03/11/2024 03:15 PM House LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| HB189 | |
| HB226 | |
| HB203 | |
| HB175 | |
| HB254 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 203 | TELECONFERENCED | |
| += | HB 254 | TELECONFERENCED | |
| += | HB 150 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| *+ | HB 327 | TELECONFERENCED | |
| *+ | HB 271 | TELECONFERENCED | |
| += | HB 189 | TELECONFERENCED | |
| *+ | HB 226 | TELECONFERENCED | |
| += | HB 175 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
March 11, 2024
3:20 p.m.
MEMBERS PRESENT
Representative Jesse Sumner, Chair
Representative Justin Ruffridge, Vice Chair
Representative Mike Prax
Representative Dan Saddler
Representative Stanley Wright
Representative Ashley Carrick
Representative Zack Fields
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 189
"An Act relating to the sale of alcohol; and providing for an
effective date."
- HEARD & HELD
HOUSE BILL NO. 226
"An Act relating to the Board of Pharmacy; relating to
insurance; relating to pharmacies; relating to pharmacists;
relating to pharmacy benefits managers; relating to patient
choice of pharmacy; and providing for an effective date."
- HEARD & HELD
HOUSE BILL NO. 203
"An Act relating to wage payments."
- HEARD & HELD
SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 175
"An Act relating to midwives and the practice of midwifery;
relating to apprentice midwives; renaming the Board of Certified
Direct-Entry Midwives as the Board of Licensed Midwives;
relating to the Board of Licensed Midwives; extending the
termination date of the Board of Licensed Midwives; relating to
insurance; and providing for an effective date."
- HEARD & HELD
HOUSE BILL NO. 254
"An Act relating to liability for publishing or distributing
pornography to minors on the Internet."
- MOVED HB 254 OUT OF COMMITTEE
HOUSE BILL NO. 150
"An Act relating to residential building codes; relating to
construction contractors and residential contractor
endorsements; and providing for an effective date."
- SCHEDULED BUT NOT HEARD
HOUSE BILL NO. 327
"An Act relating to the Board of Massage Therapists; and
providing for an effective date."
- BILL HEARING CANCELED
HOUSE BILL NO. 271
"An Act relating to social media and minors; and providing for
an effective date."
- BILL HEARING RESCHEDULED TO 3/13/24
PREVIOUS COMMITTEE ACTION
BILL: HB 189
SHORT TITLE: SALE OF ALCOHOL BY UNDER 21
SPONSOR(s): LABOR & COMMERCE
05/03/23 (H) READ THE FIRST TIME - REFERRALS
05/03/23 (H) L&C
03/06/24 (H) L&C AT 3:15 PM BARNES 124
03/06/24 (H) <Bill Hearing Rescheduled to 03/08/24>
03/08/24 (H) L&C AT 3:15 PM BARNES 124
03/08/24 (H) Scheduled but Not Heard
03/11/24 (H) L&C AT 3:15 PM BARNES 124
BILL: HB 226
SHORT TITLE: PHARMACIES/PHARMACISTS/BENEFITS MANAGERS
SPONSOR(s): SUMNER
01/16/24 (H) PREFILE RELEASED 1/8/24
01/16/24 (H) READ THE FIRST TIME - REFERRALS
01/16/24 (H) HSS, L&C, FIN
02/27/24 (H) HSS AT 3:00 PM DAVIS 106
02/27/24 (H) Heard & Held
02/27/24 (H) MINUTE(HSS)
02/29/24 (H) HSS AT 3:00 PM DAVIS 106
02/29/24 (H) Moved CSHB 226(HSS) Out of Committee
02/29/24 (H) MINUTE(HSS)
03/04/24 (H) HSS RPT CS(HSS) 6DP 1NR
03/04/24 (H) DP: SUMNER, RUFFRIDGE, MCCORMICK,
SADDLER, MINA, PRAX
03/04/24 (H) NR: FIELDS
03/06/24 (H) L&C AT 3:15 PM BARNES 124
03/06/24 (H) Scheduled but Not Heard
03/11/24 (H) L&C AT 3:15 PM BARNES 124
BILL: HB 203
SHORT TITLE: PAYMENT OF WAGES; PAYROLL CARD ACCOUNT
SPONSOR(s): SUMNER
05/16/23 (H) READ THE FIRST TIME - REFERRALS
05/16/23 (H) L&C
01/26/24 (H) BILL REPRINTED
02/09/24 (H) L&C AT 3:15 PM BARNES 124
02/09/24 (H) -- MEETING CANCELED --
02/16/24 (H) L&C AT 3:15 PM BARNES 124
02/16/24 (H) -- MEETING CANCELED --
02/23/24 (H) L&C AT 3:15 PM BARNES 124
02/23/24 (H) Scheduled but Not Heard
02/28/24 (H) L&C AT 3:15 PM BARNES 124
02/28/24 (H) -- MEETING CANCELED --
03/01/24 (H) L&C AT 3:15 PM BARNES 124
03/01/24 (H) Scheduled but Not Heard
03/04/24 (H) L&C AT 3:15 PM BARNES 124
03/04/24 (H) Heard & Held
03/04/24 (H) MINUTE(L&C)
03/11/24 (H) L&C AT 3:15 PM BARNES 124
BILL: HB 175
SHORT TITLE: BOARD OF LICENSED MIDWIVES
SPONSOR(s): ALLARD
04/24/23 (H) READ THE FIRST TIME - REFERRALS
04/24/23 (H) L&C, FIN
04/26/23 (H) SPONSOR SUBSTITUTE INTRODUCED
04/26/23 (H) READ THE FIRST TIME - REFERRALS
04/26/23 (H) L&C, FIN
02/21/24 (H) L&C AT 3:15 PM BARNES 124
02/21/24 (H) -- MEETING CANCELED --
02/23/24 (H) L&C AT 3:15 PM BARNES 124
02/23/24 (H) Scheduled but Not Heard
03/08/24 (H) L&C AT 3:15 PM BARNES 124
03/08/24 (H) Heard & Held
03/08/24 (H) MINUTE(L&C)
03/11/24 (H) L&C AT 3:15 PM BARNES 124
BILL: HB 254
SHORT TITLE: PROHIBIT PORNOGRAPHY TO MINORS
SPONSOR(s): VANCE
01/16/24 (H) PREFILE RELEASED 1/12/24
01/16/24 (H) READ THE FIRST TIME - REFERRALS
01/16/24 (H) L&C, JUD
01/31/24 (H) L&C AT 3:15 PM BARNES 124
01/31/24 (H) Heard & Held
01/31/24 (H) MINUTE(L&C)
03/06/24 (H) L&C AT 3:15 PM BARNES 124
03/06/24 (H) Heard & Held
03/06/24 (H) MINUTE(L&C)
03/11/24 (H) L&C AT 3:15 PM BARNES 124
WITNESS REGISTER
SARENA HACKENMILLER, Staff
Representative Jesse Sumner
Alaska State Legislature
POSITION STATEMENT: Juneau, Alaska Presented the proposed CS
for HB 189, Version S, on behalf of the House Labor and Commerce
Standing Committee, sponsor by request, chaired by
Representative Sumner; presented CSHB 227(L&C), on behalf of
Representative Sumner, prime sponsor.
DAVID MCCARTHY, CEO
Northern Hospitality Group;
Owner, 49th State Brewing
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of the
proposed CS for HB 189, Version S.
DIANE THOMPSON, President
Alaska Hospitality Retailers;
Owner, Firetap Restaurant
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of the
proposed CS for HB 189, Version S.
CODIE COSTELLO, President/COO
Alaska Center for the Performing Arts;
General Manager, Broadway Alaska
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of the
proposed CS for HB 189, Version S.
BRANDY SEIGNEMARTIN, PharmD, Executive Director
Alaska Pharmacy Association
Juneau, Alaska
POSITION STATEMENT: Co-presented a PowerPoint presentation,
entitled "HB 226: Transparency in Prescription Pricing & Patient
Freedom of Pharmacy Choice" during the hearing on CSHB 226(HSS).
DANIEL NELSON, PharmD, Director of Pharmacy
Tanana Chiefs Conference
Fairbanks, Alaska
POSITION STATEMENT: Co-presented a PowerPoint presentation,
entitled "HB 226: Transparency in Prescription Pricing & Patient
Freedom of Pharmacy Choice" during the hearing on CSHB 226(HSS).
ASHLEY SCHABER, Chair
Alaska Board of Pharmacy
Anchorage, Alaska, Alaska
POSITION STATEMENT: Gave invited testimony in support of CSHB
226(HSS).
DESIREE MOLINA, Pharmacist
Three Bears Pharmacy
Mat-Su, Alaska
POSITION STATEMENT: Gave invited testimony in support of CSHB
226(HSS).
JENNIFER CAVE, Vice President
Midwives Association of Alaska;
Owner, The Nesting Place
Soldotna, Alaska
POSITION STATEMENT: Testified in support of HB 175.
BARBARA NORTON, representing self
Anchorage, Alaska
POSITION STATEMENT: Spoke in opposition to HB 175.
ACTION NARRATIVE
3:20:31 PM
CHAIR JESSE SUMNER called the House Labor and Commerce Standing
Committee meeting to order at 3:20 p.m. Representatives Prax,
Ruffridge, Saddler, Wright, Carrick, Fields, and Sumner were
present at the call to order.
HB 189-SALE OF ALCOHOL BY UNDER 21
3:20:58 PM
CHAIR SUMNER announced that the first order of business would be
HOUSE BILL NO. 189, "An Act relating to the sale of alcohol; and
providing for an effective date."
3:21:26 PM
REPRESENTATIVE RUFFRIDGE moved to adopt the proposed committee
substitute (CS) for HB 189, Version 33-LS0697\S, C. Radford,
1/15/24, as the working document.
CHAIR SUMNER objected.
3:22:03 PM
SARENA HACKENMILLER, Staff, Representative Jesse Sumner, on
behalf of on behalf of the House Labor and Commerce Standing
Committee, sponsor by request, chaired by Representative Sumner,
paraphrased the sponsor statement [included in committee
packet], which read as follows:
HB189 would aim to change existing Alaska statutes,
that would allow employees between the ages of 18 and
20 to sell, serve, deliver, and dispense alcohol
within restaurants and other specified license and
endorsement types under appropriate supervision. This
bill also modifies hours that a theater license holder
may serve alcohol and updates alcohol warning signs
content to include warnings against certain types of
cancer.
Alaska is one of just three states that require
employees to be over the age of 21 to sell, serve,
dispense, and deliver alcohol, while 39 states allow
servers to be 18-20. HB189 would create positive
change by tackling labor shortages and a high rate of
turnover in industries affected by this bill. Now, 18-
to 20-year-olds who wish to work in these industries
will have the opportunity to move into positions that
increase their earning potential. Expanding the
potential workforce strengthens businesses, allowing
them to operate at full capacity, leading to greater
economic contributions overall.
Many establishments already implement robust training
programs to ensure responsible alcohol service
practices. These measures, combined with on-site
supervision, could effectively ensure responsible
service by young adults within these industries.
With adequate training and supervision, employees aged
18-20 can responsibly and safely handle alcohol sales
and service in a controlled restaurant environment.
This change would benefit Alaska's economy, alleviate
labor shortages, and promote fairness within our
service industry.
3:23:58 PM
MS. HACKENMILLER gave a summary of changes in Version S
[included in committee packet], which read as follows:
Version B to Version S
Section 1: Specifies that the person under 21 must be
employed.
Section 2: No change.
Section 3: New section. Modifies theater license
statutes.
Section 4: Prior Section 3. Specifies that the person
under 21 must be employed.
Section 5: Prior Section 4.
Section 6: Prior Section 5. Specifies that the person
under 21 must be employed.
Section 7: Prior Section 6.
Section 8: Prior Section 7.
Section 9: New section. Updates and modifies AS
04.09.049(h).
Section 10. Prior Section 8.
Section 11: New section. Repeals AS 04.09.250(d).
Section 12. Prior Section 9. This updates the
effective date to January 1, 2025.
3:25:04 PM
CHAIR SUMNER removed his objection.
REPRESENTATIVE CARRICK object for the purposes of discussion.
She asked Ms. Hackenmiller to describe the modifications to
section 3.
MS. HACKENMILLER said Section 3 would expand the time period in
which a theater license may sell and serve alcohol and removes
the intermission language.
REPRESENTATIVE CARRICK removed her objection.
3:25:53 PM
REPRESENTATIVE SADDLER objected for purposes of discussion and
asked what a theater license is.
MS. HACKENMILLER did not know the answer.
REPRESENTATIVE SADDLER remove his objection. There being no
further objection, Version S was adopted as the working
document.
3:26:57 PM
DAVID MCCARTHY, CEO, Northern Hospitality Group; Owner, 49th
State Brewing, gave invited testimony in strong support of the
proposed CS for HB 189, Version S. He reported that Alaska is
one of only three states that have not adopted these changes.
He said hospitality is a noble career path, and the service of
others is important to the health and sustainability of a
community. He reported that hospitality builds self-confidence,
the ability to manage people's emptions, personal
responsibility, respect, cooperation, creative thinking, problem
solving, decision making, and conflict management. Further, he
said the hospitality industry shatters the diversity and
inclusion numbers across all other industries. He said the law
would broaden skillsets, create flexible shifts and hours which
creates a higher dollar return, and create a more sociable and
fun job. Overall, he said passing Version S would impact
communities through employment of young adults, which would
develop future leaders in the community,
3:33:18 PM
DIANE THOMPSON, President, Alaska Hospitality Retailers; Owner,
Firetap Restaurant, gave invited testimony in support of the
proposed CS for HB 189, Version S. She reiterated that Alaska
is one of three states that does not allow 1820-year-olds to
serve alcohol. Furthermore, there is a significant shortage of
workers in the state. She said the bill would benefit both the
employee and employer and help to keep students in Alaska by
giving them employment opportunities.
3:35:33 PM
CODIE COSTELLO, President/COO, Alaska Center for the Performing
Arts (PAC); General Manager, Broadway Alaska, gave invited
testimony in support of the proposed CS for HB 189, Version S.
She shared details about the PAC and its role as an economic
engine for downtown Anchorage, highlighting the expansion of its
new Broadway program. Under the current alcohol license,
patrons may only consume alcohol in upper-level lobbies and
within certain timeframes, and there is no alcohol allowed in
theaters. Version S would provide an updated framework for the
rules, provide flexibility, and elevate patrons' experience
while keeping with industry trends.
3:39:48 PM
REPRESENTATIVE SADDLER asked whether other limitations are
placed on younger workers aged 18-21 at the theater.
MS. COSTELLO said younger workers can be employed in the ticket
office or backstage; however, they cannot work in concessions.
REPRESENTATIVE SADDLER asked where young people would be
employed if the bill were to pass.
MS. COSTELLO said she could see an expansion in front-of-house
services, the volunteer usher core, and concessions.
3:41:19 PM
CHAIR SUMNER announced that Version S would be held over.
HB 226-PHARMACIES/PHARMACISTS/BENEFITS MANAGERS
3:41:30 PM
CHAIR SUMNER announced that the next order of business would be
HOUSE BILL NO. 226, "An Act relating to the Board of Pharmacy;
relating to insurance; relating to pharmacies; relating to
pharmacists; relating to pharmacy benefits managers; relating to
patient choice of pharmacy; and providing for an effective
date." [Before the committee was CSHB 226(HSS).]
3:41:48 PM
MS. HACKENMILLER, on behalf of Representative Sumner, prime
sponsor, presented CSHB 226(HSS). She shared the sponsor
statement for the bill [included in committee packet], which
read as follows [original punctuation provided]:
House Bill No. 226 aims to address critical issues
related to the Board of Pharmacy, insurance,
pharmacies, pharmacists, and pharmacy benefits
managers in the state of Alaska. This comprehensive
legislation is designed to ensure patient choice of
pharmacy, improve transparency and accountability in
pharmacy benefit management, and enhance the standards
for pharmaceutical care across the state.
HB226 emphasizes the powers of the Board of Pharmacy,
including provisions for licensing, inspection, and
regulation of pharmacies, pharmacists, and other
entities involved in the distribution of drugs. It
also seeks to establish safeguards for patient access
to pharmacy services and clinician-administered drugs,
while preventing unfair trade practices by insurers
and pharmacy benefits managers.
This legislation introduces provisions for the
reimbursement of pharmacy services, addressing issues
related to national average drug acquisition cost and
dispensing fees, with the goal of ensuring fair
compensation for pharmacies and pharmacists.
House Bill No. 226 is a critical step forward in
promoting the best interests of patients, pharmacies,
and pharmacists in Alaska. By enacting this
legislation, we strive to create an environment that
fosters quality pharmaceutical care, empowers patient
choice, and enhances the overall integrity of pharmacy
services in our state.
This legislation is scheduled to take effect on July
1, 2025, and represents a collaborative effort to
modernize and improve the pharmaceutical landscape in
Alaska.
3:44:53 PM
BRANDY SEIGNEMARTIN, PharmD, Executive Director, Alaska Pharmacy
Association, co-presented a PowerPoint, entitled "HB 226:
Transparency in Prescription Pricing & Patient Freedom of
Pharmacy Choice," [hard copy included in the committee packet].
She presented an overview of the presentation on slide 2 and
continued to slide 3, "What is a Pharmacy Benefit Manager
(PBM)," which read as follows [original punctuation provided]:
• Third-party companies that act as intermediaries
between insurance companies, drug manufacturers,
pharmacies, & patients
• Created to help insurers control drug spend, but
have become perversely incentivized to increase
drug spend
• Why are they incentivized to increase drug spend?
? Create and manage formularies
? Negotiate rebates
? Process claims
? Manage pharmacy networks
? Operate mail-order and "specialty"
pharmacies
MS. SEIGNEMARTIN turned to slide 4, "How PBMs Impact Healthcare
Costs," which read as follows [original punctuation provided]:
• How do they increase drug costs?
? Rebates and fees demanded of manufacturers
for formulary placement - responsible for
42% of every dollar spent on brand medicines
in the commercial market
? Incentivize spend on higher-cost drugs in
order to maximize profit margin
? Reimburse self-owned pharmacies at higher
rates than other pharmacies
? Invented the fallacy of "specialty" pharmacy
as a guise to increase spend on higher-
profit margin prescriptions that they steer
to their owned pharmacies
? Spread pricing- charging the plans more for
a claim and underpaying the pharmacies
3:47:08 PM
DANIEL NELSON, PharmD, Director of Pharmacy, Tanana Chiefs
Conference, moved to slide 5, "PBMs are Harming Alaskans," which
read as follows [original punctuation provided]:
Pharmacies across Alaska are closing crumbling
public health infrastructure due to deceptive
practices by Pharmacy Benefit Managers
• 25% of independent pharmacies have closed since
2018
• Even more chain and independent pharmacies have
limited staffing and hours
• Tribal health systems feel the impact on overall
care
3:48:14 PM
MR. NELSON proceeded to slide 6, which featured Alaska news
headlines about pharmacy closures, staffing shortages, and
cyber-attacks on pharmacy benefit managers (PBM). He moved to
slide 7 to discuss the vertical relationship among insurers,
PBMs, specialty pharmacies, retail pharmacies, mail-order
pharmacies, and providers in 2022. Slide 8 showed a pie chart
of the big 3 PBMs that have market monopoly power: OptumRx, CVS,
and Express Scripts.
3:52:46 PM
MS. SEIGNEMARTIN continued the presentation on slide 9 to
discuss price spreading; anti-competitive, unfair trade
practices; and patient steering. She said price spreading is
dangerous because plan sponsors are charged significantly more,
and pharmacies are paid significantly less.
3:54:52 PM
MR. NELSON shared a spread pricing example from one Alaska
pharmacy on slide 10.
3:56:25 PM
MS. SEIGNEMARTIN moved to slide 11, "Spread Pricing," which read
as follows [original punctuation provided]:
• Harms Alaskan employers, patients, and pharmacies
• Alaskan Employer Example
• AlaskaCare
• In other states, investigations have found that
PBMs were overcharging their plans by millions of
dollars
? $223.7 million in Ohio in one year
? Utah uncovered $8 per prescription average
spread
3:57:15 PM
MS. SEIGNEMARTIN advanced to slide 12, "Anti-competitive, unfair
trade practices," which read as follows [original punctuation
provided]:
• Monopolistic practices lead to artificially
inflated drug costs
• Anti-competitive practices to discourage or
squash competition
• As PBMs grow in power and continue to have lack
of oversight, they are crushing Alaska pharmacies
with non-negotiable contracts and forcing them
out of business
• Reports show that PBMs reimburse their affiliated
pharmacies at much higher rates than local
pharmacies
3:58:48 PM
MS. SEIGNEMARTIN turned to slide 13, "Patient Steering," which
read as follows [original punctuation provided]:
PBMs steer patients to their own high-cost, low
quality lower 48 mail-order pharmacies
• Causes delays in patient care, poor outcomes,
increased healthcare costs
• Patients deserve the right to choose where they
get their medications
3:59:46 PM
CHAIR SUMNER passed the gavel to Vice Chair Ruffridge.
4:01:06 PM
MR. NELSON moved to slide 14, "To Whom are PBMs responsible?"
Slide 14 read as follows [original punctuation provided]:
Currently, the big PBMs are only beholden to their
shareholders
• Should PBMs have a responsibility to the health
of Alaskans?
This is not only an issue for the private sector
Tribal Health Organizations are heavily impacted
? THO pharmacies are forced to either send
prescriptions out to PBM-owned mail-order
pharmacies
? Or, they "eat" 100% of the cost of what
should be a covered prescription
4:02:13 PM
REPRESENTATIVE FIELDS asked which section of statutes affect
tribal health organizations (THO).
MR. NELSON said there's not a specific reference to THOs in the
bill; nonetheless, the bill would positively impact THO's bottom
line and the patients they serve.
4:03:07 PM
MS. SIEGNEMARTIN continued the presentation on slide 15, "HB 226
Provisions," which read as follows [original punctuation
provided]:
Gives patients the right to access medication at a
pharmacy of their choice
- Bans patient steering to PBM-owned or
affiliated pharmacies
Ensures safe access to physician-administered
medications
- Bans PBM-required white bagging and brown
bagging
Requires a transparent reimbursement model
- Saves money for patients and plan sponsors
on prescription drug spend
- Gets rid of complicated and opaque
reimbursement methodologies
HB226 will:
• Ban spread pricing
• Require reimbursement floor of NADAC + dispensing
fee
• Require payment parity between PBM-owned
pharmacies and local pharmacies
• Fiduciary responsibility from PBMs to plan
sponsors
4:04:40 PM
REPRESENTATIVE SADDLER asked Ms. Stiegnemartin to explain "white
bagging" and "brown bagging."
MS. SIEGNEMARTIN defined white bagging and brown bagging as
practices in which PBMs use their monopolistic power to steer
the flow of prescription commerce away from local pharmacies and
clinics into their own hands to allow for remuneration at a
higher level. More specifically, white bagging is when the drug
is sent to the mail room of the patient's clinic, as opposed to
being sent through the proper supply chain, which circumvents
certain protective systems. Brown bagging is when the drug is
sent directly to the patient's home, which adds extra layers of
product integrity issues and other safety concerns.
4:07:29 PM
REPRESENTATIVE PRAX questioned which U.S. Supreme Court decision
determined that PBMs are okay.
MS. SIEGNEMARTIN answered Rutledge v. PCMA, which was a 2020
decision.
4:09:34 PM
REPRESENTATIVE SADDLER how the state got to this point.
MS. SIEGNEMARTIN analogized the Kudzu plant and explained that
PBMs were intended to be an adjudication point between
pharmacies and insurance companies; however, over time, their
vertical integration model amassed monopolistic wealth and power
that is used to steer the flow of prescription commerce. She
added that many insurance companies are beholden to state laws,
but third-party administrators are not regulated in the same
way.
4:12:29 PM
REPRESENTATIVE FIELDS said the fiscal note from the Department
of Administration (DOA) reflects a $2 million dollar cost
increase. He asked Mr. Nelson why he disagrees with the
department's analysis.
MR. NELSON confirmed that he strongly disagrees with DOA because
there was no consideration for the cost savings that would occur
from changing the model for ingredient costs. He resumed the
presentation on slide 18 which featured a bar graph of the
Division of Retirement and Benefits (DRB) spend in 2022 versus
the potential cost impact of HB 226. DRB spent $277 million in
2022 [on prescriptions]. If HB 226 were to pass, Mr. Nelson
estimated that the bill would save the state somewhere between
$.7 million and $7.9 million at an average of $4.3 million in
costs savings.
4:16:53 PM
MR. NELSON shared several examples of how the bill might impact
Dimethyl Fumerate and Copaxone prescription costs on slides 19-
20.
4:18:47 PM
REPRESENTATIVE SADDLER asked whether HB 226 would eliminate the
opportunity for specialty pharmacy cost increases.
MR. NELSON answered yes, because more local pharmacies would
qualify as "specialty pharmacies" under the bill. He shared an
example of how HB 226 would save the state money on the cost of
filling Ampyra prescriptions on slide 21. Slide 22 projected
overall cost savings for Alaska employers of anywhere between $4
million and $44 million based on the National Average Drug
Acquisition Cost (NADAC) high and low. He moved to slide 23,
which read as follows [original punctuation provided]:
HB 226 is Pro-Alaska economy by preventing forced mail
order and patient steering/coercion
HB226 would allow patients to fill prescriptions
locally if they would like to
Potential to infuse $34-$36 million annually into
Alaska's local economy for state employee/retiree
prescriptions alone (based on 2022 data)
Overall positive financial impact on Alaska economy is
much larger
MR. NELSON emphasized that the bill would not prevent the
allowance of mail order prescription services. On slide 14, he
estimated that based on the NADAC low and high, the overall
gross economic infusion for Alaska without forced mail and
dispensing fee would range from savings of between $190 million
to $200 million.
4:24:09 PM
MR. NELSON concluded on slide 25 with an example of benefits
that could be gained through a transparent PBM, such as OreadRx,
as presented by the owner, Dr. Dared Price, at a White House
listening Session.
4:25:59 PM
REPRESENTATIVE FIELDS questioned the admin fee of OreadRx.
MS. SIEGNEMARTIN did not know the answer; nonetheless, she said
it is "flat and transparent," which is in direct opposition to
current PBMs that use spread pricing.
REPRESENTATIVE CARRICK asked whether the flat administrative fee
is statutorily set.
MR. NELSON said the flat fee is negotiated between the plan
sponsor and the PBM.
4:27:15 PM
REPRESENTATIVE SADDLER sought to better understand the meaning
of spread pricing.
MR. NELSON defined the "spread" as the difference between the
amount negotiated between the pharmacy and the plan sponsor.
4:28:48 PM
REPRESENTATIVE PRAX asked why everyone hasn't switched to
OreadRx.
MS. SIEGNEMARTIN said the answer is vertical integration. She
explained that plans must sometimes pay a large fee to opt out
of using the vertically integrated PDM services, which speaks to
their monopolistic power. She explained that if more employers
moved towards transparent PBMs any of the 74 outside of the
big three everyone would be much better off.
MR. NELSON, in response to a follow up question from
Representative Prax, added that Mark Cuban testified at the
White House Listening Session about this intentionally
complicated system.
4:32:28 PM
REPRESENTATIVE CARRICK asked how PBMs aren't violating Antitrust
laws at the federal level if they are acting as pharmacies and
manufacturers in some cases and working vertically integrated
with insurance companies. She said she had seen many local
pharmacies go out of business as a result of this structure and
agreed that something needs to be done; however, she asked why
the state is the most appropriate entity to take action.
MS. SIEGNEMARTIN said the PBMs built their vertical integration
slowly over time. She explained that the Federal Trade
Commission (FTC) launched an investigation into the big PBMs and
sent out compensatory orders about 18 months ago. Two weeks
ago, the FTC reported that the PBMs are not complying with those
orders. She added that Alaska is behind the curve compared to
other states.
4:34:53 PM
REPRESENTATIVE FIELDS said he is still struggling to understand
the impact on Tribal health providers. If the bill were to
pass, he asked whether Tribal members who are state employers
would receive their medication through a Tribal pharmacy that
would receive an additional dispensing fee paid through Alaska
Care.
MR. NELSON characterized Alaska Medicaid as a blessing because
it does not use a PBM model. However, Tribal health providers
also serve tons of patients with private insurance or no
insurance at all. He said the bill would still apply to these
patients and make it a fair playing ground.
REPRESENTATIVE FIELDS sought to confirm that privately insured
individuals using Tribal pharmacies are the primary reason that
Tribal health pharmacies are interested in this bill.
MR. NELSON said that's correct.
4:37:15 PM
ASHLEY SCHABER, Chair, Alaska Board of Pharmacy, gave invited
testimony in support of CSHB 226(HSS). She said the Board of
Pharmacy is in unanimous support of the bill because it gives
patients the right to access medications at the pharmacy of
their choice if it's contracted with the PBM; provides a
framework of transparency and reimbursement for pharmacies and
patients; protects patient access to clinician administered
medications by restriction the practices of white bagging and
brown bagging; and aligns with the board's strategic plan to
grow the state's economy by promoting community health and
safety. She explained since the work on HB 226 began, multiple
Alaska pharmacies have closed, including those providing
specialized services. She said the bill would ensure that
Alaska's pharmacies can continue to safely serve Alaskans.
4:39:55 PM
REPRESENTATIVE FIELDS asked Ms. Schaber whether she had
reflected on how to most efficiently support community
pharmacies without wasting money on larger corporations.
MS. SCHABER said the premise of the bill is to allow Alaskans to
choose, so putting a limitation on that would go against the
original intent of the legislation.
4:41:08 PM
DESIREE MOLINA, Pharmacist, Three Bears Pharmacy, gave invited
testimony in support of CSHB 226(HSS). She shared examples of
how unethical PBM practices harm Alaskans. In addition to
harming Alaskans by restricting their access to lifesaving
medications, PBMs are contributing to the closure of Alaska
pharmacies. She said this is a health crisis and urged members
to support HB 226.
4:44:05 PM
REPRESENTATIVE RUFFRIDGE announced that HB 226 would be held
over.
HB 203-PAYMENT OF WAGES; PAYROLL CARD ACCOUNT
4:44:25 PM
REPRESENTATIVE RUFFRIDGE announced that the next order of
business would be HOUSE BILL NO. 203, "An Act relating to wage
payments."
4:44:41 PM
REPRESENTATIVE RUFFRIDGE opened public testimony on HB 203.
After ascertaining that no one wished to testify, he closed
public testimony and announced that the bill would be held over.
HB 175-BOARD OF LICENSED MIDWIVES
4:45:32 PM
REPRESENTATIVE RUFFRIDGE announced that the next order of
business would be SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 175, "An
Act relating to midwives and the practice of midwifery; relating
to apprentice midwives; renaming the Board of Certified Direct-
Entry Midwives as the Board of Licensed Midwives; relating to
the Board of Licensed Midwives; extending the termination date
of the Board of Licensed Midwives; relating to insurance; and
providing for an effective date."
4:45:49 PM
REPRESENTATIVE RUFFRIDGE opened public testimony on HB 175.
4:46:19 PM
JENNIFER CAVE, Vice President, Midwives Association of Alaska;
Owner, The Nesting Place, testified in support of SSHB 175.
With the recent extension of the postpartum period by Medicaid
to one year after birth, she said it's fitting that SSHB 175
would expand the scope to allow the one-year postpartum period.
She said the bill would help ease the burden of doctors and give
clients the care they need in a timely fashion. In addition,
SSHB 175 would ensure that insurance companies reimburse home
births in Alaska and save clients' money.
4:50:30 PM
BARBARA NORTON, representing self, spoke in opposition to SSHB
175. She said she supported the overriding of EO 130, which
would disband the Board of Direct Entry Midwives (CDM); however,
she said she does not support the statute changes in HB 175.
She listed the following changes as "counter to common sense:"
removing the doctor and nurse midwife from the board and
replacing them with direct entry midwives; eliminating the need
for a diploma; prohibiting regulations requiring collaboration
with hospitals, doctors, or advanced nurse practitioners;
removing the requirement that preceptors may not have any
experience to train new midwives; removing the language that has
for 32 years, recommended that women entering prenatal care,
receive a physical exam by a doctor or nurse practitioner;
expanding the scope of direct entry care to include
preconception care. She shared an anecdote. She urged sensible
direct entry midwives to get back on their board and change the
regulations back to pre-2023 to ensure that the public's best
interest.
4:56:19 PM
REPRESENTATIVE RUFFRIDGE closed public testimony on HB 175 and
announced that the bill would be held over.
HB 254-PROHIBIT PORNOGRAPHY TO MINORS
4:56:42 PM
REPRESENTATIVE RUFFRIDGE HOUSE BILL NO. 254, "An Act relating to
liability for publishing or distributing pornography to minors
on the Internet."
4:57:02 PM
REPRESENTATIVE WRIGHT moved to report HB 254 out of committee
with individual recommendations and the accompanying fiscal
notes.
REPRESENTATIVE CARRICK objected.
4:57:34 PM
The committee took an at-ease at 4:57 p.m.
4:58:11 PM
REPRESENTATIVE CARRICK said she believed with the intent of the
bill; however, the bill contains loopholes or gaps that could
lead to poor outcomes.
REPRESENTATIVE FIELDS agreed that the concept of the bill is a
good one, but the committee has heard little on the merits of
the legislation and how it would work in the real world. For
that reason, he said he would not support moving the bill out of
committee at this time.
REPRESENTATIVE SADDLER said he supports the underlying effort of
the bill, but he would like to know more about commercially
available age verification. Nonetheless, he said he would not
stand in the way of the bill's advancement.
REPRESENTATIVE CARRICK noted that she had asked about the
commercially available options for verification, to which the
sponsor's office responded with a list of private companies.
She said she looked into the top 5 or 10 companies that were
listed and found potential security issues that could impact
Alaskans' identities.
5:01:43 PM
A roll call vote was taken. Representatives Prax, Saddler,
Wright, and Ruffridge voted in favor of moving HB 254 from
committee. Representatives Carrick and Fields voted against it.
Therefore, HB 254 was reported out of the House Labor and
Commerce Standing Committee by a vote of 4-2.
5:02:16 PM
ADJOURNMENT
There being no further business before the committee, the House
Labor and Commerce Standing Committee meeting was adjourned at
5:02 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB226 Sponsor Statement.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 226 |
| HB226 Sectional Analysis Ver. S.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 226 |
| HB226 Summary of Changes Ver B to Ver S.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 226 |
| Pat Shire clarification on 2.27.24 testimony (HSS HB226).pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 226 |
| HB 189 State by State.xlsx |
HL&C 3/11/2024 3:15:00 PM |
HB 189 |
| HB189 Sponsor Statement.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 189 |
| SB 121HB 226 Revised Slides.pptx |
HL&C 3/11/2024 3:15:00 PM |
HB 226 |
| S.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 189 |
| HB189 Explanation of Changes.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 189 |
| HB189 Sectional Analysis Ver. S.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 189 |
| HB327 Support.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 327 |
| SB121 & HB226 DCCED-DOI Applicable Court Cases in Oklahoma and Arkansas 3.12.24.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 226 SB 121 |
| HB226 Letter of Support.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 226 |
| HB 226 Letter of Support - Albertsons.pdf |
HL&C 3/11/2024 3:15:00 PM |
HB 226 |