Legislature(2023 - 2024)DAVIS 106
03/13/2023 08:00 AM House EDUCATION
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| Audio | Topic |
|---|---|
| Start | |
| HB69 | |
| HB106 | |
| HB105 | |
| HB21 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 105 | TELECONFERENCED | |
| *+ | HB 106 | TELECONFERENCED | |
| += | HB 69 | TELECONFERENCED | |
| *+ | HB 21 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HB 21-SCHOOL/UNIVERSITY EMPLOYEE HEALTH INSUR
8:55:48 AM
CO-CHAIR ALLARD announced that the final order of business would
be HOUSE BILL NO. 21, "An Act relating to group insurance
coverage and self-insurance coverage for school district
employees, employees of the University of Alaska, and employees
of other governmental units in the state; and providing for an
effective date."
8:56:24 AM
REPRESENTATIVE SARAH VANCE, Alaska State Legislature, as prime
sponsor, presented the sponsor statement of HB 21 [copy included
in the committee packet], which read as follows [original
punctuation provided]:
House Bill 21 amends current statute to create
the opportunity for school districts, the University
of Alaska, and governmental units such as cities and
boroughs to optionally participate in AlaskaCare: our
state healthcare program. These entities would have
the choice to opt into the pool as an entire entity,
enabling Alaska's Department of Administration to
negotiate a better cost of healthcare.
Research conducted by the Institute of Social and
Economic Research of the University of Alaska
Anchorage suggests that Alaskans spend the most per
resident, face the highest insurance premiums, and
have seen overall spending grow much faster than the
rest of the country. Alaskans spent more out-of-pocket
dollars on health care costs than residents in any
other state in 2019, according to a recent Health
Affairs study. In fact, in less than 25 years Alaska's
spending for health care increased more than 5 times
over, growing an average 7.8% per year compared to the
U.S. average of 6.0%. On average, 45% of our state
educational budget funds healthcare and benefits,
leaving only 54% to go towards the classroom.
Specifically, school districts across Alaska are
facing increasing costs of healthcare that is
impacting recruitment and retention of teachers. If
passed, House Bill 21 could ease the financial burden
of school districts and give the State of Alaska more
leverage to negotiate with healthcare providers,
improving services for Alaskans with the potential of
saving millions of dollars.
8:59:58 AM
REPRESENTATIVE VANCE noted that the proposed legislation would
amend current statute to provide the option for school
districts, the University of Alaska, and governmental units to
participate in AlaskaCare. She explained that this would enable
the state to negotiate a better cost of health care. She
concluded that the benefits of consolidation would result in
cost savings, expanded healthcare options, and reduced staff
burden.
9:02:33 AM
RANDY TRANI, Superintendent, Matanuska-Susitna Borough School
District, gave invited testimony and offered support for HB 21.
He added that this has been on the school board's list of
priorities for the last three years. He expressed the opinion
that there is not a negative downside, as it provides potential
for savings.
9:04:46 AM
REPRESENTATIVE VANCE summarized the sectional analysis [copy
included in the committee packet], which read as follows
[original punctuation provided]:
Section 1. Adds to powers of regional school boards
the power to establish and maintain school district
participation in a policy of group insurance, selected
by the State of Alaska, that provides medical
insurance.
Section 2. Adds to the duties of a regional school
board the duty, when the board's school district
participates in a policy of group insurance elected by
the State of Alaska that provides medical insurance,
to determine and disperse to district employees and
administrative officers the amounts necessary to cover
the district's portion of the cost of that
participation.
Section 3. Allows the Commissioner of Administration
to expend from the public education fund (AS
14.17.300) to the group health and life benefits fund
(AS 39.30.095) a total of $100,000,000 or less as
needed to pay claims submitted by school district
employees who are covered by a policy of self-
insurance provided by the state; and, requires the
Commissioner of Administration to repay the public
education fund, over a period of 10 years, the full
amount of the commissioner's expenditures from the
public education fund.
Section 4. (a) Allows school districts to participate
in a policy of insurance that provides medical
insurance coverage to state employees and to school
district employees. (b) Requires participating school
districts to contribute to the group health and life
benefits fund (AS 39.30.095) based on rates set by the
commissioner of administration. (c) Requires
participating school districts to reimburse the state
for procuring excess loss insurance if the state
provides insurance benefits to school district
employees under a policy of self-insurance. (d)
Requires participating school districts to reimburse,
over a period not to exceed 10 years, the department
of administration's cost of paying insurance claims by
school district employees for the first four months
school district employees are covered by a policy of
self-insurance provided by the state of Alaska. (e)
Allows a participating school district to require its
employees to pay some or all of the money that this
bill section would require the school district to pay
to the state. (f) Defines "school employee" and
"school employer" for purposes of the bill section.
Section 5. Allows the Board of Regents of the
University of Alaska to establish and maintain
university participation in a policy of group
insurance, selected by the State of Alaska, that
provides medical insurance for university employees.
Section 6. Clarifies that when an employee of a
participating governmental unit is covered by a group
insurance policy obtained by the Department of
Administration the employee spouse and dependent
children are also covered.
Section 7. Adds to the University of Alaska to the
definition of governmental unit applicable to section
6 of the bill.
Section 8. Add the definition of school district to AS
39.30.090, which is amended by section 6 and 7 of the
bill.
Section 9. Authorizes the Department of Administration
to provide group medical care insurance coverage to
school district employees and employees of other
governmental unit by means of self-insurance.
Section 10. Requires the Department of Administration
to procure excess loss insurance in connection with
providing group medical insurance coverage to
employees of governmental units other than the state,
and allows the department to allocate the cost with
the excess loss insurance across all of those
governmental units.
Section 11. Make sections 1- 8 and section 10 of the
bill applicable to collective bargaining agreements
and other contracts that become legally binding on or
after the effective date of those bill sections.
Section 12. Require certain self-insured school
districts to transfer the closing balance of their
self-funded insurance reserve account soon after they
enroll in a health care plan administered by the
state, and requires that when transferred by a school
district these amounts will be applied to offset
reimbursements owed by that school district under AS
14.20.127(d), a provision proposed in section 4 the
bill.
Section 13. Authorizes the commissioner of
administration to adopt regulations necessary to
implement the changes made by the bill, to take effect
on or after the effective date of the changes made by
the bill.
Section 14. Make sections 12 and 13 of the bill
effective immediately, subject to the restrictions set
forth in those bill sections.
Section 15. Makes the bill's provisions effective date
July 1, 2024, except as provided in bill section 14.
9:08:42 AM
REPRESENTATIVE STORY questioned how many districts would be
interested in this option.
REPRESENTATIVE VANCE replied that her office had emailed every
school district, but she does not have a definitive number at
this point.
9:10:11 AM
REPRESENTATIVE VANCE, in response to Co-Chair Ruffridge, stated
that the fiscal notes had just been received, and they will be
forwarded to the committee as soon as possible.
9:11:00 AM
REPRESENTATIVE PRAX asked if governmental units other than the
state are not allowed to participate in the state's AlaskaCare
health plan.
REPRESENTATIVE VANCE confirmed that is correct.
REPRESENTATIVE PRAX observed that it is a "one-sided agreement,"
as there is no mention of underwriting standards; therefore, he
expressed the understanding that the state's employee insurance
plan would be required to accept other groups.
REPRESENTATIVE VANCE deferred the question to Betsey Wood.
9:12:36 AM
BETSY WOOD, Acting Chief Health Administrator, Division of
Retirement and Benefits, Department of Administration, explained
that the proposed bill would require the Department of
Administration to accept any governmental unit or school
district that wanted to participate.
9:15:04 AM
REPRESENTATIVE HIMSCHOOT asked how the $7 million is calculated.
DR. TRANI explained that the calculation is the premium paid,
plus the premium of AlaskaCare, and this is multiplied times the
number of employees. He added that this number is based off a
calculation from several years ago and premiums change
frequently; therefore, he expressed uncertainty concerning any
current savings. He noted that the average premium is currently
between $28 thousand and $30 thousand per year per employee.
REPRESENTATIVE HIMSCHOOT requested that the current numbers be
forwarded to the committee.
9:16:24 AM
CO-CHAIR RUFFRIDGE expressed surprise concerning the cost of
premiums. He questioned whether the cost included the
employee's family.
DR. TRANI confirmed the cost is for family coverage. He added
that there are several different plans for employees to choose
from.
9:18:19 AM
REPRESENTATIVE PRAX questioned whether actuarial standards
change when working with big insurance companies. He referenced
[the Affordable Care Act] in relation to offering incentives.
MS. WOOD responded that to get a better sense of longer-range
impacts this type of actuarial analysis is done when a proposed
bill approaches the finance committee.
9:20:10 AM
REPRESENTATIVE STORY pointed out the 2021 study regarding the
university system joining AlaskaCare. She questioned whether
costs were affected by this.
MS. WOOD expressed the understanding that there was minor, but
not significant savings. She stated she will follow up with
this information.
9:22:21 AM
REPRESENTATIVE PRAX commented that the legislature needs to look
at this very carefully, and he shared an experience with
insurance policies and the costs involved.
REPRESENTATIVE VANCE remarked that the proposed legislation
would allow the option for universities and schools to choose
from the best option for individual units. She stated that the
overall goal is to ease the financial strain on school
districts, so schools can focus on what matters most.
9:24:29 AM
CO-CHAIR ALLARD announced HB 21 was held over.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB69 Sponsor Statement.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 69 |
| HB69 Sectional Analysis.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 69 |
| HB0069A.PDF |
HEDC 3/13/2023 8:00:00 AM |
HB 69 |
| HB69 Hearing Request.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 69 |
| HB106-Fiscal Note.PDF |
HEDC 3/13/2023 8:00:00 AM |
HB 106 |
| HB106A.PDF |
HEDC 3/13/2023 8:00:00 AM |
HB 106 |
| HB106 - Sectional Analysis.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 106 |
| HB106 - Sponsor Statement.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 106 |
| HB106- House Education Hearing Request.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 106 |
| HB0105A.PDF |
HEDC 3/13/2023 8:00:00 AM |
HB 105 |
| HB105 - Sectional Analysis.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 105 |
| HB105- House Education Hearing Request 3-8-2023.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 105 |
| HB105 Sponsor Statement.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 105 |
| HB105-Fiscal Note.PDF |
HEDC 3/13/2023 8:00:00 AM |
HB 105 |
| HB 21 - Letter of Support from KPBSD.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 21 |
| HB 21 - Presentation.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 21 |
| HB21A.PDF |
HEDC 3/13/2023 8:00:00 AM |
HB 21 |
| HB 21 - School Healthcare Consolidation Sponsor Statement.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 21 |
| HB 21 - Healthcare Consolidation Bill Sectional Analysis.pdf |
HEDC 3/13/2023 8:00:00 AM |
HB 21 |