Legislature(2007 - 2008)SENATE FINANCE 532
02/14/2008 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB255 | |
| SB196 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 196 | TELECONFERENCED | |
| *+ | SB 255 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE FINANCE COMMITTEE
February 14, 2008
9:08 a.m.
CALL TO ORDER
Co-Chair Stedman called the Senate Finance Committee meeting
to order at 9:08:51 AM .
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Charlie Huggins, Vice-Chair
Senator Kim Elton
Senator Donny Olson
Senator Joe Thomas
MEMBERS ABSENT
Senator Fred Dyson
ALSO PRESENT
Tim McLeod, President and General Manager of Alaska Electric
Light and Power Company, (AELP); Connie Hulbert, Chief
Financial Officer, AELP; Ginger Blaisdell, Staff, Senator
Green
PRESENT VIA TELECONFERENCE
Sara Fisher-Goad, Acting Executive Director, Operations,
Alaska Industrial Development and Export Authority, (AIDEA);
Valerie Walker, Deputy Director, Finance, AIDEA; Linda
Barefoot, Senior Regional Director, State Government
Affairs, Purdue Pharma, LP; Patricia Senner, Alaska Nurse's
Association; Julie Woodworth, Chair, Legislative Committee
of the Homer Chamber Of Commerce
SUMMARY
SB 255 "An Act relating to refunding of certain
outstanding bonds issued by the Alaska Industrial
Development and Export Authority concerning the
Snettisham hydroelectric project and related
assets; and providing for an effective date."
SB 255 was REPORTED out of Committee with a "do
pass" recommendation and with a new zero fiscal
note by the Department of Commerce, Community and
Economic Development.
SB 196 "An Act relating to establishing a controlled
substance prescription database."
CSSB 196 (FIN) was REPORTED out of Committee with
"do pass" recommendation and new fiscal note from
the Department of Commerce, Community and Economic
Development and the letter of intent from the
Senate Labor and Commerce Committee.
9:09:00 AM
SENATE BILL NO. 255
"An Act relating to refunding of certain outstanding
bonds issued by the Alaska Industrial Development and
Export Authority concerning the Snettisham
hydroelectric project and related assets; and providing
for an effective date."
Senator Elton presented an overview authorizing Alaska
Industrial Development and Export Authority (AIDEA) to
refinance bonds for the Snettisham Hydroelectric project in
Southeast Alaska. Senator Elton read the sponsor statement.
SB 255 authorizes the Alaska Industrial Development &
Export Authority (AIDEA) to refund bonds for the
Snettisham hydroelectric project in Southeast Alaska.
If bond markets are favorable and the bonds meet both
market and AIDEA financial tests, this refinancing will
save money for ratepayers whose electricity comes from
the Snettisham dam at no cost to the state.
In 1998, AIDEA bonded $100 million to buy the
Snettisham hydro project from a federal energy
authority and construct project capital improvements. A
private utility pays the debt service on those bonds
and operates the project.
Recent trends in the financial markets suggest the debt
can be refunded at significantly lower interest rates
than the current debt. The utility operating the
Snettisham project asked AIDEA to look into refinancing
the debt by refunding the remaining bonds, which have
an outstanding balance slightly over $82 million.
AIDEA's legal counsel advises that in order to roll the
costs of issuing new bonds, along with premiums paid to
retire the old bonds early, into the new bond issue,
AIDEA must receive legislative authorization.
SB 255 provides an explicit statement of authority to
refund the bonds. The bill provides a direct benefit to
ratepayers in the form of lower electric bills in homes
and businesses buying kilowatt hours generated at
Snettisham.
9:12:40 AM
SARA FISHER-GOAD, ACTING EXECUTIVE DIRECTOR, OPERATIONS,
ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY (AIDEA),
thanked Senator Elton for introducing SB 255 and asked if
the Committee had questions.
Senator Thomas questioned the anticipated cost of
refinancing this bond. Ms. Fisher-Goad replied that there
were $82 million in bonds outstanding, and although she was
unable to give the actual cost of the issuance, she
anticipated the cost of 3 per cent to finance the bonds. She
also indicated that the market circumstances dictate the
amount of savings.
Senator Thomas added that the specific day the transaction
occurred would also affect the savings.
Co-Chair Stedman inquired about the coupon rate is on the
bond.
VALERIE WALKER, DEPUTY DIRECTOR, FINANCE, AIDEA responded
that the current rate range was 4.85 percent to 5.5 percent,
but did not have the actual rate available. The bonds are
outstanding through 2034 but they are not fully refundable
until October 2008, so the rate will be whatever the market
is on that date. Refunding will only occur if rates continue
to be favorable and rates are favorable at this time. She
amended that the current rates ranges are 4.85 percent to 6
percent.
Co-Chair Stedman asked for confirmation that the bonds were
callable in October. Ms. Walker clarified that they were
callable in January 1, 2009; however the tax rules allow the
bonds to be refunded up to ninety days before that date. She
continued that a new issue could be made by October 2, 2008,
and with the proceeds of the new bond, the old bond would
retire on the date of issuance.
TIM MCLEOD, PRESIDENT AND GENERAL MANAGER OF ALASKA ELECTRIC
LIGHT AND POWER COMPANY (AELP) supported this bill; he
believes there is potential savings for the customers. He
noted that Snettisham currently provides about 85 percent of
the energy for Southeast Alaska and that the debt service
for that project is a significant portion of the rate
structure.
9:18:20 AM
Senator Thomas inquired about the yearly kilowatt hour costs
for hydroelectric as opposed to other sources. Mr. McLeod
replied that the company normally provides about 100 percent
from hydroelectric resources. When in a hydro deficient, as
currently being experienced, some power has to be provided
with diesel. Diesel costs approximately 20 cents per
kilowatt hour versus hydro costs of 3.5 cents per kilowatt
hour.
Co-Chair Stedman inquired if this was the actual cost, not
what was being billed to the customer. Mr. McLeod confirmed
that this was not the amount billed to the customer.
Senator Huggins inquired on the effect to the company if SB
255 did not pass. Mr. McLeod responded that the company
would not be allowed to borrow more than par value of the
bonds for the Snettisham project, requiring additional costs
to be through traditional financing. This additional cost of
$80,000 to $100,000 a year would be passed to the customers.
Senator Huggins noted that this could possibly cause a
significant rate hike to the customers. Mr. McLeod agreed
that additional costs would be passed to the customers but
that it would not be a significant rate hike. Senator
Huggins asked about the "no cost to state" and wondered if
there was any scenario there would be a cost to the state.
Mr. McLeod indicated that there would never be a cost to the
state.
9:20:32 AM
Co-Chair Stedman requested from Ms. Fisher-Goad a response
to Senator Huggins' question about "no cost to the state"
and asked if there is any other entity that AIEDA needs to
refinance in the capital markets. Ms. Fisher-Goad replied
there would not be any additional costs to the State of
Alaska. She added that there are no outstanding bonds at
AIDEA that need refunding or legislation.
9:21:58 AM
Senator Elton MOVED to REPORT SB 255 out of Committee with
individual recommendations and the accompanying fiscal note.
Senator Huggins OBJECTED for discussion.
Senator Huggins thanked Senator Elton for his work in making
this legislation happen for the people of Southeast Alaska.
Senator Elton commented that as a rate payer, he would
benefit along with the community.
Senator Huggins WITHDREW his OBJECTION.
9:23:28 AM
SB 255 was REPORTED out of Committee with a "do pass"
recommendation and accompanying new zero fiscal note by the
Department of Commerce, Community and Economic Development.
AT EASE: 9:23:47 AM
RESUME: 9:27:03 AM
SENATE BILL NO. 196
"An Act relating to establishing a controlled substance
prescription database."
GINGER BLAISDELL, STAFF, SENATOR GREEN, provided an overview
on the establishment of a prescription drug database (PDMP)
within the Board of Pharmacy. She introduced the legislation
by referring to the presentation booklet (Prescription Drug
Monitoring Program and Databases, Senate Bill 196, Offered
by Senator Green, copy on file). Ms. Blaisdell reported that
Senator Green was approached by emergency room doctors,
pharmacists, and other medical professionals asking if the
State of Alaska would consider introducing this legislation.
She pointed out that there is currently prescription
monitoring programs in forty of the fifty states; most of
the other ten states were looking at legislation and/or a
tracking database. She remarked that all states have laws
and regulations to govern the distribution and handling of
controlled substances. The database would be a new tool in
this control. She continued that the diversion of controlled
substances and other pharmaceuticals is generally recognized
as a serious problem throughout the United States (p. 1).
Ms. Blaisdell commented that national news organizations
have reported that most states have been pleased with the
outcome of the prescription drug monitoring program and have
found this program among the most effective tools available
to identify and prevent drug diversion (p. 2).
9:30:11 AM
Ms. Blaisdell explained that drug diversion is taking a
legal prescriptive substance and altering it to provide a
different effect or selling/giving it to someone, other than
the person to whom it was intended. She maintained that
these practices affects the health of citizens and often
promulgates other criminal activity (p. 3). The goals of the
Prescription Drug Monitoring Program (PDMP) are intended to
promote pharmaceutical care while deterring diversion
through education and law enforcement. She interjected that
law enforcement language is contained in the bill to give it
more substance. She also mentioned that PDMPs are aimed at
upholding statutory mandates in a manner that is supportive
of but not disruptive to medical and pharmaceutical
practices. Ms. Blaisdell noted that most states are finding
that reporting the controlled substances takes about two
minutes per day (p. 4). She asserted that there is a
national presumption that the misuse of prescription drugs
are safer than elicit or "street" drugs, but it is being
found that prescription drugs, when used inappropriately,
can cause death, coma, respiratory arrest, and other serious
problems. Mixing prescription drugs, with over the counter
medications, is becoming the new "party" drug for teenagers
and young adults (p. 7). She pointed out that 25 to 40
percent of MySpace websites have direct links on how to get
prescription drugs over the internet. She informed the
Committee that the most commonly abused prescription
medications were painkillers, stimulants, sedatives and
tranquilizers (p. 8). Prescription abuser profiles range
from young children who "overtake" their medication to the
elderly selling part of their medication to provide needed
money. She continued that nearly 70 percent of prescription
drugs are obtained free from family members and that pain
killers are the number one abused drug (p. 9).
9:34:48 AM
Ms. Blaisdell continued that legislation is being introduced
because Senator Green was approached by members of the
medical community and law enforcement officials due to the
increase in prescription drug diversion criminal activity.
She asserted that with this legislation, the state will be
eligible for federal funding to pay for the program in full
(p. 11). This bill establishes a PDMP within the
responsibilities of the Board of Pharmacy which will track
all schedule 1-V controlled substances in state and federal
law. The prescription data will be electronic rather than
paper (p. 12). She noted that licensed prescribers are
entitled to use the database: medical doctors, emergency
room doctors, dentists, veterinarians, nurse practitioners
and licensed or registered dispensers, such as pharmacists
(p. 13). Data can also be used by the Board of Pharmacy
personnel regarding licensing inquiries and for database
management. Ms. Blaisdell continued that this data can be
requested through the Board by law enforcement entities with
a subpoena or court ordered warrant. This provision is to
prevent "fishing" expeditions looking for a prescription
drug pattern for an individual (p. 14). The database can be
used to improve health care for patients and identify
prescribing and dispensing practices that may be in
question, such as, individuals who show a pattern of
inappropriate use (p. 15). The access and use of this data
will be confidential and not subject to public disclosure,
with some exceptions (p. 16).
9:37:41 AM
Ms. Blaisdell discussed the two fiscal notes, starting with
the Department of Commerce requesting authorization to
receive $400,000 available in federal funding. The second
fiscal note, from Department of Health and Social Services,
reflects potential savings in the Medicaid Agency (p. 17).
She referenced that members were provided the sectional
analysis explaining changes to the legislation in previous
committees (copy on file). She read the letter of intent
from Senator Green, Senate Labor and Commerce Committee,
which stated,
It is the intent of the Legislature that the Alaska
Prescription Monitoring Program be funded with federal
grants and state appropriations. It is not the intent
of the Legislature that the professional users of the
database absorb the costs of managing this public
program through their license fees or other fee
structure (copy on file).
9:39:53 AM
Ms. Blaisdell provided members with sample reports
describing a "good" prescribing practice that probably would
not be questioned (OHIO Automated RX Reporting System, Betty
Testpatient, copy on file) and a report reflecting large
prescription doses, visits to multiple doctors, numerous
pharmacies and frequent personal information changes. The
second sample report should raise questions by the doctor or
pharmaceutical prescriber (OHIO Automated RX Reporting
System, Joseph Llewellyn, copy on file). She outlined the
White House national campaign to prevent prescription and
over the counter drug abuse by teens (White House Office of
National Drug Control Policy National Youth Anti-Drug media
Campaign, copy on file).
9:42:35 AM
Co-Chair Stedman asked for elaboration on how the state and
federal databases would interface. Ms. Blaisdell answered
that no federal data base existed at this time. The
controlled substance information provided to the DEA is
viewed in a "big picture" approach. The DEA looks at the
amount of pills being manufactured by a company and how
these pills are being distributed throughout the United
States. She explained that discrepancies in importing and
exporting of pills are reviewed. The only states that
currently share information are Nevada and California.
9:44:30 AM
Senator Elton asked about the imposition on the pharmacists
per prescription. Ms. Blaisdell explained that the
imposition to the pharmacist is two minutes per day total,
which accounts for the time the data is transferred. The
program would be on the pharmacist's website, then, at the
end of the day, the data could be downloaded with a push of
a button.
Senator Elton inquired who has access to the database. Ms.
Blaisdell explained that the Board of Pharmacy sets a
specific set of criteria that allows one to get a log-in ID
to obtain access to the data. This applies to all who can
prescribe medicines and pharmacists who are actively
dispensing.
9:47:32 AM
Senator Elton questioned the time limit a name and
prescription information is kept in the database. Ms.
Blaisdell indicated that most states have time limits of two
to three years.
9:48:18 AM
Senator Elton asked if Medicaid would have to obtain a court
order to access the data. Ms. Blaisdell explained that
Medicaid and other government agencies could only acquire
this information if there was "just cause" to obtain legal
access, then it would be through a court order.
9:49:48 AM
Senator Thomas inquired how this bypasses HIPAA (Health
Insurance Portability and Accountability Act). Ms. Blaisdell
explained that HIPAA did adopt "exception language" and any
state entering into a prescription drug monitoring program,
for the purposes of health policy or law enforcement, are
exempt from breaking any HIPAA laws.
9:51:09 AM
Senator Olson wondered what kind of a burden would be placed
on the physician to access this information. Ms. Blaisdell
responded that it could be "zero" if a doctor chooses not to
participate; otherwise it takes about 15 seconds to receive
a report. Senator Olson inquired how this would work for
physicians without computer access, such as rural Alaska.
Ms. Blaisdell explained that this is one of the reasons
there is no requirement or mandate in the bill for a doctor
to be required to look up the data information. A solution
for doctors without computer access could be to request the
Board of Pharmacy to run a report and FAX it to the doctor.
Senator Olson inquired if there would be some sort of
backlash or discipline to physicians who are seen to
overprescribe. Ms. Blaisdell responded that, in past state
experiences, most physicians are aware that there may be a
doctor overprescribing. Often this problem is settled
through "peer review." This database would make the review
more efficient.
9:54:28 AM
Senator Thomas questioned how the security or pin number is
protected. Ms. Blaisdell responded that most states use a
physician's Drug Enforcement Administration (DEA) number
with a confidential password. The DEA number has recently
been scrutinized since it is often written on doctor's forms
making it fairly accessible. Some states have chosen to use
the NPI number (National Provider Identifier). Pharmacists
also have a separate identifier number for individual
persons.
Senator Elton did not see that the Medical Board had access
to database when considering disciplinary action toward a
physician. Ms. Blaisdell responded that the Medical Board
would need a court order. Senator Elton inquired if the
Medical Board fell under federal, state and local law
enforcement authorities (p. 4, Section 5). Ms. Blaisdell
responded that board members, appointed by the Governor, are
considered state public officials acting on behalf of a
government agency.
9:58:30 AM
Senator Olson added that, having served on the Medical
Board, the investigator has no problem obtaining a court
order.
9:58:39 AM
Co-Chair Stedman MOVED to ADOPT Amendment #1:
25-LS1092\K.1
Luckhaupt
1/10/11
A M E N D M E N T
OFFERED IN THE SENATE
TO: CSSB 196(L&C)Page 5, lines 18 - 22:
Delete all material and insert:
"(i) A person
(1) with authority to access the database
under (d) of this section who knowingly
(A) accesses information in the
database beyond the scope of the person's
authority commits a class A misdemeanor;
(B) accesses information in the
database and knowingly discloses that information
to a person not entitled to access or to receive
the information commits a class C felony;
(C) allows another person who is not
authorized to access the database to access the
database commits a class C felony;
(2) without authority to access the database
under (d) of this section who knowingly accesses the
database or knowingly receives information that the
person is not authorized to receive under (d) of this
section from another person commits a class C felony."
Page 5, following line 26:
Insert a new paragraph to read:
"(3) "knowingly" has the meaning given in
AS 11.81.900;"
Co-Chair Stedman OBJECTED for discussion.
Ms. Blaisdell discussed that intent of the amendment is to
better clarify what a class "A" misdemeanor and a class "C"
felony might involve. A class "A" misdemeanor would cover
someone accessing data, beyond one's authority, such as
front desk staff in a doctor's office. A class "C" felony
applies to someone who tries to alter the data in a PDMP.
10:00:58 AM
Senator Elton asked what happens if someone inappropriately
accesses this information to give it to a pharmaceutical
company with the purpose of soliciting the patient with
additional drug information. He wondered if a penalty
existed for that person or pharmaceutical company. Ms.
Blaisdell considered the person giving the information to
the pharmaceutical company would have legal repercussions
but not certain what penalty would apply to the
pharmaceutical company itself.
Co-Chair Stedman WITHDREW his OBJECTION. There being NO
further OBJECTION, Amendment #1 was adopted.
10:01:51 AM
Co-Chair Stedman commented positively on the zero line
fiscal notes.
10:02:16 AM
LINDA BAREFOOT, REGIONAL DIRECTOR, STATE GOVERNMENT AFFAIRS,
PURDUE PHARMA, L.P., identified the company as a
manufacturer and distributor of controlled and non-
controlled prescription medication and over the counter
products. Purdue Pharma supported SB 196.
Co-Chair Stedman inquired if Purdue Pharma manufactured
OxyContin. Ms. Barefoot responded "yes." Co-Chair Stedman
wondered if this bill would impact sales or marketing of the
drug. Ms. Barefoot responded that the company only wants
OxyContin prescribed for legitimate pain patients.
10:04:07 AM
PATRICIA SENNER, ADVANCED NURSE PRACTIONER, ALASKA NURSES
ASSOCIATION, indicated that the nurses association has been
working with Senator Green on this bill and supports the
intent of this bill. Many nurse practitioners prescribe
medicines and would like the ability to confirm a patient's
history when prescribing pain medication. She informed the
Committee that, having worked with both teenagers and
adults, she found more problems with adults. A major concern
about the database has to do with confidentiality and who
will have access to the database. The association is
concerned about the wrong person getting access to patient
addresses with the purpose of robbery to obtain pain
medications. She also indicated that inserting into the
database information if the patient is currently under a
"Pain Management Contract" with a pain doctor would be
helpful.
10:07:04 AM
Senator Olson questioned if Ms. Senner had any experience
with any Prescription Drug Monitoring Program. Ms. Senner
responded that she had not had experience with any
databases.
Senator Olsen wondered if she agreed with the time
commitment expressed for the prescribers and pharmacist. Ms.
Senner believed that the pharmacist who has it on their
computer will have a far shorter time commitment than those
that dispense from their office, especially for rural
offices.
10:08:03 AM
JULIE WOODWORTH, CHAIR, LEGISLATIVE COMMITTEE OF HOMER
CHAMBER OF COMMERCE supported SB 196. She remarked hearing
positive responses to this bill in the medical and local
communities.
10:09:18 AM
Senator Elton asked if Ms. Blaisdell had a comment on the
information of individuals obtaining patient addresses for
criminal purposes. Ms. Blasdell responded that one of the
reasons for pursuing this nationwide database is that access
to people's personal information is already occurring.
Co-Chair Hoffman MOVED to REPORT out of Committee as amended
with individual recommendations and attached fiscal notes
and the letter of intent.
CSSB 196 (FIN) was REPORTED out of Committee with "do pass"
recommendation and new fiscal note from the Department of
Commerce, Community and Economic Development and the letter
of intent from the Senate Labor and Commerce Committee.
ADJOURNMENT
The meeting was adjourned at
10:11:59 AM
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