Legislature(1999 - 2000)
02/24/1999 03:18 PM House L&C
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 68 - BOARD OF PHARMACY
Number 0065
CHAIRMAN ROKEBERG announced the committee's first order of business
is HB 68, "An Act extending the termination date of the Board of
Pharmacy to June 30, 2005; and providing for an effective date."
Number 0123
CATHERINE REARDON, Director, Division of Occupational Licensing,
Department of Commerce and Economic Development, came forward to
testify in support of HB 68. She stated, "I am here today to speak
in support of the extension of the Board of Pharmacy, which my
division staffs and assists. The Board of Pharmacy has achieved a
lot during the last sunset period. They worked hard ... to support
legislation that rewrote the pharmacy statute, and then follow it
up ... with a comprehensive rewrite of all of their regulations,
which was quite a large project, and the purpose of all that was to
try to bring the pharmacies' laws up to date with modern drug and
business practices. I think it's an example of a situation in
which a board is very important, it would have been very difficult
for my staff, with our lack of technical knowledge, to have carried
out such a project. You really need to know a lot about pharmacy
to effectively regulate that profession. The sunset audit does
recommend extending the board for this length of time, and had very
little to suggest in the way of changes, and this board, like all
of our licensing programs, is financially self-sufficient in that
the license fees cover the costs of regulation. So, I do have a
zero fiscal note for this bill, at the same time acknowledging that
the ongoing costs built into the budget already are approximately
$61,000 a year."
Number 0270
REPRESENTATIVE MURKOWSKI said, "Apparently there was a requirement
that you state your height, your weight, your hair color, and all
that, and in the recommendation it indicated that there was
reasonable cause to request this information, because it's
important when licensing individuals working with controlled
substances." She asked, "Do they do ... criminal background
checks, or what's the extent of the investigation?"
MS. REARDON responded that they do not do fingerprinting or
criminal background checks at the time of licensure. She said that
they do take a photograph of the person and have it notarized, in
order to verify that the person and the photograph match. She
noted they do ask questions on the initial application about
someone's criminal background, but they do not verify the answers
unless someone were to answer yes indicating that they were
convicted of something. Ms. Reardon commented that the issue has
come up recently with regards to medical licenses; the desire to
have physician applicants fingerprinted. The Federal Bureau of
Investigation (FBI) will only provide criminal background
information if there is a state law specifically saying that we
need to get FBI background checks. This means, if the legislature
wants that to take place, they will initiate a statute change.
Number 0440
REPRESENTATIVE MURKOWSKI commented that as a lawyer for the state
you are fingerprinted and there are character investigations, which
is basically a criminal background check. If the state is going to
require it of lawyers, than we might want to consider requiring it
of those handling controlled substances.
MS. REARDON said that she doesn't know whether the Drug Enforcement
Administration (DEA) is doing a criminal background check before
issuing the DEA license. The division does require pharmacists to
have DEA licenses, so there is a backup in that profession, but
that would not be the case for most of the division's professions.
CHAIRMAN ROKEBERG noted the chairman of the Board of Pharmacy is
participating via teleconference and the committee may want to
direct the more technical questions toward him.
REPRESENTATIVE CISSNA wondered if there has ever been any problems
with controlled substances and pharmacists.
Number 0564
MS. REARDON noted she would defer this question to the chairman of
the Board of Pharmacy. However she said she suspects in the
country as a whole there have probably been problems with theft or
misuse of drugs in that profession, just as there would be in any
profession with that kind of access to amphetamines, et cetera.
Ms. Reardon stated she has looked into the issue with regards to
physicians because of questions from legislators and citizens. She
said there has not been any history of a public complaint about the
quality of a practice and then later discovery of an undisclosed
criminal background. There does not seem to be a connection
between "bad doctors" and some secret undisclosed criminal
background. She said that she is not sure if the lack of criminal
background checks with regards to physicians has contributed to any
public harm.
REPRESENTATIVE HALCRO stated, "There seems to be some disagreement
with one of the recommendations - Prior Year Recommendation Number
5 - where it states in the report that it encourages several
organizations to establish fee levels that are more reflective of
the regulatory costs of the occupation [Audit Report, August 25,
1998, Division of Legislative Audit]. And in Commissioner
Sedwick's [Deborah B. Sedwick, Commissioner, Department of Commerce
and Economic Development] response, dated October 27, 1998, she
states, 'We don't concur, we don't agree with this.'"
Representative Halcro asked, "Can you give me a summary on what's
happening with this?"
Number 0707
MS. REARDON replied, "This a recommendation that you will probably
see appear in a lot of audits to come, because it's a difference of
opinion that isn't playing out just in the pharmacy board, but in
all of our programs. ... Alaska Statute 08.01.065(c) says that the
Department of Commerce will set license fees so that the revenue
generated from an occupation is approximately equal to the
regulatory costs." Ms. Reardon continued, "We've been audited
several times on this topic, and in the early '90s an audit
indicated that the use of the term 'occupation' meant that not just
a board area, like Board of Pharmacy or [State] Medical Board, but
the actual occupations within the board -- in pharmacy there are
pharmacy technicians, and facilities and pharmacists. In the
Medical Board there'd be physician assistants, paramedics,
physicians, osteopaths, podiatrists -- that it needed to be carried
down to that level. That was an audit, actually, by the Office of
Management and Budget, I believe, and in response, the division did
begin tracking costs at the occupation level, not just the program
board level. ... But we have not strictly applied the law to
always ensure that an occupation, versus a board or program, is
covering its own costs." Ms. Reardon continued, "I've been open
about that with future auditors and the legislature, in that we
have a 100 and some different occupations within our 36, 37 board
areas. ... When you get down to having self-sufficiency at that
level, you have a lot more occupations, a lot more groups, that
have fewer than 50 people - some fewer than 20 people - to pay, and
when you really make a group that small pay its own regulatory
costs, you get extremely volatile fees. Maybe someone appeals
their license denial - in a group of only 20 people, or 10 people
in some of these cases - it costs us $3 [$3,000] or $4,000 in legal
fees to take that appeal through. You've got so few people to
spread that cost to, their fees might ... become 2,000 bucks each
... for one period and then drop back down."
Number 0871
MS. REARDON further stated, "It's bad enough as it is with
self-sufficiency at the board or program level, with fees like the
psychology fees ... going up or down. At some point we thought to
exacerbate that by having 120 fees shooting up and down, and their
deficits and surpluses rolling forward from the previous two years
continually, that when a profession or a board seemed amenable to
a little bit of sharing going on within their program, we weren't
strictly ... saying, 'No, you may not share.' For example, in the
Medical Board it seems that the medical community accepts the idea
that the physicians will pay a little bit more, so that the
paramedics can pay a little bit less than they cost. As long as
everyone is pretty much getting along, we haven't pushed it and
said, 'No, you may not share.' When, in a profession, there isn't
that kind of getting along within a board area, and someone pushes,
then, quite honestly, I usually get into a situation where I go,
'Okay, we have to lower the boom and do something more strict,' and
then we do. But the auditors, I think, are looking at us and
saying, 'It might be a perfectly good public policy ... decision to
let programs pay for themselves, but it's not how we read the
strict letter of the law. Stop it.' We're just worried about what
that really means for your constituents and our licensees. How
many $1,000 fees we're going to get. That's a long answer, but
that's where the 'push and shove' is coming."
REPRESENTATIVE CISSNA asked if there would be a difference in terms
of the cost of administering those 100 different professions if the
administration is broken down to those 100 different professions.
Number 0987
MS. REARDON replied, "Yes, I believe there would be, in that part
of it is the tracking of the roll forward of deficits and
surpluses. We've been tracking that by program, by board area, so
you're 50,000 in the hole, you're 120,000 ahead, and we credit
that; but when you try to do that for 120 [professions], it becomes
a bigger challenge to be doing that every year. ... Another part
of this ... that we have an honest difference of opinion with the
auditors -- ... we track our revenue for a profession based on
licensing statistics. If we licensed 200 pharmacists, which we
know out of our database, we know how much money we got for that
whole board area in a year. When we get checks in the mail, we
don't actually credit them right then to the occupation, we just
credit them to the board area. Then we divvy up that revenue
within a board area, based on how many people we licensed, by using
our statistics out of our computer. The auditors would prefer that
as we open up each check, we right then decide which of the
sub-occupations it goes to, that slows up our paper work and
getting those checks in the bank. So, we respectfully suggest that
our statistical data is good enough, but they disagree in the audit
...."
Number 1064
CHAIRMAN ROKEBERG stated, "This is an ongoing battle we have with
the department, and something the chair is - and the old-timers
here are very familiar with. ... I would just like to point out
that there is a bill that's going to be introduced regarding the
Real Estate Commission Surety Fund and the licensing fee, which
will take up this very issue in a more generic sense ...."
MS. REARDON noted she would be happy to answer questions in another
setting from any of the committee members regarding this fee
setting issue.
REPRESENTATIVE HARRIS questioned if Ms. Reardon was familiar with
the Peter Crack (ph) case, a Dillingham pharmacist.
MS. REARDON replied she was vaguely familiar.
Number 1113
REPRESENTATIVE HARRIS commented that Mr. Crack (ph) was a
pharmacist who had been stealing drugs through the pharmacy and
giving them to boys for favors. He asked, "Do you have any idea
how that somebody could get away with that for that long ...
without being detected?"
MS. REARDON responded that she would need to review the case in
order to give a good answer.
REPRESENTATIVE HARRIS stated he thought it was an ongoing thing for
a long time. He indicated he hopes the system would have enough
checks and balances in it, since they are dealing with fairly heavy
drugs, to discover other similar situations if those situations are
occurring.
MS. REARDON said she believed there was first criminal action
against the pharmacist and then the Board of Pharmacy was able to
take licensing action very promptly. She thought the situation
involving Mr. Crack (ph) was uncovered through more of a criminal
investigation by the police in that town; the board hadn't received
any complaints, et cetera, about him.
REPRESENTATIVE HARRIS asked, "Aren't certain drugs through ... the
department, aren't they supposed to be monitored on a quarterly or
yearly basis, or something, to keep control of them?"
MS. REARDON asked if she could defer that question to the pharmacy
board chair.
CHAIRMAN ROKEBERG answered in the affirmative. He thanked Ms.
Reardon, asking her to stand by in case any follow-up is needed.
He indicated the committee would take teleconference testimony from
the chairman of the Board of Pharmacy, Paul Gionet.
Number 1231
PAUL GIONET, Chairman, Board of Pharmacy, testified via
teleconference from Anchorage. He stated, "Regarding the Crack
(ph) case and others similar to that -- ... the Crack (ph) case
was, as Catherine Reardon pointed out, ... brought to us ... from
a criminal side and then we were able to get Mr. Crack (ph) to
suspend his license and voluntarily do that rather quickly. As far
as drug usage amongst pharmacists, we do not monitor that. That
would have to be staffed by a team of investigators full time.
Usually in other states there are actually pharmacists as police
agents, and there just is not the amount of pharmacies or
pharmacists or moneys available in the state of Alaska to do that.
The DEA does not require the Boards of Pharmacies to monitor drug
activity; they take a stance of finding out about it if it occurs
on the criminal side, for the most part."
CHAIRMAN ROKEBERG asked Mr. Gionet if he had any additional
comments.
Number 1299
MR. GIONET stated, "I did want to mention [to] the first person
asking the question about the height, weight and color of eyes -
that is an optional question on the application that we have, any
applicant does not have to answer those questions. There was
another question about do we verify the photographs, and,
currently, as an applicant comes and takes the jurisprudence exam
in front of a board member, we do verify their drivers' licenses
against their photographs." Mr. Gionet noted that concluded his
comments, stating, "As Ms. Reardon stated, we did quite a few
projects in the last four to six years, rewriting a lot of our
statutes and regulations. We also wrote regulations regarding
sterile pharmaceuticals and home infusions. We're rewriting
regulations on nuclear pharmacy and ... we also licensed
technicians in the last year or two. ... We do require licensing
of out-of-state pharmacies, such as mail-order pharmacies, and
we're also looking at the issue of Internet pharmacies, of which is
hitting in the news now, and we're going to have to deal with this
as a safety issue in Alaska."
Number 1369
REPRESENTATIVE SANDERS asked, "To your knowledge, with Mr. Crack
(ph) or with anyone else who has been prosecuted over
pharmaceuticals in Alaska, do you know if a background check on any
of those people would have turned up anything in their history that
might have prevented them from getting in that position if we had
been doing so?"
MR. GIONET answered, "I don't believe that we do any background
criminal checks, but if they have any licensing actions against
them in any other state, that's reported to us before we issue
their license. I believe Mr. Crack (ph) had had his license for
quite a few years here in Alaska, and until a complaint is brought
to us by the public, either on the criminal side or to the board,
or to occupational licensing - to the investigators - then there's
really no way of us monitoring that or finding that out. But as
far as someone perhaps practicing in another state with problems
with their licenses - those are brought to our attention on a
fairly regular basis. ... I've been on the board six years, [and]
I'm sure at least ten of those have been brought to the Board of
Pharmacy, and they have been acted upon, and many licenses have
been denied because of that."
REPRESENTATIVE SANDERS questioned, "Then do you feel that we should
look into background checks, as a legislature -- into passing
something that would authorize you to do background checks?"
MR. GIONET replied he thought it would be a good idea, but it
depends on the cost to the state and if investigators are willing
to do some of that. He stated it would protect the public more.
Referring to the Crack (ph) case, Mr. Gionet said he believed Mr.
Crack's (ph) actions began while Mr. Crack (ph) was in Alaska and
there weren't too many ways for the board to find out,
unfortunately, until something happened.
Number 1475
CHAIRMAN ROKEBERG clarified that background checks would not be a
cost to the state, but a cost to Mr. Gionet and his colleagues.
REPRESENTATIVE MURKOWSKI asked Mr. Gionet if he would define
nuclear pharmacy.
MR. GIONET replied, "It actually has been occurring for quite a few
years. If you go into any hospital and you have any radiation
treatment for cancer, you're being treated with nuclear
radio-particles -- and, actually in the last two years, there is an
official nuclear pharmacy that was established in Alaska. ... Most
of their statutes and regulations are included on a federal level
because they are regulated by federal agencies, so we're actually
excited that we can write some regulations to incorporate the
federal regulations for the state of Alaska. But this has been
something that goes on in every hospital, practically, throughout
the state of Alaska and has always been monitored by radiologists
or radiologist technician[s], and there are nuclear pharmacies all
over the country. ... It's something that will help the public
safety."
REPRESENTATIVE HARRIS asked Mr. Gionet if people who are not
pharmacists or doctors are allowed to dispense drugs in rural
Alaska.
Number 1570
MR. GIONET stated, "No, they are not allowed. There are a few
instances under the Medical Board where physicians may, nurse
practitioners, and physician assistants, but otherwise no one is
allowed to dispense drugs. There are some still, I believe, rural
health aides under the federal program with the Natives that are
allowed to do things either under the federal law or under the
Medical Board of Alaska."
REPRESENTATIVE HARRIS asked if the Board of Pharmacy monitors that
activity.
MS. GIONET replied, "We do not have authorization by statute to
monitor any of that activity regarding the Medical Board or the
federal program."
CHAIRMAN ROKEBERG asked, "Can you describe, to the committee, what
the technical licensing is of the tech [technician]?"
Number 1616
MR. GIONET noted, "[In] any normal retail pharmacy in any state
there are always assistants to the pharmacists. ... In the last
probably 10 to 20 years ... we're getting more in tune to people
that are having alcohol abuse, and drug abuse, and mental problems,
and [we're] starting to encourage them to get help, and, if they
don't, have licensing action against them. There are so many
assistants in the pharmacy realm that we felt it necessary to
license these people in order to take some actions against them in
case we had some technicians that were in trouble. ... Last June,
we did license the technicians, and since then we've already been
able to suspend one license of a technician that was in a rural
area abusing narcotics along with the pharmacist. Had we not had
the technicians licensed, no action would have been taken against
that person, and they could just keep going on."
CHAIRMAN ROKEBERG asked Mr. Gionet if he believes the Board of
Pharmacy has the ability to control the pharmacy in the state's
Pioneers' Home system [Alaska Pioneers' Homes, Division of Alaska
Longevity Programs, Department of Administration], and if the board
needs any legislative authority, or his feelings.
Number 1693
MR. GIONET commented he would defer the question to Ms. Reardon.
He stated it is an active case with the investigators, they have
some sealed documents with the Board of Pharmacy, and he thinks the
board has been requested not to discuss the issue.
CHAIRMAN ROKEBERG commented, "Obviously you have jurisdiction ...
if it's being investigated."
MR. GIONET responded, "It's being investigated, but the
investigators won't tell us yet, because they're actively
investigating it, what we're even to rule on. ... I'm assuming
maybe we'll have some part of it, but it's total secrecy because we
act as jurors in the case."
Number 1723
CHAIRMAN ROKEBERG asked Mr. Gionet if he was aware of any
prohibitions that disallow the board from jurisdiction in a state
institution.
MR. GIONET answered in the negative.
CHAIRMAN ROKEBERG thanked Mr. Gionet for his testimony and asked if
there were any further questions or testimony. There being none,
the chairman stated the public hearing on HB 68 is closed.
Number 1774
REPRESENTATIVE HALCRO made a motion to move HB 68 out of committee
with the attached zero fiscal note and individual recommendations.
There being no objections, HB 68 moved out of the House Labor and
Commerce Standing Committee.
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