Legislature(2001 - 2002)
03/27/2001 03:00 PM House ARR
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
JOINT MEETING
ADMINISTRATIVE REGULATION REVIEW
March 27, 2001
3:00 p.m.
HOUSE MEMBERS PRESENT
Representative Lesil McGuire, Chair
Representative Jeannette James
Representative Joe Hayes
HOUSE MEMBERS ABSENT
All members present
SENATE MEMBERS PRESENT
Senator Georgianna Lincoln
SENATE MEMBERS ABSENT
Senator Robin Taylor, Vice Chair
Senator Lyda Green
COMMITTEE CALENDAR
Review of recent proposed and approved regulations/Proposed
Pioneers' Homes rate increases
PREVIOUS ACTION
No previous action to record
WITNESS REGISTER
JIM KOHN, Director
Division of Alaska Longevity Programs
Department of Administration
PO Box 110211
Juneau, Alaska 99811-0211
POSITION STATEMENT: Discussed the proposed regulations and
answered questions.
ALISON ELGEE, Deputy Commissioner
Department of Administration
PO Box 110200
Juneau, Alaska 99811-0200
POSITION STATEMENT: Answered questions.
CHARLES JOHNSON, AARP representative and veteran
Sitka, Alaska
POSITION STATEMENT: Testified on the proposed regulations and
asked questions.
DAVID PREE, Resident
of the Anchorage Pioneers' Home
POSITION STATEMENT: Expressed interest in the legislature's
intent with the creation of the Pioneers' Homes.
ACTION NARRATIVE
TAPE 01-9, SIDE A
Number 001
CHAIR LESIL McGUIRE called the meeting of the Joint Committee on
Administrative Regulation Review to order at 3:00 p.m.
Representatives McGuire, James, Hayes, and Senator Lincoln were
present at the call to order.
Proposed Pioneers' Homes rate increases
CHAIR McGUIRE announced that the committee would hear testimony
on the proposed rate increases for the Pioneers' Homes. She
explained that the committee is hearing this issue today due to
concern that a particular policy in the regulations may be in
contradiction to statute. That policy appears to be one of full
compensation on the part of pioneers. Chair McGuire noted that
the committee packet should include a letter to Governor Knowles
from the Pioneers' Home Advisory Board. The [second page,
fourth paragraph] of the letter appears to recommend full cost
of care recovery by 2003; there would be a slow increase over
the years. However, the problem seems to be that the
regulations were promulgated under AS 47.55.030, which governors
admission on payment. That statute, AS 47.55.030, says that the
rate charge doesn't need to fully compensate the state.
CHAIR McGUIRE directed attention to a series of minutes from
1995 when the legislature considered privatizing Pioneers'
Homes. Much of the testimony through the [1995] committee
process focused on the concern that privatization of the
Pioneers' Homes would result in assessment of the full cost of
care to the pioneers, which could create a hardship on the
pioneers. Chair McGuire noted that the proposed regulations
would take effect July 1, 2001. She also noted her intent to
take testimony and to closely follow this in order to determine
whether these regulations comport with this legislature's
intent.
CHAIR McGUIRE, in response to Representative James, said that
the committee doesn't have any information from the March 23[,
2001,] meeting [on the sixth rate increase].
Number 0378
JIM KOHN, Director, Division of Alaska Longevity Programs,
Department of Administration, read the following testimony:
For many years Pioneers' Home rates charged to
residents were exceedingly low and didn't reflect the
actual cost to provide services. Consequently, every
year, the state subsidized the Homes to a greater and
greater degree.
Early in the Pioneers' Home history, residents were
required to give all their monthly income to the Home,
keeping $25 for personal spending. Of the total
Pioneers' Home population at that time, only a few
residents had ... income ... [such as] social security
... [or] railroad pension checks [to help pay for
their cost of care]. In 1954, the first formal
[monthly] rates were set at $150 per month. At this
time the Homes primarily served indigent elderly
Alaskans. Indigent elderly Alaskans were given
priority for admission.
In 1961, the legislature added a provision that those
applicants who were not indigent could enter the
Pioneers' Home as long as they agreed to pay for care.
AS 47.55.030(a) says "A person eligible for admission
[under AS 47.55.020] may on application be admitted to
the home upon the person's agreement to pay to the
state each month an amount the Department of
Administration considers sufficient to compensate the
state for the cost of care and support of the person
at the home." During the decades following this
legislative change of admission criteria, the periodic
rate increases fell well behind the cost of care.
In 1995, the legislature introduced a bill to close
the Pioneers' Homes. That bill was based on two
fiscal gap studies which recommended closing the
Pioneers' Homes in order to help close the fiscal gap.
Clearly, the Homes needed a plan to decrease the need
for general fund dollars in order to survive the
fiscal gap budget reductions.
The Pioneers' Home advisory board reviewed the rate
history and legislative intent regarding payment for
Pioneers' Home services. Consequently, the board
recommended to the Governor in the fall of 1995 that
residents be charged for their cost of care. The
board's plan increased rates in annual increments over
seven years. The advisory board's recommendation was
implemented in fiscal year 97, which was July of 1996,
and the process has increasingly reduced the Pioneers'
Homes' dependence on state general funds each year.
Through the years the question continues to be, "Who
is responsible to pay for the Pioneers' Homes and what
is the funding source?" Presently, the funding source
is approximately 64 percent state general funds and 36
percent program receipts. As you can see, program
receipts pay only a portion of the full cost. Every
dollar collected from a resident for care reduces the
Pioneers' Home dependence on the state general fund by
a corresponding dollar. Therefore, as the rates
increase and residents pay more of the cost of care,
fewer state general fund dollars are needed.
In fiscal year '94, 15 percent of the cost of
operating the Homes was paid for by the residents. In
fiscal year '01 the percentage is up to 36 percent.
Program receipts are expected to make up $13.2 million
of the $33.8 million FY01 Pioneers' Home budget. If
the governor's budget is passed by the legislature for
FY02, it is projected that the program receipts will
be in excess of $15 million of the $38.9 million
proposed budget.
As the residents pay an increased share of the cost of
the Homes' operation, we continue to keep the overall
cost of operating the Homes down. We have strategies
that include:
Centralizing certain jobs and services such as
waiting lists, payment assistance process,
billing and revenue collection, purchasing of
supplies, and other office functions;
Utilizing purchasing cooperatives and volume
discounts for supplies and pharmaceuticals;
Becoming more energy efficient;
Extending health care service resources by using
other funding such as Medicaid Part B;
And computerization of quality assurance
reporting, resident records, and preventative
building maintenance records.
Some of these cost containment and cost reduction
strategies are reflected in a recent legislative
audit, which stated that the cost of operating the
Homes from 1995 to 1999 decreased by 4.3 percent.
Since the board's seven-year plan began to go into
effect, the legislature has responded with two
Pioneers' Home statutory changes: AS 47.55.020(b),
[which] was amended in 1996 stating, "The department
may not evict a person from the Pioneers' Home if the
income and assets of that person are insufficient to
pay the monthly rate." In 1997, the legislature
passed the Pioneers' Home Resident Dignity Act, which
placed a number of regulations into statute.
The hearing for the sixth of the seven proposed rate
increases took place ... March 23rd [2001]. The rate
increase is scheduled to begin on July 1, 2001. As in
previous hearings, participants made suggestions to
the department to assist residents and their families
as the rates increase. The department has implemented
many of these suggestions over the years, such as
providing economic security for the spouses of a
Pioneers' Home resident who resides in the community.
At the time the Pioneers' Home Advisory Board
recommended the seven-year rate increase plan, the
board also recommended that steps should be taken to
develop long-term care insurance to assist Alaskans
who have to pay for care in the Pioneers' Homes and
other facilities. Not only is it difficult for
residents in the Pioneers' Homes to pay for the
increasing cost for their care, but it is also
difficult for those unable to enter a Pioneers' Home
to pay private sector assisted living and skilled
nursing home costs.
MR. KOHN offered to answer questions.
Number 0920
REPRESENTATIVE HAYES inquired as to the percentage the pioneers
would pay versus the state's role in financing at the seven year
mark.
MR. KOHN explained that in the seventh year, the Pioneers' Home
wouldn't expect to be charging the full cost of care. He
further explained that when the seven-year plan was developed,
1995 was used as the cost of running the Pioneers' Homes. The
board wanted to have an unchanging plan in order that people
would know the rates in advance. Therefore, the cost of care
referred to the cost of care in 1995.
MR. KOHN turned to how much would actually be collected due to
the rate increases. In FY02, about $15 million would be
collected of the $38 million budget. The next rate increase,
the seventh rate increase, would probably cause [an increase in
collections of] about a few hundred thousand. He estimated that
about 40 percent would be the limit.
REPRESENTATIVE HAYES related his understanding then that
references to cost of care don't necessarily mean the cost to
run a facility.
MR. KOHN explained that the board discussed raising the cost of
care and the cost of care of 1995. However, when determining
the cost of care, the fact that not everyone can pay must be
taken into consideration. Therefore, for about half the people
in the home, the cost of care isn't even collected and thus
about half of those in the homes pay on a sliding scale rate
that is based on their income. He acknowledged that although
the cost of care is approaching the level it was in 1995, the
cost of care will never actually be collected.
Number 1232
REPRESENTATIVE JAMES inquired as to the percentage of people in
the homes that can pay, and what percentage are already at their
limit. She also inquired as to whether the Choice waiver
program is utilized for those [who qualify].
MR. KOHN answered that about half of the residents pay full
charges, while the other half do not. Those that don't pay full
charges make payments based on their income and assets. In
regard to the waiver, it is a Medicaid fund. In order to
receive this waiver, the Pioneers' Homes would be required to
change a number of things, such as the one-year residency
requirement. Therefore, the waiver program hasn't been used in
the Pioneers' Homes. However, Medicare has been used. He
explained that residents are required to have Medicare Part B,
which costs about $50 a month. If the resident doesn't have
that $50, then the [department] pays it. If a resident requires
additional physical therapy after release from the hospital,
then the home arranges for a private sector physical therapist
who bills Medicare Part B.
REPRESENTATIVE JAMES indicated her support of the assisted
living home environment. She noted that it seems that the
Pioneers' Home is more expensive than an assisted living
situation where there is also the ability to utilize the Choice
waiver. Therefore, she inquired as to Mr. Kohn's thoughts on
trying to expand Alaska's assisted living home operations as
opposed to continuing the Pioneers' Homes.
MR. KOHN noted his support of expanding assisted living
opportunities in Alaska because of the need as the elderly
population increases. He recognized that the Choice waiver
program requires that a person spend down their assets as is the
case with Medicaid and the Pioneers' Home. However, he pointed
out that by and large the private sector assisted living homes
are sending some of their residents to the Pioneers' Homes. The
reason for that, he believes, is that the Pioneers' Homes have
maintained a fairly high medical model assisted living program.
Therefore, nurses are available 24 hours a day. However, in the
private sector such medical support and involvement in the care
of the resident is not present. Therefore, the Pioneers' Homes
tend to receive residents when they are older, and often have
more problems. The average age of entrance is 83 and the
average age in the home is in excess of age 87. Mr. Kohn said
that he believes there is a place for everyone, in providing
care for the elderly, and thus he supports the private sector.
CHAIR McGUIRE turned to the issue of nursing shortages. In her
opinion, the [rate] increases are fairly significant. She asked
if the increases will solve the nursing shortage and fill the
100 beds that are currently available.
MR. KOHN answered that the increase will allow the homes to
collect the money that is part of the proposed budget. The 2002
budget proposed by the governor has about a $5 million increase,
about half of which is Pioneers' Home receipts. Therefore, as
the money is collected and spent as Pioneers' Home receipts,
most of that money will be spent on more staff in order to staff
the [vacant] beds. Mr. Kohn informed the committee that
currently 83 percent of their budget is spent on staffing, and
he didn't expect that to change.
CHAIR McGUIRE inquired as to the number of staff and beds that
would be funded with the money collected from the increment
increase from last year to this year.
MR. KOHN explained that in the governor's 2002 budget, the
[Pioneers' Home] is requesting approximately $5 million in order
to fill about 90 vacant beds that are located in Palmer,
Anchorage, and Sitka. He recalled that those 90 beds would
require 127 new staff in order to provide care for those on the
waiting list. Those on the waiting list are people who need 24
hour care.
CHAIR McGUIRE asked if it would be safe to say that by 2007,
[Alaska] would have solved its nursing shortage and filled all
the [vacant] beds.
MR. KOHN replied that he couldn't answer that.
Number 1807
REPRESENTATIVE JAMES inquired as to where those on the waiting
list [receive care] while on the waiting list.
MR. KOHN acknowledged that some on the waiting list are quite
desperate and frequently inquire as to their position on the
waiting list. There are also many on the waiting list that are
being taken care of at home by family members.
REPRESENTATIVE JAMES inquired as to the percentage of people in
the Pioneers' Homes and on the waiting list that are Alzheimer's
patients.
MR. KOHN answered that, depending upon the home, between 80-90
percent of those in the Pioneers' Homes are Alzheimer's
patients. The waiting list reflects about the same percentage.
CHAIR McGUIRE asked if it would be fair to say that when the
increases are completed next year, there will be some who will
be paying the full cost of care.
MR. KOHN replied no, and clarified that even with the increases
no one in the Pioneers' Homes will be charged the full cost of
care. In further response to Chair McGuire, Mr. Kohn explained
that the cost hasn't been refigured. The original cost was
based on 1995 when the seven-year rate increase began. However,
he estimated that the Pioneers' Home residents would be "a ways
out from paying the full cost of care." He agreed with Chair
McGuire that patients might be paying as high as 80 percent of
the cost of care.
Number 1944
SENATOR LINCOLN returned to the issue of the vacant beds and the
proposed legislation to fill [some of] those beds with veterans.
She inquired as to how that veterans' legislation would impact
the services and staffing.
MR. KOHN informed the committee that currently there are
approximately 90 veterans in the Pioneers' Homes. Mr. Kohn
interpreted the proposed veterans' preference to mean putting
aside 25 beds, about 21 percent of the total of beds, [for
veterans]. Therefore, there is a difference of about 35 beds
between the preference and how many veterans are already in the
home. Currently, there are 56 veterans on the active waiting
list, and therefore approximately 35 of the 56 would be taken
off the waiting list. However, he reminded the committee that
about 90 beds would be opened and the veterans wouldn't have
preference on the balance of those beds. Therefore, the
preference would be in place until 125 veterans [are placed in
the homes].
SENATOR LINCOLN recalled, in relation to the proposed veterans'
preference legislation, that the beds are available and [filling
the beds with veterans] wouldn't have any impact. She didn't
understand how there is a waiting list while there are vacant
beds for which there will possibly be a veterans' preference.
If there is a veterans' preference, she inquired as to how that
would impact the program receipts.
MR. KOHN explained that the veterans are [already] on the
waiting list. The charge to veterans or nonveterans will be the
same. However, work is being done with the federal Department
of Veterans Affairs (VA) in order to try to waiver funds to
veterans in order to help pay for their care in Pioneers' Homes.
U.S. Secretary Principi, Department of Veterans Affairs, has
said that the waiver is doable. The money from the waiver would
go directly to the veterans to help pay for their care.
However, most people don't have the income to pay the full
charge and thus receiving financing from the outside - from the
VA - will increase their income and ability to pay the charges.
Therefore, the Pioneers' Homes will collect more. Mr. Kohn saw
it as increasing the Pioneers' Homes ability to collect program
receipts from veterans.
Number 2269
REPRESENTATIVE JAMES related her understanding that the current
request, the additional money to open up the beds, would be
funded with general fund (GF) dollars.
MR. KOHN clarified that [the request] is funded with half GF and
half program receipts.
REPRESENTATIVE JAMES indicated her understanding of that, and
pointed out that it didn't include any funding for veterans.
MR. KOHN said, "It's included in the program receipts so that if
the ... Veterans Administration is able to come up with a waiver
that allows the veteran to receive a per diem ..., then that
would go to the veteran who would then use it as income to pay
the program receipts."
REPRESENTATIVE JAMES noted that she shared the same concerns as
Senator Lincoln in regard to the waiting list. She felt that
doing [the veterans' preference] would reduce the opportunity
for some of the women to [enter the Pioneers' Homes].
Representative James expressed her nervousness with utilizing
preferences versus seeing people one at a time [as individuals].
Number 2366
REPRESENTATIVE JAMES then turned to the rates and expressed the
need to develop a different plan in view of the increasing
elderly population and the average rate of assisted living.
Therefore, she inquired as to any suggestions from Mr. Kohn.
MR. KOHN recalled that the board reported [the increasing
elderly population and rates for assisted living] as a looming
problem. The board felt that long-term care insurance should be
investigated by the state, but it hasn't been done yet. He said
that [investigating long-term care insurance] would be his only
suggestion.
REPRESENTATIVE JAMES remarked that capital expenditures are used
to maintain these Pioneers' Homes. She said that she wasn't
convinced that the Pioneers' Homes were designed to take care of
people efficiently and thus the construction of the building
itself could be a cost deterrent.
MR. KOHN agreed with that assessment.
Number 2516
CHAIR McGUIRE turned to the problems with the waiver programs,
that is the one-year residency requirement. She pointed out
that there is a needy pool that has some overlap because it has
some members that are veterans. Therefore, she inquired as to
whether there has been any thought given to amending the waiver
requirements for the neediest category overall.
MR. KOHN deferred to the Department of Administration or the
Department of Health & Social Services.
Number 2591
ALISON ELGEE, Deputy Commissioner, Department of Administration,
informed the committee that she traveled with the Pioneers' Home
Advisory Board when this policy was debated back in 1995. The
decision to move [residents] to the full cost of care was very
difficult, and therefore was frozen at the 1995 rate. She
recalled that the bottom line for the board was to treat
Alaska's seniors equally. In 1995 there were in excess of
30,000 seniors and the projections are that the senior
population will more than double by 2010. With six homes, "we"
would never be in a position to provide low-cost long-term care
to seniors across the state. It was felt unfair that some have
to seek long-term care services elsewhere, simply because there
wasn't room.
MS. ELGEE acknowledged that the Pioneers' Homes are more
expensive than the small assisted living facilities. However,
the Pioneers' Homes are less expensive than the long-term care
nursing homes. She echoed Mr. Kohn's point that the Pioneers'
Homes provide an assisted living environment with a heavy
medical model. Therefore, she felt that the costs are
comparable for the services being provided. In regard to equity
for seniors, the move to full cost of care was good public
policy. She noted that the financial rules before financial
assistance begins were modeled similar to those in Medicaid in
order to provide equity.
Number 2696
CHAIR McGUIRE asked if there was a response to the letter sent
by the Pioneers' Home Advisory Board to Governor Knowles.
MS. ELGEE explained that the governor doesn't respond in
writing, but rather has a meeting with representatives from the
board after the recommendations are proposed.
CHAIR McGUIRE restated her earlier question regarding whether
any consideration had been or will be given to the notion of
waiving the overall Medicaid requirement.
MS. ELGEE clarified that the negotiations taking place with the
VA are seeking an alternative to the VA's normal course of long-
term care delivery in a stand-alone veterans' home. She
mentioned the rules that the [VA] has. The discussion with the
VA is revolving around doing a demonstration project that
provides veterans money in a format similar to that of Medicaid
waivers. This would be a demonstration project that would allow
the [VA] to pay [veterans] that would be residents of a stand-
alone veterans' home, if Alaska had such.
CHAIR McGUIRE expressed her belief that one of the solutions may
be to obtain some of the Medicaid waiver dollars. However, she
didn't want to eliminate the residency requirement.
MS. ELGEE pointed out that in order to obtain Medicaid waiver
dollars, the Pioneers' Home residency and age requirements would
have to be eliminated. Furthermore, Ms. Elgee pointed out that
Medicaid isn't available to people until they have spent down to
a point that exceeds Alaska's state regulations regarding when
state payment assistance begins. Therefore, receiving Medicaid
provides no advantage to the residents themselves. However, if
"we" chose to accept Medicaid and abandon the age and residency
requirements, then the Pioneers' Home could use Medicaid dollars
to perhaps supplement and replace some general fund dollars.
Again, [Medicaid] will never be a greater advantage to residents
themselves due to the Medicaid spend-down requirements.
Number 2897
SENATOR LINCOLN returned to the letter from the Pioneers' Home
Advisory Board. Of the five recommendations noted in that
letter, what has been done with any of them?
MS. ELGEE turned to the first recommendation, which requested
additional funding for staffing. The governor proposed, in the
fiscal year 1996 budget, additional funding for Pioneers' Home
staff. She recalled that only a portion of the full request was
received from the legislature. In other years, the legislature
has included some portion of requests for capital funds, which
is also addressed in the first recommendation. Ms. Elgee said
that the full request for the Pioneers' Home program has never
made it through the governor's budget deliberation or the
legislative process.
SENATOR LINCOLN requested that Ms. Elgee respond in writing as
to where these 1995 recommendations stand.
TAPE 01-9, SIDE B
Number 3002
MS. ELGEE, in response to Representative James, answered that
the current admission criteria for the Pioneers' Home would not
be changed, even with a veterans' preference. Therefore,
veterans seeking to enter the Pioneers' Home would have to be 65
and older with one year of residency.
MS. ELGEE agreed with Representative James's understanding that
establishing a veterans' preference in order to obtain federal
payment is still in the discussion stage. Furthermore, the
budget attached to the Veterans' and Pioneers' Home proposal
doesn't assume any federal funds. However, that avenue will
still be pursued in order to determine if some benefits can be
provided to veterans.
REPRESENTATIVE JAMES asked if the per diem was given to veterans
in the Pioneers' Homes, would that same per diem be available to
veterans in assisted living homes.
MS. ELGEE replied that she didn't know. The discussions with
the VA have been specifically in regard to the Pioneers' Home
approach. However, she understood the VA to be reviewing a
variety of alternatives for providing long-term care. The VA
recognizes that the independent veterans' home approach that has
been utilized throughout the country for years is an
extraordinarily expensive manner in which to meet long-term care
needs. Therefore, she imagined seeing changes.
REPRESENTATIVE JAMES related her belief that if the VA would be
willing to provide funds to a Pioneers' and Veterans' Home, then
she felt that it should apply to any veteran regardless of where
the services were provided because there is no alternative care
in Alaska specifically for veterans.
Number 2824
CHAIR McGUIRE asked: "Is it the Department of Administration's
position that the legislature has authorized regs to be written
that would implement a fee structure that would fully pay for
the cost of care in the Pioneers' Home?"
MS. ELGEE answered that the department believes that the
regulations provide the department the ability to charge up to
the full cost of care. However, "we never expected the
Pioneers' Homes to be supported solely by resident rates," she
clarified. She felt the legislature understood that in terms of
the legislation adopted, which placed guarantees placed in
statute. For instance, there is the guarantee that no resident
will be evicted from the Pioneers' Home even if he/she doesn't
have the ability to pay. Furthermore, financial information
isn't collected.
Number 2730
CHARLES JOHNSON, AARP representative and veteran, testified via
teleconference. He posed a hypothetical situation in which a
man in his 80s is married to a woman 15 years his junior and
they have some assets. If the man enters the Pioneers' Home as
a veteran, will the requirements be the same so that the
couple's assets are spent down to the level at which Medicaid
could be obtained. Furthermore, if the couple has long-term
care insurance and the man outlives the term of the insurance,
what impact would that have on his civilian wife.
MR. KOHN recalled that during the yearly hearings for the rate
increases, witnesses testified to the changes that might be
helpful. One of the changes suggested was to help the spouse
that remained in the community while the other entered the home,
which is what he understood Mr. Johnson's hypothetical situation
to be. Presently, the regulations allow the spouse in the
community to keep a house of any value, a car of any value,
$100,000 in additional assets, $2,000 of joint income per month,
a $4,500 burial fee for each, and $5,000 plus $100 a month in
cash for the spouse in the home. He noted that there may be a
few other things that are allowed before any collection begins.
Number 2572
MR. JOHNSON turned to the per diem payment and related his
belief that paying it directly to the Pioneers' Home would be
better than first paying it to the veteran.
MR. KOHN informed everyone that discussion thus far has revolved
around the money going directly to the veteran because the VA
would have to know where the veteran is located and what kind of
care he/she is receiving. The money would go to the veteran
because of the veteran being outside of the stand-alone
veterans' home. However, as discussions continue that may
change.
MR. JOHNSON recalled the situation in Mt. Edgecumbe when the
Bureau of Indian Affairs (BIA) would send its physicians and
nurses to finish their terms at the hospital. He wondered if
that would be a possibility for them to assist at the Pioneers'
and Veterans' Homes.
MR. KOHN remarked that the Pioneers' and Veterans' Homes concept
opens up a lot of possibilities. The aforementioned suggestion
may be a possibility.
MR. JOHNSON informed the committee that his wife is a volunteer
at the Sitka Pioneers' Home and she is concerned about the
understaffing there.
MR. KOHN pointed out that over 83 percent of the Pioneers'
Home's budget goes toward staff. The staff to resident ratio is
similar in all the homes. Currently, in the 24 hour care areas
residents receive an average of 4.9 hours of care per resident
per day. However, there is a nursing shortage. Specifically,
in Sitka, there have been problems in regard to filling
positions and thus nurses have had to work extra in order to
maintain sufficient staffing. This is the case in a number of
the homes. He believes this problem will be resolved with the
increase.
Number 2262
CHAIR McGUIRE inquired as to whether any more nurses were gained
last year [due to last year's rate increase].
MR. KOHN replied no. In some years, the Pioneers' Home's budget
has requested that some of the program receipts be kept as an
increment to the budget. He recalled that in 1997 or 1998 a
fairly large amount was kept and a number of staff were hired.
However, most years, as the program receipts increased, the
general fund dollars increased and thus the budget was the same
[total amount] but with a different mix.
CHAIR McGUIRE surmised then that in six years [of rate
increases] there was only one year in which significant [staff
increases took place].
MR. KOHN responded that there was more than one year. He
offered to provide that information.
Number 2186
CHAIR McGUIRE related her understanding that the [department]
predicts that the upcoming rate increase coupled with the
general fund request would result in the hiring of 127 new
staff.
MR. KOHN interjected that those hired would be nurses and nurse
aides.
CHAIR McGUIRE related the opinion of some legislators that the
[nursing] shortage isn't something that money can make up,
because there is a nationwide shortage of nurses.
MR. KOHN presented his view. "As long as nursing is paid at a
very low rate of pay, you don't draw new people into nursing,"
he charged. However, he pointed out that the Alaska Nursing
Home Association (ANSHA) has spearheaded a program in order to
train LPNs and RNs in Alaska. If nurses know that a good paying
job is waiting for them, they will take the time to move up.
Number 2043
DAVID PREE, Resident of the Anchorage Pioneers' Home, testified
via teleconference. He informed the committee that he was the
last First Assistant Attorney General before statehood and he
was also the Statehood Election Commissioner. Therefore, he is
very familiar with statutory construction and the relationship
between the executive and judicial branches and the executive
and legislative branches of government. Mr. Pree asked if
Commissioner Kohn had requested an opinion from the Attorney
General regarding the Department of Administration's
interpretation of the various statutes involved.
MS. ELGEE answered that all regulation development promulgated
by any program or department is done so with the legal advice
and review of the Department of Law. The department worked
directly with an attorney from the Department of Law on the
drafting of these regulations. Then another attorney within the
Department of Law reviews the regulations before the department
is allowed to promulgate the regulations and conduct public
hearings. Upon completion of the public hearing process, there
is a final review of the regulations by the Department of Law
before the regulations become effective.
MR. PREE remarked that Ms. Elgee's answer refers to the legal
ease of the regulations with which he is not interested. Mr.
Pree clarified that he is interested in the intent of the
legislature. He said:
What was the intent that the legislative body had in
enacting the Pioneer Homes and the cost entailed
thereof. We have a co-mangling (ph) of the capital
expenses here, maintenance of the existing facility,
and then you have operating expenses. If ... the
administrative agency, who is to administer these
laws, interpret these statute one way and it's
inconsistent with the legislative intent, then you've
created a lot of mess for the state and for the
individual agency. If the commissioner hasn't
requested an Attorney General's opinion on the
question of legislative intent and your proposed
increases here and use of the money, I respectfully
submit that the administrator or the executive branch
of government is not willing to ... have the Attorney
General look at this aspect, then I respectfully
submit that the legislative attorney should look at
it. There are a number of questions that I have
involved in this whole mess.
CHAIR McGUIRE clarified that the role of Joint Committee on
Administrative Regulation Review is to review proposed
regulations in order to determine whether those regulations
comport or do not comport with legislative intent. She said,
"That's precisely the reason why we are holding this hearing."
Chair McGuire noted that Senator Lincoln had requested [that the
department have] the ability to respond in writing. Chair
McGuire said, "We respectfully request that the Lieutenant
Governor doesn't sign these yet." She pointed out that these
regulations don't go into effect until July 1st and the public
comment period is now.
MR. PREE requested the following from someone in the Department
of Administration:
What $800,000 of receipts were diverted from the money
that was supposedly appropriated for the original
$1.13 million that the legislature last time referred
to.
MS. ELGEE clarified that Mr. Pree was referring to the money
that was appropriated last year for the heating, ventilation,
and air conditioning system at the Anchorage Pioneers' Home.
She explained that last year [the Department of Administration]
had almost a $1.5 million [request] before the legislature. The
legislature provided [the department with] $250,000 in Alaska
Housing and Finance Corporation (AHFC) funds and the ability to
spend program receipt revenues if they collected Pioneers' Home
resident fees in excess of what were included in the operating
budget. She informed the committee that last year about
$285,000 were realized to put toward that project. However, she
didn't anticipate any excess revenue collections in the current
year. Therefore, the authorization is basically an empty shell
that has no revenue behind it. In recognition of that, [the
department] has a million dollar supplemental request before the
legislature in order to be able to complete that project.
MR. PREE reiterated his question: "Why was $800,000 of receipts
from, apparently, residents diverted to some other source?"
MS. ELGEE restated that no money was diverted. She reiterated
that [the department] had a spending authorization that was
based on the speculation that there might be more revenue coming
in than was budgeted for other purposes, which did not occur.
Therefore, resident revenues were not diverted to any other
purpose and thus are all reflected in the Pioneers' Home's
operating budget. Ms. Elgee noted that there have been years in
which more money was collected than there was an authorization
to spend. Therefore, the legislature provided the opportunity
for an authorization, but there was not excess money.
MR. PREE asked Ms. Elgee if she was the department
representative who appeared before the Senate Committee on
Oversight in February.
MS. ELGEE specified that she is the Deputy Commissioner of the
Department of Administration. She was unsure as to which
committee [meeting] Mr. Pree was referring.
Number 1450
MR. PREE reiterated his earlier question regarding why $800,000
was diverted from receipts to maintenance. Mr. Pree said:
The federal government has made it real clear that
they will not, under any circumstances, contribute
anything to a capital budget fund or the capital for
the Pioneer Home. They will not pay a dime for
maintenance. That means operating expenses only.
Why, then, does either the legislative branch or, for
that matter, the executive [branch] divert funds that
were originally derived from the residents [of the
Pioneers' Home].
MS. ELGEE again stated that no resident revenues were diverted.
In regard to there being no federal funding for maintenance, Ms.
Elgee pointed out that [the Pioneers' Home] actually received
$600,000 last year through the federal government for
maintenance at the Sitka Pioneers' Home.
CHAIR McGUIRE asked if Ms. Elgee would be willing to respond in
writing to Mr. Pree and to the committee.
MS. ELGEE answered in the affirmative.
CHAIR McGUIRE, in response to Mr. Pree, agreed to obtain a copy
of the hearing Mr. Pree was interested in.
ADJOURNMENT
There being no further business before the committee, the Joint
Committee on Administrative Regulation Review meeting was
adjourned at 4:19 p.m.
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