Legislature(2005 - 2006)BELTZ 211
03/22/2005 01:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| SB140 | |
| SB137 | |
| SB130 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 137 | TELECONFERENCED | |
| *+ | SB 140 | TELECONFERENCED | |
| += | SB 130 | TELECONFERENCED | |
SB 130-WORKERS' COMPENSATION
CHAIR CON BUNDE announced SB 130 to be up for consideration.
BARBARA WILLIAMS, Alaska Injured Workers Alliance, did not
support SB 130, because rolling back the rates would lead to a
bigger shortage of physicians to treat injured workers. Further,
she said it didn't address the problems with the fee schedule.
Some health care providers the Alliance surveyed hold a fee
schedule and regularly have their bills reduced below the rate
set out in it. She stated:
This would mean that globally, if insurance review
companies are reducing payments, there is no clear
idea of how much a company is saving on medical costs.
What it does reveal to us is that the medical costs
are already being cut. It also tells us that not only
are insurance companies saving money, but they are
providing little information on what those savings
might be.
We also have no enforcement of the current fee
schedule. It would appear that there is more cost
shifting here than enforcement of this current fee
schedule. We need reliable data and information to
address these costs.
Her survey has information from an audit review indicating that
the bills are being reduced at Providence Hospital. Regarding
medical benefits, she said:
We do not believe that a preferred provider list or a
drug list would be appropriate for Workers'
Compensation. This further limits the care and drugs
workers could potentially receive and insurance
companies now have control over what they are willing
to pay for. The current law does not provide for
preauthorization of service and pushing a list of
providers and drugs would further complicate an
already complex process.
Equally, the injured employees would like to suggest
the employer is to be held to an independent medical
evaluator provider list. Injured workers would like to
see only one doctor at a time unless a referral is
provided. Right now, currently, injured workers are
subject to panels of doctors paid for by employers.
Adjudication of claims - We do not feel the proposed
education would better serve injured workers or
employers. There is currently no education process to
explain to them how they should participate in the
adjudication process. Complex changes in the proposed
bill will, in our view, increase time delay appeals to
about the same time that we're currently looking at.
Additionally, we do not feel that an over panel should
have the authority to set precedence over Superior and
Supreme Court. The balance must be restored to the
impartial process to create a fair chance for all
parties. We're giving a lot of power to an unbalanced
board or division and we feel this is wrong.
Retraining benefits - We feel that a clear retraining
process that provides results for injured workers
would be of greater benefit than the proposed bill.
Injured workers know little or nothing about the
retraining process and this will add more red tape and
confusion to an already complex part of the benefits
available to injured workers. Workers need to
understand and not guess about what benefits they
need.
Overall, we know that the personnel in the division
have little or no training on the complex hearing
process, the Workers' Compensation Act and little or
no medical training. Yet, they must make complex
decisions based on the information that is available
to them. We need to encourage training for all staff,
make benefits more clear and base rate increases on
tangible, factual data. We do not need to make
sacrifices for the sake of expediency, but we do need
to make informed changes based on facts. We have
little or no information on the complex [indisc.]
medical costs, rehabilitation, retraining benefits and
know the hearing process is far from impartial....
Legal counsel would not become more available unless
defense costs are fully reported. Plaintiff attorneys
are making approximately 50 cents on the dollar while
defense attorneys get dollar for dollar what they bill
for. Why not drop the defense costs to match that of
injured workers to contain costs?
Insurance premiums should be frozen until we can
figure out this mess so that employers are not
overcharged for their insurance product. Hiring
advocates in theory is good, but who wants the job?
Legal services is a non-profit and Alaska pro bono
programs are not geared for Workers' Compensation. At
minimum, it could potentially take up to two years for
them to get the nuances of the program as well as the
practices and procedures. We urge you not to pass this
bill....
MS. WILLIAMS said that a bill from Providence Hospital was
$14,000 and by not utilizing the proper fee schedule, it
collected only $11,000. She said there is no mechanism to report
accurate figures to the Division of Workers' Compensation.
2:37:57 PM
CHAIR BUNDE asked who belongs to her organization.
MS. WILLIAMS replied that the Alaska Injured Workers Alliance is
a non-profit organization educating injured workers. It is
partnering with Alaska Public Interest Research Group Alaska
Public Interest Research Group (AKPIRG) on this issue, because
she feels there are consumer issues involved.
2:38:56 PM
JERRY FLOCK, injured worker, said he has fallen through every
possible crack in the current system. "Because my employer was
uninsured, my employer got to pick what medical it would and
would not pay for."
He said there have been problems with workers' compensation for
a while. An audit report dated October 31, 1999, was written
about the insufficiencies of workers' compensation. SB 130 is
just a bandaid. The Division of Workers' Compensation already
has police powers. In his case, the state had to pay $10,000 for
an operation, because his employer wasn't insured. His employer
had an annual edit error and there is a $10,000 fine for that
and $100 per day fine for 10 days afterwards.
That means this employer owes the state a total of
$77,000. Will the state go for it? No, they don't go
for it. They don't even ask for it, but yet the state
will come after me for a $10,000 surgery that they
paid for.
2:44:58 PM
MR. FLOCK discussed the penalty section and how his employer
allowed his insurance to lapse 18 times, but was still able to
get a business license.
2:46:03 PM
CHAIR BUNDE said his point is well-taken. He said even though
Mr. Lisankie couldn't comment on Mr. Flock's case, he wanted to
know what enforcement tools the division has and how well they
are being used on people who drop their insurance.
2:46:28 PM
PAUL LISANKIE, Director, Division of Workers Compensation,
replied that he didn't have the specifics of Mr. Flock's case,
but it is well-known in the division. This is why he has
mentioned to the committee that the division needs some kind of
a hammer to get on top of an uninsured employer quickly rather
than to try to come in after the fact and clean up the mess. Mr.
Flock's testimony indicated how difficult it is to get anything
once a problem has transpired.
He disagreed that this bill doesn't change anything, however.
Under this bill, the director of the division could order a stop
work order immediately, as opposed to what happens now where an
investigator comes back, gets a hearing scheduled before the
Workers' Compensation Board and then there is a hearing to
decide if the employer is still uninsured at that moment.
I have no doubt that there are employers that do run
without insurance for a period of time. If they get
detected, their normal response oftentimes is to bring
their insurance current and go forward. That can be a
recurrent problem and that would be some of the
factors that would be considered under this
bill...that the board could consider how much to fine
that employer.
I think also based on Mr. Flock's testimony, which is
eloquent as far as what happens when you get court
orders and then you try to enforce them in the court
system against somebody who may or may not have
money....
2:49:23 PM
CHAIR BUNDE remarked that it is hard to collect money from
someone who doesn't have it. He said he would continue taking
public testimony on Thursday and would address a CS one week
from today. There being no further business to come before the
committee, he adjourned the meeting at 2:51:19 PM.
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