Legislature(1997 - 1998)
03/19/1998 01:42 PM Senate L&C
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 336 - WORKERS' COMP: EXEMPT HOCKEY PLAYERS
CHAIRMAN LEMAN called the Senate Labor and Commerce Committee
meeting to order at 1:42 p.m. and announced SB 336 to be up for
consideration.
MR. LORALI MEIER, Aide to Senator Leman, said this bill amends
Worker's Compensation by adding professional hockey teams to the
list of persons not covered under AS 23.30.220. In exchange for
this exemption, a team owner would have to provide a medical and
disability program to cover the players and be responsible for the
cost of premiums. This program would cover the players 100 percent
of the time, whether they are traveling or on their own time.
MR. STAN GARLINGTON, Division of Insurance, didn't take a position
on SB 336.
SENATOR KELLY asked if they had heard from the hockey players
whether or not they want to be exempt, since it's such a dangerous
profession or is it a management decision.
CHAIRMAN LEMAN said they would defer that question to the next
person to testify who is from the Anchorage Aces.
SENATOR MACKIE asked why do they want to do this, other than
perhaps to have someone not pay worker's compensation. It seems
like hockey players are getting their teeth knocked out and other
things going on all the time. If anyone needs worker's
compensation, it would be them.
CHAIRMAN LEMAN said he thought the answer would be that there are
other ways to get medical expenses taken care of.
Number 62
MR. DEREK DONALD, General Manager, Anchorage Aces, said as long as
players are covered medically, they are fine. There is a policy in
place to cover salaries if a player is injured. Those two things
are their main concerns.
CHAIRMAN LEMAN asked him to explain the costs associated with
worker's compensation for the Anchorage Aces.
MR. DONALD answered that the cost of worker's compensation would
financially ruin the team. They have looked at other comparisons
with other teams, like in Phoenix, Arizona, where the annual
expense for worker's compensation is $25,000 - $30,000 per year.
In Anchorage, it would cost well over $200,000 for the season.
CHAIRMAN LEMAN asked what insurance would cost.
MR. DONALD replied he has estimates for different plans that range
anywhere, depending on the number of claims, from $30,000 - $40,000
upwards to $140,000 for the most expensive.
CHAIRMAN LEMAN asked if he had any records of what the medical
claims would be for the past year for the Anchorage Aces.
MR. DONALD said the total for last season was around $21,000.
SENATOR KELLY asked if they are currently paying worker's
compensation.
MR. DONALD answered that the owner had not been doing so that he
knew of.
CHAIRMAN LEMAN asked if they were under an insurance policy, then.
MR. DONALD answered yes.
SENATOR MACKIE asked if they aren't required by law right now to
pay worker's compensation. He was also concerned that assurances
be given to employees had they not been paying worker's
compensation, that they would continue to have wages or other
things taken care of as employees, that State law affords to other
people.
Number 110
MR. DONALD answered within the West Coast Hockey Rate, which
governs the Aces as well as other teams in their league, there is
a requirement that all players are covered for medical problems and
salaries.
CHAIRMAN LEMAN asked if any other states have an arrangement like
what is being proposed.
MR. DONALD answered that Florida is one state that allows
professional sports to operate under their own insurance policies.
He is doing research on other states.
SENATOR MACKIE asked Mr. Grossi what their position on the bill was
and if there are requirements for workers' compensation for
athletic teams right now.
MR. PAUL GROSSI, Director, Division of Workers' Compensation, said
the Department hadn't taken a position on this bill and unless
there is an exemption in workers' compensation, all employees have
to be covered by workers' compensation. They could also be
certified to self-insure. He said he hadn't checked to see if the
Anchorage Aces were currently covered.
SENATOR MACKIE asked why he didn't have a position on this.
MR. GROSSI answered mostly it's because they are not traditional
workers and it's such a small group that they didn't have a
position. This doesn't affect workers in general and he didn't
know a whole lot about the financial position of the Anchorage
Aces. In most situations, they would be against most industries
opting out of workers' compensation. They look at this similar to
entertainers who are exempted and aren't sure whether this is just
a sideline, similar to baseball teams where this isn't their prime
source of income.
SENATOR MACKIE asked what was exempted currently other than the
ones he listed in statute.
MR. GROSSI said there were numerous exemptions listed in statute.
CHAIRMAN LEMAN said it's interesting that fishermen are exempted,
because they have one of the most dangerous professions.
SENATOR KELLY reminded him that they have a separate fund.
SENATOR MACKIE explained that the fishermen's fund is paid into by
fishermen and is governed by a statute whereas a health care
insurance policy is a policy.
Number 209
SENATOR KELLY said he is a little concerned about the protection of
the players. He presumed they are contractual players and as such
should not be covered under workers' compensation. At this point,
he doesn't have a problem as long as there is a strong health care
insurance plan in place. If the Anchorage Aces are exempted from
workers' compensation, they are exempted from the no-fault concept
also and can be sued by the players. He wasn't sure they thought
about that. It also doesn't protect for lost wages, even if they
do have a strong plan in place. All of that being said, since they
don't have workers' compensation now and the Administration doesn't
care, he didn't want to stand in their way. Although, he thought
they needed added language in what the Aces would be required to
carry in terms of health care insurance plans and it would have to
be approved by the Director of the Division of Insurance.
Number 272
SENATOR KELLY moved to amend Subsection 9 after "under a health
care insurance plan" add "approved by the Director of Insurance."
CHAIRMAN LEMAN asked Mr. Garlington if the Division now approved
any health care insurance plans or does it just do rate review.
MR. GARLINGTON answered they review policy forms, but they would
not review an individual insurance policy.
CHAIRMAN LEMAN asked if Senator Kelly's proposed amendment would be
new work for him to do.
MR. GARLINGTON answered that was correct.
CHAIRMAN LEMAN said he would object for purposes of discussion. He
remembers dealing with health insurance reform a few years ago and
that was an issue that was brought up and the legislature chose not
to go into that arena. He considered requiring them to be covered
under a health care insurance plan comparable to the medical
coverages provided under workers' compensation or something like
that.
SENATOR KELLY said that would be fine.
MR. DONALD responded that they have basically covered themselves
for complete coverage of an injury and has no problem with that
language. Their intention is to make sure they are covered from
that aspect as well.
CHAIRMAN LEMAN asked if he was aware of the risk they have of being
subject to lawsuit from injuries.
MR. DONALD answered he was.
SENATOR MACKIE asked if they are currently self-insured or do they
have a health insurance policy.
MR. DONALD answered that they have a policy for the players.
SENATOR KELLY said he would withdraw his motion in favor of a
conceptual amendment that it is comparable to the medical insurance
covered under workers' compensation. There were no objections and
it was so ordered.
SENATOR MACKIE said he was still concerned with how the players
were taken care of for lost wages, if they are to suffer an injury
that won't allow them to work, especially since policies can
change.
Number 324
MR. DONALD explained that there is wording in their contract that
says players are entitled to pay if they are injured during the
game or practice. The cost of that is very minimal in relation to
any premiums they would pay. The average salary would be $300 -
$500 per week.
SENATOR KELLY asked how long the season lasted.
MR. DONALD answered that they play 64 regular season games plus any
playoffs. The season runs from October 1 through the end of April,
about six months.
SENATOR MACKIE asked if there was anything in the contract dealing
with a worker that was injured and how long they had to pay his
salary. What if it was for a couple of years?
MR. DONALD said there is something that will be implemented in one
of the policies they are looking at regarding future wages for
injuries lasting longer than the season.
SENATOR MACKIE said he thought that would be an issue when the bill
comes to the floor.
SENATOR MACKIE moved CSSB 336(L&C)from Committee with individual
recommendations. There were no objections and it was so ordered.
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