Legislature(2005 - 2006)BUTROVICH 205

04/08/2005 08:00 AM JUDICIARY

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08:07:45 AM Start
08:09:30 AM SB130
10:42:10 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Recessed from April 7 --
Scheduled But Not Heard
Scheduled But Not Heard
+ Bills Previously Heard/Scheduled TELECONFERENCED
Moved CSSB 130(JUD) Out of Committee
Scheduled But Not Heard
                    ALASKA STATE LEGISLATURE                                                                                  
              SENATE JUDICIARY STANDING COMMITTEE                                                                             
                         April 8, 2005                                                                                          
                           8:07 a.m.                                                                                            
MEMBERS PRESENT                                                                                                               
Senator Ralph Seekins, Chair                                                                                                    
Senator Charlie Huggins, Vice Chair                                                                                             
Senator Gene Therriault                                                                                                         
Senator Hollis French                                                                                                           
Senator Gretchen Guess                                                                                                          
MEMBERS ABSENT                                                                                                                
All members present                                                                                                             
COMMITTEE CALENDAR                                                                                                            
SENATE BILL NO. 140                                                                                                             
"An   Act   relating   to  spyware   and   unsolicited   Internet                                                               
     SCHEDULED BUT NOT HEARD                                                                                                    
SENATE BILL NO. 132                                                                                                             
"An  Act  relating  to  complaints  filed  with,  investigations,                                                               
hearings, and orders  of, and the interest rate on  awards of the                                                               
State Commission for Human  Rights; making conforming amendments;                                                               
and providing for an effective date."                                                                                           
     SCHEDULED BUT NOT HEARD                                                                                                    
SENATE BILL NO. 130                                                                                                             
"An Act relating  to a special deposit  for workers' compensation                                                               
and  employers' liability  insurers;  relating  to assigned  risk                                                               
pools; relating  to workers'  compensation insurers;  stating the                                                               
intent  of   the  legislature,   and  setting   out  limitations,                                                               
concerning the  interpretation, construction,  and implementation                                                               
of workers'  compensation laws; relating  to the  Alaska Workers'                                                               
Compensation   Board;    assigning   certain    Alaska   Workers'                                                               
Compensation  Board   functions  to  the  division   of  workers'                                                               
compensation   in  the   Department   of   Labor  and   Workforce                                                               
Development and to that department,  and authorizing the board to                                                               
delegate administrative  and enforcement duties to  the division;                                                               
establishing   a   Workers'  Compensation   Appeals   Commission;                                                               
providing for workers' compensation  hearing officers in workers'                                                               
compensation  proceedings;  relating   to  workers'  compensation                                                               
medical benefits and  to charges for and payment of  fees for the                                                               
medical benefits; relating to  agreements that discharge workers'                                                               
compensation   liability;  relating   to  workers'   compensation                                                               
awards;  relating to  reemployment benefits  and job  dislocation                                                               
benefits; relating  to coordination of workers'  compensation and                                                               
certain  disability benefits;  relating to  division of  workers'                                                               
compensation records;  relating to release of  treatment records;                                                               
relating to an  employer's failure to insure and  keep insured or                                                               
provide  security;   providing  for  appeals   from  compensation                                                               
orders; relating to  workers' compensation proceedings; providing                                                               
for  supreme  court jurisdiction  of  appeals  from the  Workers'                                                               
Compensation Appeals  Commission; providing for a  maximum amount                                                               
for  the  cost-of-living  adjustment  for  workers'  compensation                                                               
benefits;   relating  to   attorney  fees;   providing  for   the                                                               
department to  enter into contracts with  nonprofit organizations                                                               
to  provide  information  services and  legal  representation  to                                                               
injured  employees; providing  for  administrative penalties  for                                                               
employers  uninsured or  without adequate  security for  workers'                                                               
compensation; relating to fraudulent  acts or false or misleading                                                               
statements in  workers' compensation  and penalties for  the acts                                                               
or  statements;  providing for  members  of  a limited  liability                                                               
company to  be included as  an employee for purposes  of workers'                                                               
compensation;  establishing  a   workers'  compensation  benefits                                                               
guaranty  fund;  relating  to  the  second  injury  fund;  making                                                               
conforming amendments;  providing for a  study and report  by the                                                               
medical  services   review  committee;   and  providing   for  an                                                               
effective date."                                                                                                                
     MOVED CSSB 130(JUD) OUT OF COMMITTEE                                                                                       
SENATE BILL NO. 128                                                                                                             
"An  Act   relating  to  consideration  by   the  Local  Boundary                                                               
Commission of a requested borough incorporation."                                                                               
     SCHEDULED BUT NOT HEARD                                                                                                    
PREVIOUS COMMITTEE ACTION                                                                                                     
BILL: SB 130                                                                                                                  
SHORT TITLE: WORKERS' COMPENSATION                                                                                              
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
03/03/05       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/03/05       (S)       L&C, FIN                                                                                               
03/08/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/08/05       (S)       Heard & Held                                                                                           
03/08/05       (S)       MINUTE(L&C)                                                                                            
03/10/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/10/05       (S)       Heard & Held                                                                                           
03/10/05       (S)       MINUTE(L&C)                                                                                            
03/15/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/15/05       (S)       Heard & Held                                                                                           
03/15/05       (S)       MINUTE(L&C)                                                                                            
03/17/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/17/05       (S)       Heard & Held                                                                                           
03/17/05       (S)       MINUTE(L&C)                                                                                            
03/22/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/22/05       (S)       Heard & Held                                                                                           
03/22/05       (S)       MINUTE(L&C)                                                                                            
03/24/05       (S)       L&C AT 2:00 PM BELTZ 211                                                                               
03/24/05       (S)       Heard & Held                                                                                           
03/24/05       (S)       MINUTE(L&C)                                                                                            
03/29/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/29/05       (S)       -- Meeting Canceled --                                                                                 
03/31/05       (S)       L&C AT 1:30 PM BELTZ 211                                                                               
03/31/05       (S)       Moved CSSB 130(L&C) Out of Committee                                                                   
03/31/05       (S)       MINUTE(L&C)                                                                                            
04/01/05       (S)       L&C RPT CS 2DP 1NR 2AM NEW TITLE                                                                       
04/01/05       (S)       DP: BUNDE, STEVENS B                                                                                   
04/01/05       (S)       NR: SEEKINS                                                                                            
04/01/05       (S)       AM: DAVIS, ELLIS                                                                                       
04/01/05       (S)       JUD REFERRAL ADDED AFTER L&C                                                                           
04/05/05       (S)       JUD AT 8:30 AM BUTROVICH 205                                                                           
04/05/05       (S)       Heard & Held                                                                                           
04/05/05       (S)       MINUTE(JUD)                                                                                            
04/06/05       (S)       JUD AT 8:30 AM BUTROVICH 205                                                                           
04/06/05       (S)       Heard & Held                                                                                           
04/06/05       (S)       MINUTE(JUD)                                                                                            
04/07/05       (S)       JUD AT 8:30 AM BUTROVICH 205                                                                           
04/07/05       (S)       Heard & Held                                                                                           
04/07/05       (S)       MINUTE(JUD)                                                                                            
04/08/05       (H)       JUD AT 8:00 AM CAPITOL 120                                                                             
04/08/05       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
WITNESS REGISTER                                                                                                              
Mr. Paul Lisanki, Director                                                                                                      
Division of Worker's Compensation                                                                                               
Department of Labor & Workforce Development                                                                                     
PO Box 21149                                                                                                                    
Juneau, AK 99802-1149                                                                                                           
POSITION STATEMENT:  Commented on SB 130                                                                                      
Ms. Linda Hall, Director                                                                                                        
Division of Insurance                                                                                                           
333 Willoughby St                                                                                                               
Juneau, AK 99801                                                                                                                
POSITION STATEMENT:  Commented on SB 130                                                                                      
Mr. Jim Jordan, Executive Director                                                                                              
Alaska State Medical Association                                                                                                
4107 Laurel St.                                                                                                                 
Anchorage, AK                                                                                                                   
POSITION STATEMENT:  Commented on SB 130                                                                                      
ACTION NARRATIVE                                                                                                              
CHAIR  RALPH   SEEKINS  called  the  Senate   Judiciary  Standing                                                             
Committee meeting to  order at 8:07:45 AM.  Present were Senators                                                             
French, Therriault, Guess, and Chair Seekins.                                                                                   
            SB 130-WORKERS' COMPENSATION/ INSURANCE                                                                         
8:09:30 AM                                                                                                                    
CHAIR RALPH SEEKINS  reviewed the work from the  previous day and                                                               
advised  the committee  members of  the intended  agenda. Several                                                               
proposed amendments were passed out.                                                                                            
8:16:32 AM                                                                                                                    
CHAIR SEEKINS  informed Ms.  Linda Hall of  a proposal  to freeze                                                               
both  medical  benefits  and insurance  premiums.  He  asked  the                                                               
practical effect that would have.                                                                                               
MS. LINDA HALL, director, Division  of Insurance, hesitated to be                                                               
an alarmist. However, she said  if the premiums were frozen there                                                               
would be a market withdrawal.                                                                                                   
8:19:08 AM                                                                                                                    
The  practical effect  would be  employers would  have no  one to                                                               
obtain for  coverage. A  secondary effect  would be  the assigned                                                               
risk  pool would  fold. At  that point  it would  mean the  state                                                               
would have to relinquish the  mandatory requirement for employers                                                               
to hold  worker's compensation coverage  or the state  would have                                                               
to establish a state fund.                                                                                                      
8:20:44 AM                                                                                                                    
CHAIR SEEKINS  asked whether  the state  would have  to subsidize                                                               
the fund.                                                                                                                       
MS. HALL replied somebody would.                                                                                                
CHAIR  SEEKINS stated,  "Assuming we  could contain  the cost  by                                                               
freezing  rates, we  may have  the same  practical effect  on the                                                               
MS. HALL responded correct. Premiums are reflective of costs.                                                                   
8:22:03 AM                                                                                                                    
CHAIR  SEEKINS announced  the  Alaska  State Medical  Association                                                               
brought three amendments for consideration.                                                                                     
Chair Seekins called a brief recess at 8:22:55 AM.                                                                            
Chair Seekins reconvened the meeting at 8:27:08 AM.                                                                           
CHAIR  SEEKINS announced  the  primary goal  is  to consider  the                                                               
amendments first. For the record  the committee passed Amendments                                                               
1, 2, 3, & 4. The committee tabled Amendment 5.                                                                                 
8:28:27 AM                                                                                                                    
SENATOR  HOLLIS FRENCH  asked Mr.  Lisanki the  amount of  claims                                                               
Amendment 5 would affect.                                                                                                       
MR.  LISANKI,   director,  Division  of   Worker's  Compensation,                                                               
Department of  Labor and Workforce Development  (DOLWD), answered                                                               
the system  has never been set  up to make a  distinction between                                                               
injuries. He could not give an answer to the question.                                                                          
CHAIR SEEKINS asked Mr. Lisanki to comment on Amendment 6.                                                                      
MR.  LISANKI  stood  by  his  original  comments.  Treatment  for                                                               
chronic intractable pain would be considered palliative care.                                                                   
8:33:41 AM                                                                                                                    
SENATOR GENE THERRIAULT asked  the difference between intractable                                                               
and debilitation.                                                                                                               
8:34:31 AM                                                                                                                    
Mr.  JIM   JORDAN,  executive  director,  Alaska   State  Medical                                                               
Association,  understood "intractable"  to  mean unrelenting  and                                                               
CHAIR  SEEKINS read  the Webster's  New World:  "Hard to  manage,                                                               
unruly, or stubborn."                                                                                                           
8:35:54 AM                                                                                                                    
SENATOR  FRENCH commented  Amendment 7  should make  certain that                                                               
the job  dislocation benefit waiver  works best  when represented                                                               
by counsel.                                                                                                                     
CHAIR  SEEKINS countered  people  are allowed  to sign  contracts                                                               
that affect their lives without representation.                                                                                 
8:37:46 AM                                                                                                                    
Senator Charlie Huggins joined the committee.                                                                                   
CHAIR SEEKINS  asserted he did not  want to restrict a  person to                                                               
first talk to counsel.                                                                                                          
SENATOR  THERRIAULT asked  Mr. Lisanki  whether people  currently                                                               
have counsel to help them make decisions.                                                                                       
MR.  LISANKI  answered there  is  currently  no requirement  that                                                               
someone consult an attorney before making a benefit decision.                                                                   
8:40:55 AM                                                                                                                    
SENATOR FRENCH  aired it  was a one-time  buyout for  a permanent                                                               
impairment and the need for consulting an attorney was definite.                                                                
8:43:12 AM                                                                                                                    
MR. LISANKI clarified  it was not a buy out  of permanent partial                                                               
impairment. The permanent partial benefit would still be paid.                                                                  
8:45:01 AM                                                                                                                    
SENATOR  FRENCH commented  Amendment  8 also  relates to  waiving                                                               
benefits.  He expressed  concern  the waiver  be  reviewed by  an                                                               
attorney or the Worker's Compensation Board.                                                                                    
8:49:18 AM                                                                                                                    
MR.  LISANKI said  the  waiver  was designed  to  be  a lump  sum                                                               
payment. Section  19 reflects a  syntax change. It  is relatively                                                               
new and was put in place by the Legislature in 2000.                                                                            
8:52:26 AM                                                                                                                    
SENATOR THERRIAULT asked Mr. Lisanki to comment on Amendment 9.                                                                 
8:54:20 AM                                                                                                                    
MR. LISANKI said  Amendment 9 was redrafted  because of redundant                                                               
language. Section 40 was changed  to clarify compensatory damages                                                               
are awarded by a  jury in a jury trial. They  added the words "or                                                               
8:59:03 AM                                                                                                                    
MR.  LISANKI commented  Amendment 10  puts into  statute what  is                                                               
already happening. Since  1988 the benefit has  been converted to                                                               
permanent partial  impairment benefits. To avoid  litigation, the                                                               
ad hoc committee recommended the language.                                                                                      
9:00:50 AM                                                                                                                    
SENATOR THERRIAULT sponsored Amendment 10.                                                                                      
SENATOR HUGGINS moved Amendment 5.                                                                                              
SENATOR FRENCH objected. He said  the committee should be advised                                                               
the number of cases Amendment 5 would affect.                                                                                   
SENATOR  THERRIAULT said  Alaska  couldn't afford  to consider  a                                                               
pre-existing  injury  under  the worker's  compensation  benefits                                                               
9:03:39 AM                                                                                                                    
SENATOR GUESS  advised she would  vote against Amendment  5 until                                                               
she learns more about the impact it would have.                                                                                 
Roll call proved the Amendment  5 passed 3-2 with Senators French                                                               
and Guess dissenting.                                                                                                           
9:05:00 AM                                                                                                                    
SENATOR HUGGINS moved Amendment 6.                                                                                              
SENATOR GUESS introduced an amendment to Amendment 6.                                                                           
                    AMENDMENT TO AMENDMENT 6                                                                                
Page 2, Line 11, after "...treatments of a similar nature."                                                                     
"Limitations described  in this  subsection do  not apply  in the                                                               
event that the  physician certifies that the  treatment is needed                                                               
to treat chronic, intractable pain."                                                                                            
SENATOR THERRIAULT  suggested changing the word  "intractable" to                                                               
SENATOR GUESS asked Mr. Lisanki to comment.                                                                                     
MR. LISANKI voiced it is a  dilemma to define a term that allowed                                                               
for serious pain treatment.                                                                                                     
9:08:23 AM                                                                                                                    
CHAIR SEEKINS said the intent is to allow a physician to find                                                                   
new technologies to treat serious pain.                                                                                         
MR. LISANKI responded the provision is for palliative care of a                                                                 
patient who is beyond recoverable treatment.                                                                                    
CHAIR SEEKINS conceded to change the word "intractable" to                                                                      
"debilitating." Hearing no objection, Amendment 6 was adopted.                                                                  
9:10:32 AM                                                                                                                    
SENATOR FRENCH moved Amendment 7. Hearing no objection, the                                                                     
motion carried.                                                                                                                 
                      A M E N D M E N T 7                                                                                   
OFFERED IN THE SENATE                         BY SENATOR FRENCH                                                                 
     TO: CSSB 130(L&C)                                                                                                          
Page 11, line 8, following "AS 23.30.130":                                                                                  
     Insert ";                                                                                                              
               (4)  the administrator may not accept an election                                                            
     to accept a job dislocation benefit by an employee who has                                                             
     not signed a form, which conspicuously notes the benefit                                                               
     being waived."                                                                                                         
9:12:05 AM                                                                                                                    
Senator French moved Amendment 8.                                                                                               
                      A M E N D M E N T 8                                                                                   
OFFERED IN THE SENATE                         BY SENATOR FRENCH                                                                 
     TO: CSSB 130(L&C)                                                                                                          
Page 12, line 18, following "AS 23.30.130.":                                                                                    
     Insert "The division may not accept a wavier executed by an                                                            
employee unless the waiver has been reviewed and approved by the                                                            
SENATOR  THERRIAULT  objected  for  discussion.  He  asked  Chair                                                               
Seekins whether  this would  mean that the  Board has  to approve                                                               
each waiver.                                                                                                                    
CHAIR SEEKINS said it would prescribe who would draft the form.                                                                 
MR. LISANKI answered the form  would be approved by the director,                                                               
the  division would  serve  the notice,  and  the division  would                                                               
receive  the  statement  form.   The  operative  phrase  is  "not                                                               
withstanding AS  23.30.012." That is the  provision that requires                                                               
the  Board to  review and  approve  settlements. One  of the  two                                                               
would have to go.                                                                                                               
9:14:48 AM                                                                                                                    
SENATOR  FRENCH clarified  the specific  employee's waiver  would                                                               
have to be approved.                                                                                                            
SENATOR THERRIAULT maintained his objection.                                                                                    
Roll called proved Amendment 8  failed 4-1 with Senators Huggins,                                                               
Guess, Therriault, and Chair Seekins dissenting.                                                                                
SENATOR THERRIAULT moved Amendment 9.                                                                                           
CHAIR SEEKINS  objected for discussion.  He voiced  hesitation to                                                               
put compensatory and punitive  damages into worker's compensation                                                               
9:16:14 AM                                                                                                                    
SENATOR THERRIAULT asked the penalties that would be divined.                                                                   
CHAIR  SEEKINS  speculated fines  and  jail  terms. Punitive  and                                                               
compensatory damages  are an additional  award used for  pain and                                                               
MR.  LISANKI said  the Board  could order  repayment of  benefits                                                               
that were obtained fraudulently.                                                                                                
9:19:23 AM                                                                                                                    
SENATOR THERRIAULT  proposed a conceptual amendment  to Amendment                                                               
9, which would strike the word "punitive."                                                                                      
9:21:29 AM                                                                                                                    
CHAIR SEEKINS  clarified the intent  of the  conceptual amendment                                                               
was  to  direct   the  drafter  to  ensure   the  statutes  allow                                                               
compensatory damages but not punitive damages.                                                                                  
9:25:26 AM                                                                                                                    
Hearing no  objections, the conceptual  amendment to  Amendment 9                                                               
was adopted. Amendment 9 was adopted.                                                                                           
SENATOR  THERRIAULT moved  Amendment 10.  Hearing no  objections,                                                               
the motion carried.                                                                                                             
                      A M E N D M E N T 10                                                                                  
*Sec. 17. AS 23.30.041(k) is amended to read:                                                                                   
     (k) Benefits related to the reemployment plan may not                                                                      
extend  past  two  years  from  the  date  of  plan  approval  or                                                               
acceptance,  whichever  date  occurs  first, at  which  time  the                                                               
benefits expire. If an employee  reaches medical stability before                                                               
completion  of  the  plan, temporary  total  disability  benefits                                                               
shall cease and permanent impairment  benefits shall then be paid                                                               
at  the  employee's  temporary  total  disability  rate.  If  the                                                               
employee's  permanent impairment  benefits  are exhausted  before                                                               
the  completion  or  termination   of  the  reemployment  process                                                           
[PLAN],  the  employer shall  provide  compensation  equal to  70                                                               
percent  of the  employee's spendable  weekly wages,  but not  to                                                               
exceed  105  percent  of  the  average  weekly  wage,  until  the                                                               
completion or termination of the  process [PLAN], except that any                                                           
compensation  paid  under this  subsection  is  reduced by  wages                                                               
earned by the employee while  participating in the process [PLAN]                                                           
to  the extent  that the  wages  earned, when  combined with  the                                                               
compensation paid  under this  subsection, exceed  the employee's                                                               
temporary total disability rate.  If permanent partial disability                                                               
or  permanent partial  impairment benefits  have been  paid in  a                                                           
lump sum before the employee  requested or was found eligible for                                                               
reemployment benefits, payment of  benefits under this subsection                                                               
is  suspended until  permanent  partial  disability or  permanent                                                           
partial  impairment   benefits  would  have  ceased,   had  those                                                           
benefits been  paid at the employee's  temporary total disability                                                               
rate,  notwithstanding  the  provisions  of  AS  23.30.155(j).  A                                                               
permanent   impairment   benefit   remaining  unpaid   upon   the                                                               
completion  or termination  of  the  plan shall  be  paid to  the                                                               
employee in a single lump sum.  An employee may not be considered                                                               
permanently totally disabled so long  as the employee is involved                                                               
in the  rehabilitation process  under this  chapter. The  fees of                                                               
the  rehabilitation  specialist  or  rehabilitation  professional                                                               
shall  be  paid by  the  employer  and  may  not be  included  in                                                               
determining the cost of the reemployment plan.                                                                                  
9:27:13 AM                                                                                                                    
SENATOR GUESS moved Amendment 11.                                                                                               
                      A M E N D M E N T 11                                                                                  
OFFERED IN THE SENATE                          BY SENATOR GUESS                                                                 
     TO:  CSSB 130(L&C)                                                                                                         
Page 10, line 8:                                                                                                                
     Delete "15"                                                                                                                
     Insert "30 [15]"                                                                                                       
Page 11, line 7, following "elected;":                                                                                      
     Insert "except as provided in (4) of this subsection,"                                                                 
Page 11, line 8, following "AS 23.30.130":                                                                                  
     Insert ";                                                                                                              
          (4)  an employee who elects to accept a job                                                                       
dislocation benefit under (2) of this subsection may revoke that                                                            
election if the employee                                                                                                    
               (A)  notifies the administrator in writing within                                                            
     one year after the receipt of the job dislocation benefit                                                              
     under (2) of this subsection, that the employee chooses                                                                
     reemployment benefits; and                                                                                             
               (B)  refunds the entire job dislocation benefit                                                              
     received, without interest"                                                                                            
Page 11, following line 19:                                                                                                     
     Insert a new bill section to read:                                                                                         
   "* Sec. 18.  AS 23.30.041(n) is amended to read:                                                                         
          (n) After the employee has elected to participate in                                                                  
     reemployment   benefits,  if   the  employer   believes  the                                                               
     employee  has not  cooperated,  the  employer may  terminate                                                               
     reemployment  benefits   on  the  date   of  noncooperation.                                                               
     Noncooperation means                                                                                                       
               (1) unreasonable failure to                                                                                      
                    (A) keep appointments;                                                                                      
                    (B) maintain passing grades;                                                                                
                    (C) attend designated programs;                                                                             
                    (D) maintain contact with the rehabilitation                                                                
                    (E)   cooperate   with   the   rehabilitation                                                               
          specialist in developing a reemployment plan and                                                                      
          participating     in     activities     relating     to                                                               
          reemployability on a full-time basis;                                                                                 
                    (F)     comply     with    the     employee's                                                               
          responsibilities outlined in the reemployment plan; or                                                                
                    (G) participate in any planned reemployment                                                                 
          activity as determined by the administrator; or                                                                       
               (2) failure to give written notice to the                                                                        
     employer   of  the   employee's  choice   of  rehabilitation                                                               
     specialists within  30 [15] days  after receiving  notice of                                                           
     eligibility for benefits from  the administrator as required                                                               
     by (g) of this section."                                                                                                   
Renumber the following bill sections accordingly.                                                                               
Page 27, line 11:                                                                                                               
     Delete "sec. 30"                                                                                                           
     Insert "sec. 31"                                                                                                           
Page 27, line 12:                                                                                                               
     Delete "sec. 30"                                                                                                           
     Insert "sec. 31"                                                                                                           
Page 28, line 10:                                                                                                               
     Delete "sec. 23"                                                                                                           
     Insert "sec. 24"                                                                                                           
Page 28, line 14:                                                                                                               
     Delete "Section 49"                                                                                                        
     Insert "Section 50"                                                                                                        
Page 28, line 15:                                                                                                               
     Delete "30, and 51"                                                                                                        
     Insert "31, and 52"                                                                                                        
Page 28, line 16:                                                                                                               
     Delete "37, 46, and 50"                                                                                                    
     Insert "38, 47, and 51"                                                                                                    
Page 28, line 21:                                                                                                               
     Delete "52 - 54"                                                                                                           
     Insert "53 - 55"                                                                                                           
SENATOR THERRIAULT objected.                                                                                                    
SENATOR   GUESS  said   Amendment  11   would  balance   the  new                                                               
dislocation benefit. It would allow  people a little more time to                                                               
respond.  It would  also  allow  an injured  worker  one year  to                                                               
change their  mind and provide for  the payback of the  $5,000 in                                                               
exchange for retraining.                                                                                                        
9:28:50 AM                                                                                                                    
MR. LISANKI commented  up until 2000 the employee  was allowed 10                                                               
days  to respond  and then  it was  expanded to  15 days.  SB 130                                                               
provides one  additional factor  for the  person to  consider. It                                                               
would be administratively difficult  for the Division of Worker's                                                               
Compensation  and  the insurance  company  to  believe they  have                                                               
something resolved  but in actuality,  it is not  truly resolved.                                                               
He said he couldn't support the amendment.                                                                                      
MS. HALL agreed.                                                                                                                
9:32:49 AM                                                                                                                    
SENATOR  THERRIAULT asked  Mr. Lisanki  whether  his concern  was                                                               
based  on  the length  of  time  or  the mechanism  for  changing                                                               
MR.  LISANKI responded  both. The  mechanism would  be completely                                                               
new. Ramifications would be hard to determine.                                                                                  
SENATOR  THERRIAULT  suggested  the   current  system  allows  an                                                               
employee to try and go back to work even during treatment.                                                                      
MR. LISANKI agreed. Entitlement to  the benefit being given up is                                                               
premised on the ability to go back to the job.                                                                                  
9:34:42 AM                                                                                                                    
CHAIR SEEKINS said he has no objection to waiting 30 days.                                                                      
SENATOR GUESS  stated she contrived  Amendment 11 in  response to                                                               
the new benefit and the unknown  impact. She asked Mr. Lisanki to                                                               
explain the reason for the job dislocation benefit.                                                                             
9:37:27 AM                                                                                                                    
MR.  LISANKI  said  reemployment benefits  couldn't  possibly  be                                                               
constructed  to individual  cases.  The  job dislocation  benefit                                                               
provides an option.                                                                                                             
9:38:57 AM                                                                                                                    
SENATOR  THERRIAULT moved  to separate  out the  30-day allowance                                                               
from Amendment 11. Hearing no objection, the motion carried.                                                                    
CHAIR SEEKINS  moved Amendment 11(a). Hearing  no objections, the                                                               
motion carried.                                                                                                                 
9:40:36 AM                                                                                                                    
SENATOR GUESS moved Amendment 11(b).                                                                                            
SENATOR  THERRIAULT objected.  Roll call  proved Amendment  11(b)                                                               
failed 3-2  with Senators Huggins, Therriault,  and Chair Seekins                                                               
9:42:30 AM                                                                                                                    
CHAIR  SEEKINS moved  Amendment  12. Hearing  no objections,  the                                                               
motion carried.                                                                                                                 
                      A M E N D M E N T 12                                                                                  
OFFERED IN THE SENATE                                                                                                           
     TO:  CSSB 130(L&C)                                                                                                         
Page 9, line 19, following "evaluation.":                                                                                       
     Insert "If the company, firm, or other entity that employs                                                                 
a  rehabilitation specialist  selected  by  the administrator  to                                                               
perform  an  eligibility  evaluation  under  this  subsection  is                                                               
performing  any  other work  on  the  same workers'  compensation                                                               
claim  involving the  injured employee,  the administrator  shall                                                               
select a different rehabilitation specialist."                                                                                  
Chair Seekins announced a brief recess at 9:44:57 AM.                                                                         
Chair Seekins reconvened the meeting at 10:02:48 AM.                                                                          
CHAIR SEEKINS  asked whether  there were  any more  amendments to                                                               
consider from the committee members.                                                                                            
SENATOR FRENCH moved Amendment 17.                                                                                              
CHAIR SEEKINS objected for discussion.                                                                                          
                      A M E N D M E N T 17                                                                                  
OFFERED IN THE SENATE                         BY SENATOR FRENCH                                                                 
     TO:  CSSB 130(L&C)                                                                                                         
Page 28, line 12:                                                                                                               
     Delete "March 1, 2007"                                                                                                     
     Insert "the first week of the First Regular Session of the                                                                 
Twenty-Fifth Alaska State Legislature"                                                                                          
     Following "provide to the":                                                                                                
          Insert "legislature and the"                                                                                          
10:04:22 AM                                                                                                                   
SENATOR FRENCH explained Amendment 17  refers to a medical review                                                               
committee and would  move the review date up two  months and make                                                               
certain the report is provided to the Legislature.                                                                              
CHAIR  SEEKINS  removed  his  objection   and  Amendment  17  was                                                               
10:06:27 AM                                                                                                                   
SENATOR GUESS moved a conceptual  amendment. Page 28, line 12 add                                                               
the  word  "delivery"  after the  word  "necessity."  Hearing  no                                                               
objections, Amendment 18 was adopted.                                                                                           
10:07:48 AM                                                                                                                   
SENATOR THERRIAULT  moved a conceptual  amendment. Page  15, line                                                               
12,   delete  "prescribing"   insert   "attending."  Hearing   no                                                               
objections, Amendment 19 was adopted.                                                                                           
10:08:47 AM                                                                                                                   
SENATOR GUESS  asked the  committee to  revisit Amendment  2. She                                                               
expressed  concern with  moving  SB 130  to  the Senate  Standing                                                               
Finance Committee with  the changes they have made  in regards to                                                               
Amendment 2.                                                                                                                    
CHAIR SEEKINS  asked Mr.  Lisanki to discuss  the history  of how                                                               
the limitation was placed on chiropractic visits.                                                                               
MR.  LISANKI explained  in 1988  the  Legislature was  confronted                                                               
with the  possibility of limiting  certain types of  medical care                                                               
in  terms  of  frequency.  The upshot  of  the  1988  Legislative                                                               
Session was  statutory authority that  was given to  the Worker's                                                               
Compensation  Board,  which  was   authorizing  them  to  address                                                               
certain types  of treatment, which were  described as "continuing                                                               
and  multiple treatments  of  a similar  nature."  That has  been                                                               
viewed  as covering  things like  physical therapy,  chiropractic                                                               
and similar  healthcare treatments.  The Board cast  a regulation                                                               
that speaks of the number of  treatments that can be given during                                                               
the  12-month   period.  The  Board   may  allow   more  frequent                                                               
10:11:42 AM                                                                                                                   
MR.  LISANKI continued  there were  no distinctions  drawn as  to                                                               
whether  a   chiropractor  could   be  considered   an  attending                                                               
CHAIR  SEEKINS  clarified  a  chiropractor, at  the  end  of  his                                                               
statutory  authority,  could  collaborate  with  an  allopath  to                                                               
extend the treatments.                                                                                                          
MR. LISANKI agreed.                                                                                                             
SENATOR THERRIAULT asked  whether it isn't enough  that the Board                                                               
has the authority to authorize extended treatments.                                                                             
MR. LISANKI  said yes. The  Board can revisit the  regulations if                                                               
10:14:46 AM                                                                                                                   
SENATOR  THERRIAULT  asked Mr.  Lisanki  to  clarify whether  the                                                               
current regulatory  power of the  Board applies to  the attending                                                               
physician as defined by statute.                                                                                                
MR.  LISANKI  responded  it  applies  to  the  limited  types  of                                                               
treatment described in statute.                                                                                                 
SENATOR THERRIAULT inquired as to the need to restate.                                                                          
CHAIR SEEKINS  said the chiropractor  should be on notice  that a                                                               
task  force will  examine  the area  of  "continuing in  multiple                                                               
treatments of a similar nature."                                                                                                
10:17:20 AM                                                                                                                   
CHAIR  SEEKINS said  chiropractic  care is  an  area where  costs                                                               
could be controlled more effectively.                                                                                           
SENATOR  THERRIAULT  moved to  rescind  Amendment  2. Hearing  no                                                               
objections, the motion carried.                                                                                                 
SENATOR THERRIAULT  moved an  amendment to  Amendment 2.  Page 1,                                                               
lines 12 and 13, delete the  language after (f) and strike it all                                                               
down to the comma after "occurs."                                                                                               
CHAIR   SEEKINS   clarified   (f)   would   read,   "a   licensed                                                               
chiropractor." Hearing no objections, the motion carried.                                                                       
SENATOR THERRIAULT moved Amendment  2. Hearing no objections, the                                                               
motion carried.                                                                                                                 
10:19:34 AM                                                                                                                   
CHAIR SEEKINS moved Amendment 13.                                                                                               
                      A M E N D M E N T 13                                                                                  
Sec 23.30.095. Preferred drug list;  limitation of drug coverage.                                                             
(n) The department shall adopt  a preferred drug list by adoption                                                             
of a regulation.  The regulations must include                                                                                
        (1)                     standards for placing or not                                                                  
           placing a drug on the preferred drug list;                                                                         
        (2)                     an opportunity for public comment                                                             
before the  department places or  determines not to place  a drug                                                             
on the preferred drug list;                                                                                                   
        (3)    an appeal process for a  person who is affected by                                                             
a decision of the  department to place or not to  place a drug on                                                             
the preferred drug list; and                                                                                                  
        (4)    a  provision  under   which  the  department  will                                                             
approve coverage of  a drug that is not on  a preferred drug list                                                             
without   requiring  additional   medical   justification  if   a                                                             
physician  documents  on  the  prescription   that  the  drug  as                                                             
prescribed is  medically necessary for  the patient as  being the                                                             
most  effective drug  available  for the  patient's condition  by                                                             
writing  on the  prescription the  phrase "dispense  as written,"                                                             
"medically necessary," or other wording with similar import.                                                                  
     (o) Subject to AS 36.30 (State Procurement Code), the                                                                    
department may contract for the  services necessary to assist the                                                             
department  in developing  a preferred  drug list  or determining                                                             
whether coverage for a drug should be limited.                                                                                
     (p) The commissioner shall appoint a Prescription Drug                                                                   
Review Advisory  Committee consisting of practitioners  who treat                                                             
injured  workers  of  at  least  two  members  who  are  licensed                                                             
pharmacists  under  AS  08.80,  at  least  two  members  who  are                                                             
licensed  to  practice medicine  under  AS  08.64, at  least  two                                                             
members who  are dentists  licensed under AS  08.36 at  least two                                                             
advanced  nurse  practitioners licensed  under  AS  08._; and  at                                                             
least two Physician Assistants licensed under AS 08.  .                                                                       
        (1)    conducting   public  meetings   on  developing   a                                                             
preferred drug list or limiting coverage for a drug;                                                                          
        (2)    assisting the department in  setting standards  in                                                             
regulations for the review and  selection of drugs for a referred                                                             
drug list;                                                                                                                    
        (3)    reviewing each drug  and making recommendations to                                                             
the department  as to whether the  drug should be on  a preferred                                                             
drug  list  or  subject  to  limitation  of  coverage  under  the                                                             
standards adopted under (2) of this subsection.                                                                               
     (d) A committee member appointed under (p) of this section                                                               
serves  without compensation  but  is entitled  to  per diem  and                                                             
travel expenses  authorized for boards  and commissions  under AS                                                             
39.20.180.   The committee  shall select a  chair form  among its                                                             
membership who may be removed from  the position as chair only by                                                             
a majority vote of the full committee.                                                                                        
     (q) In this section,                                                                                                     
                (1) "drug" means a prescription drug;                                                                         
                (2) "preferred drug list" means a list of drugs                                                               
                       (A) that comprise a restrictive formulary;                                                             
                       (B) for which the department will not                                                                  
                           require   a   prior   or   retroactive                                                             
                           prescription approval process;                                                                     
                       (C) for which the department will not                                                                  
                           require medical  justification by  the                                                             
                           prescriber as a condition  of coverage                                                             
                           under this  chapter  before the  drugs                                                             
                           may be  dispensed  to  a recipient  of                                                             
                           assistance under this chapter; or                                                                  
                       (D) for which the department will not                                                                  
                           establish other similar restrictions                                                               
                           for coverage under this chapter                                                                    
Renumber the following sections accordingly.                                                                                    
CHAIR SEEKINS explained  the intent of Amendment  13 would delete                                                               
the generic drug  product, the use of the  cookbook approach, and                                                               
the  fees.  The Alaska  State  Medical  Association proposed  the                                                               
10:23:57 AM                                                                                                                   
Roll call proved Amendment 13 failed unanimously.                                                                               
10:26:12 AM                                                                                                                   
CHAIR SEEKINS moved Amendment 14.                                                                                               
                      A M E N D M E N T 14                                                                                  
     Page 15                                                                                                                    
 Delete Section 24 lines 10 through 31;                                                                                         
Page 16                                                                                                                         
 Delete Section 24 lines 1 through 7; and                                                                                       
Page 17                                                                                                                         
 Delete Section 25 lines 1 through 27                                                                                           
CHAIR SEEKINS  objected for discussion. The  amendment would keep                                                               
the current rates rather than rolling them back one year.                                                                       
10:26:40 AM                                                                                                                   
MR.  TIM  KELLY,  Alaska  State  Medical  Association,  explained                                                               
Amendment 14  would change the date  of the schedule use  for the                                                               
payment  of medical  fees from  December  15, 2003  to the  rates                                                               
established on December 15, 2004.                                                                                               
10:29:02 AM                                                                                                                   
SENATOR GUESS  asserted the issue was  one for the task  force to                                                               
MS.  HALL  added  one  reason   for  looking  into  the  worker's                                                               
compensation system  was to  address ways  to decrease  costs for                                                               
insurance  purposes.  She  expressed concern  with  another  year                                                               
passing with no cost impact.                                                                                                    
SENATOR  THERRIAULT   moved  to   amend  Amendment  14   to  say,                                                               
"published bulletin  in effect on  December 1, 2003."  Hearing no                                                               
objections, the motion carried.                                                                                                 
Roll call proved  Amendment 14 failed 4-1  with Senators Huggins,                                                               
Therriault, French, and Chair Seekins dissenting.                                                                               
SENATOR  HUGGINS  moved Amendment  20.  Line  15 delete  "dated",                                                               
insert "in effect." Change the  date from December 15 to December                                                               
1, 2003. Hearing no objections, the motion carried.                                                                             
10:34:06 AM                                                                                                                   
CHAIR SEEKINS asked  for a committee member  to sponsor Amendment                                                               
15. He asked  Mr. Lisanki whether the committee was  at the point                                                               
to consider  the American  College of  Occupational Environmental                                                               
Medicine (ACOEM)  practice guidelines in respect  to an insurance                                                               
company denying treatment.                                                                                                      
MR. LISANKI responded  there was nothing in the  substance of the                                                               
text to indicate that.                                                                                                          
CHAIR   SEEKINS  asked   whether  the   Board  would   feel  more                                                               
comfortable were the Legislature  add the verbiage clarifying the                                                               
ACOEM guidelines could not be used to deny treatment.                                                                           
MR. LISANKI said yes.                                                                                                           
10:36:30 AM                                                                                                                   
SENATOR GUESS said that was addressed in Amendment 3.                                                                           
Amendment 15 was withdrawn.                                                                                                     
10:37:33 AM                                                                                                                   
CHAIR SEEKINS assigned Amendment 16 to the task force.                                                                          
10:38:30 AM                                                                                                                   
CHAIR SEEKINS  revisited Amendment  1 and said  he would  like to                                                               
expand  the  legislative  membership   to  one  member  from  the                                                               
minority  to  be  determined  by   the  Speaker  and  the  Senate                                                               
10:40:22 AM                                                                                                                   
SENATOR  THERRIAULT  moved to  rescind  Amendment  1. Hearing  no                                                               
objections, the motion carried.                                                                                                 
SENATOR THERRIAULT  moved a conceptual amendment  to Amendment 1.                                                               
The  Speaker and  the  President  of the  Senate  would select  a                                                               
member  of  the  minority  jointly. Hearing  no  objections,  the                                                               
motion carried.                                                                                                                 
SENATOR THERRIAULT moved Amendment  1. Hearing no objections, the                                                               
motion carried.                                                                                                                 
10:41:19 AM                                                                                                                   
CHAIR  SEEKINS complimented  the minority  members of  the Senate                                                               
Judiciary Standing Committee.                                                                                                   
SENATOR  HUGGINS   moved  CSSB   130(JUD)  from   committee  with                                                               
individual  recommendations and  attached  fiscal note(s).  There                                                               
being no objection, the motion carried.                                                                                         
There being  no further  business to  come before  the committee,                                                               
Chair Seekins adjourned the meeting at 10:42:10 AM.                                                                           

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