HB 219-FIRE AND EMERGENCY MEDICAL SERVICES  8:06:28 AM CHAIR MUNOZ announced that the first order of business would be HOUSE BILL NO. 219, "An Act exempting certain emergency medical and fire department services from regulation as insurance." 8:06:47 AM MICHAEL PASCHALL, Staff, Representative Eric Feige, Alaska State Legislature, speaking on behalf of the sponsor, Representative Feige, first disclosed that he is an assistant chief of a volunteer fire department and Representative Feige is a chief of a volunteer fire department that could be impacted by HB 219. Mr. Paschall opined that the last hearing on HB 219 became a bit sidetracked pertaining to certification under Alaska statute. The sponsor's opinion is that statute doesn't specifically state that certification is required. He noted that the committee packet should include a legal opinion from Legislative Legal Services dated February 29, 2012, which relates the conclusion that the language is ambiguous regarding certification. Mr. Paschall pointed out that HB 219 isn't about certification, but rather exempts nonprofit municipal organizations that provide fire, ambulance, and emergency medical services (EMS) from the requirements of Title 21 of statute. MR. PASCHALL informed the committee that although the Division of Insurance provides exemptions similar to those proposed in HB 219, those existing exemptions don't reach fire, ambulance, and EMS providers that aren't a municipality, nonprofit association, or nonprofit medical services corporation. He opined that the provisions in AS 21.87, which were referenced at the last hearing, were designed to apply to medical service corporations that provide health care across a broad range such as Blue Cross. He further opined that the intent of that statute wasn't to deal with small municipal or nonprofit ambulance services. He noted that creating a nonprofit medical services corporation is much more difficult than simply creating a nonprofit. For example, a medical services corporation has to have available a minimum of $100,000 in assets to cover six months of operations in order to be certified by the Division of Insurance. Most of the organizations HB 219 seeks to help don't have the $100,000 and are struggling to get by. The goal is to provide a mechanism for an organization, large or small, to entice donations and financial support by allowing them to waive fees to those who provide an agreed upon level of financial support in advance of services. He emphasized that there is no guarantee the organization will provide those services, just as there is no guarantee today that the same organization would provide those services. This legislation would allow the organization to waive fees in order to literally keep the doors open by paying day-to-day expenses. With regard to the concern regarding these organizations receiving funds from multiple sources, Mr. Paschall said that's already the case for many of the ambulance services that are municipally run or funded through tax revenue. For instance, when the City of Fairbanks fire department, which is supported by city taxes, responds to a wreck within the city, the owner of the vehicle will be billed for the call. Therefore, the scenario of concern already occurs and won't be changed by HB 219. 8:12:16 AM REPRESENTATIVE GARDNER asked if it's possible for a fire department that's supported by property taxes to also have subscriptions. MR. PASCHALL said that they would have to review a department that's run by a municipality and one that's contracted through a service area. For example, he presumed that the City of Fairbanks could enact a program for subscriptions such that when they run a call for which they would normally bill, they wouldn't bill for [when there is a subscription]. In the case of most service area departments, they are nonprofits under contract with the municipality to provide services. Although the revenue generates from property taxes, it's not necessarily paid to them in the form of a percentage of a property tax but rather is based on a budget that they submitted. He opined that both fire and EMS would be able to do the aforementioned. REPRESENTATIVE GARDNER expressed concern with the aforementioned because a property taxpayer is already paying for service, albeit that it might be inadequate. MR. PASCHALL acknowledged the concern, but pointed out that the legislation doesn't change the types of funding [certain emergency medical and fire department services] can obtain. The legislation merely allows them to accept the funding upfront to defer the fee, as a way to place more operating funds in the department's budget in advance. "From a practical standpoint, I think what you're looking at there is what works in each individual community," he opined. 8:14:54 AM REPRESENTATIVE SADDLER asked if the emergency medical and fire departments keep records for those who pay for the subscription service so that people only receive service up to the amount paid. MR. PASCHALL responded that he isn't aware of any subscription service that is based on the amount of the subscription. However, he suggested that the amount of funding [subscription] could be based on the amount of property. Often, the [subscription fee] for an average home is $100 while a home over 3,000 square feet would have a [subscription fee] of $150. For a business, the [subscription fee] might be $200. The [subscription fee], he said, is based upon the perceived level of need in the event of an emergency or the likelihood of an emergency. When the actual response occurs, the [level of service] isn't based on the amount paid. From the prior hearing on HB 219 he recalled the question regarding whether the subscription department responds to everyone or only subscribers and specified that it depends upon the department's structure. 8:16:45 AM REPRESENTATIVE SADDLER inquired as to how the department establishes the amount of the subscription fee. MR. PASCHALL confirmed that the amount of the subscription fee is determined by the department's annual budget and the estimated number of folks who will subscribe as well as what the market will bear. Common subscription fee amounts that have been in place for a number of years have been $75-$100. 8:17:25 AM MR. PASCHALL, in response to Chair Munoz, said that the certification issue only arose in terms of the current statute and this proposed statute wouldn't require certification. He maintained that the issue of certification is for a different debate. 8:19:11 AM CHAIR MUNOZ, upon determining no one else wished to testify, closed public testimony. 8:19:50 AM REPRESENTATIVE AUSTERMAN moved to report HB 219 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HB 219 was reported from the House Community and Regional Affairs Standing Committee. 8:20:13 AM The committee took a brief at-ease.