Legislature(2019 - 2020)BELTZ 105 (TSBldg)

03/19/2019 01:30 PM LABOR & COMMERCE

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Audio Topic
01:30:05 PM Start
01:32:09 PM Presentation
02:04:58 PM SB65
02:32:31 PM Confirmation Hearing(s)
02:37:46 PM SB66
02:54:43 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Presentation: TELECONFERENCED
Health Care & Alaska's Economy by Charles
Silver, M.A., J.D. & David Hyman, M.D., J.D.
-- Testimony <Invitation Only> --
<Item Above Added to Agenda>
+ Consideration of Governor's Appointees: TELECONFERENCED
Workers' Compensation Board - Julie Duquette
-- Public Testimony --
*+ SB 65 DEPT. OF LABOR: TECHNICAL ED. PROGRAMS TELECONFERENCED
Heard & Held
-Invited Testimony Followed by Public Testimony-
*+ SB 66 LABOR STANDARDS/SAFETY; WORKER COMP. TELECONFERENCED
Heard & Held
-Invited Testimony Followed by Public Testimony-
+ Bills Previously Heard/Scheduled TELECONFERENCED
**Streamed live on AKL.tv**
                    ALASKA STATE LEGISLATURE                                                                                  
          SENATE LABOR AND COMMERCE STANDING COMMITTEE                                                                        
                         March 19, 2019                                                                                         
                           1:30 p.m.                                                                                            
                                                                                                                                
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Lora Reinbold, Chair                                                                                                    
Senator Mia Costello, Vice Chair                                                                                                
Senator Click Bishop                                                                                                            
Senator Chris Birch                                                                                                             
Senator Elvi Gray-Jackson                                                                                                       
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
PRESENTATION: Health Care & Alaska's Economy                                                                                    
                                                                                                                                
     - HEARD                                                                                                                    
                                                                                                                                
SENATE BILL NO. 65                                                                                                              
"An Act relating to the duties of the Department of Labor and                                                                   
Workforce Development; and providing for an effective date."                                                                    
                                                                                                                                
     HEARD AND HELD                                                                                                             
                                                                                                                                
CONFIRMATION HEARING:                                                                                                           
                                                                                                                                
Workers' Compensation Board                                                                                                   
Julie Duquette - North Pole                                                                                                     
                                                                                                                                
     CONFIRMATION ADVANCED                                                                                                      
                                                                                                                                
SENATE BILL NO. 66                                                                                                              
"An Act relating  to the division of labor  standards and safety;                                                               
relating to  the division of workers'  compensation; establishing                                                               
the division  of workers' safety and  compensation; and providing                                                               
for an effective date."                                                                                                         
                                                                                                                                
     HEARD AND HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: SB 65                                                                                                                   
SHORT TITLE: DEPT. OF LABOR: TECHNICAL ED. PROGRAMS                                                                             
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
02/20/19       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/20/19       (S)       L&C, FIN                                                                                               
03/19/19       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
BILL: SB 66                                                                                                                   
SHORT TITLE: LABOR STANDARDS/SAFETY; WORKER COMP.                                                                               
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
02/20/19       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/20/19       (S)       L&C, FIN                                                                                               
03/19/19       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
CHARLES SLIVER, M.A., J.D.; Co-Director                                                                                         
Center on Lawyers                                                                                                               
School of Law, University of Texas                                                                                              
Austin, Texas 78705                                                                                                             
POSITION STATEMENT: Provided a presentation on Health Care &                                                                  
Alaska's Economy.                                                                                                               
                                                                                                                                
DAVID HYMAN, M.D., J.D.; Professor of Law                                                                                       
Georgetown University Law Center                                                                                                
Washington, D.C.                                                                                                                
POSITION STATEMENT: Provided a presentation on Health Care &                                                                  
Alaska's Economy.                                                                                                               
                                                                                                                                
TAMIKA LEDBETTER, PhD; Commissioner Designee                                                                                    
Department of Labor and Workforce Development (DOLWD)                                                                           
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified and answered questions during the                                                               
hearing on SB 65.                                                                                                               
                                                                                                                                
JULIE DUQUETTE, Appointee                                                                                                       
Workers' Compensation Board                                                                                                     
Department of Labor and Workforce Development (DOLWD)                                                                           
North Pole, Alaska                                                                                                              
POSITION STATEMENT: Testified as appointee to the Workers'                                                                    
Compensation Board.                                                                                                             
                                                                                                                                
GREY MITCHELL, Director                                                                                                         
Division of Workers' Compensation                                                                                               
Central office                                                                                                                  
Department of Labor and Workforce Development (DOLWD)                                                                           
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified during the hearing on SB 66.                                                                    
                                                                                                                                
DON ETHERIDGE, Executive Director                                                                                               
AFLCIO                                                                                                                          
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified during the hearing on SB 66.                                                                    
                                                                                                                                
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
1:30:05 PM                                                                                                                    
CHAIR  LORA  REINBOLD  called  the   Senate  Labor  and  Commerce                                                             
Standing Committee meeting  to order at 1:30 p.m.  Present at the                                                               
call to  order were Senators  Gray-Jackson, Costello,  Bishop and                                                               
Chair  Reinbold. Senator  Birch  arrived as  the  meeting was  in                                                               
progress.                                                                                                                       
                                                                                                                                
^PRESENTATION                                                                                                                   
                         PRESENTATION:                                                                                      
                 Health Care & Alaska's Economy                                                                             
                                                                                                                              
1:32:09 PM                                                                                                                    
CHAIR REINBOLD announced  that the first order  of business would                                                               
be a presentation on Health Care & Alaska's Economy.                                                                            
                                                                                                                                
1:33:21 PM                                                                                                                    
CHARLES  SLIVER,  M.A.,  J.D.; Co-Director,  Center  on  Lawyers,                                                               
School  of  Law, University  of  Texas,  Austin, Texas,  began  a                                                               
presentation on  Health Care &  Alaska's Economy. He  stated that                                                               
he  is  also  an  adjunct  scholar  at  the  Cato  Institute,  [a                                                               
conservative  think  tank],  and co-author  of  Overcharged:  Why                                                             
Americans Pay too Much for Healthcare,  which is a "soup to nuts"                                                             
review  of the  health care  system  and the  pathologies of  the                                                               
same.                                                                                                                           
                                                                                                                                
1:33:46 PM                                                                                                                    
DAVID HYMAN, M.D., J.D.; Professor  of Law, Georgetown University                                                               
Law  Center,  Washington,  D.C.,  stated he  is  a  professor  of                                                               
Georgetown, he is  also an adjunct scholar at  the Cato Institute                                                               
and the American Enterprise Institute.  He said he co-authored of                                                               
Overcharged:  Why  Americans  Pay  too Much  for  Healthcare.  He                                                             
remarked  that  the  Pacific  Health  Coalition  paid  for  their                                                               
travel. He offered to provide copies of the book to members.                                                                    
                                                                                                                                
CHAIR REINBOLD wanted  to be sure that  legislators could receive                                                               
the book, but she would check the ethics guidelines.                                                                            
                                                                                                                                
1:35:13 PM                                                                                                                    
MR. SILVER  offered to provide a  brief overview of the  book. He                                                               
said  that  the U.S.  healthcare  system  seemed designed  to  be                                                               
expensive. The  system's third party payers,  including insurance                                                               
companies,  Medicare,  Medicaid,   TRICARE,  and  other  entities                                                               
dominate the payment  system. At the point  of delivery, patients                                                               
typically pay about  11 cents on the dollar for  health care. The                                                               
remaining 89 cents  comes from a third party  payer. This reduces                                                               
patients' questions on whether the  fees are reasonable. Patients                                                               
rely on  the payers  to do  so, which  creates a  principal agent                                                               
relationship between the providers  and payers instead of between                                                               
the providers and  patients. Since the bulk of  the payments come                                                               
from payers,  the providers are  more concerned  about satisfying                                                               
the  payers'  requirements  rather  than  what  is  in  the  best                                                               
interest of the patients. The  system incentivizes individuals to                                                               
overconsume and  providers are satisfied  with the flow  of money                                                               
to them. The  payers, such as private insurers,  make their money                                                               
based on  the dollar value  of the claims. Government  payers are                                                               
not capable  of scrutinizing the services  but receive electronic                                                               
forms  and  process  the  claims  if  the  forms  are  filled  in                                                               
correctly. This  spiral of  spending has  led to  today's issues.                                                               
Alaska's  health care  costs are  the highest  per capita  in the                                                               
U.S. and the world. He characterized  it as a generic problem for                                                               
the nation.                                                                                                                     
                                                                                                                                
1:38:03 PM                                                                                                                    
DR.  HYMAN agreed  with Dr.  Silver. He  offered his  belief that                                                               
many  conscientious  people  work  for  insurance  companies  and                                                               
health care  providers, but the  incentives often  interfere with                                                               
the  outcome. He  said that  not  enough attention  was given  to                                                               
delivering high  quality care.  Second, the  "incentive problems"                                                               
extend  to  "surprise" medical  bills  or  balanced billing.  For                                                               
example, this issue  exists in many states for  patients who have                                                               
surgery in an  "in-network" hospital only to  later discover that                                                               
the anesthesiologist  is not in  network. Patients  discover this                                                               
two or three months later when  the insurance declines to pay and                                                               
patients must fight for payment. In  fact, he has written a white                                                               
paper  that  discusses  this.  He   offered  to  further  discuss                                                               
Alaska's issues. He emphasized the  importance of competition and                                                               
market entry  as a  means to lower  prices and  enhancing quality                                                               
and value for  patients. Restrictions on market entry,  such as a                                                               
certificate  of  need,  licensure   requirements,  and  scope  of                                                               
practice,  and   market  consolidation  make  it   hard  to  have                                                               
effective  competition.  He  suggested  that  encouraging  market                                                               
entry is  an area Alaska could  direct its attention to  in order                                                               
to  improve the  healthcare  system. He  further suggested  using                                                               
insurance  for true  catastrophes instead  of for  general health                                                               
care needs.                                                                                                                     
                                                                                                                                
1:41:04 PM                                                                                                                    
SENATOR GRAY-JACKSON  said she attended  the presentation  at the                                                               
"lunch and learn." She thanked them for the great presentation.                                                                 
                                                                                                                                
1:41:32 PM                                                                                                                    
SENATOR COSTELLO said she previously  served on the House Finance                                                               
Committee  and held  numerous  discussions  on transparency.  She                                                               
offered her belief that it  is difficult for companies to provide                                                               
transparency  since  prices  are  negotiated  for  services.  She                                                               
recalled  he suggested  that patients  should ask  questions. She                                                               
said it is  virtually impossible to obtain  information, that the                                                               
culture does not promote transparency.  She asked for suggestions                                                               
on how that  could change. She said that health  care costs drive                                                               
up budgets, including school district  budgets. She did not think                                                               
the legislature has been able to make headway.                                                                                  
                                                                                                                                
1:43:39 PM                                                                                                                    
MR. SILVER  referred to his  book that may provide  some answers.                                                               
He said  some parts  of the  healthcare system  provide a  lot of                                                               
transparency. For example, people can go  to a walk in clinic and                                                               
see the cost  for services. He said that a  large part of walk-in                                                               
clinics'  business  is on  a  self-pay  basis. For  example,  the                                                               
Surgery Center  of Oklahoma  performs complex  medical procedures                                                               
for individuals  or employers, who  send their employees,  but it                                                               
does so on  a cash basis and does not  use insurance. The website                                                               
shows  a body  and the  patient can  click on  the body  part and                                                               
obtain  the cost  of the  procedure, including  hip replacements.                                                               
When the  consumer spends money  directly, the  provider conducts                                                               
itself  as any  business.  He offered  his  belief that  self-pay                                                               
needs  to be  a big  part of  the reform.  He questioned  whether                                                               
legislating  transparency  would   work.  Providers  must  desire                                                               
business and advertise its prices, he said.                                                                                     
                                                                                                                                
1:45:48 PM                                                                                                                    
DR. HYMAN  added that other  sectors voluntarily  disclose prices                                                               
without a  mandate. He said  that the healthcare system  makes it                                                               
difficult for  people outside  the system  to access  pricing. He                                                               
pointed  out  the  disconnect  between   those  who  provide  the                                                               
service, who  have no idea  of the cost,  and those who  bill for                                                               
it. Second,  all products in front  of the counter in  a pharmacy                                                               
have a  single price, but  the prescription drug costs  depend on                                                               
the insurance coverage.  He offered his belief  that the presence                                                               
of insurance was an important factor in pricing.                                                                                
                                                                                                                                
He suggested that it might  be worthwhile to do some transparency                                                               
efforts to show how public and  private funds are being spent. He                                                               
cautioned   against    compelling   them   to    disclose   their                                                               
chargemasters,  [which  is  a  list  of  all  billable  services.                                                               
Instead, what  is more  important is to  have the  prices bundled                                                               
for  particular types  of problems.  He  offered to  talk to  the                                                               
committee  in more  detail.  He  referred to  his  book for  some                                                               
information, but he  and Mr. Silver have done  additional work on                                                               
the subject.                                                                                                                    
                                                                                                                                
1:47:33 PM                                                                                                                    
MR. SILVER said  that the amount the state spends  on Medicaid is                                                               
driven  by the  amount  that providers  demand  for treating  the                                                               
recipients.  He suggested  that  the  legislature divorce  itself                                                               
from  that  dependency.  It  would mean  creating  a  system  for                                                               
catastrophic care insurance that  provides an umbrella for people                                                               
who suffer  real catastrophes, or low-frequency  high-cost events                                                               
which  is what  insurance  is designed  to do.  The  rest of  the                                                               
system should be a self-pay  one and operate like social security                                                               
or food stamps. He suggested  programs, such as food stamps, give                                                               
people money  with restrictions.  Other programs, such  as social                                                               
security  and  earned income  tax  credit  programs do  not  have                                                               
restrictions.  Those  programs funnel  money  into  the hands  of                                                               
consumers  who use  the funds  for housing,  food, gasoline,  and                                                               
education. He  said many people do  not realize that most  of the                                                               
contributions for good  health are through access  to clean water                                                               
and  stable housing.  In addition,  education  represents a  huge                                                               
driver of health. Poor people  spend their money on other things,                                                               
which  are the  social determinants  of health,  which provide  a                                                               
"lot  of bang  for  the buck."  It does  not  provide nearly  the                                                               
payoff when  money is spent  on intensive medical  treatments, he                                                               
said.                                                                                                                           
                                                                                                                                
1:49:34 PM                                                                                                                    
DR. HYMAN  interjected that positive spillovers  occur for family                                                               
members when  the money  is spent on  the social  determinants of                                                               
health and the benefits are not just limited to the individual.                                                                 
                                                                                                                                
1:50:01 PM                                                                                                                    
SENATOR BISHOP asked  how things went the U.S. went  so wrong. He                                                               
said that  when his mother was  born, her total bill  was $25 and                                                               
consisted of three lines for five hospital days.                                                                                
                                                                                                                                
DR. HYMAN said one important  starting point was made during WWII                                                               
to allow  employment based health  insurance to be provided  on a                                                               
pre-tax basis. He  characterized this as a  large subsidy through                                                               
employers. That caused horizontal  and vertical inequity, because                                                               
when an employer  does not provide insurance,  the individuals do                                                               
not receive a subsidy. Vertical  inequity exists in a progressive                                                               
tax system that  provides a subsidy that is worth  more to people                                                               
with higher salaries.                                                                                                           
                                                                                                                                
He said that  the basic issue is that the  U.S. subsidizes health                                                               
insurance. In  fact, it is  the single, largest tax  subsidy. The                                                               
second important point was the  adoption of Medicare and Medicaid                                                               
in the form that it took.  He said that the empirical evidence is                                                               
quite  clear  that  the  mid-60s   decision  to  structure  these                                                               
programs  on a  "tell us  what the  charges are  and we  will pay                                                               
them" approach  was an  invitation for  volume and  price effects                                                               
that have continued ever since.                                                                                                 
                                                                                                                                
SENATOR BISHOP pointed out that  Alaska does not have the economy                                                               
of scale to  create competition. People stop  paying premiums and                                                               
the overall cost of premiums rise, he said.                                                                                     
                                                                                                                                
1:53:47 PM                                                                                                                    
MR. SILVER  said people opt  out when they  are forced to  do so.                                                               
These people  become part  of the army  using retail  outlets. He                                                               
acknowledged  that  the  cost spiral  cannot  continue  and  that                                                               
insurance premiums  are unaffordable. He pointed  out that Alaska                                                               
has  geographic  problems  that are  difficult  to  overcome.  He                                                               
suggested that Alaska could be  more receptive to market entry by                                                               
using telehealth  options and mobile  health care  centers. These                                                               
options  could  help  because  lots of  places  cannot  afford  a                                                               
physician. However,  some situations will be  difficult to solve,                                                               
he said.                                                                                                                        
                                                                                                                                
1:56:02 PM                                                                                                                    
CHAIR  REINBOLD  drawing  from  her time  as  a  chief  executive                                                               
officer for  a company, she  said she has experience  with health                                                               
care. She expressed  concern about the $2,000  per month premiums                                                               
for state  employees. She offered  her belief that the  state has                                                               
serious  negotiation   issues,  which  is  why   she  would  like                                                               
contracts negotiated in public. She  described issues she and her                                                               
husband  had   in  terms  of  selecting   health  insurance.  She                                                               
emphasized  the  need to  focus  on  prevention and  research  to                                                               
determine the high incidence of  cancer, heart disease and sexual                                                               
assault  and  domestic  violence,   which  drive  up  costs.  She                                                               
suggested  that hospital  audits are  available to  review costs.                                                               
She agreed that third party  insurance also drives up health care                                                               
costs, yet the  insurers take little risk  whereas doctors absorb                                                               
the  risks. She  once posted  the salaries  of large  health care                                                               
insurers, which she said were outrageous.                                                                                       
                                                                                                                                
1:58:27 PM                                                                                                                    
SENATOR BIRCH joined the meeting.                                                                                               
                                                                                                                                
1:58:49 PM                                                                                                                    
CHAIR REINBOLD  identified another  issue as  the overutilization                                                               
of emergency  rooms. She  recalled hearing that  ten per  cent of                                                               
the  patients represent  90 percent  of the  emergency room  use.                                                               
Reducing prescription  costs could help.  She pointed out  that a                                                               
doctor showed  her a phone  app that could  reduce pharmaceutical                                                               
costs  by  identifying the  costs  at  every single  pharmacy  in                                                               
Alaska.  She  emphasized  the importance  of  breaking  down  the                                                               
barriers to competition.                                                                                                        
                                                                                                                                
1:59:46 PM                                                                                                                    
DR. HYMAN  offered to  address several  issues and  to meet  at a                                                               
future  date. He  said  that emergency  rooms  are important  and                                                               
provide  a  critical part  of  the  health  care system  but  are                                                               
plagued by  overutilization. Doctors treat patient  problems that                                                               
often  do not  need  emergency room  facilities. Further,  social                                                               
problems  such  as  people with  housing  and  stability  issues,                                                               
criminal justice  system encounters,  and substance  abuse issues                                                               
often  come   to  emergency  rooms,   where  treatment   is  very                                                               
expensive.  He suggested  thinking creatively  about ways  to get                                                               
those problems out  of emergency rooms due to  the expense. Often                                                               
patients are  out of  network or  uninsured. Second,  the medical                                                               
malpractice system  and tort  reform have  had modest  effects in                                                               
some  states, but  it  is not  a good  way  to address  defensive                                                               
medicine. He  offered to  share articles  with the  committee. He                                                               
said  that  the huge  numbers  are  not  borne out  by  empirical                                                               
research.                                                                                                                       
                                                                                                                                
He said that being a passive  payer is not an effective strategy,                                                               
which is  why premiums  are several thousand  per month.  He said                                                               
that most  employees are not aware  of the cost of  the insurance                                                               
coverage. These employees do not  receive any raises, because the                                                               
funds  are used  to pay  the  increased costs  for employer  paid                                                               
health care  coverage. He suggested  people would  make different                                                               
choices with more transparency of premiums.                                                                                     
                                                                                                                                
2:03:20 PM                                                                                                                    
CHAIR  REINBOLD  remarked that  a  healthy  tension exists.  Many                                                               
doctors believe that doctors  are micromanaged and overregulated,                                                               
whereas  lawyers  are  totally unregulated.  She  suggested  that                                                               
lawyers are part of the problem in the health care issue.                                                                       
                                                                                                                                
          SB 65-DEPT. OF LABOR: TECHNICAL ED. PROGRAMS                                                                      
                                                                                                                                
2:04:58 PM                                                                                                                    
CHAIR REINBOLD  announced that the  next order of  business would                                                               
be SENATE  BILL NO.  65, "An  Act relating to  the duties  of the                                                               
Department of Labor and Workforce  Development; and providing for                                                               
an effective date."                                                                                                             
                                                                                                                                
2:05:06 PM                                                                                                                    
TAMIKA  LEDBETTER,  PhD;  Commissioner  Designee,  Department  of                                                               
Labor  and Workforce  Development (DOLWD),  Anchorage, said  that                                                               
the department's primary focus is  to connect Alaskans to the job                                                               
opportunities  in the  state.  She  highlighted the  department's                                                               
goal to connect  more young Alaskans with  high-quality career or                                                               
technical  training,   and  education   that  can  lead   to  job                                                               
opportunities in  their home  regions. Whether  those individuals                                                               
reside in  coastal or  interior Alaska,  the department  seeks to                                                               
identify partnerships  with employers and  training organizations                                                               
to prepare Alaskans for these opportunities.                                                                                    
                                                                                                                                
SB  65  would add  language  in  AS  Title  44 that  directs  the                                                               
Department  of   Labor  and  Workforce  Development   (DOLWD)  to                                                               
coordinate  and monitor  state career  and technical  educational                                                               
programs  by cooperating  with the  Department  of Education  and                                                               
Early  Development  (DEED), the  University  of  Alaska, and  any                                                               
other  entities that  provide career  or technical  training. The                                                               
Department  also   helps  employers  find  skilled   workers  and                                                               
identifies  education   and  training  opportunities   for  their                                                               
current workforce, she said.                                                                                                    
                                                                                                                                
2:07:08 PM                                                                                                                    
COMMISSIONER DESIGNEE  LEDBETTER said  that the  Alaska Workforce                                                               
Investment  Board   (AWIB)  is   the  lead  state   planning  and                                                               
coordinating  entity for  human resource  programs in  the state.                                                               
Members  represent  a diverse  cross  section  of businesses  and                                                               
educational  partners in  Alaska.  In 2010,  the  AWIB worked  in                                                               
cooperation   with  the   Department  of   Education  and   Early                                                               
Development (DEED)  and the University  of Alaska to  develop the                                                               
2010  Alaska Career  and Technical  Education  (CTE) plan,  which                                                               
called for  strategies to improve career  and technical education                                                               
and  prepare  Alaskans  with   skills  needed  for  postsecondary                                                               
training and  careers in high  growth occupations in  Alaska. The                                                               
CTE  plan  called  for  increasing   efforts  to  develop  career                                                               
pathways,  career counseling,  standards  for training  programs,                                                               
coordination,  and  program  delivery.  The  plan  addressed  the                                                               
individual need  for career preparedness  as well as  the broader                                                               
need  for a  training  and education  system  that is  efficient,                                                               
effective,  and coordinated  with  current  and future  workforce                                                               
needs.                                                                                                                          
                                                                                                                                
In  2018,  these same  partners  developed  the addendum  to  the                                                               
Alaska Career and Technical Education  Plan. This effort was made                                                               
to reenergize  and reexamine CTE  plan strategies to  help ensure                                                               
that   a  broad   spectrum   of   educational  opportunities   is                                                               
communicated to Alaskans, she said.                                                                                             
                                                                                                                                
The CTE coordinator's  role is to work to implement  the CTE plan                                                               
strategy, she  said. Alaska  Vocational Technical  Center (AVTEC)                                                               
provides a premier state training  school for customized training                                                               
directed  at specific  employers  and  long-term training.  These                                                               
programs  average  nine months  in  duration  in fields  such  as                                                               
maritime,  applied  technology,  the culinary  arts,  energy  and                                                               
building  technology,  and  information technology.  Another  key                                                               
role  that  the Department  of  Labor  and Workforce  Development                                                               
(DOLWD)  plays  is  the dissemination  of  Career  and  Technical                                                               
Training  Funds through  State  Training  and Employment  Program                                                               
Funds and many federal grant programs, she said.                                                                                
                                                                                                                                
COMMISSIONER DESIGNEE  LEDBETTER said that SB  65 would formalize                                                               
the  DOLWD as  the  lead agency  in  coordinating and  monitoring                                                               
state career and technical education.                                                                                           
                                                                                                                                
2:10:14 PM                                                                                                                    
SENATOR  BIRCH  remarked  on  the level  of  engagement  and  the                                                               
positive impact  that continuing  technical education has  had on                                                               
Alaska's children.  Specifically, he recalled  the superintendent                                                               
of the  Juneau School District  reported a graduation rate  of 82                                                               
percent which  bumped up to  84 percent  for those who  took some                                                               
additional classes  in a fifth  year. Remarkably,  the graduation                                                               
rate for  students with access  to technical  education component                                                               
jumped to  93-94 percent. He  said that  was pleased to  see this                                                               
proposal coming forward.                                                                                                        
                                                                                                                                
2:11:31 PM                                                                                                                    
SENATOR  COSTELLO  said  that  she  was  encouraged  to  see  the                                                               
department  break down  some "silos"  because  the Department  of                                                               
Education  and  DOLWD  should  be   working  in  tandem.  One  of                                                               
department's roles  is to get  Alaska's youth ready for  the work                                                               
force and  the other is  to train people  for work. She  said she                                                               
viewed these roles as a natural  link. She asked whether the bill                                                               
goes far  enough. For example, she  said that she would  like the                                                               
department to  review current career and  technical opportunities                                                               
at the Anchorage  School District's middle and  high schools. She                                                               
asked whether the language should identify more detailed goals.                                                                 
                                                                                                                                
COMMISSIONER  DESIGNEE  LEDBETTER   suggested  that  the  current                                                               
language  in the  bill was  fine. She  explained that  career and                                                               
technical  education  does not  stop  at  K-12.  The goal  is  to                                                               
provide a  robust strategy  and plan to  address CTE  training at                                                               
every level  from K-12 on to  age 99, if possible,  she said. She                                                               
offered her  belief that  a career  and technical  education plan                                                               
should  result  in  employment  or  it  is  a  failed  plan.  The                                                               
department should lead the way  because the employer community is                                                               
its  primary customer.  As the  department assesses  training and                                                               
workforce  needs,  it  must  coordinate with  the  DEED  and  the                                                               
University of  Alaska system  to ensure  that people  are trained                                                               
and  educated  to   fill  vacant  and  new   positions  that  the                                                               
department brings to Alaska.                                                                                                    
                                                                                                                                
SENATOR COSTELLO asked for the local school districts' role.                                                                    
                                                                                                                                
COMMISSIONER DESIGNEE  LEDBETTER said that the  CTE coordinator's                                                               
role  is  to  reach  out  and  work  with  all  schools,  private                                                               
industry, and the  university system to ensure that  plans are in                                                               
place. While  young people may not  know what they want  to be as                                                               
adults, by fifth grade they know  exactly what they don't want to                                                               
be,  she  said.  The  department will  work  to  encourage  these                                                               
entities to recognize this opportunity  to partner with the DOLWD                                                               
and not view  the coordination as a "hostile  takeover." She said                                                               
that this is something necessary to grow Alaska's workforce.                                                                    
                                                                                                                                
2:15:21 PM                                                                                                                    
SENATOR COSTELLO asked  whether she has information  on the types                                                               
of jobs and careers that will be needed in Alaska.                                                                              
                                                                                                                                
COMMISSIONER  DESIGNEE  LEDBETTER  answered that  the  department                                                               
always considers jobs  in demand. She said that  she would report                                                               
back to the committee on the specific jobs.                                                                                     
                                                                                                                                
SENATOR COSTELLO  recalled the Department of  Education and Early                                                               
Development's  commissioner previously  spoke  before the  Senate                                                               
Education  Committee on  the role  of coding.  She asked  whether                                                               
coding jobs were being reviewed by the department.                                                                              
                                                                                                                                
COMMISSIONER DESIGNEE  LEDBETTER answered  that the  DOLWD worked                                                               
closely with  the Department of  Education and  Early Development                                                               
(DEED) on coding  academies. She reported that  events were held,                                                               
in Kotzebue and in the Mat-Su  Valley. She stated that coding was                                                               
one  of the  industries that  would be  surfacing in  Alaska. The                                                               
state is  poised to take  advantage of many opportunities  due to                                                               
its  geographic  location.  Although  many  younger  people  have                                                               
expressed interest in coding, people  of all ages could code. She                                                               
welcomed members to attend the  Juneau kickoff event later in the                                                               
week. In response to Chair  Reinbold, she instructed her staff to                                                               
provide the information on the event to the committee.                                                                          
                                                                                                                                
2:18:02 PM                                                                                                                    
SENATOR BISHOP  asked whether she  could identify  any benchmarks                                                               
for  underperforming school  districts and  the deliverables  she                                                               
wanted to accomplish. He offered  his belief that Alaska does not                                                               
spend  enough on  career  education in  school  districts in  the                                                               
state.                                                                                                                          
                                                                                                                                
COMMISSIONER  DESIGNEE  LEDBETTER  answered that  the  department                                                               
already  has language  in the  Alaska Workforce  Investment Board                                                               
plan. The  department has stepped  up as  a leader in  career and                                                               
technical education.  This proposal  would strengthen  that role.                                                               
She  identified career  and  technical education  as  one of  her                                                               
primary  focuses.   The  governor   has  expressed   interest  in                                                               
providing these opportunities to  Alaska's youth. Adding the duty                                                               
to coordinate and monitor state  career and technical educational                                                               
programs would  bring a richness  to the program. CTE  means more                                                               
than  just providing  a CTE  class in  a school  or hiring  a CTE                                                               
instructor.  It must  be  imbedded  in the  state.  In fact,  the                                                               
reason to educate  and train people is to provide  them with good                                                               
paying jobs, which is an investment  that will result in a higher                                                               
qualified workforce.                                                                                                            
                                                                                                                                
2:20:52 PM                                                                                                                    
CHAIR  REINBOLD  remarked  that  she   was  a  firm  believer  in                                                               
technical  classes.  She  said  the  drafting,  woodworking,  and                                                               
automotive courses she  took were the best classes  she had taken                                                               
in  school. She  expressed concern  that these  types of  classes                                                               
were cut from Eagle River High School.                                                                                          
                                                                                                                                
SENATOR COSTELLO reported that the  upcoming coding session would                                                               
be held  on March  21 from  noon to  4 p.m.  at the  Alaska State                                                               
Museum.  The coding  session did  not require  previous expertise                                                               
and industry leaders would be attending.                                                                                        
                                                                                                                                
2:24:16 PM                                                                                                                    
CHAIR   REINBOLD  opened   public  testimony   and  after   first                                                               
determining no one wished to  testify, closed public testimony on                                                               
SB 65.                                                                                                                          
                                                                                                                                
[SB 65 was held in committee.]                                                                                                  
                                                                                                                                
2:25:28 PM                                                                                                                    
At-ease.                                                                                                                        
                                                                                                                                
^CONFIRMATION HEARING(S)                                                                                                        
                    CONFIRMATION HEARING(S):                                                                                
                  Workers' Compensation Board                                                                               
                                                                                                                                
2:32:31 PM                                                                                                                    
CHAIR  REINBOLD reconvened  the  meeting and  announced that  the                                                               
next  order of  business would  be the  Confirmation Hearing  for                                                               
Julie Duquette, appointee to the Workers' Compensation Board.                                                                   
                                                                                                                                
2:33:02 PM                                                                                                                    
JULIE   DUQUETTE,   Appointee,   Workers'   Compensation   Board,                                                               
Department  of Labor  and  Workforce  Development (DOLWD),  North                                                               
Pole, stated  that she  currently works  for Sladen  Plumbing and                                                               
Heating.  She  has  always  worked  in  construction  or  in  the                                                               
construction  support  industry.  She expressed  an  interest  in                                                               
worker safety  and for  safe work  environments for  workers. She                                                               
would  like to  continue to  serve on  the Workers'  Compensation                                                               
Board to further assist Alaska and the construction industry.                                                                   
                                                                                                                                
2:33:54 PM                                                                                                                    
SENATOR  BIRCH thanked  her  for her  interest  in continuing  to                                                               
serve  on the  Workers' Compensation  Board. He  said that  it is                                                               
helpful to have knowledgeable people  who understand business and                                                               
the construction industry serving on the board.                                                                                 
                                                                                                                                
SENATOR BISHOP echoed Senator Birch's comments.                                                                                 
                                                                                                                                
2:34:43 PM                                                                                                                    
CHAIR REINBOLD  opened public testimony and  after determining no                                                               
one   wished  to   testify,  closed   public  testimony   on  the                                                               
confirmation  hearing  for  Julie   Duquette,  appointee  to  the                                                               
Workers' Compensation Board.                                                                                                    
                                                                                                                                
MS. DUQUETTE said she appreciated the committee's hard work.                                                                    
                                                                                                                                
CHAIR REINBOLD  asked her to  provide input  on any of  the bills                                                               
that come before the committee.                                                                                                 
                                                                                                                                
2:35:54 PM                                                                                                                    
CHAIR REINBOLD stated  that in accordance with  AS 39.05.080, the                                                               
Senate  Labor &  Commerce  Committee reviewed  the following  and                                                               
recommends the appointments  be forwarded to a  joint session for                                                               
consideration:                                                                                                                  
                                                                                                                                
Workers' Compensation Board                                                                                                   
Julie Duquette - North Pole                                                                                                     
                                                                                                                                
[Signing  the  reports  regarding   appointments  to  boards  and                                                               
commissions in  no way reflects  individual members'  approval or                                                               
disapproval  of  the  appointees;   the  nominations  are  merely                                                               
forwarded   to  the   full   legislature   for  confirmation   or                                                               
rejection.]                                                                                                                     
                                                                                                                                
2:36:23 PM                                                                                                                    
At-ease.                                                                                                                        
                                                                                                                                
           SB 66-LABOR STANDARDS/SAFETY; WORKER COMP.                                                                       
                                                                                                                                
2:37:46 PM                                                                                                                    
CHAIR  REINBOLD reconvened  the  meeting and  announced that  the                                                               
next  order of  business would  be SENATE  BILL NO.  66, "An  Act                                                               
relating to the division of  labor standards and safety; relating                                                               
to  the  division  of  workers'  compensation;  establishing  the                                                               
division of  workers' safety and compensation;  and providing for                                                               
an effective date."                                                                                                             
                                                                                                                                
2:38:05 PM                                                                                                                    
COMMISSIONER DESIGNEE  LEDBETTER said that this  bill proposes to                                                               
merge the Division of Labor  Standards, whose focus is to prevent                                                               
workplace accidents and enforce  laws related to workplace safety                                                               
with the  Division of  Workers' Compensation,  whose focus  is to                                                               
provide efficient  administration of benefits to  injured workers                                                               
and   to   enforce   laws  related   to   workers'   compensation                                                               
requirements.                                                                                                                   
                                                                                                                                
She  said  that  these  two divisions'  missions  complement  one                                                               
another, such that  one works to prevent accidents  and the other                                                               
works  to provide  an efficient  system of  benefits for  injured                                                               
workers. This  bill would further  increase the  opportunities to                                                               
remove "silos"  and capitalize on efficiencies  through a unified                                                               
management  structure. The  proposed merger  will not  impact any                                                               
statutes or  regulations currently  administered and  enforced by                                                               
each  division.  The  department   seeks  to  take  advantage  of                                                               
position  vacancies  to  explore opportunities  to  share  duties                                                               
between divisions where it makes  sense, streamline processes and                                                               
reduce unnecessary middle management supervisory functions.                                                                     
                                                                                                                                
COMMISSIONER DESIGNEE LEDBETTER reviewed  the DLWD's fiscal note.                                                               
The bill  would result  in immediate  administrative efficiencies                                                               
by  reclassifying the  Division of  Labor Standards  and Safety's                                                               
director  to  a deputy  director,  who  will focus  attention  on                                                               
operational   aspects   of   the   new   division's   inspection,                                                               
consultation,  and  enforcement   functions.  This  would  reduce                                                               
midlevel management  in the Division  of Occupational  Safety and                                                               
Health   component.  In   addition,   the   two  divisions   will                                                               
consolidate  and  share  administrative  duties  where  it  makes                                                               
sense.   Future  efficiencies   may  occur   with  office   space                                                               
consolidation,  increased  coordination,   and  improved  service                                                               
delivery  for employers  and  workers. The  bill  would create  a                                                               
structure to share resources and find efficiencies over time.                                                                   
                                                                                                                                
2:41:08 PM                                                                                                                    
GREY  MITCHELL,  Director,  Division  of  Workers'  Compensation,                                                               
Department of  Labor and  Workforce Development  (DOLWD), Juneau,                                                               
stated  the  main  purpose  of  SB 66  was  to  combine  the  two                                                               
divisions   as  previously   stated   by  Commissioner   Designee                                                               
Ledbetter.                                                                                                                      
                                                                                                                                
2:41:48 PM                                                                                                                    
MR. MITCHELL  began a  sectional analysis of  SB 66.  He reviewed                                                               
Sections 1-6:                                                                                                                   
                                                                                                                                
     Section 1: Renames the division  of labor standards and                                                                    
     safety  to   the  division   of  workers'   safety  and                                                                    
     compensation in AS18.20.410(b).                                                                                            
                                                                                                                                
     Section 2: Renames the division  of labor standards and                                                                    
     safety  to   the  division   of  workers'   safety  and                                                                    
     compensation in AS18.20.450(a).                                                                                            
                                                                                                                                
     Section 3: Renames the division  of labor standards and                                                                    
     safety  to   the  division   of  workers'   safety  and                                                                    
     compensation in AS18.60.055.                                                                                               
                                                                                                                                
     Section 4: Renames the division  of labor standards and                                                                    
     safety  to   the  division   of  workers'   safety  and                                                                    
     compensation in AS18.60.055(a).                                                                                            
                                                                                                                                
     Section 5: Renames the division  of labor standards and                                                                    
     safety  to   the  division   of  workers'   safety  and                                                                    
     compensation                                                                                                               
     in AS18.60.235(a).                                                                                                         
                                                                                                                                
    Section   6:   Renames   the   division   of   workers'                                                                     
      compensation to the division of workers' safety and                                                                       
     compensation in AS 23.05.067(a)(1)(B).                                                                                     
                                                                                                                                
2:43:13 PM                                                                                                                    
CHAIR  REINBOLD said  the  committee  did not  need  to hear  the                                                               
detailed changes.                                                                                                               
                                                                                                                                
2:43:43 PM                                                                                                                    
SENATOR  COSTELLO asked  whether removing  "standard" would  will                                                               
have any effect.                                                                                                                
                                                                                                                                
MR. MITCHELL  answered that the  name change does not  impact the                                                               
statutory  authority. All  of the  previous authorities  for each                                                               
division would  be incorporated into  the new division  of Worker                                                               
Safety and Compensation Division. He  said that the standards for                                                               
wage and  hour and  mechanical inspections  would still  occur in                                                               
the merged division.                                                                                                            
                                                                                                                                
2:44:49 PM                                                                                                                    
SENATOR COSTELLO  asked whether there  was any opposition  to the                                                               
bill.                                                                                                                           
                                                                                                                                
MR. MITCHELL has not heard any opposition to the merger.                                                                        
                                                                                                                                
2:45:03 PM                                                                                                                    
SENATOR  BISHOP asked  whether the  department  would absorb  the                                                               
cost to print new letterhead.                                                                                                   
                                                                                                                                
MR.  MITCHELL  answered  yes.  In  further  response  to  Senator                                                               
Bishop, he agreed  to inform the committee if the  merger was not                                                               
working.  He said  that it  wasn't possible  to predict  what may                                                               
arise during the merger, but if  it became necessary to "beef up"                                                               
some area to  maintain the same level of  service, the department                                                               
would do so. The department  does not intend on reducing services                                                               
to  the  public and  seeks  to  increase services.  For  example,                                                               
currently, a  workers' compensation  investigator might  visit an                                                               
employer  and several  days later  a wage  and hour  investigator                                                               
would appear. However, with a  little coordination the department                                                               
could consolidate  the inspections  to increase  efficiencies and                                                               
provide better services to the public.                                                                                          
                                                                                                                                
2:46:56 PM                                                                                                                    
SENATOR BIRCH said he is not  familiar with the two divisions. He                                                               
asked whether any tension exists between the two agencies.                                                                      
                                                                                                                                
MR.  MITCHELL  answered that  the  department  does not  see  any                                                               
conflict  between  the  two divisions.  Instead,  the  department                                                               
views synergy,  with one division  focused on  reducing accidents                                                               
and minimizing safety  hazards and the other  division focused on                                                               
paying benefits  for incidents.  Sharing data  and administrative                                                               
oversight between the divisions makes sense, he said.                                                                           
                                                                                                                                
COMMISSIONER  DESIGNEE   LEDBETTER  answered  that   the  current                                                               
division director  for the Division of  Workers' Compensation was                                                               
previously the  director of the  Division of Labor  Standards and                                                               
Safety. The current staff has  extensive experience in the field,                                                               
so it  provides opportunities to share  knowledge and collaborate                                                               
to build  a rich division  that would be  two halves of  the same                                                               
whole.  The  department  has  begun   the  effort  to  share  and                                                               
collaborate, she said.                                                                                                          
                                                                                                                                
2:49:44 PM                                                                                                                    
SENATOR GRAY-JACKSON said  she was pleased to  see the efficiency                                                               
of $283,000 and looked forward to more efficiencies.                                                                            
                                                                                                                                
2:50:20 PM                                                                                                                    
COMMISSIONER DESIGNEE LEDBETTER introduced her staff.                                                                           
                                                                                                                                
2:50:49 PM                                                                                                                    
CHAIR REINBOLD opened public testimony on SB 66.                                                                                
                                                                                                                                
2:52:22 PM                                                                                                                    
DON  ETHERIDGE,  Executive  Director, AFLCIO,  Juneau,  said  one                                                               
concern the AFLCIO  has with the merger of the  divisions is that                                                               
one division's function  may not get adequate  attention. He said                                                               
that he hoped that nothing would slip through the cracks.                                                                       
                                                                                                                                
2:52:56 PM                                                                                                                    
CHAIR REINBOLD,  after first  determining no  one else  wished to                                                               
testify, closed public testimony on SB 66.                                                                                      
                                                                                                                                
2:53:16 PM                                                                                                                    
CHAIR REINBOLD reviewed upcoming announcements.                                                                                 
                                                                                                                                
2:53:34 PM                                                                                                                    
COMMISSIONER  DESIGNEE LEDBETTER  said  that  the department  has                                                               
long  considered   the  merger   to  increase   the  department's                                                               
effectiveness and  efficiency. She  said her  focus is  to ensure                                                               
that these  changes do not  harm the department's  current staff.                                                               
She  said she  hoped  it  would proceed  in  a  fashion that  was                                                               
beneficial to all.                                                                                                              
                                                                                                                                
[SB 66 was held in committee]                                                                                                   
                                                                                                                                
CHAIR REINBOLD reviewed upcoming committee announcements.                                                                       
                                                                                                                                
2:54:43 PM                                                                                                                    
There being no further business to come before the committee,                                                                   
Chair Reinbold adjourned the Senate Labor and Commerce Standing                                                                 
Committee meeting at 2:54 p.m.                                                                                                  

Document Name Date/Time Subjects
03.19.19 Resume of Charles Silver.pdf SL&C 3/19/2019 1:30:00 PM
03.19.19 Resume of David A. Hyman.pdf SL&C 3/19/2019 1:30:00 PM
L&C Workers Compensation Resume - Duquette.pdf SL&C 3/19/2019 1:30:00 PM
SB 65 Ver. A.PDF SL&C 3/19/2019 1:30:00 PM
SB 65
SB 65 Transmittal Letter.pdf SL&C 3/19/2019 1:30:00 PM
SB 65
SB 65 Sectional Analysis.pdf SL&C 3/19/2019 1:30:00 PM
SB 65
SB 65 FN 0139-DOLWD-WIB-02-19-19.PDF SL&C 3/19/2019 1:30:00 PM
SB 65
SB 65 FN 0139-EED-SSA-2-15-19.PDF SL&C 3/19/2019 1:30:00 PM
SB 65
SB 66 Ver. A.PDF SL&C 3/19/2019 1:30:00 PM
SB 66
SB 66 Transmittal Letter.pdf SL&C 3/19/2019 1:30:00 PM
SB 66
SB 66 Sectional Analysis.pdf SL&C 3/19/2019 1:30:00 PM
SB 66
SB 66 Bill and Sectional Analysis - DOLWD.pdf SL&C 3/19/2019 1:30:00 PM
SB 66
SB 66 FN 0049-DOLWD-WC-02-18-19.PDF SL&C 3/19/2019 1:30:00 PM
SB 66
SB 66 FN 0049-DOLWD-OSH-02-15-19.PDF SL&C 3/19/2019 1:30:00 PM
SB 66