Legislature(1993 - 1994)
03/09/1994 01:55 PM Senate HES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SENATE HEALTH, EDUCATION AND SOCIAL SERVICES COMMITTEE March 9, 1994 1:55 p.m. MEMBERS PRESENT Senator Steve Rieger, Chairman Senator Bert Sharp, Vice-Chairman Senator Loren Leman Senator Jim Duncan Senator Johnny Ellis Senator Judy Salo MEMBERS ABSENT Senator Mike Miller COMMITTEE CALENDAR SENATE BILL NO. 249 "An Act relating to assisted living homes; repealing references to residential facilities for dependent adults; and providing for an effective date." SENATE BILL NO. 298 "An Act relating to licensure by the State Medical Board." SENATE BILL NO. 270 "An Act creating the Alaska Health Commission; relating to the delivery, quality, access, and financing of health care; relating to review and approval of rates and charges of health insurers; relating to certain civil actions against health care providers and health insurers; repealing Alaska Rule of Civil Procedure 72.1; and providing for an effective date." SENATE BILL NO. 284 "An Act establishing the Alaska Health Insurance Corporation and requiring licensed health care providers to comply with certain statutes and regulations relating to the corporation; relating to disability insurance claims processing and to approval of rates for disability insurance, including health insurance; and providing for an effective date." PREVIOUS SENATE COMMITTEE ACTION SB 249 - See Health, Education & Social Services minutes dated 2/2/94, 2/4/94, 2/16/94, and 2/23/94. SB 298 - No previous action to record. SB 270 - See Health, Education & Social Services minutes dated 2/9/94, 2/18/94 and 3/2/94. SB 284 - See Health, Education & Social Services minutes dated 2/14/94, 2/18/94 and 3/2/94. WITNESS REGISTER D. R. Lehmann, President Alaska State Medical Association Family Practitioner 700 Katlian Sitka, Alaska 99835 POSITION STATEMENT: Offered a change to SB 298. Roy A. Box 16185 Lena Loop Road Juneau, Alaska POSITION STATEMENT: Explained amendment to SB 249. Connie Sipe, Executive Director Division of Senior Services P.O. Box 110209 Juneau, Alaska 99811-0209 POSITION STATEMENT: Reviewed SB 249. Dave Williams Division of Medical Assistance Department of Health and Social Services P.O. Box 660 Juneau, Alaska POSITION STATEMENT: Reviewed the fiscal note for SB 249. Nancy Usera, Commissioner Department of Administration P.O. Box 110200 Juneau, Alaska 99811-0200 POSITION STATEMENT: Answered questions regarding Pioneer Homes. Mary Lou Mieners, Chairperson State Legislative Committee Amemrican Association of Retired Persons P.O. Box 020412 Juneau, Alaska 99802 POSITION STATEMENT: Supported SB 249. ACTION NARRATIVE TAPE 94-16, SIDE A Number 009 CHAIRMAN RIEGER called the Senate Health, Education and Social Services (HESS) Committee to order at 1:55 p.m. He introduced SB 298 (LICENSING OF PHYSICIANS) as the first order of business before the committee. D. R. LEHMANN, President of the Alaska State Medical Association (ASMA) and a family practitioner, stated that SB 298 is a good bill that can be improved upon. He discussed an example that illustrates that the current system requiring interviews for medical licensure is a burden, especially in rural areas where there are not members representing the State Medical Board. The licensure interview tends to last less than five minutes. He explained that SB 298 should correct much of the licensure problems by allowing the board's designated representative to conduct the licensure interview. He suggested changing "shall" to "may" on page 1, line 4, which would allow the board to collect all necessary data for screening applicants. If everything was in order after the data collection, the interview could be omitted. He pointed out that omitting the interview was not a radically new approach; only twenty-two states of the fifty-three state entities require interviews. Omitting the interview or having it at the board's discretion would allow the board more time to fulfill disciplinary and investigatory functions. He said that the interviews do not seem to serve any major purpose. Number 095 ROY BOX, optometrist, stated that he was present to testify on an amendment to SB 298 that would be similar to section 3 of HB 507. SENATOR LEMAN informed everyone that the amendment to be offered was in their packet. ROY BOX explained that the proposed amendment would allow the Optometry Board to allow locum tenens licenses to optometrists in the state. The locum tenens license would basically operate the same as the Medical Board's locum tenens license. A locum tenens is a licensed temporary doctor who fills in for a practicing doctor. The practicing doctor would be responsible for the temporary or locum tenens doctor. He pointed out that locum tenens are needed since there are only about fifty practicing optometrists and of those about forty are in private practice. This amendment would allow specialty care from visiting doctors, as well as allowing a solution for ill or vacationing doctors in small towns. SENATOR SHARP set aside SB 298. Number 163 SENATOR SHARP introduced SB 249 (REGULATION OF ASSISTED LIVING HOMES) as the next order of business before the committee. SENATOR LEMAN moved to adopt for discussion the CSSB 249 (HES), the Lauterbach J version. Hearing no objections, it was adopted. CONNIE SIPE, Executive Director of the Division of Senior Services, stated that the CS appears consistent with their recommendations and the committee's recommendations. SENATOR LEMAN asked if Ms. Sipe was aware of the Anchorage Pioneer Home's desire to be excluded from SB 249. CONNIE SIPE said that she was aware of the Anchorage Pioneer Home's position. She explained that some of the nurses of the Anchorage Pioneer Home seem to be concerned about the gradual shift in Pioneer Homes having more assisted living beds with fewer residential and nursing home beds. They are also concerned that unlicensed staff would be used in pioneer homes to provide nursing care. She referred to the health related services portion of SB 249 which allows a registered nurse to train an unlicensed individual to perform tasks as approved by the State Board of Nursing. She explained that the nurses are confused because the State Board of Nursing, who have the legal power to define the scope and practice of nursing in the state, issued an opinion that goes beyond SB 249. The State Board of Nursing issued an opinion stating that nurses may train and delegate tasks to unlicensed personnel in any setting. This position reverses a 1991 opinion. She specified that the State Board of Nursing 1994 opinion, which is currently in effect, has nothing to do with SB 249. The opinion relates to all nursing practice in the state of Alaska. She asserted that SB 249 does not require the state of Alaska to do assisted living in the Pioneer Homes, SB 249 only licenses what is currently being done and allows it to be done in other settings besides the Pioneer Homes. Number 306 DAVE WILLIAMS, Division of Medical Assistance in the Department of Health and Social Services, reviewed the reasons an assisted living facility which can offer medical services was created. He pointed out that assisted living facilities will increase access to services for which Medicaid will pay. The alternative to assisted living facilities would be nursing homes which are more expensive. Assisted living facilities and pioneer homes would be considerably less. SB 249 increases access which would increase costs. Mr. Williams explained that the fiscal note assumes that a certificate of need would be required prior to conversion of any or part of any assisted living facility into a nursing home. He pointed out that the CS work draft left out some essential suggested language; the words "Not withstanding the expenditure threshold" were left out at the beginning of section 4 on page 27. He explained that someone should not be able to spend $1 million to convert a building into a nursing home when the building is already built, only the new license is needed to convert. He stated that the fiscal note would not be valid without that language because conversion to a nursing home carries a $78,000 yearly cost. SENATOR ELLIS asked why those words were left out of the work draft. CONNIE SIPE said that she read section 4 as stating that no part of the building may be converted without a certificate of need. She explained that the drafter may have felt that the language was strong enough legal language so that "regardless of the expenditure limit" was not necessary. She believed that putting the language in would not hurt the bill. DAVE WILLIAMS explained that perhaps Lauterbach was being economical with words. He reiterated the need to have that language added, especially on a technical level. Number 392 SENATOR ELLIS recommended that Mr. Williams' concerns should be addressed before the bill moves out of the committee. He asked for the number of seniors who qualify under Medicaid waivers now and how many people to date have been served. DAVE WILLIAMS clarified that the waivers come in a graduated scale over the next three years. In the third year, this would come into effect due to the time for an assisted living home to be built. He stated that 401 people could be served under the Aged Person Waiver. CONNIE SIPE stated that nine seniors are being served. There are forty-five slots reserved. She explained that by the end of this fiscal year the half year mark would be reached, sixty people. She noted that the program was six months late because the regulations were in the Department of Law longer than expected. SENATOR ELLIS asked if the Hickel administration had considered any initiative making the Pioneer Homes Medicaid eligible. NANCY USERA, Commissioner of the Department of Administration, explained that the subject of Medicaid has often been a topic of discussion regarding maintaining the quality of service of Pioneer Homes in a cost effective manner. The people eligible for Medicaid in the Pioneer Homes are few under the current structure. If individuals are Medicaid eligible, there are private nursing facilities available for them. She stated that the Pioneer Homes fulfill the moderate income seniors and alzheimers disease or related dementia seniors, who are not Medicaid eligible. She said that they are not pursuing an initiative to make Pioneer Homes Medicaid eligible. SENATOR ELLIS asked if poor individuals would go to private nursing homes, while wealthy individuals would go to Pioneer Homes. NANCY USERA said that Pioneer Home residents cross the spectrum of the senior community. She discussed the change in the Pioneer Homes' population, they do not need twenty-four hour nursing but rather they need the assisted living type of situation. Alzheimers is not a Medicaid eligible diagnosis so currently, there is no funding for them. She reiterated that the Pioneer Homes serve a moderate income level population. SENATOR ELLIS inquired as to what level of the administration was the decision made not to pursue an initiative to make Pioneer Homes Medicaid eligible. NANCY USERA explained that for the past three years the administration has explored, with consideration to budget concerns, how to maintain the financing structure of the Pioneer Homes. The benefits of making Pioneer Homes Medicaid eligible do not out weigh the costs. SENATOR ELLIS pointed out that the rates of the Pioneer Homes have been increasing which indicates, to him, the need to bring in more money in order to lessen the general fund obligation. He stated that there was a lack of consistency. NANCY USERA explained that to convert to a Medicaid system would require significant structural changes to the Pioneer Home. The rates are adjusted on an annual basis with respect to the cost of living in order to keep up with the additional cost of running the homes. She noted that Pioneer Home residents only pay 13 percent of the cost of nursing, they pay 23 percent with assisted living, and 35 percent with residential. She said that these rates are not unreasonable. She believed that the residents are still receiving the best deal in Alaska in terms of quality of care at the price. SENATOR ELLIS disagreed with Ms. Usera on the issue that SB 249 has nothing to do with Pioneer Homes regarding rates and such. Number 492 DAVE WILLIAMS referred to a 1990 December Report which illustrates the avoidance of approximately 200 nursing home constructions by emphasizing home rather than institutional care. Since the current facilities are full, waivers should be acquired and used as well as going forward with assisted living homes. He asserted that unless those alternatives were utilized, nursing homes would be constructed. Such circumstances would leave Medicaid responsible for paying for the nursing homes. SENATOR SHARP asked if Mr. Williams was referring to section C regarding the omitted language. DAVE WILLIAMS said no and specified that the language was omitted in the work draft on page 27, line 11 after subsection (b). He reiterated his recommendation to insert the language, "Not withstanding the expenditure threshold in AS 18.07.031," at the beginning of subsection (b), before "A." SENATOR SALO moved to adopt Mr. Williams suggestion. Page 27, line 11, after "(b)": Insert "Not withstanding the expenditure threshold in AS 18.07.031," Hearing no objections, it was adopted. MARY LOU MIENERS, Chairperson of the State Legislative Committee (SLC) for American Association of Retired Persons (AARP), stated their support for SB 249. She envisioned this as an opportunity to assist seniors in their communities on a smaller scale. She urged passage of SB 249. SENATOR DUNCAN moved CSSB 249 (HES) as amended out of committee with individual recommendations and the accompanying fiscal note. Hearing no objections, it was so ordered. Number 556 CHAIRMAN RIEGER introduced SB 270 (COMPREHENSIVE HEALTH CARE) and SB 284 (COMPREHENSIVE HEALTH INSURANCE ACT) as the next order of business before the committee. He stated that he intended to discuss the liability reform proposals of both bills. He noted that there had been a hearing on Senator Duncan's bill of last year and it would be available for discussion as well. SENATOR DUNCAN specified that the Tort Reform bill was left to move on its own. Therefore, there is no companion bill to SB 284. CHAIRMAN RIEGER asked Ms. Usera to discuss the proposals of SB 270 regarding civil procedures, arbitration. NANCY USERA pointed out the two civil provisions of SB 270. The first provision is, section 4, page 8, a non-binding court ordered arbitration for malpractice suits. She noted that this alternative dispute resolution has been successfully used in other states. This would resolve a malpractice suit before going through a costly litigation process. The second provision in section 6 addresses a similar concept for claims against insurance companies. TAPE 94-16, SIDE B Number 593 NANCY USERA summarized that they are attempting to uncover more cost effective ways to resolve these disputes short of the courts. CHAIRMAN RIEGER asked if the possibility of strengthening the burden of proof, or the penalties on either party that rejects the arbitrator's claim had been considered. NANCY USERA said no. Ms. Usera explained that the premise of SB 270 is to do what can be done now. This was the first step towards finding alternative dispute resolutions. CHAIRMAN RIEGER indicated that he may want to introduce something similar. He noted a discussion with the legal counsel who explained that one cannot mandate that an arbitrator's ruling is deemed to be true nor can the burden be placed on the individual to disprove the ruling. The stakes, such as court costs and attorney fees, can be raised. He asked Senator Duncan to discuss SB 123 regarding an OB statute of limitations. SENATOR DUNCAN explained that there were no recommendations on Tort Reform in SB 284 because of the constitutional single subject rule. He pointed out that there were recommendations in SB 123: (1) reducing the statute of limitations for birth related injuries from current law to the eighth birthday of the child; (2) court ordered non binding arbitration process be used to replace existing pre-trial screening process for medical malpractice suits; and (3) change the pre-judgement interest rate from 10.5 to the prevailing interest rate. CHAIRMAN RIEGER inquired of the expert advisor provision. SENATOR DUNCAN believed that was part of the non binding arbitration process. NANCY USERA stated that changes a court rule which requires a different vote of the legislature to do that. She explained that SB 270 converts from a three person panel to a one person expert advisor for the resolution. She referred to an article which would be given to the committee which illustrates the success of arbitration versus litigation; 89 percent of the cases were settled prior to hearings. She clarified that the provisions in SB 270 do not limit anyone's liability, but only provide an alternative to dispute resolution; therefore, the single subject rule does not seem to apply. SENATOR DUNCAN requested a legal opinion. Number 539 CHAIRMAN RIEGER offered an amendment for discussion regarding raising the stakes which would clarify that court costs and attorney fees would go against the party who attempts to appeal the arbitrator's decision if nothing changes. The amendment was written for SB 270 because the drafter needed somewhere to start, but Chairman Rieger did not know where it would be used. Chairman Rieger asked if there were any questions or objections to the basic ideas of the proposals by Senator Duncan, Nancy Usera, and his amendment. SENATOR ELLIS stated opposition of the proposals being proposed separately. The recommendations Senator Duncan discussed were adopted in the context of a comprehensive health care reform package. He pointed out that many of the recommendations were adopted because other parts of the Task Force's recommendations were adopted. The Tort Reform recommendations of the Task Force proposed individually would not be supported by the majority of the Task Force. He stated that he would support the provisions in the context of comprehensive health care reform. CHAIRMAN RIEGER acknowledged the need to review the proposals case by case and not always refer to them in context of the entire package. He advised the committee that the provisions regarding regulation of insurers, the standardized claims form, and the fiscal notes of both SB 270 and SB 284 would be addressed at the next meeting. He said that the civil procedure aspect of the bills could be discussed today. SENATOR DUNCAN clarified that the work group did not endorse any of the Tort Reform proposals even those in SB 123. There was no formal recommendation from the work group. SENATOR ELLIS added that he believed that most physicians thought Tort Reform was going to pass this year and time should not be wasted discussing or negotiating other liability and compensation limits in the health care reform context. CHAIRMAN RIEGER explained that he did not realize that Tort Reform was not part of the work group's proposal. The February 9, 1994 draft of the Health System Reform Work Group, Alaska Proposal SB 284 lists Tort Reform as item ten. SENATOR DUNCAN informed Chairman Rieger that he had an old copy, there is a newer copy that would be provided. Number 469 SENATOR ELLIS asked if Mr. Walsh would be discussing the Division of Insurance's portion of the fiscal note for both bills. CHAIRMAN RIEGER reiterated that the standardized claim form, the regulation of insurers, and the fiscal notes would be before the committee on Friday. SENATOR DUNCAN requested that Kim Busch and others of the Department of Health and Social Services be present on Friday to discuss the various Medicaid claim costs and administrative costs. He expressed concern with a fiscal note being prepared by AETNA; he would review that aspect. There being no further business before the committee, the meeting was adjourned at 2:55 p.m.
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