He noted  that if                                                                 
the state designated the entity  the cost is less and dependent                                                                 
upon the user fee charged for system participation.                                                                             
                                                                                                                                
9:48:48 AM                                                                                                                    
                                                                                                                                
WILLIAM  STREUR, DEPUTY  COMMISSIONER, MEDICAID  & HEALTH  CARE                                                                 
POLICY, DEPARTMENT  OF HEALTH AND  SOCIAL SERVICES  stated that                                                                 
the administration's position on the  bill is in support of the                                                                 
concept  and  creation  of a  health  information  network.  He                                                                 
informed  that   the  administration   felt  that   too  little                                                                 
information  is   available  regarding  the   ramifications  of                                                                 
accepting  the stimulus  funds. The  administration is  waiting                                                                 
for additional guidance regarding acceptance of the funds.                                                                      
                                                                                                                                
Co-Chair Stedman requested clarification  as the fiscal note is                                                                 
$27.9  million.  He asked  if  the  state secures  the  federal                                                                 
stimulus  funds, will  the administration  go forward  with the                                                                 
legislation.                                                                                                                    
                                                                                                                                
Mr.  Streur   clarified  that  the   administration's  position                                                                 
regards the concept of health  information exchange. Due to the                                                                 
expense involved, the administration  cannot take a position on                                                                 
the funding itself.                                                                                                             
                                                                                                                                
9:50:55 AM                                                                                                                    
                                                                                                                                
MR. SAM  TRIVETTE, SELF, spoke in  support of SB 133.  He urged                                                                 
consideration of moving the legislation  forward. He noted that                                                                 
legislation  frequently pits  one person  against another,  but                                                                 
this bill allows everyone to  win. He encouraged spending money                                                                 
to save money. He relayed  a personal story regarding a medical                                                                 
error.                                                                                                                          
                                                                                                                                
PAT  LUBY, ADVOCACY  DIRECTOR,  ALASKA  ASSOCIATION OF  RETIRED                                                                 
PERSONS  (AARP), ANCHORAGE  (testified via  teleconference). He                                                                 
testified in  support of  SB 133.  He stated  that SB  133 will                                                                 
reduce  medical  errors  in hospitals.  He  informed  that  the                                                                 
electronic  health  records  could provide  information  for  a                                                                 
person who might not be able to speak for themselves.                                                                           
                                                                                                                                
9:54:22 AM                                                                                                                    
                                                                                                                                
REBECCA  MADISON, ALASKA  TRIBAL  HEALTH CONSORTIUM  (testified                                                                 
via  teleconference).  She  reported that  providers  in  other                                                                 
states  with  electronic   health  records  report  significant                                                                 
savings  to  Medicaid   through  health  information  exchange.                                                                 
Multiple  health  care  agencies  in Alaska  support  the  bill                                                                 
including  federal  agencies,  the  Department  of  Health  and                                                                 
Social  Services, private  physicians, primary  care providers,                                                                 
hospitals and nursing homes.                                                                                                    
                                                                                                                                
Senator Olson asked if the  health corporations have weighed in                                                                 
on the legislation and cost.                                                                                                    
                                                                                                                                
Ms. Madison  asked if  Senator Olson  was referring  to Alaskan                                                                 
health  corporations.  Senator  Olson  concurred  that  he  was                                                                 
referring  to Alaskan  corporations.  Ms.  Madison stated  that                                                                 
many Alaskan corporations entered partnership agreements.                                                                       
                                                                                                                                
9:56:28 AM                                                                                                                    
                                                                                                                                
SHELLY HUGHES,  ALASKA PRIMARY  CARE ASSOCIATES  (testified via                                                                 
teleconference).  She  expressed  appreciation  to  the  Senate                                                                 
Finance  Committee. She  appreciated  Senator  Paskvan and  his                                                                 
sponsorship  of  the  bill.  She relayed  that  much  time  and                                                                 
consideration has gone  into the creation of SB  133. She noted                                                                 
that the Primary Care Associates  appreciates the protection of                                                                 
the patient's confidentiality.                                                                                                  
                                                                                                                                
9:58:08 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman  asked about  the issue  of the  acceptance or                                                                 
refusal  of  the stimulus  money.  He  asked  if this  is  time                                                                 
sensitive assuming that the administration accepts the money.                                                                   
                                                                                                                                
9:59:10 AM                                                                                                                    
                                                                                                                                
Mr. Streur  answered that  the timeline  for acceptance  of the                                                                 
money includes a  90 percent match plus 100%  funding to assist                                                                 
in the  development during 2010  and 2011.  At the end  of 2011                                                                 
the  department returns  to the  Medicaid match  rate of  54.24                                                                 
percent.                                                                                                                        
                                                                                                                                
Co-Chair Stedman  asked about the  six full time  positions and                                                                 
the capital  expenditures of  27.9 million  of which  $25.1 are                                                                 
federal. He  noted that the  legislature does not have  to take                                                                 
action  on the  bill. He  struggled  with the  timing issue  as                                                                 
session  ends  soon.  Does  this  put us  in  any  jeopardy  to                                                                 
postpone accepting the money? Mr.  Streur responded that he was                                                                 
unable to answer the question at this time.                                                                                     
                                                                                                                                
Co-Chair Hoffman  requested the  information the  department is                                                                 
lacking. Mr. Streur explained that  the department must vet out                                                                 
the information  ensuring that there are  no "strings attached"                                                                 
to these funds prior to moving forward.                                                                                         
                                                                                                                                
10:01:27 AM                                                                                                                   
                                                                                                                                
Co-Chair  Hoffman  recalled  Mr.   Streur  commenting  that  he                                                                 
anticipated  an   answer.  He  asked  who   would  provide  the                                                                 
department with the information.                                                                                                
                                                                                                                                
Mr. Streur  replied that the  information would  be forthcoming                                                                 
from  the  federal  government. Co-Chair  Hoffman  asked  if  a                                                                 
specific person was in contact with the department.                                                                             
                                                                                                                                
Mr. Streur stated that the  department corresponds with various                                                                 
people in  the center for  Medicaid and Medicare  services. Co-                                                                 
Chair  Hoffman asked  when the  department expects  a response.                                                                 
Mr. Streur answered  that he would have the  information by the                                                                 
end of the session.                                                                                                             
                                                                                                                                
Co-Chair Stedman noted that the  legislation had a large fiscal                                                                 
impact. He noted concern about  the legislation adopted without                                                                 
the   federal  funds   coming   through.   He  requested   more                                                                 
information about the timing once the department has it.                                                                        
                                                                                                                                
10:02:42 AM                                                                                                                   
                                                                                                                                
Mr. Streur  was hopeful  that a decision  would be  made sooner                                                                 
rather than later.                                                                                                              
                                                                                                                                
SB  133   was  HEARD   and  HELD   in  Committee   for  further                                                                 
consideration.                                                                                                                  
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 10:03 AM.                                                                                          
                                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
SB 1 Additional Backup.pdf SFIN 4/7/2009 9:00:00 AM
SB 1
SB 1 Amendment 1 C.1.pdf SFIN 4/7/2009 9:00:00 AM
SB 1
SB133_Backup_AK_HISPC_Project_Summary.pdf SFIN 4/7/2009 9:00:00 AM
SB 133
SB133_Backup_Cost_Savings.pdf SFIN 4/7/2009 9:00:00 AM
SB 133
SB133_Backup_Media.pdf SFIN 4/7/2009 9:00:00 AM
SB 133
SB133_Backup_NCSL_HIT_State_Legislation.pdf SFIN 4/7/2009 9:00:00 AM
SB 133
SB 1 proposed CS Version C.pdf SFIN 4/7/2009 9:00:00 AM
SB 1
SB 170 proposed CS Version S.pdf SFIN 4/7/2009 9:00:00 AM
SB 170
SB133_Backup_AK_HISPC_Project_Summary.pdf SFIN 4/7/2009 9:00:00 AM
SB 133
SB 170 Additional Backup.pdf HFIN 4/8/2009 1:30:00 PM
SFIN 4/7/2009 9:00:00 AM
SB 170
SB 133 Additional backup.pdf SFIN 4/7/2009 9:00:00 AM
SB 133
SB 170 Amendment 1 S.1.pdf SFIN 4/7/2009 9:00:00 AM
SB 170
SB133_Explanation_of_CS_Changes.pdf SFIN 4/7/2009 9:00:00 AM
SB 133
SB133_Letters_of_Support.pdf SFIN 4/7/2009 9:00:00 AM
SB 133
SB133_Presentation_AeHN overview April 2009.ppt SFIN 4/7/2009 9:00:00 AM
SB 133
SB170 frequently asked questions.pdf SFIN 4/7/2009 9:00:00 AM
SB 170
SB133_Sponsor Statement.pdf SFIN 4/7/2009 9:00:00 AM
SB 133
SB170 letters of support.pdf SFIN 4/7/2009 9:00:00 AM
SB 170
SB170 sponsor statement.pdf SFIN 4/7/2009 9:00:00 AM
SB 170
SB170 supporting information.pdf SFIN 4/7/2009 9:00:00 AM
SB 170