Legislature(1997 - 1998)

04/25/1997 09:06 AM HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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      SENATE HEALTH, EDUCATION & SOCIAL SERVICES COMMITTEE                     
                         April 25, 1997                                        
                           9:06 a.m.                                           
                                                                               
  MEMBERS PRESENT                                                              
                                                                               
 Senator Gary Wilken, Chairman                                                 
 Senator Loren Leman, Vice Chairman                                            
 Senator Lyda Green                                                            
 Senator Jerry Ward                                                            
 Senator Johnny Ellis                                                          
                                                                               
  MEMBERS ABSENT                                                               
                                                                               
 All members present.                                                          
                                                                               
  COMMITTEE CALENDAR                                                           
                                                                               
 SENATE BILL NO. 170                                                           
 "An Act relating to financial assistance for students attending               
 certain graduate education programs; and providing for an effective           
 date."                                                                        
                                                                               
  - HEARD AND HELD                                                             
                                                                               
 SENATE BILL NO. 116                                                           
 "An Act relating to welfare to work tax credits under the Alaska              
 Net Income Tax Act; and providing for an effective date."                     
                                                                               
  - MOVED SB 116 OUT OF COMMITTEE                                              
                                                                               
 CS FOR SENATE BILL NO. 152(L&C)                                               
 "An Act relating to certified nurse aides; and providing for an               
 effective date."                                                              
                                                                               
  - MOVED CSSB 152(L&C) OUT OF COMMITTEE                                       
                                                                               
  PREVIOUS SENATE COMMITTEE ACTION                                             
                                                                               
 SB 170 - No previous Senate action to record.                                 
                                                                               
 SB 116 - See Senate State Affairs Committee minutes dated 3/25/97,            
      3/27/97.  See Senate Health, Education & Social Services                 
      minutes dated 4/23/97.                                                   
                                                                               
 SB 152 - See Labor and Commerce minutes dated 4/15/97.                        
                                                                               
  WITNESS REGISTER                                                             
                                                                               
 Joe Ambrose, Staff                                                            
 Senator Taylor                                                                
 State Capitol                                                                 
 Juneau, Alaska 99801-1182                                                     
  POSITION STATEMENT:   Read the Sponsor Statement.                            
                                                                               
 Laura Burleson, UAF Pre-Med Student                                           
 4758 Glasgow #1                                                               
 Fairbanks, Alaska 99709                                                       
  POSITION STATEMENT:   Supported SB 170.                                      
                                                                               
 Wendy Redman, Vice President                                                  
 University of Alaska Statewide System                                         
 PO Box 755000                                                                 
 Fairbanks, Alaska 99775                                                       
  POSITION STATEMENT:   Urged the committee to continue WAMI.                  
                                                                               
 Diane Barrans, Executive Director                                             
 Postsecondary Education Commission                                            
 3030 Vintage Boulevard                                                        
 Juneau, Alaska 99801-7109                                                     
  POSITION STATEMENT:   Answered questions.                                    
                                                                               
 Jim Nordlund, Director                                                        
 Division of Public Assistance                                                 
 Department of Health & Social Services                                        
 PO Box 110640                                                                 
 Juneau, Alaska 99811-0640                                                     
  POSITION STATEMENT:   Explained SB 116.                                      
                                                                               
 Joseph Friedman, Director                                                     
 Trade Dollar Exchange                                                         
 3820 Lake Otis Parkway                                                        
 Anchorage, Alaska 99508                                                       
  POSITION STATEMENT:   Discussed the Trade Dollar Exchange.                   
                                                                               
 Pam LaBolle                                                                   
 Alaska State Chamber of Commerce                                              
  POSITION STATEMENT:   Supported SB 116.                                      
                                                                               
 Annette Krietzer, Staff                                                       
 Senator Leman                                                                 
 State Capitol                                                                 
 Juneau, Alaska 99801-1182                                                     
  POSITION STATEMENT:   Reviewed SB 152.                                       
                                                                               
 Teresa Lyons, Registered Nurse                                                
 PO Box 477                                                                    
 Ester, Alaska 99725                                                           
  POSITION STATEMENT:   Supported SB 152.                                      
                                                                               
 Gail McGuill, President                                                       
 Alaska Nurses Association                                                     
 237 E 3rd Avenue                                                              
 Anchorage, Alaska 99501                                                       
  POSITION STATEMENT:   Supported SB 152.                                      
                                                                               
 Ron Cowan                                                                     
 Division of Medical Assistance                                                
 Department of Health & Social Services                                        
 PO Box 110660                                                                 
 Juneau, Alaska 99811-0660                                                     
  POSITION STATEMENT:   Supported SB 152.                                      
                                                                               
 Catherine Reardon, Director                                                   
 Division of Occupational Licensing                                            
 Department of Commerce & Economic Development                                 
 PO Box 110806                                                                 
 Juneau, Alaska 99811-0806                                                     
  POSITION STATEMENT:   Supported SB 152.                                      
                                                                               
  ACTION NARRATIVE                                                             
                                                                               
  TAPE 97-43, SIDE A                                                           
                                                                               
              SB 170 REPAY GRADUATE EDUCATION AID                             
                                                                              
 Number 001                                                                    
                                                                               
  CHAIRMAN WILKEN  called the Senate Health, Education & Social                
 Services Committee (HES) to order at 9:06 a.m. and introduced                 
 SB 170  as the first order of business before the committee.                  
                                                                               
  JOE AMBROSE , Staff to Senator Taylor, read the following Sponsor            
 Statement into the record:                                                    
                                                                               
 Senate Bill 170 was introduced at the request of constituents                 
 interested in preserving the WAMI Medical Education Program.  This            
 is a companion measure to House Bill 193 and its introduction is              
 intended to compliment that effort.  These bills would convert the            
 Alaska program into a loan program.  The state of Montana has                 
 already made this conversion.                                                 
                                                                               
 WAMI has been a program of financial assistance named for the                 
 participating states of Washington, Alaska, Montana, and Idaho.  It           
 is intended to facilitate the education of medical professionals.             
 Alaska participated to the tune of $1,309,000 in FY97.                        
                                                                               
 WAMI has been criticized because there has been no real incentive             
 for a student to return to the state upon completion of their                 
 education.                                                                    
                                                                               
 By converting this program to a loan program and including a                  
 provision for loan forgiveness, proponents feel young Alaskans will           
 be more likely to bring their new skills back to Alaska.                      
 The House sponsor has been working with the Postsecondary Education           
 Commission and has developed a committee substitute.  Senator                 
 Taylor recommends adopting the same language as a substitute for              
 SB 170.                                                                       
                                                                               
  SENATOR GREEN  moved that CSSB 170(HES) be placed before the                 
 committee.  Without objection, CSSB 170(HES) was before the                   
 committee.                                                                    
                                                                               
  SENATOR LEMAN  inquired as to the impact on the borrower.  When does         
 the pay back schedule for the WAMI loan begin?   JOE AMBROSE  pointed         
 out the language on page 2, lines 7-9 "Interest imposed under this            
 subsection begins to accrue when the person terminates studies                
 under the graduate education program."  Mr. Ambrose believed the              
 legislation allows for the internship.  Mr. Ambrose directed                  
 Senator Leman to page 2, lines 27-29 "A person employed in a                  
 medical residency program is not required to begin repayment to the           
 state as long as the person remains in the medical residency                  
 program."  With regard to the impact on the borrower, Mr. Ambrose             
 deferred to the Postsecondary Education Commission.                           
                                                                               
 Number 115                                                                    
                                                                               
  LAURA BURLESON , UAF Pre-Med student, supported SB 170.  WAMI is             
 important to Alaskan pre-med students because WAMI gives Alaskans             
 preference for admission and tuition.  WAMI treats Alaskan pre-med            
 students as residents for admission purposes.  Ms. Burleson                   
 informed the committee that a school to which she recently applied            
 had received over 10,000 applicants for 113 positions while another           
 school had 8,000 applicants for 32 out of state positions.  With              
 those odds, Alaskan students do not have much of a chance because             
 Alaska does not have a medical school to provide in state admission           
 preference.  SB 170 is a compromise to the alternative of                     
 eliminating the program.  Without WAMI, the challenge of the                  
 numbers of getting into a medical school out of state would be very           
 difficult.  Furthermore, this bill could help WAMI students                   
 applying for the program.  In the past the return rate for students           
 returning to the state is relatively low.  The return or repayment            
 clause in SB 170 would help those students who do intend to return            
 to the state and practice.                                                    
                                                                               
  WENDY REDMAN , Vice President of the University of Alaska statewide          
 system, thanked Representative Bunde and Senator Taylor for their             
 work on this issue.  WAMI is very important to the university.  The           
 University of Alaska-Anchorage offers the first year of the medical           
 program which provides the basis of a biomedical program.  Ms.                
 Redman was supportive of this legislation if it is a means to                 
 maintain WAMI.  Ms. Redman hoped that the Senate action deleting              
 WAMI will be worked out.  Ms. Redman suggested that the pay back              
 provision for the first year be eliminated.  The first year of the            
 program is offered in Alaska and is important to the university and           
 the state by drawing medical research here.  Ms. Redman recognized            
 that the WAMI program is an expensive program, but it is                      
 substantially less expensive than having a medical school.  The               
 decision to bring back WAMI students to Alaska is a policy call               
 which SB 170 addresses.  Currently, 48 percent of the WAMI                    
 participants do return to Alaska which is higher than the national            
 average for other medical schools.  The WAMI program is a bargain             
 for Alaska and Alaskan students.  Ms. Redman urged the committee to           
 continue the WAMI program and consider an amendment that would                
 provide that the first year of pay back be eliminated.                        
                                                                               
 Number 263                                                                    
                                                                               
  SENATOR ELLIS  asked if the return rate was expected to                      
 substantially increase with the Sisters of Providence family                  
 practice residency program.  Senator Ellis projected that a                   
 substantial increase in the return rate would occur due to the                
 availability of the residency program within the state.   WENDY               
 REDMAN  agreed with Senator Ellis that students tend to become                
 permanent residents in the community in which the student did                 
 residency.  Therefore, the family practice residency in Alaska                
 would make a big difference.                                                  
                                                                               
  SENATOR ELLIS  inquired as to the average debt load of a student             
 after seven years of medical training.   WENDY REDMAN  informed               
 everyone that the average loan is $45,000 to $80,000 per the                  
 information of the Postsecondary Commission.  With SB 170, $56,000            
 would be added if all four years pay back are included or $44,000             
 if the first year of pay back is eliminated.  That would total                
 about $100,000 to $130,000 of debt.  Ms. Redman pointed out that              
 these are family practitioners, not cardiac surgeons which could              
 possibly absorb that debt.                                                    
                                                                               
  SENATOR ELLIS  stated that the higher the debt load, the more likely         
 someone is to specialize and practice in a major urban center in              
 order to pay off the debt.  The lower the debt load, the more                 
 likely someone would choose to deliver babies in a rural setting.             
                                                                               
  SENATOR GREEN  noted that students could accumulate $50,000 in post          
 graduate debt before beginning the WAMI program as well as the debt           
 the WAMI program would incur.  When does repayment begin for the              
 debt incurred in the post graduate education?   WENDY REDMAN                  
 explained that the Postsecondary Commission would provide deferment           
 on the baccalaureate loans while the student is attending medical             
 school on a loan.  Ms. Redman pointed out that the loans are                  
 additive.  If a student has a loan from Alaska, the first                     
 baccalaureate loan would be deferred while the student continues              
 his/her education.  At the time the student graduates from medical            
 school and one year afterwards, the entire loan would begin                   
 repayment.                                                                    
                                                                               
  SENATOR GREEN  asked if the student's record was clean with a                
 deferment; is there a bad debt record being assessed against the              
 student or the institution?                                                   
                                                                               
 Number 322                                                                    
                                                                               
  DIANE BARRANS , Executive Director of Postsecondary Education                
 Commission (PSEC), stated that there are provisions for deferment             
 that do not damage a student's credit history.                                
                                                                               
  SENATOR LEMAN  inquired as to the tax consequences of WAMI; is the           
 program treated like a scholarship which is nontaxable?   DIANE               
 BARRANS  explained that it would be categorized as gift aid.  Since           
 the loan is not associated directly with an individual, there is              
 simply a contractual fee paid to the University of Washington.                
 Therefore, the WAMI loan would not relate to an individual's                  
 scholarship or loan limits.   SENATOR LEMAN  ascertained then that            
 there is no obligation by the party benefiting to pay the IRS any             
 portion of that benefit.   DIANE BARRANS  replied no.                         
                                                                               
  SENATOR LEMAN  asked if a loan program with forgiveness was created,         
 would that be a taxable benefit?   DIANE BARRANS  understood that in          
 the past, the tax code made some provisions for those receiving a             
 benefit related to specific employment or service.  In the early              
 1990s, the IRS did contact PSEC and required the disclosure of                
 forgiveness benefits upon which people were taxed.  However, Ms.              
 Barrans said that at that time there was no provision in the tax              
 code for people to receive a benefit simply because the person                
 resided in a particular area.  Ms. Barrans said that it is                    
 difficult to receive tax advice from the IRS, therefore a tax                 
 accountant or tax attorney should be contacted.   SENATOR LEMAN  did          
 not want to inadvertently establish a cash drain away from Alaska             
 or Alaskans to the IRS.  Senator Leman expressed the need to make             
 the tax consequences benefit Alaska or Alaskans who participated.             
                                                                               
 Number 370                                                                    
                                                                               
 In answer to the first half of Senator Leman's question,  DIANE               
 BARRANS  explained that the student with a WAMI loan would be                 
 borrowing the differential between the resident and the non-                  
 resident University of Washington School of Medicine rate of                  
 tuition.  Currently, the student pays the resident rate of tuition            
 which is about $8,000 per year.  The student would be borrowing the           
 additional amount that is charged to residents.  Ms. Barrans                  
 pointed out that was calculation 2 in the committee packet.                   
                                                                               
  SENATOR LEMAN  determined then that the student is responsible for           
 the resident tuition rate and may borrow that under other loan                
 programs, but not specifically under the WAMI loan program.   DIANE           
 BARRANS  agreed with that assessment.                                         
                                                                               
  CHAIRMAN WILKEN  requested that the concerns with SB 170 be                  
 addressed and the Chair held SB 170.                                          
                                                                               
               SB 116 WELFARE TO WORK TAX CREDITS                             
                                                                              
  CHAIRMAN WILKEN  announced that  SB 116  was the next order of               
 business before the committee.                                                
                                                                               
 Number 402                                                                    
                                                                               
  JIM NORDLUND , Director of the Division of Public Assistance,                
 informed the committee that he was present to testify on the behalf           
 of the Administration in support of SB 116.  SB 116 will provide              
 tax credits to Alaska corporate employers who hire disadvantaged              
 workers.  Mr. Nordlund has a particular interest in SB 116 because            
 of the challenge of the division and the state as a whole to find             
 work opportunities for up to 4,000 individuals in the next year due           
 to state and federal mandates.  This is a multi-departmental                  
 effort.  Mr. Nordlund noted his work with the employer community to           
 review incentives for employers to hire welfare recipients and                
 SB 116 is a key to this goal.  Mr. Nordlund mentioned that a                  
 representative from the Department of Revenue and the Department of           
 Labor are present for questions regarding the respective                      
 departments.                                                                  
                                                                               
 SB 116 is modeled after federal legislation that provides a tax               
 credit on the federal income tax to businesses that hire welfare              
 recipients.  SB 116 would require a state tax credit of up to                 
 $1,000 per employee and an additional $500 if the employer provides           
 job training to the recipient.  The employee must be on the job for           
 180 days or 400 hours, and those need not be consecutive days which           
 recognizes the seasonal employment in Alaska.  Mr. Nordlund                   
 mentioned that the federal law and SB 116 are not limited to                  
 welfare recipients, but are available to other categories of                  
 disadvantaged workers.  For the number of employers who hire                  
 recipients, there is a significant cost savings in terms of welfare           
 benefits that would have otherwise been paid offsetting the cost to           
 the Treasury of providing that tax credit to employers.  Mr.                  
 Nordlund noted that SB 116 makes it as administratively simple for            
 employers as possible.                                                        
                                                                               
  SENATOR LEMAN  said that he liked the idea.  Senator Leman noted             
 that a few years ago, he introduced a welfare reform bill which               
 included a provision similar to the concept of SB 116.  Senator               
 Leman was concerned with limiting the tax credit to the corporate             
 income tax.  Perhaps, there is a way in which to broaden the base             
 to include more employers to participate in employing welfare                 
 recipients.  The number of corporate tax payers in Alaska is small            
 in comparison to the number of business licenses.                             
                                                                               
 JIM NORDLUND  recognized that SB 116 would only benefit Alaskan               
 corporations because corporations are the only businesses that pay            
 income taxes.  Mr. Nordlund emphasized that SB 116 is one of                  
 several incentives being utilized to encourage employers to hire              
 welfare recipients.  Mr. Nordlund informed the committee that a               
 program modeled after the Green Star program is being reviewed.               
 The Work Star program which recognizes businesses hiring                      
 disadvantaged workers or welfare recipients is also being reviewed.           
 Under SB 98 from last year, the actual welfare benefit can be used            
 as a wage subsidy to businesses not limited to corporations hiring            
 welfare recipients.  Mr. Nordlund pointed out that most who work              
 outside of government work for a corporation.  The bigger                     
 businesses who hire more are generally corporations.                          
                                                                               
  SENATOR LEMAN  inquired as to the numbers of employees hired by the          
 corporations covered under the corporate income tax versus the                
 total number of employees in Alaska.   JIM NORDLUND  said that could          
 be provided.                                                                  
                                                                               
 Number 489                                                                    
                                                                               
  SENATOR GREEN  inquired as to how the wage subsidy would work.   JIM         
 NORDLUND  explained that for a business, such as KMART, who pays $7           
 an hour and who hires a welfare recipient for six months to a year;           
 the business would receive $2 an hour.  The welfare benefit would             
 be utilized to subsidize $2 an hour of the wage.  Mr. Nordlund                
 pointed out that the program has been used in other states.  Due to           
 the combination of the residual benefit and the wage, the person              
 would do better than with the welfare benefit alone.  The employer            
 experiences a reduced payroll cost.  The wage subsidy is good for             
 the State Treasury because the needs of the family are being                  
 provided for partially through wages as opposed to 100 percent                
 through the welfare benefit.  Mr. Nordlund noted that the wage                
 subsidy will be placed in regulation by October 1997.                         
                                                                               
  SENATOR GREEN  asked if this would be part of the training component         
 or the work requirement.  How does this impact the two year and               
 five year time limit with regard to the individual's participation            
 in the tax credit?   JIM NORDLUND  said that presuming the individual         
 is working, the individual would not be subject to the two year               
 time limit which is the requirement for people to be in a job.  If            
 the job has a low wage and the individual is eligible for welfare,            
 the individual would receive a reduced benefit.  Between now and              
 five years, hopefully the individual would be at a point to support           
 themselves without any assistance.                                            
                                                                               
  SENATOR GREEN  asked if this could be construed to be a disincentive         
 to get off welfare.   JIM NORDLUND  did not think so.  This is                
 invisible to the recipient, except that employers would be willing            
 to hire the recipient.                                                        
                                                                               
  SENATOR LEMAN  asked if the Work Star program is a recognition               
 program and there is no money involved.   JIM NORDLUND  agreed that           
 the Work Star program is a recognition program that is being tested           
 with employers.  A steering committee of employers has been formed            
 in order to receive advice from employers.                                    
                                                                               
  SENATOR LEMAN  encouraged Mr. Nordlund to recognize businesses who           
 help programs such as Bootstraps which is designed to move folks              
 from welfare to work.                                                         
                                                                               
 Number 539                                                                    
                                                                               
  JOSEPH FRIEDMAN , Director of the Trade Dollar Exchange, informed            
 the committee that he represented about 100 small businesses in               
 Alaska.  The Trade Dollar Exchange is a program allowing small                
 businesses to actively participate in the hiring of persons through           
 trade.  Mr. Friedman pointed out that the Tax Equity & Fiscal                 
 Responsibility Act of 1982 said that trading or bartering must be             
 declared as income, but businesses can deduct the income as it is             
 spent for business expenses.  The Trade Dollar Exchange provides a            
 forum for low income persons to trade skills amongst each other and           
 are awarded trade dollars.  With those trade dollars, the                     
 individual can go to participating businesses and redeem the trade            
 dollars for goods and services.  For example, the People Mover in             
 Anchorage will provide bus passes for trade dollars.  The YMCA is             
 part of the Trade Dollar Exchange.  The Trade Dollar Exchange is a            
 debit-credit banking system.  Mr. Friedman noted that the Trade               
 Dollar Exchange comes from the Time Dollar Programs.  In St. Louis,           
 the largest Time Dollar Program has over 8,000 people trading                 
 skills.  If those 8,000 people participated 10 hours a week, that             
 results in 80,000 of hours of services delivered without asking for           
 money from the government.  If those hours were paid at $10 an                
 hour, that would result in $800,000 in savings.  Mr. Friedman noted           
 that in Michigan and Missouri, the state has paid for services that           
 cannot be provided by the system itself.                                      
                                                                               
 Mr. Friedman said that the Trade Dollar Exchange makes Alaskan                
 businesses more competitive and profitable.  Businesses can                   
 employee these people using trade dollars.  This program allows the           
 private industry group to present the program to small businesses             
 and enlist support.  SB 116 is important in that it moves                     
 corporations into the arena.  Mr. Friedman noted that the Trade               
 Dollar Exchange had contacted the Democratic and Republican State             
 Parties and inquired as to donations of time and skill.                       
                                                                               
  TAPE 97-43, SIDE B                                                           
                                                                               
 Mr. Friedman stated that the program is looking for the                       
 opportunity, amendment to SB 116, to have the trade dollars be                
 disregarded for income analysis for AFDC, ATAP and SSI.                       
                                                                               
                                                                               
  SENATOR LEMAN  asked if there are other similar exchange programs in         
 Alaska.  If so, why would those programs not be eligible for income           
 disregard as Mr. Friedman suggested for the Trade Dollar Exchange.            
  JOSEPH FRIEDMAN  explained that exchanges work by a profit                   
 incentive.  Moving low income people from welfare to work does not            
 appeal to many.  Mr. Friedman pointed out that the Trade Dollar               
 Exchange is a program that offers training in order that people               
 would come in for four of the six weeks and become part of a                  
 community and then move to a job.  Within the trading industry many           
 do not view this as a business opportunity.                                   
                                                                               
 Number 561                                                                    
                                                                               
  PAM LABOLLE , Alaska State Chamber of Commerce, informed the                 
 committee that the chamber represents about 700 employers and                 
 businesses statewide who support SB 116.  SB 116 would encourage              
 businesses to hire persons without current experience and would               
 alleviate some of the on the job training costs.  Ms. LaBolle                 
 believed that the costs of on the job training is a major deterrent           
 for hiring persons on the welfare rolls.                                      
                                                                               
  SENATOR LEMAN  inquired as to how many of the 700 members of the             
 chamber were corporate taxpayers.   PAM LABOLLE  said that she could          
 survey the members.  Ms. LaBolle believed that at a recent chamber            
 breakfast, Mike Abbott indicated that about 3,500 corporations pay            
 corporate taxes in Alaska.  A huge percentage of that is paid by 11           
 corporations.  SB 116 is an opportunity to join in a partnership              
 with the state and there is an incentive to do so.                            
                                                                               
  SENATOR LEMAN  asked Ms. LaBolle how she viewed expanding this to            
 other costs that businesses incur such as fuel taxes and business             
 license fees to those that are employers, but are not corporate tax           
 payers.   PAM LABOLLE  believed that could be explored amongst the            
 membership of the chamber.  The cost-benefit relationship may be an           
 obstacle.                                                                     
                                                                               
  SENATOR WARD  asked if the chamber has a position on carrying the            
 credit for 2-3 years.   PAM LABOLLE  replied no.                              
                                                                               
  CHAIRMAN WILKEN  stated that he would like to move SB 116 to Senate          
 Finance.                                                                      
                                                                               
  SENATOR GREEN  moved to report SB 116 out of committee with                  
 individual recommendations and accompanying fiscal notes.  Without            
 objection, it was so ordered.                                                 
                                                                               
                                                                               
                  SB 152 CERTIFIED NURSE AIDES                                
                                                                              
                                                                               
  CHAIRMAN WILKEN  introduced  CSSB 152(L&C)  as the final order of            
 business before the committee.                                                
                                                                               
  ANNETTE KRIETZER , staff to Senator Leman, said that the legislation         
 is introduced at the request of the Alaska Nurses Association.  Ms.           
 Krietzer reviewed the sectional analysis included in the packet.              
 She noted that the sectional analysis for Section 2 had a mistake             
 the statute referenced, AS 08.68.33(c), should actually be AS                 
 08.68.333(c).  In Section 5 Sec. 08.68.333(b), Ms. Krietzer pointed           
 out that the revocation of a nurse aide's certification can occur             
 if the board finds "abuse, neglect, or misappropriation of property           
 in connection with employment as a nurse aide"; the "in connection            
 with employment as a nurse aide" was added to be specific.                    
 Therefore, a CNA can be placed on the registry one of two ways.  A            
 CNA can be placed on the registry due to "abuse, neglect, or                  
 misappropriation of property in connection with employment" which             
 is governed by the Administrative Procedure Act (APA).  However               
 under subsection (c), upon a notice of finding from DHSS, a CNA can           
 be placed on the registry under AS 47.05.055 which is not subject             
 to APA.                                                                       
                                                                               
 Ms. Krietzer expressed concern with Section 10 and directed the               
 committee to page 6, lines 20-21.  If DHSS has reason to believe a            
 CNA in a facility licensed by DHSS has committed abuse, neglect, or           
 misappropriation of property, DHSS investigates to determine                  
 whether a finding should be made.  As the legislation is currently            
 written, these proceedings are exempt from APA.  Ms. Krietzer                 
 directed the committee to page 3, lines 28-31 which states that the           
 board can revoke a nurse aide's certification without a hearing and           
 enter the finding in the registry and notify the nurse aide of the            
 actions taken by the department.  The department does not have a              
 procedure in place.   In conversations with DHSS, the department              
 indicated that it will probably follow APA, but would look for an             
 alternate procedure.  This is of concern and the committee may want           
 to contemplate whether these proceedings should be exempt from APA.           
 Ms. Krietzer noted that Sections 14-16 are conforming amendments              
 that add this agency investigation into statutes where necessary to           
 comply with federal law.                                                      
                                                                               
 Number 400                                                                    
                                                                               
  SENATOR LEMAN  understood that those sections addressing the                 
 exemption from APA were suggested by DHSS during the department's             
 assistance in drafting.  Senator Leman requested that DHSS inform             
 the committee as to why those suggestions were made.                          
                                                                               
  TERESA LYONS , registered nurse, supported SB 152.  Ms. Lyons                
 informed the committee that she has worked as a registered nurse              
 throughout Alaska and the nation and has worked with many certified           
 nursing assistants and aides.  Of those CNAs, some did prey upon              
 the vulnerable populations being served.  Ms. Lyons pointed out               
 that the lack of public oversight for CNAs in home care agencies              
 and hospitals leaves the policing to the employer.  Unfortunately             
 because of the structure, people move from agency to agency or                
 hospital to hospital and the abuse continues.                                 
                                                                               
  SENATOR ELLIS  asked if some specific event spurred this legislation         
 because this has been discussed for a number of years.   ANNETTE              
 KRIETZER  noted that there have been some changes in federal law              
 requiring that each state establish procedures to deal with the               
 revocation of certificates of CNAs.                                           
                                                                               
  SENATOR ELLIS  asked if there were any problems through the board            
 that could not be dealt with through the existing statute.   ANNETTE          
 KRIETZER  understood that the current program does not have any               
 statutory authority in existing statute to deal with what the board           
 is required to under federal law.   SENATOR ELLIS  asked if there             
 have been any problems.   ANNETTE KRIETZER  said that currently, CNAs         
 are issued certificates not licenses.  Ms. Krietzer understood that           
 there have been some problems, but the board does not have the                
 ability to deal with them.                                                    
                                                                               
 Number 349                                                                    
                                                                               
  GAIL MCGUILL , President of the Alaska Nurses Association(ANA),              
 informed the committee that she is also a registered nurse, a                 
 licensed nursing home administrator and Director of quality                   
 management at Columbia Alaska Regional.  Ms. McGuill supported SB
 152.  For seven years, ANA has worked with the Alaska Board of                
 Nursing to achieve the public protection encompassed in SB 152.               
 In 1989, the Governor signed EO 115 which called for the Department           
 of Commerce to take responsibility for the training, certification,           
 and registration of nurse aides that is required by the federal               
 government.  The ANA believes that the statutory and regulatory               
 authority for nurse aides should rest with the Board of Nursing,              
 the state agency responsible for regulating nursing care in Alaska.           
 SB 152 will strengthen the board's ability to protect the public              
 and will allow the board to establish standards for certification             
 for defining competency for nurse aides.  SB 152 provides the board           
 with the ability to discipline nurse aides and revoke certification           
 when appropriate.  Although the board has had standards for                   
 education and competency testing for nurse aides since 1989, the              
 board has been unable to perform any disciplinary actions due to              
 its lack of statutory authority.  DHSS has had the responsibility             
 to do investigations, but only when the allegations involve client            
 abuse, neglect, or misappropriation of funds.  Over the past seven            
 years, the Board of Nursing has provided professional consultation            
 to DHSS and the senior ombudsman in investigation of complaints               
 related to CNAs and nursing care of senior citizens.  SB 152                  
 provides protection to the public from all CNAs.                              
                                                                               
  RON COWAN , Division of Medical Assistance, supported the comments           
 related to the need for this legislation.  Mr. Cowan reiterated Ms.           
 McGuill's comments regarding the history of CNAs and the process              
 that has led to this legislation.  EO 115 provided limited                    
 authority to the state and Occupational Licensing in the Board of             
 Nursing to develop certain standards.  Those standards were limited           
 to the federal government, the only statutory authority available             
 at that time, which was limited to nursing homes.  The CNA                    
 population has increased and are working in many other settings               
 besides nursing homes.  The problem has been that when a hearing              
 takes place, the department does not have statutory authority to              
 enact any disciplinary actions.                                               
                                                                               
 Mr. Cowan directed the committee to Section 9, lines 7-9 and                  
 Section 10, lines 18-19 of the bill when discussing the exemption             
 from APA.  The department will ensure protection of the due process           
 rights of individuals the department takes action against.  Mr.               
 Cowan explained that an APA hearing for a CNA utilizes the same               
 criteria used to revoke a physician's license or that of a higher             
 practitioner.  In the APA hearing, malpractice and the like are the           
 subject, while CNA hearings revolve around physical abuse.  The               
 burden of proof under the APA is of such stringent nature that it             
 is difficult to take action against someone that should not be a              
 CNA.  Mr. Cowan said that this exemption is not a breaker for the             
 department, but something more effective than APA for this type               
 hearing should be reviewed.  There is a difference between the                
 revocation of the certification of a CNA versus that of a                     
 physician.  Mr. Cowan supported SB 152.                                       
                                                                               
 Number 230                                                                    
                                                                               
  SENATOR GREEN  inquired as to the training of a nurse aide.   RON            
 COWAN  explained that a minimum of 75 hours is required of which              
 certain skills are learned and competency tests must be passed.               
 There is a didactic test requirement and continuing education is              
 also required.                                                                
                                                                               
  SENATOR GREEN  asked if certification is the only method available           
 to discipline these people.   RON COWAN  pointed out that even                
 certification cannot be used.  The only basis for discipline is               
 found in federal statutes which says that an individual cannot                
 continue to work in a nursing home if the individual was found to             
 have committed violations.  Therefore, that individual can go any             
 place else in the state and work as a CNA.  Unless the action falls           
 into criminal activity, there is no further recourse available.               
                                                                               
                                                                               
  CATHERINE REARDON , Director of the Division of Occupational                 
 Licensing in the DCED, supported SB 152.  Ms. Reardon informed the            
 committee that the department already certifies approximately 2,000           
 nurse aides and SB 152 allows the existing program to work better.            
 The bill establishes a two track system which is mandated by                  
 federal law.  The federal law required nursing homes to hire CNAs             
 and if a CNA was found to have committed abuse, neglect, or                   
 misappropriation of funds that CNA could no longer work in a                  
 nursing home.  Since that time, the nurse aide system has expanded.           
 Therefore, SB 152 would allow the discipline of nurses in other               
 settings and revocation of the nurse's certificate.  The federal              
 law only places names on a registry and the nurse retains the                 
 certificate.  Ms. Reardon pointed out that there are other types of           
 incompetencies that the department would like to investigate and              
 possibly take disciplinary corrective action.  SB 152 allows the              
 board to place a nurse aide on suspension, probation, or monitoring           
 for other offenses that do not fall under abuse, neglect or                   
 misappropriation of funds.  Ms. Reardon explained that by federal             
 law DHSS deals with findings of abuse or neglect in nursing homes             
 while the Board of Nursing will deal with allegations against nurse           
 aides in other settings and for reasons besides the three                     
 specified.  The second half of the bill makes the nurse aide system           
 conform to the requirements of other agencies.  SB 152 does not               
 mandate licensure nor certification.                                          
                                                                               
 Number 117                                                                    
                                                                               
  SENATOR WARD  inquired as to Ms. Reardon's impression of the lack of         
 process for the revocation of a license.   CATHERINE REARDON  pointed         
 out that all of the Board of Nursing and the Department of Commerce           
 activities fall under APA with one exception.  In the case that               
 DHSS has had a due process hearing and reports the results to the             
 Board of Nursing, a second hearing would be redundant.  The policy            
 issue is whether DHSS should fall under APA for its hearing.  In              
 further response, Ms. Reardon said that under APA one can appeal to           
 Superior Court.                                                               
                                                                               
  SENATOR WARD  noted the growth of nurses aides when asking if any            
 consideration had been given to the upcoming nurses aides to have             
 their own surety bonds and be self supporting.    Senator Ward noted          
 that the fiscal note indicates that someone will be hired.                    
  CATHERINE REARDON  explained that the cost of that employee is being         
 paid by the license fees of the nurse aide.  SB 152 references AS             
 08.01.065 which is the self-sufficiency mandate.   SENATOR WARD               
 asked if there will be enough fees collected to cover the cost of             
 grievances, proceedings and other projected costs.   CATHERINE                
 REARDON  expected fees will be between $100-$135 every two years.             
 The division will establish those fees based on cost.  The increase           
 from $30 to $100-$135 in the fees is due to the increased activity            
 provided.                                                                     
                                                                               
  SENATOR WARD  ascertained then that this system would allow the              
 public to believe that those holding licenses are reliable and can            
 be trusted.   CATHERINE REARDON  specified that this will assure the          
 public that the nurse aide completed the training program and that            
 no complaints against the nurse aide resulted in disciplinary                 
 action.  In further response to Senator Ward, Ms. Reardon said that           
 physicians are not mandated to carry insurance and SB 152 does not            
 include an insurance requirement either.  Ms. Reardon noted that              
 most health care professions do not have insurance requirements.              
                                                                               
  SENATOR LEMAN  remained convinced that the APA provisions need not           
 be changed and the APA provisions are actually incorporated                   
 earlier.   CATHERINE REARDON  explained that when the Department of           
 Commerce receives the complaint, the individual has already                   
 received due process from DHSS.                                               
                                                                               
  TAPE 97-44, SIDE A                                                           
                                                                               
 Number 011                                                                    
                                                                               
 In response to Senator Ward,  RON COWAN  said that any administrative         
 procedures or appeals process provided is under APA.  DHSS wanted             
 the opportunity to explore other systems incorporated by other                
 states with the CNA program which were found to more effective than           
 under APA in protecting due process.  There will be circumstances             
 in which DHSS will not take action against a CNA unless that CNA in           
 question happens to be working with an entity that has licenses or            
 certification under Medicaid.  Otherwise, the action would be taken           
 by the Board of Nursing and under APA per the board's request.  Mr.           
 Cowan said that the APA due process provisions will be followed               
 until the time another procedure is approved.                                 
                                                                               
  SENATOR LEMAN  expressed the need to hear from a CNA regarding the           
 CNA.   GAIL MCGUILL  said that in discussions with colleagues there           
 has been no concern expressed by CNAs or the employer.                        
                                                                               
  CHAIRMAN WILKEN  said that question would be worked on as it passed          
 on to Senate Finance.                                                         
                                                                               
  SENATOR LEMAN  moved to report CSSB 152(L&C) out of committee with           
 individual recommendations and accompanying fiscal notes.  Without            
 objection, it was so ordered.                                                 
                                                                               
 There being no further business before the committee, the meeting             
 was adjourned at 10:45 a.m.                                                   
                                                                               

Document Name Date/Time Subjects