Legislature(1993 - 1994)

03/09/1994 01:55 PM Senate HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
    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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