Legislature(2017 - 2018)SENATE FINANCE 532
04/12/2018 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB193 | |
| HB79 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 285 | TELECONFERENCED | |
| += | HB 286 | TELECONFERENCED | |
| + | SB 193 | TELECONFERENCED | |
| + | HB 176 | TELECONFERENCED | |
| + | HB 213 | TELECONFERENCED | |
| + | HB 215 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 79 | TELECONFERENCED | |
| += | HB 121 | TELECONFERENCED | |
| += | SB 185 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
April 12, 2018
9:24 a.m.
9:24:15 AM
CALL TO ORDER
Co-Chair MacKinnon called the Senate Finance Committee
meeting to order at 9:24 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Anna MacKinnon, Co-Chair
Senator Click Bishop, Vice-Chair
Senator Peter Micciche
Senator Donny Olson
Senator Gary Stevens
Senator Natasha von Imhof
MEMBERS ABSENT
None
ALSO PRESENT
Heather Carpenter, Staff, Senator Pete Kelly; Senator Pete
Kelly, Sponsor; Jeremy Price, State Director, Americans for
Prosperity; Alyson Curry, Legislative Liaison, Planned
Parenthood Votes Alaska; Monica Windom, Director, Division
of Public Assistance, Department of Health and Social
Services; Jon Sherwood, Deputy Commissioner, Department of
Health and Social Services; Don Etheridge, AFL-CIO, Juneau;
Barbara Huff Tuckness, Director of Government and
Legislative Affairs, Teamsters Local 959, Juneau; Heidi
Drygas, Commissioner, Department of Labor and Workforce
Development; Marie Marx, Director, Division of Workers
Compensation, Department of Labor and Workforce
Development.
PRESENT VIA TELECONFERENCE
Mike Coons, President, Alaska Chapter, Association of
Mature American Citizens, Palmer; Laura Bonner, Self,
Anchorage.
SUMMARY
SB 185 REEMPLOYMENT OF RETIRED TEACHERS and ADMIN
SB 185 was SCHEDULED but not HEARD.
SB 193 MED. ASSISTANCE WORK REQUIREMENT
SB 193 was HEARD and HELD in committee for
further consideration.
CSHB 79(FIN)
OMNIBUS WORKERS' COMPENSATION
CSHB 79(FIN) was HEARD and HELD in committee for
further consideration.
SENATE BILL NO. 193
"An Act requiring the Department of Health and Social
Services to apply for a waiver to establish work
requirements for certain adults who are eligible for
the state medical assistance program."
9:25:40 AM
HEATHER CARPENTER, STAFF, SENATOR PETE KELLY, introduced
the bill. She stated that a Section 11.15 was a broad
waiver, and it was a way to "bend the rules" of what was
currently required. She shared that there had been a change
in policy to accept waivers that test the hypothesis that
requiring work or community engagement as a condition of
eligibility would result in more beneficiaries being
employed, or engaging in other productive community
engagement. Thus producing increased health and wellbeing.
She shared that President Trump signed an executive order
called, "Reducing Poverty in America by Promoting
Opportunity and Economic Mobility." She shared that the
executive order had a strong focus on work requirements for
work capable people. She stated that the Medicaid program
was established to help the most vulnerable Alaskans, and
it must continue to do so; however, the safety net program
should not be used to hold people down indefinitely. She
asserted that the legislation sought to use the Medicaid
program to lift individuals to a better quality of life by
requiring twenty hours of work activity, volunteering, or
subsistence activities each week. The legislation included
several protections that would exempt individuals from the
work requirement including children; certain parents and
caretakers; individuals with certain medical conditions;
individuals enrolled in an education or training program;
and people who were pregnant. She stated that the bill
would impact approximately 25,095 Medicaid enrollees, or
approximately 10.5 percent of the total enrollment.
9:29:55 AM
Ms. Carpenter discussed the Sectional Analysis (copy on
file):
Section 1:
Amends AS 47.07.036 to direct the DHSS to apply for a
section 1115 waiver of the Social Security Act to
establish a work requirement for adults in the
Medicaid program who not meet the criteria to be
exempted.
The waiver must include the following:
(1) Requires an able-bodied Medicaid recipient to
participate in work activities for a minimum of
20 hours each week. Actively seeking employment,
participating in an education or training
program, volunteering, engaging in subsistence
activities, or caregiving also are counted
towards the 20-hour requirement.
(2) If a Medicaid recipient is also receiving
benefits under Alaska Temporary Assistance
Program and in compliance with the work
requirements listed under AS 47.27.035, then they
automatically meet the work requirement for
Medicaid.
(3) Exempt Medicaid recipients who are:
a. Children or elderly (Under 18 years old
and over 65 years old)
b. The parent or caretaker of a dependent
child of up to 12 months of age and the
parent or caretaker is providing home care
for the child
c. The parent or caretaker of a child
experiencing a disability and the parent or
caretaker is providing home care for the
children
d. The caretaker of a relative who is
experiencing a disability and requires 24-
hour care
e. The parent or caretaker of a child under
six years of age and the parent or caretaker
demonstrated that appropriate child care is
not available
f. Unable to work for medical reasons, as
determined by a licensed medical
professional
g. Pregnant
h. Currently receiving unemployment
insurance benefits
i. Participating in a tribal work program
(4) Temporary exemptions for:
a. Experiencing a family hardship outside of
the control of the parent or caretaker
b. A victim of domestic violence
(5) Ensure that the work requirement does not
impact a Medicaid recipient from obtaining
substance abuse treatment
(6) A notification to all Medicaid receipts once
the waiver is approved, and a 90 day notice of
non-compliance with the work requirement before
benefits are terminated.
9:34:04 AM
Senator Stevens wondered how people would be notified of
the available scholarships. Ms. Carpenter replied that the
state had a rich history within the Department of Labor and
Workforce Development (DOLWF). She noted that there were
various financial resources through that department. She
shared that there was a Medicaid reform bill in 2016 that
asked that the department inform individuals on Medicaid of
education options or work availability. She stated that the
department had a process outlined through the fiscal note.
Senator Stevens assumed that the department would provide
what was available.
Senator von Imhof noted that the Sectional Analysis
included the phrase, "there parameters align with the
current Temporary Assistance for Needy Families (TANF)
program." She wondered how the requirements and exemptions
aligned with TANF. Ms. Carpenter replied that they were
almost completely aligned. She noted that there may be one
provision that was not included.
Senator von Imhof wondered whether Department of Health and
Social Services (DHSS) had an existing program to monitor
hours for Medicaid recipients. Ms. Carpenter replied that
the department had work requirements in place for both food
stamps and the temporary assistance program, but the
federal government had never allowed a work requirement for
Medicaid.
Senator von Imhof felt that the tracking process was in
place, so the current practices could be built upon. Ms.
Carpenter agreed.
Co-Chair Hoffman appreciated the inclusion of subsistence.
He wondered how to document subsistence. Ms. Carpenter
replied that there had not been a system for documenting
the subsistence. She stated that the waiver allowed for
flexibility to work with the tribes.
Co-Chair Hoffman remarked that it should be tracked with
minimal paperwork, because those living the subsistence
life rarely had detail to paperwork.
9:40:20 AM
Senator Olson wondered whether only 10 percent of the
enrollees would be affected by the legislation. Ms.
Carpenter replied that the number with exemptions was
25,095 individuals, which was 10.5 percent of the current
program.
Senator Olson wondered whether there was similar
implementation in any other states, and queried the success
in those states. Ms. Carpenter replied that it was a brand
new program. She stated that Kentucky had a waiver
approved, but there was current litigation around that
waiver.
Vice-Chair Bishop asked for more discussion with DLWD
SENATOR PETE KELLY, SPONSOR, discussed the bill.
9:44:20 AM
JEREMY PRICE, STATE DIRECTOR, AMERICANS FOR PROSPERITY,
spoke in favor of the bill. He stated that Kaiser Family
Foundation put Medicaid enrollment at 1 in 5 in the nation;
and 25 million Americans were within the population of able
bodied adults that were part of the expansion population.
He noted that Alaska was headed for some serious problems,
because there were no limits on enrollment in Medicaid.
There was a desire to preserve the program for those that
need it the most. He felt that government assistance should
be a "hand up" and not a "hand out", except for those that
truly need the program. He noted that New York, Maine,
Alabama, Georgia, and Kansas enacted welfare reform with a
focus on food stamps. He stated that after enacting work
requirements for food stamps, there was a massive reduction
in welfare assistance and increased employment for low
skilled workers. He stressed that there was clear and
convincing evidence that worklessness led to depression,
and depression led to bad things. He felt that there was a
link to mental and physical health.
Senator Micciche stressed that there may be opportunities
missed without development expectations.
Co-Chair Hoffman requested a brief description of Americans
for Prosperity. Mr. Price replied that Americans for
Prosperity was an organization dedicated to removing
barriers of opportunities for Alaskans and Americans. He
stated that they advocated for lowering regulations; making
it easier for people to start small businesses; and
lowering taxes; empowering individuals to develop their own
future and economic fortune.
Co-Chair Hoffman queried the number of members from rural
Alaska in Americans for Prosperity. Mr. Price responded
that he did not have that number.
Senator von Imhof noted that one of the possible challenges
was that folks may earn income to rise above eligibility
limits, yet may not earn enough to pay for insurance
coverage. She queried ideas to address that transition
time. Mr. Price replied in the negative.
Senator von Imhof noted that Americans for Prosperity was a
strong think tank, and had money to research important
issues with nationwide stakeholders to discuss the impacts
of a particular issue. She urged examination of the
program. Mr. Price agreed.
9:52:45 AM
ALYSON CURRY, LEGISLATIVE LIAISON, PLANNED PARENTHOOD VOTES
ALASKA, testified against the bill. She stated that, in
Alaska, over one quarter of the Planned Parenthood patients
were Medicaid beneficiaries; and over 80 percent were
women. She stressed that everyone had access to needed
health care, regardless of their income. She stated that
the enrollment restrictions in SB 193 would decrease access
to health care in the state, and would have
disproportionate impact on women. She stated that Medicaid
covered one in five women of reproductive age, and was the
source of coverage for nearly one-half of women giving
birth. She stressed that many women faced barriers to work,
like transportation, housing, and education. She remarked
that, in rural Alaska, the work requirements would
essentially prevent many women from accessing basic
preventative health care. She remarked that restricting
women from preventative care, such as contraception, was
bad for women's health and bad for the state's budget. She
remarked that the state saved seven dollars for every one
dollar it invested in family planning, because it was
cheaper to invest in contraceptive coverage than to pay for
costs associated with unintended pregnancies. She felt that
the bill would remove many women from Medicaid who were
attempting to avoid pregnancy, but then require the state
to cover the cost of their unintended pregnancy after
losing access to publicly funding family planning. She
announced that research had shown that punitive work
requirement did not actually decrease poverty, and in some
cases could push families deeper into poverty. She felt
that the bill would cut Alaskans off from the care they
depend on without improving their economic stability. She
noted that the numerous fiscal notes made it clear that it
would do so at significant cost to the state.
Vice-Chair Bishop queried the definition of "punitive." Ms.
Curry replied that it was punitive to kick someone off of
Medicaid because they were either unable to find work or
unable to work.
Vice-Chair Bishop did not feel that twenty hours was not
"out of line." He asked that they meet to discuss further
exemptions. Ms. Curry agreed.
9:57:05 AM
Senator Micciche noted that the bill also allowed volunteer
opportunities. He wondered if there was a problem with
requiring someone to participate in valuable social
activities. Ms. Curry replied that she found great value in
giving back to the community, but felt it was a fallacy to
believe that the people who were currently on Medicaid did
not have a desire to contribute to their community. She did
not see how requiring 20 hours of volunteer work rather
than seeking employment would increase someone's economic
standing.
Senator Micciche felt that the bill provided multiple ways
for people to contribute. He noted that the government must
be there for those that could not work. He remarked that
there were individuals who were displaced to receive
services, because healthy individuals were receiving
services. He wondered whether services should be
prioritized in a way that recognized someone's inability to
work above asking for a reasonable contribution from those
who were capable of working. Ms. Curry replied that she
felt that those that were able to community already
contributed to the community in their own capacity. She
stressed that Planned Parenthood had a hard line stance
that everyone deserves access to health care. She felt that
the bill focused on the Medicaid expansion population.
Senator Micciche felt that the bill did not address the
expansion population, because that population was already
working. He stressed that the focus was on another
population in the eligibility categories.
Senator von Imhof felt that Medicaid eligibility for some
populations was not health based, but income based. She
remarked that a recipient could be healthy, but at a
certain level of income to qualify for Medicaid. She noted
the extraordinary number of exemptions that would target
the Planned Parenthood population. She queried concerns
about a tribal work program versus the Medicaid work
program. Ms. Curry replied that she could not answer that
question.
10:02:48 AM
MIKE COONS, PRESIDENT, ALASKA CHAPTER, ASSOCIATION OF
MATURE AMERICAN CITIZENS, PALMER (via teleconference),
spoke in support of the bill. He stated that the welfare
reform had laid the ground work to get more Americans back
to work, while protecting and strengthening the safety for
the truly needy. He felt that federal agencies must take
advantage of the opportunity to roll back harmful
"Obamacare" policies to trap families in dependency, and
cost taxpayers billions.
Co-Chair MacKinnon CLOSED public testimony.
Senator Stevens hoped to provide educational opportunities
for the recipients.
Co-Chair MacKinnon believed that health was important, and
services were available for some who could not provide for
themselves. She wondered whether benefits were increased to
someone with a child.
10:07:40 AM
MONICA WINDOM, DIRECTOR, DIVISION OF PUBLIC ASSISTANCE,
DEPARTMENT OF HEALTH AND SOCIAL SERVICES, introduced
herself.
Co-Chair MacKinnon wondered whether benefits were increased
to someone with a child. Ms. Windom replied that the
benefit would not increase.
Co-Chair MacKinnon wondered how many pregnancies in Alaska
were covered by Medicaid.
10:08:22 AM
JON SHERWOOD, DEPUTY COMMISSIONER, DEPARTMENT OF HEALTH AND
SOCIAL SERVICES, replied that he did not have the exact
number. He stated that, historically, Medicaid covered
approximately 50 percent of pregnancies.
Co-Chair MacKinnon stated that she already had the number.
She announced that 50 percent of all live births were
covered by Medicaid. She noted that the bill would affect
program growth in other areas such as food stamps.
Senator Micciche noted that the federal poverty line was
affected by a child, so it would affect the benefit.
Co-Chair MacKinnon stressed that the child would qualify
for Medicaid.
Ms. Carpenter announced that the bill was not only directed
the expansion population. She stated that the CMS guidance
letter specifically addressed, "able bodied enrollees in
Medicaid." She agreed that it included the expansion
population, but was not entirely the expansion population.
She agreed to have conversations off the record. She shared
that she had stories of people who were told that they were
too disabled to work, but felt that it was disingenuous.
She announced that she was excited to see what the Trump
administration would present for work requirements, and
changing the welfare programs. She felt that work was an
amazing opportunity to prosper and grow.
SB 193 was HEARD and HELD in committee for further
consideration.
CS FOR HOUSE BILL NO. 79(FIN)
"An Act relating to workers' compensation; relating to
the second injury fund; relating to service fees and
civil penalties for the workers' safety programs and
the workers' compensation program; relating to the
liability of business entities and certain persons for
payment of workers' compensation benefits and civil
penalties; relating to civil penalties for
underinsuring or failing to insure or provide security
for workers' compensation liability; relating to
preauthorization and timely payment for medical
treatment and services provided to injured employees;
relating to incorporation of reference materials in
workers' compensation regulations; relating to
proceedings before the Alaska Workers' Compensation
Board; relating to the authorization of the workers'
compensation benefits guaranty fund to claim a lien;
excluding independent contractors from workers'
compensation coverage; establishing the circumstances
under which certain nonemployee executive corporate
officers and members of limited liability companies
may obtain workers' compensation coverage; relating to
the duties of injured employees to report income or
work; relating to misclassification of employees and
deceptive leasing; defining 'employee'; relating to
the Alaska Workers' Compensation Board's approval of
attorney fees in a settlement agreement; and providing
for an effective date."
10:12:20 AM
AT EASE
10:18:55 AM
RECONVENED
10:19:55 AM
Co-Chair MacKinnon stated that there was a letter from her
husband in the packet, and the testifier was her niece. She
wanted to ensure that there was not an appearance of
impropriety.
10:21:30 AM
LAURA BONNER, SELF, ANCHORAGE (via teleconference), spoke
in support of the bill.
10:23:15 AM
DON ETHERIDGE, AFL-CIO, JUNEAU, spoke in support of the
legislation.
10:25:32 AM
BARBARA HUFF TUCKNESS, DIRECTOR OF GOVERNMENT AND
LEGISLATIVE AFFAIRS, TEAMSTERS LOCAL 959, JUNEAU, testified
in support of the bill.
Co-Chair MacKinnon CLOSED public testimony.
10:28:53 AM
HEIDI DRYGAS, COMMISSIONER, DEPARTMENT OF LABOR AND
WORKFORCE DEVELOPMENT, stated that the bill should be
considered an efficiencies bill. The bill would assist the
department's ability to administer the workers compensation
system. The bill focused mainly on efficiencies and
modernizing the current system that had not been
significantly reformed in more than ten years. She stated
that the bill had been well vetted and been through several
committees.
MARIE MARX, DIRECTOR, DIVISION OF WORKERS COMPENSATION,
DEPARTMENT OF LABOR AND WORKFORCE DEVELOPMENT, discussed
the presentation, "Workers' Compensation: HB 79 Senate
Finance Committee April 10, 2018" (copy on file).
Ms. Marx highlighted slide 2, "What is Workers'
Compensation?":
A system of insurance that protects workers and
employers from some of the losses caused by on-the-job
accidents and job-related illnesses
Ms. Marx displayed slide 3, "The 'Grand Bargain'":
An employer provides prompt, necessary medical and
wage loss benefits to an injured worker for a work-
related injury.
In exchange, the injured worker receives limited
benefits and gives up the right to sue the employer.
10:30:45 AM
Ms. Marx highlighted slide 4. She stated that the Worker's
Compensation Act guided the division's administration, and
more specifically guided the mission of the Worker's
Compensation Act. The mission was to ensure the quick,
efficient, fair, and predictable delivery of benefits to
injured workers at a reasonable cost to employers. She
stressed that any effort of the division was always
balancing those five pillars.
Ms. Marx discussed slide 5, "HB 79: Workers' Compensation
Efficiencies Bill":
? Speed up dispute resolution
? Improve the delivery of medical care to injured
workers
? Strengthen provisions to prevent workers'
compensation fraud by employers and employees
? Reduce administrative costs
? Ensure adequate funding for the administration of
the workers' compensation and workers' safety programs
Ms. Marx addressed slide 6, "SPEED UP DISPUTE RESOLUTION:
SECS. 8-10, 19-21, 39":
Current law
A party requests hearing on claim
Non-attorneys may represent parties
Board must approve attorney fees in settlement
agreement
Division petitions Board to assess a civil
penalty against uninsured employer
HB 79
Board will schedule a hearing shortly after claim
is filed (Secs. 19, 21)
Any person authorized by regulation of the Board
(Sec. 20)
Board does not need to approve if fees are sole
issue that needs Board approval (Sec. 39)
Division assesses civil penalty against uninsured
or underinsured employer; party may appeal
assessment to Board (Secs. 8-10)
Ms. Marx discussed slide 7, "IMPROVE THE DELIVERY OF
MEDICAL CARE: SECS. 14, 23, 25-26":
Current law
No language addressing if and when a provider's
written request for medical care must be
preauthorized
No penalty for untimely preauthorization or
denial
Medical bills paid within 30 days
HB 79
Requires an employer to preauthorize or deny
medical treatment within 60 days of a medical
provider's written request (Sec. 14)
Penalty for untimely preauthorization or denial
(Secs. 23, 25-26)
NO CHANGE
10:35:41 AM
Ms. Marx highlighted slide 8, "Why the Division is Tackling
Misclassification":
? Worker safety
Risk of uninsured losses
? Law-abiding employers bear greater financial burden
Ms. Marx discussed slide 9, "STRENGTHEN FRAUD PROVISIONS:
SECS. 7, 9, 10-11, 28-29, 32, 35-38, 40":
Current law
No definition of misclassification
No affirmative duty to report work or wage-loss
benefits
No owner liability for benefits for some business
entities and no civil penalty liability
No definition of independent contractor and
multifactor balancing test for employee status
Co-Chair MacKinnon queried the definition of "independent
contractor."
10:38:32 AM
AT EASE
10:38:56 AM
RECONVENED
10:39:01 AM
Ms. Marx announced the definition of "independent
contractor." She looked at page 17, line 1 of the bill:
A person employed as an independent contractor; a
person is an independent contractor for the purposes
of this chapter only if the person: A) has an
expressed contract to perform the services, B) is free
from direction and control over the means and matter
of providing services, subject only to the right of
the individual for whom or entity for which the
services are provided to specify the desired results,
completion schedule, or range of work hours; or to
monitor the work for compliance with contract plans
and specifications, or federal, state, or municipal
law, C) incurs most of the expenses for tools, labor,
and other operational costs necessary to perform the
services, except for materials and equipment that
could be supplied, D) has an opportunity for profit
and loss as a result of the services performed for the
other individual or entity, E) is free to hire and
fire employees to help perform the services for the
contracted work, F) has all the business, trade, or
professional licenses required by federal, state, or
municipal authorities for a business or individual
engaging in the same type of services as the person,
G) follows federal Internal Revenue Service (IRS)
requirements by i) obtaining an employer
identification number if required; ii) filing business
or self-employment tax returns for the previous tax
year to report profit or income earned for the same
type of services provided under the contract; iii)
intending to file business or self-employment tax
returns for the current tax year to report profit or
income earned for the same type of services provided
under the contract if the person's business was not
operating in the previous year, and H) meets at least
two the following criteria: i) the person is
responsible for the satisfactory completion of
services that the person has contracted to perform and
is subject to liability for a failure to complete the
contracted work, or maintains liability insurance to
complete the contracted work or other insurance
policies necessary to protect the employee's financial
interest in customers to the person's business; ii)
the person maintains a business location or a business
mailing address separate from the location of the
individual for whom, or the entity for which the
services are performed, and iii) the person provides
contracted services for two or more different
customers within a twelve month period, or engages in
any kind of business advertising, solicitation, or
other marketing efforts reasonably calculated to
obtain new contracts to provide similar services.
Co-Chair MacKinnon wondered whether the section affected
the most recent bill that was passed about ride sharing.
Ms. Marx replied that the language would not affect the
transportation network drivers, because that bill exempted
them from the provisions of the Alaska Workers Compensation
Act.
Ms. Marx continued to discuss slide 9:
Injured worker may file lien for benefits but
Benefits
Guaranty Fund may not
HB 79
Defines misclassification and when it amounts to
fraud (Sec. 36)
Affirmative duty to report (Sec. 36)
More business entity owner liability for benefits
and civil penalties (Secs. 7, 37-38)
Defines independent contractor and clarifies
statutory definition of employee (Secs. 32, 40)
Benefits Guaranty Fund may file lien for
compensation and civil penalties (Secs. 28-29)
Ms. Marx addressed slide 10, "STRENGTHEN FRAUD PROVISIONS
CONT.: SECS. 7, 9, 10-11, 28-29, 32, 35-38, 40":
Current law
No penalty assessed for an employer who has
engaged in fraudulent misclassification
Maximum penalty of $1,000 for each uninsured
employee workday
7 days to pay penalty
Board suspends failure to insure penalties in
full or in part and no guidelines for suspension
No interest paid on payment plans
HB 79
Division may assess a penalty (Secs. 9, 35)
Maximum civil penalty of three times the premium
an employer should have paid (Sec. 9)
30 days to pay penalty or appeal to Board
(Secs. 10-11)
Failure to insure penalties may not be suspended
in full or in part (Sec. 11)
Interest on payment plans (Sec. 11)
10:45:56 AM
Vice-Chair Bishop wondered whether the experience rate was
considered in the calculation. Ms. Marx replied in the
negative. She explained that the calculation would be very
simple. She noted that it would probably be less than the
premium paid, because the premium included the building
blocks. She stressed that the base rate was used.
Co-Chair MacKinnon looked at Sections 9 and 35, and noted
that there was concern about how the DLWD was allowed to do
premium audits. Ms. Marx replied that she had not had an
opportunity to address that concern. She felt that there
may be a misunderstanding. She stressed that the department
did not do premium audits, rather it investigated fraud and
misclassification.
Vice-Chair Bishop wondered whether it was for fraudulent
and injured workers too. Ms. Marx replied in the
affirmative.
Ms. Marx announced that the department's goal was not to
penalize. She stressed that the department's goal was
education.
10:50:21 AM
Co-Chair MacKinnon remarked that with no cap on attorney
fees there was no incentive to settle, but she stressed
that those were her words and not the letter's words. Ms.
Marx replied that the bill did not remove the statute of
limitations. She stated that there was currently a
provision in the act that said that once a claim was filed,
and if an employer denied it, the employee must ask for a
hearing within two years.
Co-Chair MacKinnon noted the more penalties and hostile
business work environment. She asked for more information
about Section 11. Ms. Marx reiterated that with the
efficiencies there would be an end to the protracted
litigation, which would reduce attorneys' fees. She stated
that Section 11 sets forth the process for what happens
after a civil penalty was assessed. She explained that the
goal was not to put employers out of business, so it
allowed for a payment plan.
Co-Chair MacKinnon wanted to work to balance employees and
employers interest. Ms. Marx agreed.
Ms. Marx discussed slide 11, "REDUCE ADMINISTRATIVE COSTS:
SECS. 2-6, 13, 15-18, 22, 24, 27, 30, 33-34, 41, 43":
Current law
An employer pays benefits by check
Division may not require electronic filing
Division approval needed for corporate executive
officer workers' compensation coverage opt out
HB 79
Does not prescribe a specific method of payment
(Sec. 41)
Division may prescribe filing format (Secs. 3-6,
16-18, 22, 24, 27)
Division approval not required; not an employee
if at least 10 percent ownership interest (Sec.
33)
10:55:25 AM
Ms. Marx looked at slide 12, "REDUCE ADMINISTRATIVE COSTS
CONT.: SECS. 2-6, 13, 15-18, 22, 24, 27, 30, 33-34, 41, 43":
Current law
Some medical publications not listed
No deadline for reporting initial coverage; 10
day deadline for termination of coverage and no
penalty if late
Division administers contribution to and
reimbursement from Second Injury Fund
HB 79
Adds publications to list (Sec. 15)
30 day deadline to report initial coverage and
termination of coverage, and penalty if late
(Sec. 13)
Phases out Second Injury Fund (Secs. 2, 30, 34,
41, 43)
Ms. Marx addressed slide 13, "ENSURE ADEQUATE FUNDING: SEC.
1":
Current Law
Worker's compensation insurers pay a fee of 2.7
percent of net workers' compensation premium
written
1.82 percent to WSCAA and 0.88 percent to Alaska
Comprehensive Health Insurance Fund (ACHI)
HB 79
NO CHANGE
2.5 percent to WSCAA and 0.2 percent to ACHI
10:58:10 AM
Vice-Chair Bishop wanted an explanation of the Workers'
Safety and Compensation Administration Account (WSCAA)
funds. Ms. Marx replied that the funds were dedicated
funding to ensure that workers' compensation and safety
programs operated and sufficient funding.
Co-Chair MacKinnon requested that a sectional analysis be
presented the following day.
Co-Chair MacKinnon queried closing comments. Commissioner
Drygas replied in the negative.
Co-Chair MacKinnon discussed the following meeting's
agenda.
CSHB 79(FIN) was HEARD and HELD in committee for further
consideration.
SENATE BILL NO. 185
"An Act relating to reemployment of persons who retire
under the teachers' retirement system."
SB 185 was SCHEDULED but not HEARD.
ADJOURNMENT
11:00:41 AM
The meeting was adjourned at 11:00 a.m.