Legislature(2001 - 2002)
02/27/2002 03:25 PM House L&C
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 377-WORKERS' COMPENSATION BOARD PANELS Number 330 CHAIR MURKOWSKI announced that the next item on the agenda would be HOUSE BILL NO. 377, "An Act relating to the establishment of an additional southcentral panel to the Alaska Workers' Compensation Board and to appointments to that panel; and providing for an effective date." Number 337 JOHN MANLY, Staff to Representative John Harris, Alaska State Legislature, presented HB 377 on behalf of Representative Harris, sponsor. He told the committee that [the Department of Labor & Workforce Development (DLWD)] has workers' compensation boards throughout the state that try to resolve issues that come up in workers' compensation claims when they cannot be solved administratively. There is a huge backlog in the Southcentral area. House Bill 377 adds one board - a fourth board - to that area that would allow the backlog to be worked on and claims processed a lot quicker than they currently are. He mentioned that HB 377 has a $5,000 fiscal note. Number 346 CHAIR MURKOWSKI asked if the backlog in the Southcentral area is much greater than in other areas of the state, and if this is the reason HB 377 focuses on that area. MR. MANLY said, "That's my impression, but Mr. Grossi could probably answer that more specifically." Number 353 PAUL GROSSI, Director, Division of Workers' Compensation, Department of Labor & Workforce Development, testified before the committee. He said, "The answer is basically yes." The Juneau board and the Fairbanks board are managing to keep within a reasonable period of time getting the cases to the hearing. The main portion of the backlog is coming from the Anchorage area, and that's also where the increased caseload is occurring. He speculated that it could be a result of population growth. The Southcentral panel covers not only Anchorage, but also the Kenai Peninsula, the Matanuska-Susitna area, Cordova, Valdez, and Kodiak Island. CHAIR MURKOWSKI referred to the Workers' Compensation Budget Request Unit (BRU), and noted "an increment in the FY 02 budget." She reported that there was an additional hearing officer hired last September. She asked, "So, you've got additional hearings that are being scheduled, and so now you need the board to ... review those hearings; is that how it's proceeding?" Number 373 MR. GROSSI explained that the panel of the Workers' Compensation Board consists of the following members: the commissioner of [the Department of Labor and Workforce Development] or his/her designee - the hearing officer in most cases - and two lay members: a labor member, who is usually a business manager from a union; and an industry member, who is an executive of a corporation or a business owner. These people sit together and decide cases that can't be resolved any other way, and make a final decision on workers' compensation cases. MR. GROSSI said the number of hearing officers has been increasing, but the lay members are busy people who are executives of corporations or business managers of unions who can volunteer [just] a certain amount of time. He said, "We've gotten to that point where we actually need more hearing time, and we need some more lay members to be able to hear those increased hearings." This is a relatively inexpensive way to handle it. MR. GROSSI explained that the $5,000 fiscal note is a result of the stipend the board members are paid. Lay members, who are volunteers, are paid a $50-a-day stipend for the time they're there, usually two to four days a month. He stated, "The $5,000 would come out of our ... workers' safety and compensation account, which is our fees-driven payment system for the agency." There wouldn't be any additional fees to the employers or the insurance companies. Number 401 REPRESENTATIVE ROKEBERG asked how long the $50 stipend has been in effect. MR. GROSSI answered, "Since statehood." He added that at the time it was a significant amount, but today "it's kind of ... an embarrassment." In response to a question from Representative Rokeberg, he specified that there would be four Southcentral panels, one panel in Fairbanks, one panel in Juneau, and an at- large panel. REPRESENTATIVE ROKEBERG asked if there are two [lay] members on each panel. MR. GROSSI replied in the affirmative. REPRESENTATIVE ROKEBERG said that's 14 people. He asked what the impact on the fiscal note would be if the stipend were raised to $100. Number 420 MR. GROSSI, noting that the board meets two to four times a month, replied, "$14,000. I think that would be the approximate number." Number 436 CHAIR MURKOWSKI mentioned new regulations that require the hearings to be scheduled in a more expedited manner, within the 60-day time period. She asked what impact this will have on the respective workloads for the various panels. MR. GROSSI responded that it will be a little problematic if [the new panel] isn't approved. But if it does go through, "I think we'll be fine." CHAIR MURKOWSKI offered that [the Workers' Compensation Board] will be fine because there will be an additional panel. She asked if this will require more of the panel members by having a requirement that hearings must be scheduled. Number 444 MR. GROSSI explained that there isn't a problem in Juneau or Fairbanks, and offered that an additional panel in Anchorage will increase productivity by 25 percent. He stated, "We're focusing on the area of the problem." REPRESENTATIVE ROKEBERG asked if raising the stipend would help productivity. MR. GROSSI expressed that members sit on the board for volunteer reasons, but he thinks it would be a nice gesture [to raise the stipend]. REPRESENTATIVE ROKEBERG said he'd calculated that if there are 14 people meeting four days a month, that is 56 days; he'd rounded that figure down to 50 days. He said with a $100 stipend, that's only $5,000. He asked about the source of the workers' compensation account. MR. GROSSI said, "It's a statutory designated-program-receipts account. ... Basically, it's an account that's ... general funds program receipts." He explained that it's paid out of a portion of premium tax; for self-insurers, it's off of a percentage of indemnity benefits or workers' compensation benefits. REPRESENTATIVE ROKEBERG commented that the $5,000 figure is denoted for travel. Number 468 MR. GROSSI replied that that's the way [the Division of Workers' Compensation] accounts for the per diem, because there isn't another line item to deal with it. REPRESENTATIVE ROKEBERG asked if the fiscal gap would be affected if the stipend was raised. MR. GROSSI replied, "It would not affect the fiscal gap." REPRESENTATIVE ROKEBERG asked if Mr. Grossi had any idea what other boards around the state are being paid, either through a per diem or a stipend. Number 480 MR. GROSSI replied that some don't get any payments, but "some of them get hundreds [of dollars]." REPRESENTATIVE CRAWFORD asked, "I understand this would come from program receipts, but would that take program receipts away from some other program?" MR. GROSSI explained that the only two programs that these funds are available to are administration of workers' compensation and workers' safety - OSHA [Occupational Safety and Health Administration]. Number 489 REPRESENTATIVE CRAWFORD asked, "Would that take away from enforcement of OSHA?" MR. GROSSI offered that he thinks there are sufficient funds available. Even if it's $15,000, it's not going to make a significant difference. CHAIR MURKOWSKI asked whether the $50 stipend is all the compensation the board members receive, or if travel is included. MR. GROSSI replied that the board members are entitled to their travel. He mentioned the at-large panel and said that panel's travel costs are paid for. CHAIR MURKOWSKI inquired as to whether the board members are reimbursed for overnight expenses while traveling. MR. GROSSI replied in the affirmative. REPRESENTATIVE MEYER asked if food costs are covered also. MR. GROSSI offered that he thinks the board members are entitled to the $40-a-day food allowance that the state has. REPRESENTATIVE MEYER asked if he was correct that the board members receive a $50 stipend, travel costs, overnight expenses, and $40 for food. Number 506 MR. GROSSI explained that if the board member is from Anchorage and is hearing a case in Anchorage, then he/she isn't entitled to travel costs. He added, "They're entitled to travel [costs] when they actually travel." REPRESENTATIVE MEYER asked whether someone traveling from Wasilla to Anchorage would get a mileage reimbursement. MR. GROSSI responded in the affirmative. REPRESENTATIVE MEYER asked about babysitting costs. MR. GROSSI replied in the negative. Number 510 REPRESENTATIVE ROKEBERG calculated the cost to be about $5,000 a month, which would be an annual cost of $60,000. He asked, "Would the $60,000 make an impact on the account?" MR. GROSSI replied that it would be an increase, but that he believes there would be sufficient funds in the account. He said he couldn't answer with absolute certainty until he checked the account. REPRESENTATIVE ROKEBERG asked about any "fiscal baggage" [the division] might be dealing with right now. MR. MANLY replied, "We could certainly consider that at the [House] Finance Committee." REPRESENTATIVE ROKEBERG offered to make an amendment, or said [the House Finance Committee] could take the issue up. He said it might be easier if he offered an amendment, and then [the House Finance Committee] could remove the amendment if it didn't like the change. Number 527 REPRESENTATIVE MEYER said although he doesn't disagree with Representative Rokeberg's point, he doesn't think this is the appropriate time or place to raise the stipend. REPRESENTATIVE CRAWFORD stated that he doesn't disagree with Representative Rokeberg, either, but his main concern is to get extra board right now. CHAIR MURKOWSKI mentioned testimony that this is essentially a volunteer position, and if the stipend were raised, it wouldn't be to compensate the board members for time spent; rather, it would be a slight recognition of what they've done. Number 538 REPRESENTATIVE MEYER expressed that at some point, he'd like to look at all the boards and commissions, because it sounds as though some have no stipend, some have a $50 stipend, and some have a stipend over $100. MR. GROSSI said he remembers seeing one [board or commission] that had a $200 [stipend]. He stated, "I don't know exactly how those are determined." REPRESENTATIVE MEYER remarked, "I guess I'm a little sympathetic to the fish board too. Perhaps they should get something." Number 544 CHAIR MURKOWSKI offered that the Department of Labor [and Workforce Development] could summarize its boards, and the Division of Occupational Licensing could also, if [the legislature] wanted that kind of a summary. She stated, "As it's been pointed out, ... this is funded through a mechanism where these folks pay in, and goes for the ... administration of the workers' compensation program." Number 548 REPRESENTATIVE MEYER moved to report HB 377 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HB 377 was moved from the House Labor and Commerce Standing Committee.
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