Legislature(2011 - 2012)BELTZ 105 (TSBldg)
01/19/2012 01:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| SB116 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 116 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
SENATE LABOR AND COMMERCE STANDING COMMITTEE
January 19, 2012
1:34 p.m.
MEMBERS PRESENT
Senator Dennis Egan, Chair
Senator Joe Paskvan, Vice Chair
Senator Linda Menard
Senator Bettye Davis
Senator Cathy Giessel
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
SENATE BILL NO. 116
"An Act offering mediation of disputed workers' compensation
claims by a hearing officer or other classified employee of the
division of workers' compensation and allowing collective
bargaining agreements to supersede certain provisions of the
Alaska Workers' Compensation Act; and providing for an effective
date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: SB 116
SHORT TITLE: WORKERS' COMP.: COLL BARGAINING/MEDIATION
SPONSOR(s): LABOR & COMMERCE
03/25/11 (S) READ THE FIRST TIME - REFERRALS
03/25/11 (S) L&C, FIN
04/05/11 (S) L&C AT 2:00 PM BELTZ 105 (TSBldg)
04/05/11 (S) Heard & Held
04/05/11 (S) MINUTE(L&C)
01/19/12 (S) L&C AT 1:30 PM BELTZ 105 (TSBldg)
WITNESS REGISTER
PAUL GROSSI, Lobbyist
Alaska State Pipe Trades and Ironworkers
Juneau, Alaska
POSITION STATEMENT: Supports SB 116.
J.D. WILKERSON, Owner
Griffard Steel Company
Fairbanks, Alaska
POSITION STATEMENT: Supports SB 116.
MR. STEVE RANK, Executive Director Safety and Health
Ironworkers International Union
San Francisco, California
POSITION STATEMENT: Supports SB 116.
FRED BROWN, Executive Director
Health Care Cost Management Corporation of Alaska (HCCMCA)
Fairbanks, Alaska
POSITION STATEMENT: Supports SB 116.
GREG KUCERA, Business Manager
Ironworkers Union, Local 751
Anchorage, Alaska
POSITION STATEMENT: Supports SB 116.
JIM BARRACK, Contractor
Ironworkers Union, Local 751
Anchorage, Alaska
POSITION STATEMENT: Supports SB 116.
MR. THOMAS ZIMMERMAN, President
Universal Welding and Fabrication, Inc.
North Pole, Alaska
POSITION STATEMENT: Supports SB 116.
MR. MIKE MONAGLE, Director
Division of Workers' Compensation
Department of Labor and Workforce Development (DOLWFD)
Juneau, Alaska
POSITION STATEMENT: Neutral on SB 116.
ACTION NARRATIVE
1:34:02 PM
CHAIR DENNIS EGAN called the Senate Labor and Commerce Standing
Committee meeting to order at 1:34 p.m. Present at the call to
order were Senators Davis, Giessel and Chair Egan.
SB 116-WORKERS' COMP.: COLL BARGAINING/MEDIATION
1:34:28 PM
CHAIR EGAN announced the consideration of SB 116.
1:37:11 PM
PAUL GROSSI, lobbyist for the Alaska State Pipe Trades and
Ironworkers, Juneau, Alaska, explained that he had given past
testimony supporting SB 116. He stressed that SB 116 was not a
panacea to fix everything in Alaska's Workers' Compensation
program but that it provides an opportunity for groups to
develop a pilot-project to save money on these issues. SB 116
may provide an alternate way for dealing with rising expenses,
primarily by providing enabling language to allow groups the
opportunity to develop a program. He reiterated that the primary
intent is to lower workers' compensation costs. He added that an
early treatment system development is also part of the plan,
which allows employees a chance to return to work, saving
employee and employer groups on the investment made in training.
1:40:05 PM
SENATOR GIESSEL asked if SB 116 makes workers relinquish their
freedoms and liberties in choosing their health care provider
and beyond local Juneau support for SB 116, could he name others
that support it.
MR. GROSSI responded that the American Federation of Labor and
Congress of Industrial Organizations (AFL-CIO) had endorsed SB
116 in 2011, but he didn't know if it would continue its support
in 2012.
SENATOR GIESSEL asked if the AFL-CIO located in Alaska supports
SB 116.
MR. GROSSI replied yes.
CHAIR EGAN stressed that witness testimony on SB 116 during the
2011 session remains on the record and asked if Mr. Grossi was
extending an invitation for the committee to attend an open
house next week.
MR. GROSSI confirmed that a luncheon and tour at the local
Pipefitters Training Facility was scheduled for the committee on
Thursday, January 26, 2012.
1:42:38 PM
SENATOR GIESSEL asked if the Juneau Pipefitters Training
Facility was similar to the training facility in Fairbanks.
MR. GROSSI explained that there are three separate union locals;
Anchorage, Fairbanks and Juneau. He mentioned being hopeful that
union representatives from the Anchorage and Fairbanks training
facilities will be in attendance at next week's luncheon to
address the senators' questions.
1:43:24 PM
J.D. WILKERSON, owner, Griffard Steel Company, Fairbanks,
Alaska, said he is in favor of SB 116. He emphasized that
workers' compensation is a large part of Griffard Steel's
operating costs and feels "in the back seat" with the current
program. He believed that SB 116 could provide him with cost
savings without jeopardizing individual care choices.
1:44:38 PM
SENATOR GIESSEL asked in what way Mr. Wilkerson feels like he is
"in the back seat" regarding workers' compensation for
employees.
MR. WILKERSON referred to past workers' compensation cases at
Griffard Steel in which he sent letters to the Division of
Workers' Compensation and received no replies other than
financial statements and said he believes interacting with an
appointed trustee would help him feel more informed about the
claims. The current system provides minimal information for the
business owner.
SENATOR GIESSEL asked how he felt about losing the option of
selecting the independent medical evaluation (IME) physician for
a second opinion.
MR. WILKERSON replied that he was not 100-percent sure what
options employers currently have, but was ready to look at other
options.
1:46:44 PM
SENATOR GIESSEL stated that Alaska's present workers'
compensation process allows an employer to ask for a second
opinion pertaining to the findings of the first physician and
she advised Mr. Wilkerson to take a closer look at SB 116's
impact on employers' options for a second opinion.
1:47:16 PM
STEVE RANK, Executive Director, Safety and Health, Ironworkers
International Union, California, said he supported SB 116. He
said he was involved in developing California's Collectively
Bargained Workers Compensation (CCBWC) program in 2003 and that
it was established for the very same reasons that are being
explored in Alaska. He stressed that the CCBWC was created to
help improve the delivery of medical benefits to injured workers
without diminishing rights. He also stated that the CCBWC
programs are voluntary.
MR. RANK emphasized that nothing in the CCBWC diminishes labor's
or management's ability to get a second opinion and that it led
to labor and management working together. Both parties have
medical specialists and experienced hearing officers to expedite
claims in a timely manner, leading to a win-win for labor,
management and insurance companies.
1:50:57 PM
SENATOR PASKVAN joined the committee.
MR. RANK pointed out that independent reviews and audits were
conducted in the state of Minnesota and their Collective
Bargaining Agreement (CBA) had shown a reduction in medical
costs, lost time and days from work and litigation to help
resolve disputes.
He pointed out that delay in resolving workers' compensation
cases is the primary cause for higher costs and the CBA program
encourages the employer, insurance carrier, union ombudsman and
program trustees to work together and help expedite claims. He
stressed that Ironworkers International would not back a CBA for
its members unless it had been shown to be successful as in
California and Nevada.
He pointed out that programs from a CBA would take time to
establish, and as they develop, there would be an opportunity to
review and evaluate success. He offered Illinois as an example
of a state that had recently started a CBA pilot-program to
address "out of control" workers' compensation costs.
He emphasized that a CBA would provide an avenue for all parties
to work together. He explained that injured workers in the CCWBC
program have access to an established communication network: a
union ombudsman with 24-hour access, independent case nurse
managers with no insurance carrier, and a union or management
affiliate trained to answer medical questions rather than
dealing with a claims officer.
In closing, he summarized that while costs continue to increase,
the CBA programs have proven successful in California and
Nevada. He urged them to pass SB 116 and suggested adding a CBA
review after 12 to 18 months.
1:56:28 PM
SENATOR GIESSEL stressed being "100-percent on the same page"
with Mr. Rank. She noted that the Alaska Medical Dispute
Resolution Comparisons (AMDRC) diagram showed a limited
selection option for the employee under a CBA system when
compared to the current Alaska Statutory Workers' Compensation
System (ASWCS) that provides an option to injured employees to
select whatever physician they want - perhaps their childhood
family doctor or a specialist. If an employer has questions
about the injured employee's medical examination results, ASWCS
allows him to choose his own physician for a second opinion. She
said SB 116 limited an employee's choice of physician to the
narrower CBA "approved list" and an employer's second choice
option to a list selected by an arbitrator. She said
California's and Nevada's CBA shows a significantly larger
number of healthcare providers to choose from and asked how many
there were.
MR. RANK responded that California and Nevada CBA's allow
employees to choose a physician for general health and welfare
reasons; however, a physician specialist listing is provided for
knees, back, shoulders, hands and related injuries which require
significant expertise. He added that physicians that abuse
proper billing practices for the CBA are removed from the
approved provider listing. He concluded that since the CBA took
effect in 2003, no negative feedback has been received from
injured workers or union representatives in California and
Nevada. Current data supports the fact that a CBA for well-
organized workers' compensation programs do work.
2:02:34 PM
FRED BROWN, Executive Director, Health Care Cost Management
Corporation of Alaska, Inc. (HCCMCA), Fairbanks, Alaska, said
they support SB 116.
2:03:57 PM
GREG KUCERA, Business Manager, Alaska Ironworkers, Anchorage,
Alaska, said he supports SB 116. He explained that collective
bargaining between labor and management will result in a "higher
quality" list of physicians, specialists, independent
facilitators and case management nurses giving injured workers
the best care and path back to full employment as quickly as
possible. He concluded that SB 116 would foster a cooperative
effort to address cost savings and quality care.
2:09:07 PM
CHAIR EGAN asked if SB 116 will speed up the resolve of the
injury dispute and mediation process.
MR. KUCERA replied yes, due to a "team effort" structure.
2:09:56 PM
JIM BARRACK, Contractor, Ironworkers Local 751, Anchorage,
Alaska, said he supports SB 116. He noted that SB 116 was
explained to the Alaska Steel Erectors Association meeting last
year and it received positive feedback from membership. He
believed that it would lead to improved care and service for
injured workers along with cost reduction for employers.
2:12:55 PM
MR. THOMAS ZIMMERMAN, President, Universal Welding and
Fabrication, Inc., North Pole, Alaska, declared his support for
SB 116, clarifying his status as a contractor and not an Alaska
Ironworkers Union representative. He welcomed the concept of a
CBA for workers' compensation which would help provide an
opportunity for contractors to control costs and assure that
employees receive the level of care they deserve and are
entitled to. He said he is encouraged by the AFL-CIO's
willingness to work with management.
He reflected on his 35 years in the industry and pointed out how
individuals place faith in the current system that might not
offer alternative care solutions and that a CBA program provides
independent practioners as a sounding-board to give advice. He
also reflected on Senator Giessel's comments on the Independent
Medical Evaluation (IME) process currently used in the ASWCS for
second physician opinions and pointed out that the current IME
stage is used only after many months had elapsed. He stated his
belief that a CBA preferred-physician listing would speed up the
process and drive down costs related to second opinion
evaluations without jeopardizing employee rights. He said that
"time is money" and employees returning to work sooner win by
earning more as a productive employee versus income from
workers' compensation benefits and employers win by avoiding
losses in production. He encouraged legislators to give SB 116 a
try with sunset and review parameters.
2:18:04 PM
MR. MIKE MONAGLE, Director, Division of Workers' Compensation,
Alaska Department Labor and Workforce Development (DOLWD),
stated they have a neutral position on SB 116.
SENATOR PASKVAN asked what he liked and does not like about SB
116.
MR. MONAGLE replied that since the division has a neutral
position, he would not express his likes or dislikes. He
reflected on previous testimony and agreed that workers'
compensation costs are a concern to everyone.
SENATOR PASKVAN restated his question saying he wanted to know
if SB 116 will help or not help to save on costs. He suggested
that a concern for costs is irrelevant to the decision that has
to be made to actually help with cost reduction.
MR. MONAGLE replied that SB 116 is new legislation and that
other states claim savings using that process. But he stated
that neither the division nor the department has the ability to
collect data and estimate what impact SB 116 would have on rates
in Alaska.
SENATOR PASKVAN asked if he thought it was worth the risk to
Alaska to try SB 116.
MR. MONAGLE responded that it was up to the Senate Labor and
Commerce Committee to determine.
CHAIR EGAN commented that the State of Alaska ranks number one
for workers' compensation costs and asked how it could get
worse.
MR. MONAGLE divulged that Alaska's workers' compensation rates
were ranked second highest in the nation since 2008, but that
the state of Montana recently passed legislation that could
return Alaska to first place.
2:21:26 PM
MR. MONAGLE added that he did not know if SB 116 would bring
rates down and acknowledged that it would take time to determine
the savings.
CHAIR EGAN stated that two or three prior witness testimonies
claimed SB 116, with a scheduled review, would be worth trying
and asked if the department would take issue with doing that.
MR. MONAGLE reiterated the department's neutral position, but
added that approximately three years would be required to
collect data and determine actual cost savings.
CHAIR EGAN inquired if it is in the department's best interest
to resolve workers' compensation issues in a timelier manner.
2:23:46 PM
MR. MONAGLE responded that any legislation that saves time and
money is good for Alaska's workers. He remarked that the dispute
resolution process is complicated; some cases require years of
mediation to resolve medically complex issues. He said their
hearing officers are asked to mediate approximately 50 dispute
cases per year with a 90-percent success rate.
SENATOR PASKVAN asked if there was a better idea to try first
rather than SB 116.
2:25:38 PM
MR. MONAGLE answered that he was not aware of any other
legislation that reduces Alaska's workers' compensation rates.
SENATOR PASKVAN, for clarification, asked if beyond legislation,
was there an alternate idea, process or procedure to start
first, which benefits workers and employers regarding workers'
compensation.
2:26:05 PM
SENATOR MENARD joined the committee.
MR. MONAGLE stated that he had no better ideas to offer the
committee at this time.
SENATOR GIESSEL noted her background as a healthcare provider
and experience with workers' compensation cases and second
opinion requests. She pointed out that requests for second
opinions from an alternate physician have resulted in solutions
being found which speed the individual returning back to work at
a functional level and asked what percentage of workers'
compensation cases request a second opinion.
MR. MONAGLE said that the terminology is inconsistent and an
Independent Medical Evaluation (IME) is not considered a second
opinion when a general practioner refers an injured worker to a
specialist. An IME is considered a second opinion when the
employer requests it. He added that disputes typically occur
when a second opinion is requested to address the injured
employee's disability level.
2:28:31 PM
SENATOR GIESSEL asked how often an IME is requested.
MR. MONAGLE replied that he did not know and said that IME
approval is not required by the division and added that the
Employee Compensation Board (ECB) gets involved when parties
have a dispute between doctors when a Second Independent Medical
Evaluation (SIME) is requested. He explained that the ECB has a
list of its own medical experts. Injured workers are sent for an
independent evaluation, which is separate from the previous two
doctors used in a specific case. He mentioned that the ECB
handles approximated 1500 SIME cases per year.
2:29:27 PM
SENATOR DAVIS commented that SB 116 provides enabling
legislation that will only succeed if the parties involved work
together, and she questioned the department's neutrality on SB
116 when alternative suggestions for improvement have not been
brought forward. She added that data obtained from states which
have adopted CBA's for workers' compensation cases would be
helpful to the committee.
CHAIR EGAN said he agreed with Senator Davis and that CBA data
from other states was currently being compiled. He asked what
the member turnover is for the Division of Workers'
Compensation's ECB.
2:31:46 PM
MR. MONAGLE replied that annually there is a one or two seat
turnover. He added that the ECB is staffed with newly appointed
and experienced board members.
CHAIR EGAN said he had verified via an associate who served on
the ECB that the commitment as board member is very time-
consuming.
MR. MONAGLE agreed that membership entails a major time
commitment.
2:32:59 PM
CHAIR EGAN announced that no further questions would be taken
today and that the committee would continue to gather
information for a decision on SB 116.
2:34:17 PM
There being no further business to come before the committee,
Chair Egan adjourned the meeting at 2:34 p.m.