Legislature(2009 - 2010)HOUSE FINANCE 519

04/14/2009 08:30 AM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Delayed to 5 min. after Conf. Cmte. --
Heard & Held
Moved Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
HOUSE BILL NO. 222                                                                                                            
     "An  Act  prohibiting  discrimination   by  health  care                                                                   
     insurers  based  on  genetic  information;  requiring  a                                                                   
     health care insurer to offer  coverage for the treatment                                                                   
     of  alcoholism or  drug abuse;  providing continuity  of                                                                   
     coverage   for   college   students   during   medically                                                                   
     necessary  leaves  of absence  from  college;  requiring                                                                   
     health  care insurers  in  the group  market to  provide                                                                   
     parity   in  the  application   of  mental   health  and                                                                   
     substance  abuse  benefits   that  comply  with  federal                                                                   
     requirements;  amending the  definition of 'dentist'  to                                                                   
     include  out-of-state dentists  for purposes of  certain                                                                   
     dental  insurance  requirements;  and providing  for  an                                                                   
     effective date."                                                                                                           
REPRESENTATIVE  LINDSEY HOLMES,  SPONSOR, explained  that the                                                                   
bill  implements  federal law.    It  gives the  Division  of                                                                   
Insurance  the ability  to implement  new  federal laws  that                                                                   
will kick  in this  summer.  She  summarized the  sections of                                                                   
the bill:                                                                                                                       
     Section 1: This section incorporates requirements in 42                                                                    
     U.S.C. 300gg-53 into state law. 42 U.S.C. 300gg-54                                                                         
     prohibits health care insurers from discriminating                                                                         
     against individuals on the basis of genetic                                                                                
     information. It prohibits health care insurers from                                                                        
     requiring individuals to undergo genetic testing  as a                                                                     
     condition of insurance.                                                                                                    
     Section 2: This section changes the requirements for                                                                       
     insurance coverage for treatment of alcoholism or drug                                                                     
     abuse. Currently, insurers are mandated to provide                                                                         
     coverage for treatment of alcoholism and drug abuse to                                                                     
     employer groups with 20 or more employees and mandates                                                                     
     that insurers offer such coverage to employer groups                                                                       
     with fewer than 20 employees.  This section would                                                                          
     replace that mandate and only require insurers to offer                                                                    
     coverage for substance abuse to all employer groups.                                                                       
     Under the mental health parity provisions in Section 6                                                                     
     of the bill insurers are prohibited from placing limits                                                                    
     on substance abuse coverage that are not placed on the                                                                     
     general medical coverage of the plan.                                                                                      
     Section 3: This section amends the definition of                                                                           
     dentist for insurance purposes to cover dentists who                                                                       
     are not licensed in Alaska.                                                                                                
     Section 4: This section incorporates requirements in 42                                                                    
     U.S.C. 300gg-54 and 42 U.S.C. 300gg-7 into state law.                                                                      
     Those sections of federal statute require that health                                                                      
     care insurers continue to cover college students under                                                                     
     their parent's health insurance coverage when the                                                                          
     students take leave from school for medical reasons.                                                                       
     Section 5: This section has two changes to enrollment                                                                      
     requirements for employees who are eligible for their                                                                      
     employer's health insurance plans but have previously                                                                      
     chosen to not enroll in that plan. The first change                                                                        
     allows a person who was covered by Medicaid or similar                                                                     
     plan and loses eligibility for that plan, to enroll in                                                                     
     their employer's health insurance plan. The second                                                                         
     change allows a person to enroll in their employer's                                                                       
     health insurance plan if they become eligible for                                                                          
     assistance to help pay for their employer's health                                                                         
     insurance plan from Medicaid or a similar plan.                                                                            
     Section 6: This section incorporates requirements in 42                                                                    
     U.S.C. 300gg-5 to apply to state law. The federal                                                                          
     requirements are that a health care insurer may not                                                                        
     place restrictions on mental health and substance use                                                                      
     coverage in an insurance plan that are not placed on                                                                       
     the general medical coverage of that plan.                                                                                 
     Section 7: This section provides an effective date for                                                                     
     section 1 of the bill.                                                                                                     
     Section 8: This section provides an effective date for                                                                     
     sections 4 and 6 of the bill.                                                                                              
9:59:48 AM                                                                                                                    
Co-Chair Hawker  inquired why Representative Holmes  chose to                                                                   
sponsor  this legislation.   Representative  Holmes  reported                                                                   
that Linda  Hall, the Director  of the Division  of Insurance                                                                   
in  the  Department  of  Commerce,   Community  and  Economic                                                                   
Development, requested the bill.                                                                                                
Representative  Kelly  voiced   concern  about  the  lack  of                                                                   
doctors who will see Medicare  patients.  He pointed out that                                                                   
the  Division of  Insurance will  now be  required to  expand                                                                   
services.   He was  concerned about  senior medical  coverage                                                                   
under a "leveling" program.                                                                                                     
10:04:13 AM                                                                                                                   
Co-Chair  Hawker shared  those concerns.   He requested  more                                                                   
LINDA HALL,  DIRECTOR, DIVISION  OF INSURANCE, DEPARTMENT  OF                                                                   
COMMERCE, COMMUNITY  AND ECONOMIC DEVELOPMENT,  observed that                                                                   
all  items in  the bill,  with  the exception  of the  dental                                                                   
definition,  are federal  mandates that  will be adopted  and                                                                   
enforced on a  federal level.  The request  is to incorporate                                                                   
them into Alaska  law for enforcement reasons  and to prevent                                                                   
conflicts,  particularly  in the  mental  health  area.   The                                                                   
federal  laws  will  preempt  state  laws  and  will  present                                                                   
conflicts.   She  emphasized that  the  federal mandates  are                                                                   
geared to larger employees and,  if coverage is offered, then                                                                   
it will be on parity with the other health plan.                                                                                
10:06:58 AM                                                                                                                   
Representative Kelly  did not want  the seniors to  buy their                                                                   
insurance in the  same category with drug abusers  and mental                                                                   
health patients.   He maintained  that the bill is  not going                                                                   
to  help seniors  obtain  health  insurance.   He  called  it                                                                   
Co-Chair  Hawker concurred  that it was  an unfunded  federal                                                                   
mandate.  He asked if the Division  of Insurance supports the                                                                   
Ms. Hall  reported that  the Division  of Insurance  supports                                                                   
the  legislation.   Co-Chair  Hawker  asked  if the  governor                                                                   
supports  the  bill.   Ms.  Hall  replied that  the  governor                                                                   
authorized the bill.                                                                                                            
Co-Chair  Hawker spoke  of the problematic  issue of  holding                                                                   
the  legislature responsible  for  the outcome  of the  bill.                                                                   
Ms.  Hall reported  that she  is  looking at  the ability  to                                                                   
enforce health insurance provisions.                                                                                            
10:10:00 AM                                                                                                                   
Representative  Kelly asked if  Ms. Hall requested  the bill.                                                                   
Ms. Hall said she did.                                                                                                          
Representative  Gara  thought Ms.  Hall  was  in a  difficult                                                                   
position.    Ms.  Hall  said she  had  listened  to  previous                                                                   
discussions and implied that she  was aware of the situation.                                                                   
Representative   Gara   understood   Representative   Kelly's                                                                   
concerns.   He  shared his  understanding  of the  bill.   He                                                                   
thought it  was a constituent  service bill.  He  described a                                                                   
scenario of  what would happen  if the  bill does pass.   Ms.                                                                   
Hall agreed.  He thought the bill was needed.                                                                                   
10:12:51 AM                                                                                                                   
Co-Chair  Hawker  didn't see  that  the legislature  had  any                                                                   
choice but to adopt the legislation.                                                                                            
Representative Fairclough  wanted to know the  effective date                                                                   
of the change.   Ms. Hall reported that there  were different                                                                   
effective dates.   The genetic information  nondiscrimination                                                                   
section is effective May 21, 2009;  the coverage of dependent                                                                   
students section  is effective  October 9, 2009;  the special                                                                   
enrollment  for Medicaid  and Denali  Kid Care-type  programs                                                                   
are effective  April 1,  2009; and  the mental health  parity                                                                   
section is effective January 1, 2010.                                                                                           
Representative Fairclough  asked when the  federal government                                                                   
passed the changes.   Ms. Hall reported on  enrollment dates,                                                                   
which  were recent.   Representative  Fairclough reported  on                                                                   
another  bill  which  contained   a  good  faith  effort  for                                                                   
extensions  for implementation.    She wondered  if that  was                                                                   
included  in  this  bill.   Ms.  Hall  thought  it  was  not.                                                                   
Representative  Fairclough commented  that  some state  might                                                                   
not  be meeting  in time  to address  these  changes, so  she                                                                   
assumed there was an extension provision.                                                                                       
10:15:47 AM                                                                                                                   
Co-Chair  Hawker reported  that the  same situation  occurred                                                                   
with the Federal Stimulus Act.                                                                                                  
Representative  Holmes  summarized  that  the  federal  rules                                                                   
would go  into effect,  but the  Director of Insurance  would                                                                   
have no ability to act in the  event that a constituent had a                                                                   
Representative Fairclough related  that the Committee has had                                                                   
many conversations about the federal  government overstepping                                                                   
into state rights.                                                                                                              
10:17:03 AM                                                                                                                   
Representative   Kelly  asked   for  information  about   the                                                                   
consequences if the legislation  is not passed.  Ms. Hall did                                                                   
not have  that information, but  thought that  the provisions                                                                   
of  the bill  would  be enforced  through  the Department  of                                                                   
Representative Kelly wished to know the exact consequences.                                                                     
Representative  Crawford  commented  that  he does  not  feel                                                                   
pressured by the  federal government at all.   He thought all                                                                   
requests were the right thing to do.                                                                                            
Co-Chair Hawker opened public testimony.                                                                                        
10:19:45 AM                                                                                                                   
JEFF JESSEE,  CHIEF EXECUTIVE  OFFICER, ALASKA MENTAL  HEALTH                                                                   
TRUST AUTHORITY, testified in  favor of HB 222.  He responded                                                                   
to Representative  Kelly's concerns.  One of  the concerns in                                                                   
the  health  care  system is  that  insurance  companies  can                                                                   
dictate  the  rules.   They  would  rather have  the  private                                                                   
sector  - government -  have the  primary responsibility  for                                                                   
providing  the  services.   When  people can't  get  coverage                                                                   
through  private insurance  for mental  health and  substance                                                                   
abuse problems,  the state  government ends  up paying.   The                                                                   
idea behind health  insurance is to spread the  risk across a                                                                   
group  of   people  for   their  medical  needs.   Currently,                                                                   
insurance companies have decided  not to meet certain groups'                                                                   
needs.    He  thought  the  bill  was  headed  in  the  right                                                                   
10:22:17 AM                                                                                                                   
Representative Kelly  asked if Mr. Jessee was  happy with the                                                                   
Medicare situation  in Alaska.   Mr.  Jessee related  that he                                                                   
was not.   He thought it  was imperative to deal  with health                                                                   
care  costs.   Representative  Kelly  talked  about what  has                                                                   
crippled the Medicare  system.  He commented  on the problems                                                                   
with the social security system.                                                                                                
Mr.  Jessee shared  some of  Representative Kelly's  concern.                                                                   
He  spoke  of   needing  to  keep  the  boat   from  sinking.                                                                   
Representative  Kelly  commented  that  the  problem  remains                                                                   
10:25:37 AM                                                                                                                   
Co-Chair Stoltze preferred to  move the bill out of Committee                                                                   
unless there was more testimony.                                                                                                
Co-Chair Hawker closed public testimony.                                                                                        
10:26:38 AM                                                                                                                   
Co-Chair Hawker pointed out the zero fiscal notes.                                                                              
Co-Chair  Stoltze MOVED  to report  HB 222  out of  Committee                                                                   
with individual  recommendations and the  accompanying fiscal                                                                   
notes.  There being NO OBJECTION, it was so ordered.                                                                            
HB  222  was REPORTED  out  of  Committee  with a  "do  pass"                                                                   
recommendation  and with  two new  zero fiscal  notes by  the                                                                   
Department of Health and Social  Services, and fiscal note #1                                                                   
by  the  Department  of  Commerce,   Community  and  Economic                                                                   

Document Name Date/Time Subjects
Frequently Asked Questions.pdf HFIN 4/14/2009 8:30:00 AM
HB 204
AARP.pdf HFIN 4/14/2009 8:30:00 AM
HB 204
HB222-DHSS-MS-04-11-09NEW.pdf HFIN 4/14/2009 8:30:00 AM
HB 222
HB222-DHSS-BHMS-04-11-09NEW.pdf HFIN 4/14/2009 8:30:00 AM
HB 222
HB 222 Sectional.pdf HFIN 4/14/2009 8:30:00 AM
HB 222
HB 222 Sponsor Statement.pdf HFIN 4/14/2009 8:30:00 AM
HB 222
Stateof AlaskaDeptHSS.pdf HFIN 4/14/2009 8:30:00 AM
HB 204
Sponsor Statement WWAMI (3).pdf HFIN 4/14/2009 8:30:00 AM
HB 204
Physician Shortage Fact Sheet Header.pdf HFIN 4/14/2009 8:30:00 AM
HB 204
HB 204 - Increase WWAMI Class Size.pdf HFIN 4/14/2009 8:30:00 AM
HB 204