Legislature(2017 - 2018)HOUSE FINANCE 519
02/12/2018 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB302 | |
| HB318 | |
| HB323 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 302 | TELECONFERENCED | |
| + | HB 318 | TELECONFERENCED | |
| + | HB 299 | TELECONFERENCED | |
| + | HB 323 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE BILL NO. 323
"An Act extending the termination date of the Board of
Pharmacy; and providing for an effective date."
Co-Chair Foster invited Representative Sullivan-Leonard to
proceed with her presentation.
2:01:27 PM
REPRESENTATIVE COLLEEN SULLIVAN-LEONARD, SPONSOR, explained
that HB 323 extended the Pharmacy Board from June 2018 to
June 2022. The adoption of the bill would continue existing
activities by the board and the administration by the
division. She highlighted that Legislative Audit did a
review of the board's operations and determined that it
would be in the best interest to extend the board for 4
years through June 30, 2022. The board was comprised of 7
members. She elaborated that 5 of the members were
pharmacists and the other 2 were public members. In March
2018 the board would have a full composition for the board.
The board met 4 times yearly.
Representative Sullivan-Leonard continued that the board
regulated admission into the practice of pharmacy. They
established and enforced compliance with professional
standards and adopted regulations. The board also
established and maintained a controlled substance
prescription database as well as the administration of
vaccines, emergency medications, and opioid overdose drugs.
It oversaw licensing of pharmacists, pharmacy interns,
pharmacy technicians, and pharmacies. It oversaw wholesale
drug distributors located inside and outside the state if a
pharmacy shipped, mailed, or delivered prescription drugs
within Alaska. She conveyed the available testifiers.
Representative Wilson asked the board chair if he saw any
reason why the legislature should not provide an 8-year
extension to the board.
LEIF HOLM, CHAIR, BOARD OF PHARMACY, NORTH POLE (via
teleconference), offered that he would agree more with an
8-year extension. The board had accepted a 4-year extension
based on some conversations back and forth. Some wanted to
see how the new prescription drug monitoring program (PDMP)
legislation went through. how it was managed, and the
effect it had on opioids and the general running of the
PDMP. It appeared that the auditors would prefer to look at
the issue in 4 years again as opposed to waiting for 8
years. He suggested that all of the changes that had been
made legislatively with the PDMP, there was nothing but a
positive direction it would go in. He did not foresee any
issues going forward. He thought 8 years would be a fair
number of year but would accept 4.
Representative Wilson asked if the board had any issues
implementing new statutes or regulations in the past.
Mr. Holm responded that the pharmacy world was ever
evolving. It was difficult to keep up with the changes. He
hoped to get the help needed to keep up with industry
trends, standards, and legislative changes. Any changes
required of the industry through Alaska's State Legislature
had not been difficult to get through besides the standard
hang-ups of legal and law. In answer to Representative
Wilson's question he would say no. However, as an industry
as a whole, it was consistently struggling to keep up with
industry standards and changes.
2:06:36 PM
Representative Guttenberg asked if, with the state's
prescription drug manager dispensing drugs, the business
bifurcated. In other words, was one side a licensed
pharmacy and the other side a PBM that was not regulated at
all.
Mr. Holm responded affirmatively. It was not necessarily a
board issue, but it was the current situation. Nationwide
PBM were not under any kind of regulation or rules. It was
an issue he was dealing with in pharmacy.
2:07:29 PM
Representative Kawasaki asked about the Legislative Audit
review. Mr. Holm had relayed the pharmacy regulations were
changing rapidly. One of the big changes that came under SB
74 [Legislation passed in 2016, Short Title: Medicaid
Reform; Telemedicine; Drug Database] was that pharmacists
had to register with the prescription drug database.
Failure to do so was against the law and required
disciplinary action. He asked if the board had had to
discipline any pharmacists that were not registered with
the database.
Mr. Holm responded in the negative. The requirement for
everyone to register was still fairly new. They were still
monitoring who had not registered and sending out
notifications about registering. He considered it a grace
period trying to get everyone onboard. The board was having
a good response. However, there were people who were not
aware of the requirement presently.
Representative Kawasaki noted that the division had found
it was difficult to find out which specific dispensers were
not submitting the required information. It was difficult
to determine who needed to be sanctioned and brought to the
board's attention. He asked if it had been Mr. Holm's
observation as a board member.
Mr. Holm responded in the negative. He reported that the
board was making several changes through the vendor with
the PDMP based on the new requirements. He indicated it had
not been that long that the requirement had been in place.
However, everyone had been required to upload for some
time. As a board member, he had not received any reports
showing who was not uploading data. He had not heard a
report from the vendor or the state that anyone was having
trouble determining who was not uploading. He had not seen
such a report.
Co-Chair Foster asked Ms. Curtis to present the audit
findings.
KRIS CURTIS, LEGISLATIVE AUDITOR, ALASKA DIVISION OF
LEGISLATIVE AUDIT, referred to the legislative audit dated
August 2017. She reported that Legislative Audit concluded
that the board was serving the public's interest by
effectively licensing and regulating pharmacists, pharmacy
interns, pharmacy technicians, in-state pharmacies, drug
rooms, and wholesale distributors. Board meetings were
conducted in accordance with state law. The board was also
active in amending regulations to improve the industry. She
noted that page 9 was the schedule of licensing activity.
She reported that by the end of March 2017 there were 3,447
licensees, a 33 percent increase since the 2009 sunset
audit. She indicated that a schedule of revenues and
expenditures was in page 10. There was a surplus of just
over $275,000 at the end of FY 17. The schedule of license
fees was on page 11. According to DCBPL management a fee
analysis was scheduled for the end of 2017.
Ms. Curtis continued that although her division found that
the board was serving the public's interest, it was only
recommending a 4-year extension. It was in recognition of a
very significant statutory changes that had recently
occurred that expanded the board's duties in relation to
the controlled substance prescription database. She
highlighted that page 3 contained the background
information section, which was where Legislative audit went
through the database. She indicated that the Board of
Pharmacy was required to establish a database in 2008.
Statutes required that dispensers of controlled substances
electronically submit information on each prescription that
they dispensed. The database collected the information and
was supposed to allow pharmacists and practitioners to
review prescription history prior to prescribing or
administering medication or controlled substances.
Ms. Curtis relayed that statute also stated that the
database might be used to monitor prescribing practices and
patterns to identify practitioners who prescribed
controlled substances in an unlawful or unprofessional
manner, identify individuals who might be abusing
controlled substances, and identify individuals who might
be presenting forgeries or otherwise false prescriptions to
a pharmacy.
Ms. Curtis reported that there were several structural
problems with the 2008 law and were very slow to be
addressed. Legislative Audit grouped the problems in to 2
different areas beginning on page 4. The first area was the
completeness of information. As Representative Kawasaki had
discussed, there was no way to identify the universe of
individuals that were supposed to be reporting to the
database. As such, the board stated that they were unable
to identify the completeness of the information. They had
to report annually to the legislature. There were some
statistics being reported. It was clear the board was
having some problems getting people to submit information.
Regulations that they put in at that point required monthly
reporting. It was in no way timely enough to be useful.
Ms. Curtis moved to the second area Legislative Audit
grouped was the use of information. The law did not require
practitioners or pharmacists to consult the database prior
to prescribing or dispensing. It was totally voluntary. The
board was advised by the Department of Law that they could
not forward information to a pharmacist or a practitioner
because it would be considered an unsolicited report and
therefore, illegal. Consequently, the board did not analyze
the information and it was not used to identify unlawful
practices or patterns.
Ms. Curtis spoke about there being some recent changes to
address the problems. Currently, prescribers and dispensers
had to register with the database, and the Board of
Pharmacy was required to notify other occupational boards
that they were licensee registered. It allowed for the
identification of non-compliance in a check for
completeness. In 2018, dispensers would be required to
submit information to the database daily. Dispensers and
practitioners were now required to check the database prior
to dispensing and prescribing with some exclusions. The
board could now provide unsolicited reports. She commented
that there were quite a few significant changes.
Ms. Curtis continued to page 12 of the report. Legislative
Audit stated that with the changes the board was now
empowered to help combat the abuse of controlled
substances. Given that the changes were recent, the
division was unable, as part of the audit, to evaluate the
degree to which the board was going to use its new
authority to help serve the public's interest. However, the
division could say that the DCBPL management did not
believe the board should be proactively analyzing data to
serve public health objectives. She relayed that Department
of Commerce, Community and Economic Development management
stated that additional resources would be needed if the
legislature intended for the board to analyze data and to
become proactive in enforcing prescription drug laws.
Ms. Curtis detailed that the report included 2
recommendations for operational improvements beginning on
page 14. The division recommended that DCBPL chief
investigator work with the director to improve the
timeliness of investigations. There were 20 cases that were
open for over 180 days during the audit period. The
division tested 13 of them, 6 of them had unjustified
periods of inactivity. Those periods ranged from 51 to 184
days. She reported that the cause of the delay, at least
partially, was the competing priorities of the main
investigator assigned to the board because that individual
was also assigned to help manage the controlled substance
prescription database.
2:16:49 PM
Ms. Curtis moved to the second recommendation. Legislative
Audit recommended that DCBPL director improve procedures to
ensure required licensure documentation was obtained prior
to licensing. The division tested 20 facility licenses and
found 3 errors. First, in one case, the self-inspection
report was not submitted. In one case, a background check
was not submitted. In another case, an applicant had marked
"Yes" to a professional fitness question indicating that
their out-of-state license had received a citation against
it and the DCBPL staff had not follow-up on the issue. The
board had approved the licenses appropriately pending
receipt of certain documentation. It was the staff that had
not followed through and obtain it. She furthered that the
division tested 25 individual licenses and found one
instance regarding a pharmacy intern where there was no
support that their education had been met.
Ms. Curtis conveyed that responses to the audit began on
page 45. The governor's office agreed that the board was
serving the public's interest and should be extended. They
did not comment on the controlled substance prescription
database. The department's response was on page 47. They
agreed with both recommendations. Regarding recommendation
1, the department reported having implemented new procedure
regarding documentation for investigations and to help
ensure timeliness. Regarding recommendation 2, they agreed
that additional quality checks were needed to help ensure
that administrative records were complete. However, they
stated that additional supervisory resources were needed in
order to ensure that their standards were met. The board
chair's response was on page 49 and the chair agreed with
both recommendations.
2:18:37 PM
Representative Wilson commented that both recommendations
had nothing to do with what the board was supposed to do.
It sounded like it all came back to the law passed in 2008
that was not written correctly. She opined that the board
was being penalized for a law that was made in 2008 that
did not give them all of the needed pieces. She asked if
her assessment was fair.
Ms. Curtis replied that the Legislative Audit Division
viewed itself as a legislative oversight agency. The sunset
process was designed to ensure that the board was serving
the public's interest. She was recommending a 4-year
extension because the powers being given to the board were
very important powers. In the audit process it was not able
to evaluate the degree to which the board had been
effective at serving the public's interest. It was an
oversight mechanism noting that Legislative Audit believed
it would be important to go in earlier than 8 year. In this
particular case, given the importance of the opioid abuse
in the public, the division thought it was prudent to go in
earlier.
2:20:01 PM
Representative Wilson wanted to return to the issue that if
the law had been written correctly in 2008, Legislative
Audit would have had enough time to make and evaluation.
Ms. Curtis was uncertain what to say what Legislative Audit
would have done if things had been done differently. She
pointed to page 6 which had a timeline from 2008. The
board, legislature, and the department were not responsive.
All 3 entities that worked together to ensure that the law
was carried out did not do the best job that they could
have. She continued that given where society was at, the
division felt it was really important to provide as much
information to policy makers as possible as part of the
audit. She referred to appendices A and B. There was a
significant amount of where things were at and to what
degree the original law had been implemented. She indicated
that board was responsible for procuring the database and
encountered long delays. There were problems with the
effectiveness of the database. Legislative Audit believed
that a better job could have been done during those years
but recognized that part of the issue was the law itself.
However, the division focused going forward. There were
currently in place with additional legislation proposed to
further assist the board in carrying out these
responsibilities.
2:22:18 PM
Representative Kawasaki thought that when the board
extension came up in 2009 and has had an 8-year extension,
the legislature probably should not have extended it as
long as it did because of the current issues. He furthered
that it was not just the bill that passed in 2008, it was
all the bills subsequent to that time that had changed the
system significantly, including SB 74 which radically
changed who got access to the database. He added that SB 74
also had the pharmacy registration that required a
pharmacist had to become involved with the database. There
were many changes that had occurred recently. He concurred
that a 4-year board extension made sense. He preferred a
shorter extension due all that had been done subsequent to
the prescription drug database.
2:23:49 PM
Representative Guttenberg asked about Ms. Curtis' comments
about the board not being proactive and did not believe it
should be proactive. He asked Ms. Curtis to further
comment.
Ms. Curtis indicated that essentially the database did not
operate as it was intended. The board was not able to
analyze the data until the legislative fixes happened. What
she had said was that the department did not believe it was
the board's responsibility to be proactive in analyzing
data to help further public health objectives. She reported
that the staff of Legislative Audit had an internal debate
about whether the board was the right for the
responsibility. Many other states had the controlled
substance database under the board. She opined that it was
a policy question. She did not believe the board had been
effective.
2:25:44 PM
Representative Guttenberg asked if it would really make it
effective.
2:25:59 PM
Co-Chair Seaton mentioned the prescription drug database
and the procedures to analyze them. The legislature had not
mandated those things at the time. He asked if there was
anything that had prevented the board from passing
regulations to implement more strict adherences to the
intent of the database.
Ms. Curtis responded that only regulations could be passed
to implement the statutes. The statues, themselves, were
flawed by not providing them certain authority or certain
capabilities.
2:26:49 PM
SARA CHAMBERS, ACTING DIRECTOR, ALCOHOL AND MARIJUANA
CONTROL OFFICE, DEPARTMENT OF COMMERCE, COMMUNITY AND
ECONOMIC DEVELOPMENT, relayed that the fiscal note was
similar to the previous 2 board extensions heard in the
current day's committee. The amount was $27,900, slightly
more than the previous 2 bills, because the board had 7
members rather than 5. The authority, since it was all
funded by license fees, would provide the opportunity for
the board to meet 4 times a year as required in statute.
The money also paid for public notices, board member
training at conferences, and per diem.
2:27:47 PM
Representative Wilson asked why the board did not come back
to the legislature to inform members with an update. She
asked if the department had the ability to do so.
Ms. Chambers replied that until SB 74 and HB 159
[Legislation passed in 2017 - Short Title:
Opioids; Prescriptions; Database; Licenses] came forward,
the administrative support for the board had not dug deeply
into the intent. The department was working with the tools
it had. The legislature's movement to expand the
prescription drug monitoring program, in light of the
public crisis, helped reframe the tools and the abilities
to accomplish those things. The question that had been
posed was whether the Board of Pharmacies to proactively
solve the opioid crisis was the right place. The board was
a licensing board made of pharmacists. The 2 very powerful
bills that were passed brought other boards of
practitioners into the conversation. However, at the end of
the day, it was a question of whether the Board of Pharmacy
proactively trying to solve the opioid crisis. The board
and the department were working in tandem to work with
Department of Health and Social Services to provide them
epidemiological experts and the data they needed to assist
in moving the objective forward. HoweverShe reported that a
handful of pharmacists and a few public members found the
task to be daunting. The department was looking at ways to
collaborate and accomplish the goals within the new,
reframed mandate.
2:30:18 PM
Representative Wilson commented that a shorter sunset
period was not needed to be proactive in make a policy
call. It was a policy call by the legislature and not the
board. She asked if she was correct.
Ms. Chambers responded affirmatively.
Representative Wilson suggested that whether the sunset was
in 4 years or 8 years, the department could always suggest
legislation or suggest to the legislature to look at it if
it was not the right policy. She thought it was separate
from looking at whether it was in the public's interest.
She was certain that in 4 years it would still be in the
public's interest to have the board. She wondered if a
longer sunset would prevent the department or the governor
from coming back and suggesting needed changes.
Ms. Chambers responded that those decisions would
ultimately be made at the level of the governor's office.
Until those decisions and priorities were articulated
through the governor's office, the department would
continue with the mandate before the department.
2:31:46 PM
Co-Chair Seaton noted the policy question Representative
Wilson was discussing was where the board should be
located. He asked how things were normally handled.
Ms. Chambers replied that the department very much
appreciated the work of the legislative auditors. Feedback
was a gift of awareness. She informed the committee that
there were several federal grants through DHSS which set
forward performance measures to test against whether
policies, procedures, data collection, and the analysis
were working well. She noted that with the enhanced
responsibilities, the division had retched up analyzing the
job being done by the depart and board together. There were
internal mechanisms to determine how things were going. It
was an early stage with the new expanded responsibilities
that it would likely take another year or so before having
comprehensive data to see how things were working. If there
was a fundamental breakdown or an inability to meet the
requirements of statute the department would likely bring
forward to address the public health needs of the state.
2:34:23 PM
Co-Chair Foster OPENED and CLOSED Public Testimony.
Representative Wilson MOVED to ADOPT Conceptual
Amendment 1:
Page 1, Line 5:
Delete: 2022
Insert: 2026
Co-Chair Seaton OBJECTED for discussion.
Representative Wilson spoke to her amendment. She thought
the board would do what was necessary.
2:36:51 PM
Representative Kawasaki commented that regarding the
amendment, the legislature was not penalizing the board. He
thought it was a recognition that the legislature passed a
sunset bill in 2009 before the regulation came out that
completely changed the responsibilities of the board. He
did not believe the legislature would not have given an 8-
year sunset had it known there were significant changes
coming through the prescription drug database. The
committee had heard from the chair of the board that there
were several changes going on within the current
administration. The board spanned 3 administrations. He
reemphasized that the committee was not penalizing the
board but looking closely of the details of the present
audit. He anticipated implementing some rules around them.
He though the prescription drug management database were
very important and should be looked at within 2 years. He
thought waiting 8 years would be abrogating the
legislature's responsibilities. Although the legislature
could look at the board at any time, often times the only
time legislators reviewed them was when the saw the
recommendations from the chief auditor. He would stand with
the 4-year sunset as proposed by the legislative auditor.
2:39:08 PM
Representative Wilson thought the board was being penalized
for legislation passed in 2008 that the board did not ask
for. She surmised that had the legislation been written
correctly, the right things would have been in place. She
had faith in the department that it would be monitoring the
board. It was a question whether the legislature believed
that the department would come forward if there was a
problem. She would put her confidence in the board.
2:40:30 PM
Co-Chair Seaton did not believe it was a penalty for the
legislature to get an audit. The legislative auditors went
through what was happening in very fine detail. He thought
if the legislature had had a 4-year sunset, the issues
would not have waited until SB 74 was passed. They would
have been brought to the attention of the legislature much
earlier. Each one of the departments came forward with
recommendations that the legislature had not seen. An audit
was the way in which the legislature determined issues. He
would be opposing the amendment.
Representative Guttenberg would be opposing the amendment
as well. He relayed that the boards and commissions worked
for the legislature. They happened to function under the
executive department. The audits were critical to informing
the legislature about what they were doing. He thought the
legislature, the governor, and the executive office had
created a difficult situation. He spoke of audits showing
difficulties. He thought the audit revealed a convoluted
series of legislation requirements that had been difficult
to deal with. He did not want to wait any longer than
necessary to see the results of their success. He thought
it was important through the audit process to see if
something was working. It was not a penalization. He would
be opposing the amendment.
2:43:42 PM
Representative Wilson thought the discussion was
enlightening. She argued that waiting for an audit to have
a discussion about a serious issue did not work. She
suggested perhaps only a 1-year extension should be
granted. She was concerned that the board had an 8-year
extension. She relayed that the 2 recommendations had
nothing to do with the board. She believed in the board and
the department and that they would do what was needed. If
something could not be done, she thought they would come
back to the legislature, even before the 4-year sunset. The
bill was a sunset bill. She would be voting yes on the 8-
year amendment because of her faith in the board and the
department.
Co-Chair Seaton MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Thompson, Tilton, Wilson
OPPOSED: Guttenberg, Kawasaki, Ortiz, Pruitt, Gara, Seaton,
Foster
Representative Grenn was absent from the vote.
The MOTION to ADOPT Conceptual Amendment 1 FAILED (3/7).
2:46:39 PM
Co-Chair Seaton MOVED to report HB 323 out of Committee
with individual recommendations and the accompanying fiscal
note.
There being NO OBJECTION, it was so ordered.
HB 323 was REPORTED out of committee with a "do pass"
recommendation and with a previously published fiscal
impact note: FN1(CED).
Co-Chair Foster reviewed the agenda for the following
meeting.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 318 Amendment #1 A.1.pdf |
HFIN 2/12/2018 1:30:00 PM |
HB 318 |
| HB318 Sponsor Statement 2.7.2018.pdf |
HFIN 2/12/2018 1:30:00 PM |
HB 318 |
| HB 318 Social-Work-Final-Report-WEB.pdf |
HFIN 2/12/2018 1:30:00 PM |
HB 318 |
| HB302 Sponsor Statement 1.30.18.pdf |
HFIN 2/12/2018 1:30:00 PM |
HB 302 |
| HB 302 Audit BPC-Final-Report-WEB.pdf |
HFIN 2/12/2018 1:30:00 PM |
HB 302 |
| HB 323 Audit Pharmacy-FINAL-Report-WEB.pdf |
HFIN 2/12/2018 1:30:00 PM |
HB 323 |
| HB323 Support Letter 2.5.18.pdf |
HFIN 2/12/2018 1:30:00 PM |
HB 323 |
| HB323 Sectional Analysis 2.2.18.pdf |
HFIN 2/12/2018 1:30:00 PM |
HB 323 |
| HB323.SponsorStatement.verD.2.2.18.pdf |
HFIN 2/12/2018 1:30:00 PM |
HB 323 |