Legislature(1999 - 2000)
04/17/2000 01:26 PM House JUD
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 300 - MEDICAL SUPPORT ORDERS FOR CHILDREN CHAIRMAN KOTT announced that the first order of business would be HOUSE BILL NO. 300, "An Act relating to the establishment and enforcement of medical support orders for children; and providing for an effective date." [Before the committee is CSHB 300(HES).] Number 0098 BARBARA MIKLOS, Director, Child Support Enforcement Division (CSED), Department of Revenue, testified via teleconference from Anchorage. She informed the committee that CSED requested the introduction of HB 300 due to a problem. She explained that when people go on medical assistance, CSED is required to establish a medical support order. However, the current statute requires that the division establish a financial order along with a medical support order. Therefore, this legislation would change the law such that only a medical support order may be established in order to avoid having to establish a financial child support order. This legislation would also amend the medical support statute in order to provide that either parent, not solely the obligor parent, may be required to provide health care coverage. Furthermore, HB 300 would amend the law to require that a medical support order be issued regardless of whether health care coverage is currently available to either parent. MS. MIKLOS pointed out that HB 300 was amended in the House Health, Education & Social Services Committee (HHES). The HHES amendments made it clear that CSED and the courts follow the same procedure. Furthermore, those amendments clarified that CSED can take enforcement action in order to ensure medical support compliance with a medical support order, even in the absence of a financial support order. The remainder of the bill largely stayed the same. MS. MIKLOS informed the committee that the division believes that this legislation will help the obligee, the person who has the child or custodial parent, as well as the noncustodial parent because the division would not have to set up these financial orders unless both parents desire such. Furthermore, the division believes that the changes made in HHES are acceptable. However, [the division] has one issue which is addressed in a letter entitled, "Recommended Changes to CS for HB 300(HES)". She requested that Diane Wendlandt be allowed to discuss that issue. Number 0310 DIANE WENDLANDT, Assistant Attorney General, Collections and Support, Civil Division (Anchorage), Department of Law, testified via teleconference from Anchorage. The recommended change requests the removal of the language "government assistance" in Section 7, page 7, line 12, of CSHB 300(HES). She explained that currently the primary focus of medical support is to ensure that there is insurance for the child. However, under Civil Rule 90.3 parents also have a responsibility to allocate the [health care] expenses not covered by insurance. She explained that if a child incurs medical expenses not covered by insurance, those costs are split under the administrative or court order. As currently drafted, the legislation adds the language "government assistance" so that it says, "the parents will - before the agency will allocate medical expenses that are not covered by insurance or by government assistance." She explained the interpretation of the existing law. If a child incurs medical expenses, which are not covered by insurance, those are usually covered by Medicaid. If Medicaid pays those expenses, then Medicaid has the right to go after the parent for his/her share of the uninsured expenses. By adding the language "government assistance", there is the possibility that the legislation eliminates that right. Therefore, the recommendation is to remove the language "government assistance" in order to avoid affecting that right. Number 0448 REPRESENTATIVE ROKEBERG noted that he and Ms. Miklos have had numerous discussions regarding this. He referred to a case which he had discussed with Ms. Miklos last year and asked if, in that case, "this would require that person, that obligor, to pay back any Medicaid expenses even though he'd offered to pay for private health insurance." Representative Rokeberg said that he wasn't sure that he agreed with the suggested amendment. MS. WENDLANDT clarified that the suggested amendment would leave the door open, which is the case in existing law. She explained that medical assistance is collected when someone has reasonable health insurance available at a reasonable cost. Currently, existing law would allow the collection of financial payments which is something that HHES indicated to be of importance during their discussions. She indicated that HHES felt that instead of the state paying for the public assistance, if someone didn't have (indisc.) health insurance perhaps because they were wealthy, maybe that person could be required to pay for the care. Although existing statute would allow that, it is not the practice. Therefore, Ms. Wendlandt believes that if this amendment is not changed, that door would be closed. Number 0562 REPRESENTATIVE ROKEBERG informed the committee of a situation in which CSED went after a husband, within 30 days of getting divorced and having a signed property agreement, for increased child support. He explained that the wife went on Medicaid, which one cannot get off for six months. In this case, the wife [began] a $25 per hour job within a few weeks of obtaining Medicaid. The husband had a property settlement in which he agreed to pay everything. However, it turned into complete chaos. Representative Rokeberg said that [this suggested amendment] would make this husband responsible for all the things, such as dental work for the children, that his wife had done while on Medicaid and working for $25-per-hour. Although Representative Rokeberg believes some of the legislation is good, he was not sure that the section under discussion is valid. CHAIRMAN KOTT asked if there were any further comments on the proposed amendment. There being none, he asked if anyone else wished to testify in the room or via teleconference. He, then, inquired as to the wishes of the committee. Number 0711 REPRESENTATIVE JAMES requested clarification in regard to Ms. Miklos' suggested amendment. CHAIRMAN KOTT clarified that Ms. Miklos is suggesting the deletion of the language "government assistance" on page 7, line 12. REPRESENTATIVE ROKEBERG explained, in further response to Representative James, that Ms. Miklos' proposed amendment would allow the state to go after the obligor for payments made under a state Medicaid or other program, such as Denali KidCare. MS. MIKLOS stated, in response to the case brought up by Representative Rokeberg, that this legislation was desired because of a case such as the one mentioned by Representative Rokeberg. She explained that in the aforementioned case an agreement had been reached through a property settlement, but due to state law [the division] had to tie financial assistance into medical assistance. Therefore, this bill was introduced in an attempt to help both parents, especially in such a case. In regard to the amendment, Ms. Miklos believes that under existing statute Medicaid could ask for someone to pay for costs even if the person doesn't have health insurance. This was an important issue in HHES as there were many people who believe that people should be paying for the children's health care costs and not use public money. [The division] believes that the language "government assistance" would preclude the division from going for things other than health insurance. Ms. Miklos commented that this is a policy call. She pointed out that no one is collecting on this now; [the division] is only going after health care at a reasonable cost. That focus was chosen on the belief that it is the most cost-effective. Still, [the division] would prefer to have language in the law that wouldn't preclude CSED from going after other things under any circumstance. Number 0874 REPRESENTATIVE CROFT expressed confusion. He posed the following situation in which the children are covered by Medicaid and that part could not be allocated, which would allow Medicaid to come after the noncustodial parent. He asked if that would be correct under the current language. MS. WENDLANDT said Representative Croft's assessment is correct. REPRESENTATIVE ROKEBERG spoke in opposition to the adoption of the suggested amendment because he believes that the programs and care available under Medicaid is greater than almost anyone could receive with a private insurance plan in Alaska. By and large, one can receive better care with Medicaid because it doesn't have the exclusions, caps or limits. REPRESENTATIVE CROFT related his understanding that Ms. Miklos is saying that [Representative Rokeberg] has a compelling example, but he is coming to the wrong conclusion. He understood that Ms. Miklos is trying to help the situation [described by Representative Rokeberg]. REPRESENTATIVE ROKEBERG interjected that he agreed with the bill, just not this is particular part [the suggested amendment to Section 7]. REPRESENTATIVE KERTTULA related her understanding that this part of the bill [, Section 7,] would allow [CSED] to turn to the custodial or noncustodial parent in order to get reimbursed if one is receiving government assistance. MS. MIKLOS indicated that would be correct for uncovered expenses. Therefore, [the suggested amendment] presumes those expenses that are not covered by health insurance and would leave the door open to go after those expenses. However, if the language "government assistance" is left in Section 7, Ms. Miklos was concerned that that door would be closed. Number 1035 REPRESENTATIVE ROKEBERG posed the following situation in which the obligor had a major medical plan, but didn't have dental coverage and the children had dental work done under a Medicaid program such as Denali KidCare. He asked if this would allow [the division] the right to turn to the obligor for reimbursement for the dental plan. MS. MIKLOS agreed and noted that [the division] can do that under the existing law. She remarked that some members of HHES felt strongly that [the division] be able to do that. REPRESENTATIVE ROKEBERG and JAMES commented that they didn't believe it was fair. REPRESENTATIVE KERTTULA related her understanding, "Even if the government covered it, you'd [CSED] be able to go back against the custodial/noncustodial parent." MS. MIKLOS replied yes. REPRESENTATIVE GREEN interjected that it would be for the uncovered expenses. REPRESENTATIVE JAMES pointed out that Denali KidCare has been portrayed as an insurance policy for folks. She asked if people who take that insurance policy can be held for the cost of it. MS. MIKLOS informed the committee that it is possible for people who have health insurance to receive Denali KidCare. However, [the division] wants to up the stakes in order to receive the reimbursement for that health insurance. She acknowledged that it might not pay for the full cost of care because the Medicaid insurance plan may have higher benefits than the private insurance policy, as pointed out by Representative Rokeberg. She clarified, "Whether you took that in or left it out, the amendment that we suggested, it wouldn't affect the issue that Representative James is talking about." She specified that the issue [the division] is discussing is for the uncovered expenses, which she interpreted to mean those expenses not covered by private insurance that [the division] can already go after. By leaving [the language "government assistance" in Section 7], it doesn't preclude the division from [going after uncovered expenses monetarily]. However, she clarified that the division is not [being able to go after uncovered expenses monetarily], and furthermore she was not sure the division would begin to do so anytime soon. Still, if a wealthy person without health insurance had a child on Medicaid, the state may want to consider going after that person financially. REPRESENTATIVE JAMES asked: If a person has an insurance policy and Denali KidCare, which would be the primary? MS. MIKLOS assumed that Denali KidCare would be the payor and then seek reimbursement from the insurance policy. She noted that Medicaid does that. Number 1222 JON SHERWOOD, Division of Medical Assistance, Department of Health & Social Services, explained that for a person with insurance, the provider has to bill the private insurance first for most types of services. Medicaid only pays for expenses uncovered by the insurer. For some services that aren't commonly paid for by insurance, the provider can bill Medicaid first. He noted that "we" do try to go after the insurance company after the fact. REPRESENTATIVE JAMES commented that Denali KidCare was established for those that are either under-insured or not insured in order to cover children's medical expenses. However, no where in the Denali KidCare information did she every see the information that if one receives this benefit, he/she will have to reimburse it. MR. SHERWOOD stated that in most cases, the client would not pay it back. He related his understanding of the proposed change. He said, "In situations where there was a child support order in place (indisc.) address medical support and specifically required the noncustodial parent to pay for a portion of the health care costs directly, then the noncustodial parent would be required to pay something." Number 1304 REPRESENTATIVE JAMES asked, then, why the custodial parent would need Denali KidCare if the noncustodial parent had to pay. Furthermore, she inquired as to why the [custodial parent] would qualify. MR. SHERWOOD related his belief that the medical support order, in most cases, would be limited in regard to the amount of money an individual would have to pay and they may still need Denali KidCare to pay for things outside the coverage of the financial ability of the two parents. REPRESENTATIVE JAMES inquired as to who makes the application for Denali KidCare, the obligor or the custodial parent. If the custodial parent is not paying these and has an obligation to do so from someone else, that parent shouldn't be able to apply for Denali KidCare. MR. SHERWOOD pointed out that the custodial parent generally would make the application first for Denali KidCare. REPRESENTATIVE JAMES remarked, "Sounds like a rip-off to me." REPRESENTATIVE CROFT mentioned the following [possibilities] of $10,000 covered by private insurance, $10,000 covered by Medicaid and $10,000 uncovered. He said, "Under the bill as it stands, you 'shall allocate equally between the parents the cost of reasonable health care expenses not covered', that's $10,000 of it. We split it $5,000 and $5,000 and we say noncustodial parent you owe $5,000 for these noncovered medical expenses." He asked if that was a correct characterization. MR. SHERWOOD deferred to CSED. MS. MIKLOS agreed that Representative Croft's understanding was correct. REPRESENTATIVE CROFT related his understanding that with Ms. Miklos' suggested amendment it would result in $10,000 [for the private insurance] and $10,000 for the Medicaid, which is a total of $20,000. Therefore, that $20,000 would be split equally and thus the noncustodial parent would receive a bill for $10,000. When the custodial parent receives [the $10,000], he/she uses $5,000 for the noncovered expenses and the other $5,000 is sent back to Medicaid. MS. MIKLOS replied, "I believe so." REPRESENTATIVE CROFT indicated that it makes sense to charge the noncustodial parent for government services, but not for private insurance coverage. He said, "When it was just the uncovered, it sort of made sense to me. Why should we distinguish between the two and charge the noncustodial for paying back Medicaid?" Number 1486 MS. WENDLANDT related her understanding that government assistance is not supposed to be a substitute for the parental responsibility in paying for these expenses. If government assistance was not available, these expenses would have been paid and allocated between the parents. The policy argument is that government assistance should not act as a substitute and reduce the liability of the noncustodial or obligor parent for these expenses. MS. MIKLOS turned to Representative James' remarks and explained that when someone applies for Medicaid programs, including Denali KidCare, that triggers [the division] to pursue a medical support order. Then [the division] finds out whether [the payment] can be reimbursed, which can occur from either parent not just the obligor. She echoed Ms. Wendlandt's comments regarding the intent for the parents to be responsible, if possible. Ms. Miklos pointed out that [the division] is not doing that but rather using insurance at a reasonable cost. However, there may be a situation when the division or the court would believe that the [noncustodial] parent could afford to help out with something other than insurance. In such a case, the desire may be to include that in the order. [The division] is concerned that this would preclude that, although this is not commonly done by the division nor the court. In reference to Representative Croft's situation, the division does not ask noncustodial parents to pay the $10,000 or $20,000 because it isn't reasonable. REPRESENTATIVE ROKEBERG returned to the situation he mentioned earlier. This man was divorced, and in the child support order he agreed to pay half of [his children's] medical care. This man didn't have an insurance policy. Therefore, when his ex-wife received Medicaid coverage, it triggered the "dead-beat dad" scenario, which took a year to get out from under. Representative Rokeberg said, in his opinion, the use of the Medicaid assistance for a protracted period was discretionary on the part of the mother. He emphasized that there is no cost containment in Medicaid. Number 1646 REPRESENTATIVE JAMES related her belief that when parents separate and there is an arrangement through the courts for child support, [the support order] will say what the noncustodial parent is to pay. If the noncustodial parent is to provide insurance and pay the portion not covered by the insurance, then it seems there would be a valid reason, under child support, to go after that person because that was the agreement on the child support issue. REPRESENTATIVE JAMES posed another situation in which [the noncustodial parent] is required to provide insurance while the out-of-pocket or noncovered portion is to be covered by the custodial parent. In such a case, she believed that [the division] would have to go after the custodial parent. However, if the custodial parent makes an application to Denali KidCare, she didn't believe that custodial parent believes that [those services] will have to be paid back. It seems that there is some entrapment in that process. Furthermore, certain wage parameters must be met in order to apply for Denali KidCare and thus if [the division/court] is going to go after the custodial and noncustodial parent, then both the wages for the custodial and noncustodial parent should be included when applying for Denali KidCare. Representative James said that "we" shouldn't be putting something in law that would allow them to be entrapped in this way. MS. MIKLOS responded that most of these orders are developed after people go into Denali KidCare. When people enter Denali KidCare it is made clear that CSED will be going after a medical support order. Therefore, she didn't believe it is entrapment. She reiterated that [the division] doesn't go after the custodial and noncustodial parent that can't afford to pay the uncovered costs as it has to be "reasonable", which appears throughout the statute. The only way CSED would attempt to collect is if the custodial parent did have insurance and didn't disclose that or had received the insurance after getting Denali KidCare. Ms. Miklos emphasized that [the division] doesn't do things that it hasn't warned the parents about. Although the noncustodial parent doesn't necessarily know there will be an order, the custodial parent does know that he/she has to cooperate with child support. REPRESENTATIVE JAMES acknowledged that Ms. Miklos' concern is regarding child support and thus this particular case only addresses those parents who are separated, which would result in a custodial and a noncustodial parent. However, she wasn't sure what would happen in a situation in which the folks are not separated and have Denali KidCare. She understood that "we" are treating people who are split up differently from those who are not; she inquired as to why the two are being treated differently. MS. MIKLOS pointed out that [those who are separated versus those who are not] are treated differently due to federal requirements. Ms. Miklos said: There's a reason behind it ... and that is that if they're not split up, then I'm assuming that part ... of the Denali KidCare would be to take both of those parents' ability to have insurance or whether they have insurance would already have been taken into consideration. So, it's only when the parents are split-up, that people don't know if this other parent could possibly get this (indisc.) health insurance. Number 1871 REPRESENTATIVE JAMES asked if the parent has to notify CSED if he/she comes into some money, receives a job or health insurance; would he/she lose the ability to receive [Denali KidCare]. MS. MIKLOS deferred to Mr. Sherwood. MR. SHERWOOD answered that if someone comes into insurance after [admittance to] Denali KidCare, he/she is required to report it to [DHSS]. At that point, the providers will have to begin billing that insurance first. He noted that the parent may still remain eligible for Denali KidCare and [DHSS] would pay for the uncovered costs. Mr. Sherwood turned to Representative James' earlier question regarding a situation in which there is not an absent parent. He explained that [DHSS] does not pursue support or recovery in such a situation; however, both parents' income is taken into consideration when reviewing whether the child is eligible. Under federal law, when there is an absent parent, [DHSS] is required to disregard [the absent parent's] income and financial resources for an eligibility determination. However, there is a requirement to seek medical support for that child from that absent parent, if available at reasonable cost. REPRESENTATIVE ROKEBERG asked if seeking the medical support is a federal mandate. MR. SHERWOOD replied yes. REPRESENTATIVE ROKEBERG posed a situation in which a person qualifies for Medicaid or Denali KidCare under normal circumstances, when there is an outstanding support order. He inquired as to how long such a person would be enrolled in Medicaid because in his experience, even those that find a job remain on the rolls for some time. MR. SHERWOOD stated that once a child is determined to be eligible he/she is eligible for a minimum of six months. For families receiving coverage from Family Medicaid who lose their eligibility due to [excess] earnings, there is up to 12 months of transitional coverage; that is a federal requirement. He explained that [this transitional coverage] is considered a support for those attempting to work their way out of poverty. REPRESENTATIVE ROKEBERG surmised, then, that the situation he mentioned earlier could be correct in that the mother, within days of obtaining Medicaid, secured a $25 per hour job; however, the children remained on Medicaid for six months. He remarked, "That's a terrible defect in the law." MR. SHERWOOD said that he believes that things [such as transitional coverage] are utilized in order to encourage people to obtain a job and work themselves out of poverty. Often, the loss of health care benefits can be a large barrier to returning to work. REPRESENTATIVE CROFT posed a situation in which there is a family that is in poverty or close to poverty and there is a noncustodial parent who can pay, while the government steps in to help. He asked, "Should they or shouldn't they pick up half of that?" Representative Croft believes [the noncustodial parent should pay for half]. He noted that Representative Rokeberg's concerns are addressed by the language "reasonable" all the way through [Section 7] because it allows CSED to determine whether services rendered were reasonable. REPRESENTATIVE ROKEBERG stated that he didn't disagree with Representative Croft. However, his experience does not lend any credibility to the use of the language "reasonable" in this particular area. He noted that the complaints that he receives regarding the "gestapo" tactics of this division seem to be the norm. Therefore, he indicated disbelief in regard to the credibility of the reasonableness standard. Representative Rokeberg pointed out the need to differentiate between [covered] and uncovered benefits because he believes therein lies the abuse. Number 2160 REPRESENTATIVE CROFT suggested inserting some language defining "reasonable uncovered expenses." REPRESENTATIVE ROKEBERG said that the uncovered expenses that exceed $5,000 in a calendar year are similar to a large deductible, and thus most other things could be excluded there. Therefore, he indicated that perhaps his concerns could be reviewed with that deductible. He reiterated his belief that it is subject to abuse and that he knew of such a case. He also expressed concern regarding the Governor's aggressiveness in regard to expanding this. REPRESENTATIVE MURKOWSKI asked if anything in statute would arrive at what is "reasonable and covered expenses." MS. MIKLOS informed the committee that CSED uses the federal government's definition of "reasonable," which the feds define as insurance provided by the employer at a reasonable [cost]. In regard to Representative Rokeberg, Ms. Miklos stated that, for the most part, [CSED] doesn't go after uncovered expenses. REPRESENTATIVE ROKEBERG remarked that now CSED would be able to go after uncovered expenses. MS. MIKLOS clarified that under existing law, CSED has the ability to go after uncovered expenses; however, the division has chosen not to do so because it is not cost-effective. Furthermore, it is not required by federal law. The concern is that by leaving "government assistance" in this legislation, the division and the courts would be precluded from doing so. Number 2274 REPRESENTATIVE JAMES said that the uncovered expenses from the examples seem to be beneficial to the custodial parent in these cases because who else will pay the uncovered expenses. She found it difficult to envision that they would be uncovered if they have insurance and Denali KidCare. She asked: Am I to understand that there likely is uncovered [expenses], even after having the insurance and Denali KidCare, and if that is something, then, that the custodial parent would have to pay, and that if ... you took any action on that, there would be no benefit to the state, there would only be benefit to the custodial parent? That may be the reason you never do it. MS. MIKLOS answered that it is rare that CSED goes after either parent for uncovered expenses. Furthermore, she didn't know [of any case] when there has been health insurance. She believes that the uncovered expenses are viewed more when neither party has insurance and the costs of health insurance were split. She pointed out that when the court does this, each parent's income is weighed. In regard to a situation in which a custodial parent receives Denali KidCare and is very close to poverty, and the noncustodial parent is wealthy, there would be the opportunity to go after the noncustodial parent. If the noncustodial parent was poor, then no one would go after him/her. REPRESENTATIVE JAMES asked if it is possible that the court order establishing the child support would indicate whether the noncustodial parent is supposed to keep insurance in effect as well as pay the co-payment. MS. MIKLOS explained that the court order reads that if the parent has insurance at a reasonable cost, then it must be provided for the children. She pointed out that most of the program is geared to those that could have insurance but choose not to cover their children. There is also a provision in the court order that if there are uncovered costs, those could be equally split between the parents, depending upon the circumstances. MS. WENDLANDT remarked that she had only seen that [provision] used in a few cases. As a general rule, CSED enforces those uncovered expenses only if the parents have gone to court requesting that the court reduce those expenses to judgment. In such a case, the courts would determine whether the expenses were reasonable, whether the medical treatment was necessary and of reasonable cost, as well as who should bear the burden of the costs, given the financial status of each parent. Once the courts have made those decisions and reduced an amount to judgment, CSED will enforce that judgment. She clarified that that is how it comes up now in the context of not having any "government assistance." REPRESENTATIVE JAMES noted that in her daughter's divorce 20 years ago, her daughter's husband was supposed to maintain the insurance as well as maintain the co-payment. Perhaps that is no longer the case. MS. MIKLOS said that is certainly being done if [that parent has] insurance available. Number 2450 REPRESENTATIVE ROKEBERG referred to page 7, lines 2-6, and asked if a property settlement approved by the court would take precedence over that. He remarked that the [language] doesn't seem to give any privity of contract. MS. WENDLANDT specified that normally a property settlement would be approved by the court and thus becomes... TAPE 00-66, SIDE B MS. WENDLANDT continued, "...and the court issues an order based on that property settlement. That is what the court order is, and that's what we would enforce." REPRESENTATIVE ROKEBERG remarked that [the language in the bill] provides for a formula that may be at odds with the agreement in the court order/property agreement. MS. WENDLANDT said that she wasn't entirely sure she understood the question. However, she referred Representative Rokeberg to the bold and underlined sentence beginning on page 6, line 31, through page 7, line 2. She explained that if there is a property settlement which resolved the [health insurance] issues in another way, due to a specific reason for that different allocation, she believes that there could be a good cause to allocate the health insurance costs in an unequal manner. In such a case, there would not be an increase or decrease as provided on page 7, lines 2-9. REPRESENTATIVE ROKEBERG explained that his problem is that every day CSED [obligates] the (indisc.) contract and property settlement by changing the amounts of custodial support payments based on alleged increases in income. Number 0071 REPRESENTATIVE CROFT moved that the committee adopt the following amendment [Amendment 1]: Page 7, line 12, Delete, "or government assistance" REPRESENTATIVES ROKEBERG AND JAMES objected. Upon a roll call vote, Representatives Kerttula, Green, Murkowski, Croft and Kott voted in favor of the adoption of [Amendment 1] and Representatives Rokeberg and James voted against the adoption of [Amendment 1]. Therefore, Amendment 1 was adopted by a vote of 5-2. REPRESENTATIVE CROFT expressed concern with the word "shall" on page 7, line 11. He said that two ideas seem to be melded together. First, the court may order that the noncustodial parent do this. Second, if there is a decision to order it, then one "shall" make it equal unless there is a good reason not to. He asked, "Does any of that make any sense on dividing the two ideas into 'you may do it' and 'if you do it, you should presume it's equal unless otherwise found.'" MS. MIKLOS said that Representative Croft's thinking does make sense. She noted that now she could see the question, and it was not intended that the division should always do that. REPRESENTATIVE KERTTULA remarked that there is another part to this drafting problem. She referred to the bold and underlined sentence beginning on page 7, lines 17-20. She believes that language should be together with the other part of the section; otherwise, there is confusion. She specified that three different ideas are going on. One is to split the health insurance costs, if reasonable, and another is to allocate [the health insurance costs] equally unless there is a reason to do otherwise. Representative Kerttula surmised, then, that the reasonable costs should be determined and thus allocated equally unless there is a good reason not to do so. She asked if that would be the appropriate manner in which to put it together. REPRESENTATIVE CROFT remarked that Representative Kerttula has a point. He agreed that there are three ideas. First, "you can do this if you decide to, but you don't have to." However, the remaining two ideas are almost contradictory in the way they are written because one [part of the provision] says that the [court or agency] shall allocate [the costs of health insurance] equally, while the other [part of the provision] is based on financial circumstances. He questioned which should be followed. Representative Croft said, "I guess the combination that all works is: You may allocate this to the noncustodial parent if you want. If you decide to, you shall allocate them equally unless there's good cause, including the relative financial circumstances of the parties to do otherwise." He further clarified that if [the court or agency] decides to do it, then it must be done equally unless there is a good reason not to do it equally. REPRESENTATIVE KERTTULA inquired as to which way Ms. Miklos preferred. MS. WENDLANDT related her belief that it would be simpler for the agency if it started with the assumption that [the cost of health insurance] would be allocated equally, rather than immediately moving to the financial circumstances. Number 0303 REPRESENTATIVE CROFT moved that the committee adopt a conceptual amendment [Amendment 2]: on page 7, delete the sentence beginning on line 9 and ending on line 13; delete the sentence beginning on line 17 and ending on line 20. Replace those with [sentences] that would say: that the court may ... order the noncustodial parent to pay the uncovered expenses exceeding $5,000, for reasonable health care expenses. ... If they do make such an award, it should be allocated equally between the parents unless there is good cause, including the relative financial circumstances of the parties, to allocate them unequally. REPRESENTATIVE KERTTULA pointed out that the language needs to start out with both [parties]. LESIL McGUIRE, Staff to Representative Kott, Alaska State Legislature, clarified, then, that the language should begin by referencing both parents. CHAIRMAN KOTT asked if there was objection to Representative Croft's conceptual amendment [Amendment 2]. There being none, Representative Croft's conceptual amendment was adopted. Number 0436 REPRESENTATIVE ROKEBERG expressed concern regarding the privity of contract and the original property settlement agreement. Therefore, he suggested the addition of subsection (d) in Section 7. He explained that conceptually he is attempting to get the original property settlement agreement language to be controlling. Therefore, the conceptual amendment would read as follows: "For the purposes of this section, the original property settlement agreement ratified by the court shall be considered a good cause." He related his belief in the possibility and eventuality that the department and division would change these things with their extraordinary power, which would defeat the privity contract. MS. MIKLOS said, in response to Chairman Kott, that she and Ms. Wendlandt think Representative Rokeberg's conceptual amendment is fine. REPRESENTATIVE CROFT remarked that [Ms. Miklos and Ms. Wendlandt] know more about this area than he, and thus he would let it go. However, he pointed out that generally child support is not subject to negotiation for good policy reasons. Child support is established by rule and based on certain percentages of income. He noted, "You don't want this negotiated down because you're worried in a lot of situations about, 'I won't fight you for custody if you agree to take X or Y ....'" However, Representative Croft surmised that such is not interfering with Rule 90.3, which is the rate-setting, child-support-setting power. REPRESENTATIVE ROKEBERG stated that [his conceptual amendment] speaks only to the section on cost. MS. WENDLANDT related her understanding that Representative Rokeberg's conceptual amendment would not make a property settlement agreement controlling because it is not entirely subject to negotiation of the parties. She understood the conceptual amendment as something that could be considered when making a good cause determination on the allocation of covered expenses, which she didn't believe would violate Rule 90.3. She noted that Rule 90.3 includes good cause exceptions and guidelines. CHAIRMAN KOTT announced that Representative Rokeberg's conceptual amendment is Amendment 3. He then asked if there was objection to Amendment 3. There being none, Amendment 3 was adopted. Number 0599 REPRESENTATIVE ROKEBERG moved that the committee report [CSHB 300(HES)], as amended, out of committee with individual recommendations and the attached zero fiscal note. There being no objection, CSHB 300(JUD) was reported from the House Judiciary Standing Committee.
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