Legislature(2009 - 2010)HOUSE FINANCE 519
04/17/2009 01:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB133 |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 165 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 75 | TELECONFERENCED | |
| += | SB 177 | TELECONFERENCED | |
HOUSE FINANCE COMMITTEE
April 17, 2009
12:30 p.m.
12:30:27 PM AT EASE
12:33:59 PM RECONVENED
CALL TO ORDER
Co-Chair Stoltze called the House Finance Committee meeting
to order at 12:30 p.m.
MEMBERS PRESENT
Representative Mike Hawker, Co-Chair
Representative Bill Stoltze, Co-Chair
Representative Bill Thomas, Jr., Vice-Chair
Representative Allan Austerman
Representative Harry Crawford
Representative Anna Fairclough
Representative Richard Foster
Representative Les Gara
Representative Reggie Joule
Representative Mike Kelly
Representative Woodie Salmon
MEMBERS ABSENT
None
ALSO PRESENT
Senator Joe Paskvan; Larry Persily, Staff, Co-Chair Hawker;
William Streur, Deputy Commissioner, Medicaid & Health Care
Policy, Department of Health and Social Services; Jay Livey,
Staff, Senator Hoffman; Erin Harrington, Staff,
Representative Austerman; Representative Nancy Dahlstrom
PRESENT VIA TELECONFERENCE
Paul Sherry, Alaska Native Tribal Health Consortium,
Fairbanks
SUMMARY
CSSB 133(FIN)
"An Act creating a statewide electronic health
information exchange system; and providing for an
effective date."
HCS CSSB 133 (FIN) was REPORTED out of Committee
with a "do pass" recommendation and with fiscal
note #2 by the Department of Health and Social
Services.
SB 88 "An Act repealing certain provisions relating to
modifying the factors that apply to calculate the
amount of power cost equalization; providing for
an effective date by repealing the effective date
of sec. 3, ch. 2, 4SSLA 2008; and providing for an
effective date."
SB 88 was REPORTED out of Committee with a "do
pass" recommendation and with a new fiscal note by
the Department of Commerce, Community and Economic
Development.
CSSB 177(FIN)
"An Act relating to an exception for professional
fishing guide services in the Kenai River Special
Management Area; relating to the licensing and
regulation of sport fishing operators and sport
fishing guides and licensing and registration of
sport fishing vessels; and providing for an
effective date."
CSSB 177 (FIN) was scheduled but not heard.
CS FOR SENATE BILL NO. 133(FIN)
"An Act creating a statewide electronic health
information exchange system; and providing for an
effective date."
12:35:06 PM
SENATOR JOE PASKVAN, SPONSOR, reported that the state has a
flawed medical system in that hospitals, doctors,
pharmacies, and clinics, cannot communicate with each other.
The bill seeks to correct that flaw to save lives, provide
better medical care, and to save money. The legislation is
designed to develop a health information exchange system to
connect labs, clinics, individual practitioners,
pharmacists, and existing hospitals so that they can
communicate in order to provide the best quality of care to
each Alaskan. The network will allow individual Alaskans to
have their own personal health record and to authorize their
health care providers to exchange electronic medical records
in a timely manner. Most importantly, it will help to
reduce the risk of drug interactions and misdiagnosis, and
reduce administrative costs.
Senator Paskvan emphasized that the risk of delay matters.
There is a risk of fracturing the components of the medical
system. The money invested will be a prudent part of a
system that will be able to communicate internally. There
are FCC monies available, as well as private grants. Any
delay is a potential risk of loss of life and loss of money.
Senator Paskvan pointed out that a project like this demands
caution regarding privacy. The bill protects Alaskans'
privacy rights beyond those provided in HIPPA. It includes
a system by which patients can see who has viewed their
records. There are restrictions on how the information can
be used and on patient consent requirements, and an ability
to opt out of the network. There are notification
requirements with respect to confidentiality violations.
Senator Paskvan informed the Committee that studies show
that health care expenditures may be reduced by 5 percent a
year or $250 million annually in Alaska with $10 million
saved annually in Medicaid costs.
12:38:24 PM
Senator Paskvan highlighted the flaws in the national system
th
as discovered by the September 11 tragedy. He stated that
those flaws are being corrected. The purpose of SB 133 is
to modernize the communication system within the Alaska
health care system and save lives. The signing of the
American Recovery and Reinvestment Act (ARRA) has presented
Alaska an amazing opportunity to modernize its healthcare
infrastructure. Millions of dollars are available to states
that take early action to improve the quality and efficiency
of care, which will save lives through the use of an
electronic health information system.
Senator Paskvan spoke of those who support the legislation:
the Alaska Veterans Administration Health Care System, the
Alaska State Medical Association, the Alaska Primary Care
Association, Alaska State Hospital and Nursing Home
Association, Alaska Native Tribal Health Consortium, the
Bristol Bay Area Health Consortium, Providence Hospital
Systems, Alaska Regional, Fairbanks Memorial Hospital,
Norton Sound Regional, Mat-Su Regional, Premera Blue Cross,
AARP, Commonwealth North, private practices, hospitals, and
individuals from around the state.
12:40:47 PM
Representative Kelly requested that his questions be
answered when he returns.
LARRY PERSILY, STAFF, CO-CHAIR HAWKER, shared information as
it relates to the economic stimulus funds - HB 199. He
related that HB 199 contains money for electronic medical
records. A more detailed estimate about the amount of money
required and the amount of stimulus funds available has
since been obtained, which is reflected in the fiscal note.
If this legislation were to pass, the state is looking at
about $25 million in federal stimulus funds to help set up
the health information electronic exchange. There are also
funds available to health care providers statewide to
convert offices to electronic medical records.
Co-Chair Stoltze noted that the funds are front-loaded and
time is of the essence. Mr. Persily agreed that the sooner
the state moves, the higher the federal match. Waiting
would cost the state money.
12:43:18 PM
Representative Fairclough requested information about the
penalties for violating security measures. Senator Paskvan
replied that there were privacy regulations under (ARRA).
Representative Fairclough read from the bill on page 5,
lines 14 and 15, "meet the most stringent applicable federal
or state privacy law governing the protection of the
information contained in the system." She inquired about
the specifics in state or federal law that protects people's
information. Senator Paskvan spoke of federal protections
such as Health Insurance Portability and Accountability Act
(HIPAA). This bill provides additional protections such as
the patient being able to see who has viewed their records,
restrictions on the use of information, and the inclusion of
patient consent. There is also an opt-out provision.
12:46:07 PM
Mr. Persily added that accepting the Stimulus Act funds
connects the state with penalties and tight restrictions
under the act itself. Representative Fairclough emphasized
that it was important to understand the penalties. She
requested to know if the penalties were misdemeanors or
felonies, and what the consequences were. Mr. Persily
offered to provide that information.
12:47:56 PM
Senator Paskvan reported on HIPAA consequences and
penalties:
Clarification of Penalties under the HIPAA Privacy and
Security Regulations
Section 13410 of the Stimulus provides for a tiered increase
of Civil Monetary Penalties (CMP) up to a maximum of 1.5
million dollars depending on aggravating factors. The
Stimulus also provides for the enforcement of HIPAA by State
Attorney Generals.
A wrongful disclosure under HIPAA (as modified by the
Stimulus) occurs when a person obtains or discloses PHI
maintained by a covered entity and the disclosing party has
not obtained an authorization for the disclosure (Section
13409).
Standard of Penalty Maximum Penalty
Culpability
Did not know of the Corrective action No penalty -
violation and by without penalty however, subject to
exercising discretion of
reasonable Secretary.
diligence would not
have known of
violation
Unknowing At least $100 per Not to exceed
Violations violation $25,000 in a
calendar year
Unknowing At least $100 per Not to exceed
Violations violation $25,000 in a
calendar year
Violation due to At least $1,000 per Not to exceed
reasonable cause, violation $100,000 in a
not willful neglect calendar year
Violation due to At least $10,000 Not to exceed
willful neglect per violation $250,000 in a
calendar year
Violation is due to At least $50,000 Not to exceed
willful neglect and per violation $1,500,000
the violation is
not corrected
within 30 days of
the first date the
person liable for
the penalty knew or
should have known
that the violation
occurred
State attorneys general now have the authority to bring suit
in federal district court against any person violating the
rules on behalf of state residents to enjoin further
violation or to obtain damages on behalf of such residents.
Representative Fairclough requested a copy.
Co-Chair Stoltze referred to page 4 of the bill and wondered
where the "small players" were on the advisory board.
Senator Paskvan responded that the board has to be of
sufficient size to manage health care issues. Co-Chair
Stoltze commented that it is sometimes hard to find members
without huge financial interests to serve on boards.
12:52:00 PM
Representative Gara asked how many other states have done
this. Senator Paskvan replied that between 15 and 25 other
states had. Representative Gara observed that it was a
"good effort" bill and would be effective if everyone
participated.
12:53:38 PM
Mr. Persily pointed out that the electronic medical records
requirement is a federal requirement. President Bush had
set a deadline for 2009, which he pushed back to 2014. The
money that is available to healthcare providers continues to
2014 under the assumption that it will take that long to
convert.
Representative Fairclough asked if there would be a method
to track narcotics use. Senator Paskvan thought abuse would
be obvious under the tracking system. Mr. Persily thought
the drug addict would use the opt-out provision.
12:55:55 PM
Senator Paskvan stated that a primary reason for this
legislation is for use during emergency treatment. Having
access to medical records would be important at that time in
order to do no harm.
Representative Fairclough expressed concern about security.
She wondered if insurers would receive the data and use it
against the patient. She asked if there was a provision
that would allow an override of the opt-out provision.
Senator Paskvan thought that patients would control their
own information. Representative Fairclough reiterated
concern about the breaching of electronic information.
12:58:18 PM
Representative Foster referred to page 1, item 2, on the
question and answer sheet and said it should say Norton
Sound. Senator Paskvan said Norton Sound does strongly
support this legislation as a member of the Alaska State
Hospital and Nursing Home Association.
Senator Paskvan added, in response to a previous question by
Representative Keller, that the patient's record will stay
the patient's record.
Mr. Persily reiterated that the privacy issue was addressed
by state and federal laws, as well as by provisions in the
stimulus bill.
WILLIAM STREUR, DEPUTY COMMISSIONER, MEDICAID & HEALTH CARE
POLICY, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, related
that the administration's position is concern about overall
cost and the long-term affect to the state. He emphasized
that currently funds are limited. He pointed out that
bringing on an electronic health information exchange is
inevitable by 2014. After 2015 a Medicare provider will
have to bill electronically. He noted that with $5 billion
available nationwide, there is a lot of support for the
system.
Co-Chair Hawker questioned if there would be a $100 billion
deficit next year. Mr. Streur corrected that he said a
billion dollar deficit.
Mr. Persily pointed out, in reference to a question by
Representative Keller, that patients' rights to their own
records would not change. The stimulus act clearly states
the patients' rights to their own records would remain.
Representative Kelly inquired about the membership on the
board. Senator Paskvan reiterated the need for a workable
number of members on the board. The meetings are public and
open to public participation. Senator Paskvan wished to
promote the legislation as currently drafted.
1:06:28 PM
Representative Austerman wanted to understand the
administration's position. He asked if the administration
supports accepting the stimulus money. Mr. Streur stated
that the administration supports the concept of health
information exchange and technology, but is neutral
regarding the bill.
Vice-Chair Thomas thought the legislation was a good vehicle
to public health and safety and contradicted the governor's
earlier stance. He wondered if the cost was the issue.
Mr. Streur thought it had more to do with what is attainable
and available in the budget.
1:09:01 PM
Vice-Chair Thomas asked for the administration's explanation
of the fiscal note. Mr. Streur reported that the fiscal
note was prepared by the Department of Health and Social
Services for the administration.
Vice-Chair Thomas thought the legislation was important
because it would stop doctor shopping and addiction to
prescription drugs.
Representative Joule asked about the fiscal note which
assumes 90 percent federal funding. Mr. Persily reported
that it would bring $25 million federal dollars to the state
in FY 10.
1:11:34 PM
Representative Fairclough asked about the fiscal note and
whether there were figures on user fees or discussion of a
commitment of a year or two to offset costs. Mr. Persily
had not looked at user fee analysis. He offered to provide
that information.
1:12:47 PM
Representative Austerman questioned the term "self-
sustaining" in the fiscal note because of the required $1
million each year in general funds. Senator Paskvan called
that amount the state's user fee. Mr. Streur clarified that
it was a user fee for Medicaid recipients.
Co-Chair Hawker understood that there would be money
available to develop the system for five years, after which
it would be self-sustaining. Mr. Streur agreed.
Representative Fairclough asked if the federal government
has set a user fee. Mr. Streur replied that they have not.
Representative Fairclough asked if the user fee is an
estimation of what the federal government might establish
for Medicaid. Mr. Streur reported that the state estimated
how much it would need to support the system.
Representative Fairclough suggested that the number of
patients who would access the system and frequency was
known. Mr. Streur explained that that information is not
known at this time. He said, "We backed into it."
1:15:52 PM
Co-Chair Stoltze opened public testimony.
PAUL SHERRY, ALASKA NATIVE TRIBAL HEALTH CONSORTIUM,
FAIRBANKS, testified via teleconference. He spoke of his
role as president of the Alaska eHealth Network, which has
been working with Senator Paskvan to develop the bill.
Alaska eHealth Network hopes to be the entity designated by
the state to develop the health information exchange. He
referred to a handout provided, "Deploying a Health
Information Exchange for Alaskans" (copy on file).
Mr. Sherry spoke of a partnership of the various
stakeholders working to move the initiative forward. They
looked at other states' networks. Most states have some
sort of health information exchange. The partnership
believes that in Alaska there should be one statewide
exchange system.
Mr. Sherry addressed the work done on privacy standards. He
clarified that they are not creating a central depository
for records. He spoke of long-term savings to the state of
about 20 percent annually, a major reason for bringing this
project forward.
1:20:59 PM
Co-Chair Stoltze closed public testimony.
1:22:01 PM
Representative Kelly MOVED to adopt Conceptual Amendment 1:
Page 4, line 21
Insert (3) two non-voting liaison members to enhance
communication and collaboration between the designee
and the;
(A) Alaska Healthcare Policy Commission;
(B) University of Alaska
Co-Chair Stoltze OBJECTED.
Representative Kelly explained the amendment. It requests a
communication path be created with the Alaska Healthcare
Policy Commission and the University of Alaska.
1:22:55 PM
Representative Austerman questioned which version of the
bill the amendment addressed. Co-Chair Hawker clarified
where the amendment would be located.
Senator Paskvan thought the amendment was not harmful, but
was not necessary.
Representative Kelly encouraged support of the amendment.
Co-Chair Stoltze WITHDREW his objection. There being NO
OBJECTION, it was so ordered.
1:25:56 PM
Co-Chair Stoltze noted that the fiscal note had been
discussed.
Representative Joule MOVED to report CSSB 133 (FIN) out of
Committee with individual recommendations and the
accompanying fiscal note.
Representative Joule WITHDREW his motion.
AT-EASE: 1:26:38 PM
RECONVENED: 1:27:50 PM
Representative Joule MOVED to report CSSB 133 (FIN) out of
Committee with individual recommendations and the
accompanying fiscal note. There being NO OBJECTION, it was
so ordered.
HCS CSSB 133 (FIN) was REPORTED out of Committee with a "do
pass" recommendation and with fiscal note #2 by the
Department of Health and Social Services.
1:29:28 PM
SENATE BILL 88
"An Act repealing certain provisions relating to
modifying the factors that apply to calculate the
amount of power cost equalization; providing for an
effective date by repealing the effective date of sec.
3, ch. 2, 4SSLA 2008; and providing for an effective
date."
JAY LIVEY, STAFF, SENATOR HOFFMAN, summarized that Power
Cost Equalization (PCE) is a program that provides
assistance to residents in rural areas to be able to
purchase electricity at more affordable prices. He
requested consideration of the bill.
ERIN HARRINGTON, STAFF, REPRESENTATIVE AUSTERMAN, echoed Mr.
Livey's comments.
Co-Chair Stoltze closed public testimony.
1:31:06 PM
Mr. Livey addressed the fiscal note, which would add about
$5.5 million in general fund costs if the PCE formula were
to change from 52 cents to $1.
Vice-Chair Thomas emphasized that this bill was a priority.
Representative Austerman thanked the Committee for its work
on the bill.
Representative Austerman MOVED to report SB 88 out of
Committee with individual recommendations and the
accompanying fiscal note. There being NO OBJECTION, it was
so ordered.
SB 88 was REPORTED out of Committee with a "do pass"
recommendation and with a new fiscal note by Department of
Commerce, Community and Economic Development.
1:33:24 PM
Co-Chair Hawker pointed out that the fiscal note was a
notational note and the amount was already funded in the
operating budget. Whichever bill passes will be funded.
Representative Foster commended the Committee for its work
on PCE.
1:35:11 PM
Representative Gara requested that testimony be allowed on
SB 75 as it pertains to the governor's gas line budget
request.
RECESSED: 1:35:37 PM
ADJOURNMENT
The meeting was adjourned at 4:40 PM.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Government Hill Community Council Support Letter.pdf |
HFIN 4/17/2009 1:30:00 PM |
SB 165 |
| ASD Letter of Support.pdf |
HFIN 4/17/2009 1:30:00 PM |
SB 165 |
| SB 165 sponsor statement.pdf |
HFIN 4/17/2009 1:30:00 PM |
SB 165 |
| RR letter of support.pdf |
HFIN 4/17/2009 1:30:00 PM |
SB 165 |
| SB 75 HFC Amendments 1 - 3.pdf |
HFIN 4/17/2009 1:30:00 PM |
SB 75 |
| HCSSB 75 Version U 041709.pdf |
HFIN 4/17/2009 1:30:00 PM |
SB 75 |
| SB 75 Amendment 4 Glenn culvert.doc |
HFIN 4/17/2009 1:30:00 PM |
SB 75 |