HOUSE BILL 529 "An Act giving notice of and approving the entry into, and the issuance of certificates of participation in, a lease-purchase agreement for a centralized public health laboratory." KAREN PERDUE, COMMISSIONER, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, spoke in support of HB 529. The public health laboratories are an essential component of the public health system in each state and in the national public health system. Alaska must have sufficient public health laboratory capacity in order to identify, evaluate and control public health threats. She continued, Alaska has three public health laboratories. They were established as regional laboratories when transportation linkages and technology dictated that laboratory services could only be delivered effectively through a regional structure. Adequate facilities are critical to safe, effective and efficient laboratory operations. Because of the special nature of laboratory functions we must have facilities capable of supporting operations involving bio-hazards and accommodating specialized equipment and changing technologies. Commissioner Perdue added, in the future to maintain the facilities as laboratories would require specialized upgrades and some improvements that are not feasible at a reasonable cost. Alaska must develop a permanent facility to support the specialized activities of the State Medical Examiner program which also involves bio-hazards. The program supports law enforcement and public health efforts by determining the cause and manner of deaths that occur in suspicious or unexplained circumstances or which may present a public health threat. Objective analysis indicates that the most cost and 9 operationally efficient solution to these problems would be the construction of a new facility that centralizes laboratory operations in Anchorage. Centralization of the functions to a single facility would provide the most economical permanent solution to the critical facility problems, while improving overall accessibility, enhancing the Department's ability to perform disease surveillance, evaluation and control activities, and avoid unrecoverable costs related to current laboratories. Commissioner Perdue pointed out that HB 529 provides the mechanism to implement a solution, authorizing the issuance of certificates of participation for lease/purchase financing of a centralized laboratory total cost in the amount of $23.5 million dollars. A centralized facility would house public health laboratory staff from Anchorage, Fairbanks, and Juneau as well as the laboratory chief and the State Medical Examiner staff. Commissioner Perdue acknowledged how difficult it was to propose a project which would centralize services and at the same time could adversely affect the economies of Fairbanks and Juneau. She noted her belief in regional government, although, pointed out that the project was necessary for the state as a whole. She spoke to the transudation plan. JOHN MIDDAUGH, MD., CHIEF, EPIDEMIOLOGY SECTION, DIVISION OF PUBLIC HEALTH, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, echoed that the current facilities were no longer adequate. The laboratory function of a public health lab is the core building block of state's health department and a critical component of protection from infectious diseases. Alaska must keep their prevention efforts in the forefront. The State's ability to employ new technology in rapidly diagnosing infections and establishing diagnosis will enable the State to facilitate control measures as a critical component of the public health laboratory. A close relationship exists with physicians around the State who submit specimens causing illness among Alaskans. The State Medical Association has fully endorsed the central new lab in Anchorage and the co-located staff. On a scientific basis, the practice of housing facilities in various locations around the State is not a good, sound idea. DR. GREGORY HAYES, CHIEF, LABORATORIES, DIVISION OF PUBLIC HEALTH, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, advised that the services for the public health laboratory are directed towards prevention and control of disease in the community. These services differ from the clinical laboratories directed at individual patient care. 10 The core functions of a centralized lab would include: * Support of disease control and prevention programs, maternal child and family health programs and epidemiological programs; * Support surveillance activities, outbreak investigations and monitor for, the emergence of new infectious agents or re-emergence of infectious agents; * Focus on the development of methods for testing when those tests are not readily available and transfer that technology to the private sector; * Perform diagnostic product evaluation; * Data collection; * Testing of high quality at a reasonable rate; * Provide training, laboratory expertise and reference services to the private laboratory community in the laboratory diagnosis of diseases of public health significance. Dr. Hayes continued, the Juneau and Anchorage laboratories perform primarily microbiological testing. Juneau specializes in Mycology and Water Bacteriology while in Anchorage the specialty is Tuberculosis (TB) testing. The Fairbanks laboratory performs almost exclusively Virology testing. The facilities are in urgent need of repair, having mechanical and structural inadequacies for conducting laboratory testing. All three laboratories have poor facility layouts and have space limitations for future growth. In order to operate, Alaska must meet Federal Regulations, under the Clinical Laboratory Improvement Amendments. During the last survey, Alaska was found out-of-compliance and given 90 days to correct some major ventilation deficiencies or face loss of license. The surveyors will be looking for resolutions in long range planning to address laboratories health and safety concerns. Representative Therriault voiced concern in closing the Fairbanks lab. Dr. Hayes advised that there are no major health and safety problems with the Fairbanks facility. That facility is very dated and the lab is spread out over several floors and poorly laid out. Commissioner Perdue added that the Anchorage facility must be replaced because 11 it is unsafe. She added that when purchasing property, it would be most cost effective to purchase one location and consolidate the services from that spot. The turn around time is also predictable in Anchorage. Co-Chair Hanley asked the costs of maintaining the current facilities. TOM LANE, JUNEAU FACILITIES MANAGER, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, replied that fiscal costs are included in the fiscal notes provided to the Committee. Lease and personnel costs would be saved, providing a total savings of $710 thousand dollars per year. If a new facility was built in Anchorage and the facility in Fairbanks continued operation, $210 thousand dollars would be saved in the long term. Operating costs would diminish through centralization. RUSS WEBB, HEALTH PROGRAMS MANAGER, DIVISION OF PUBLIC HEALTH, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, stated that centralizing services would be scientifically sound management and would enable the lab to achieve more efficiency. Discussion followed between Representative Therriault and Dr. Hayes regarding continued use of the Fairbanks facility. Dr. Hayes stressed that the current Alaskan system does not work well nor benefit the citizens of Alaska. Mr. Lane noted that an analysis had been done indicating the benefits of building the facility in Anchorage. He pointed out that Anchorage is the hub of the transportation network. Representative Kohring voiced concern with the cost analysis of the legislation. Mr. Webb stressed that the Juneau and the Anchorage facility can not be added on too. The Fairbanks facility would be difficult to add to in a cost effective way. None of the current facilities would be able to support the long-term functions of the lab. Representative Martin supported passage of the legislation. (Tape Change, HFC 96-106, Side 2). REPRESENTATIVE JOHN DAVIES voiced support for the lab services continuing to be housed in Fairbanks.