HOUSE BILL NO. 23 "An Act relating to major medical insurance coverage under the Public Employees' Retirement System of Alaska for certain surviving spouses and dependent children of peace officers and firefighters; and providing for an effective date." 1:41:07 PM ^AMENDMENTS 1:41:56 PM Co-Chair Foster thought the amendment process could get complicated, but the amendments would be rolled into a clean committee substitute. Co-Chair Foster noted the committee had been considering Amendment 13 when the meeting concluded the previous afternoon [see February 7, 2017 1:32 p.m. minutes for detail]. Representative Guttenberg WITHDREW his MOTION to ADOPT Amendment 13, 30-LS0258\O.20 (Wayne, 2/6/17) (copy on file). Co-Chair Foster asked the committee to rescind its action on Amendment 1. Co-Chair Seaton MOVED to RESCIND its action in adopting Amendment 1. Representative Wilson OBJECTED for discussion. 1:43:01 PM LISA WEISSLER, STAFF, REPRESENTATIVE ANDY JOSEPHSON, explained there was a desire to make the terms in the bill consistent regarding types of insurance. There was an issue around the term, "major medical." The term was very specific and was not intended to be used in the bill. There were 2 places where there was a reference to insurance. The first was on Page 3, line 10 and again on line 16 regarding eligibility requirements. She relayed that a person became ineligible for premium payments if they were eligible to receive major medical insurance coverage. In the remainder of the bill the insurance coverage would be the same coverage as if the employee was still alive. She referenced Page 3, line 20. She explained that the use of major medical narrowed the scope. Using the word "medical" on its own kept things broader and in line with the intent of the bill. The intent was a continuation of coverage. Representative Wilson referenced Page 3, line 10 and asked if the term "major medical" would remain in the bill. Ms. Weissler responded that it needed to remain as it was. She thought it matched up with Tier I major medical benefits. The remainder of the bill reflected a broader term. 1:46:19 PM Representative Wilson asked if the state would be paying the premiums for health insurance until the insured had other major medical insurance. She wondered if the policy would have to be greater that what the state was paying for. Ms. Weissler answered that it would depend on the type of insurance the deceased had at their time of death. For instance, a person might have premium coverage which would continue. Someone else might have economy coverage. She explained that because of the variation in coverage a definitive term was needed for the ineligibility criteria. Representative Wilson provided an example of a Tier IV police officer killed in the line of duty. Their family would continue to receive the same coverage until the spouse had access to the same or a better level of coverage from their employer. She continued to relay her example and asked for clarification. JANE PIERSON, STAFF, REPRESENTATIVE NEAL FOSTER, explained that there were many different policies available to peace officers. Using the word "medical" insured that the level of coverage the family members had remained the same. However, there was a disqualifier for being in the program, major medical, which could be the same or lesser coverage. Representative Wilson asked whether Medicaid or Medicare were considered major medical. She wondered why the amendment changing from age 65 to a specific program was offered the prior day. Ms. Pierson responded in the positive. She relayed that qualifying for Medicare would be a major medical policy. If the bill passed a person might not qualify for Medicaid if they had insurance in place. Representative Wilson voiced concerned with the terminology. She wanted to make sure survivors were covered. Representative Wilson WITHDREW her OBJECTION. There being NO OBJECTION, Amendment 1 was RESCINDED. 1:50:59 PM Co-Chair Foster MOVED to ADOPT Amendment 1a (copy on file): Page 1, line 2: Delete "health" Insert "medical" Page 1, line 7: Delete "health" Insert "medical" Page 1, line 8: Delete "health" Insert "medical" Page l, line 12: Delete "health" Insert "medical" Page 1, line 14: Delete "health" Insert "medical" Page 2, line 16: Delete "health" Insert "medical" Page 2, line 23: Delete "health" Insert "medical" Page 2, line 25: Delete "health" Insert "medical" Page 3, line 2: Delete "health" Insert "medical" Page 3, line 20: Delete "health care" Insert "medical" Page 3, line 24: Delete "health" Insert "medical" Representative Wilson OBJECTED for discussion. 1:51:42 PM AT EASE 1:52:54 PM RECONVENED Co-Chair Foster summarized that the committee had just rescinded Amendment 1. Currently, the committee was considering Amendment 1a. There was an objection. He asked his staff to walk the committee through the amendment. Ms. Pierson explained that Amendment 1a replaced health insurance throughout the bill with medical insurance. It kept the term the same but was a broader term that encompassed several different policies that were currently in effect for a fallen officer. There might be different policies in effect for different departments. Representative Wilson thought major medical was higher than the term medical. She understood that the term "medical" was a higher standard than "major medical." She approved of the change. Representative Wilson WITHDREW her OBJECTION. There being further NO OBJECTION, Amendment 1a was ADOPTED. Co-Chair Foster remarked that there had been amendments that were rolled from the previous meeting that would be considered next. Representative Guttenberg MOVED to ADOPT Amendment 13a (copy on file): Page 2, lines 2 - 5: Delete "appropriations designated for state employees or employees of a small municipality. The department shall create two separate accounts in the fund, one account for state employees and a separate account for employees of a small municipality" Insert "other money appropriated to the fund" Page 2, line 16: Delete "the state account of' Page 2, lines 17 - 19: Delete "and to pay the department's costs associated with administering the fund. The commissioner may use money in the small municipality account of the fund to pay" Insert "," Page 2, line 21, following "AS 39.60.040": Insert ", and the department's costs associated with administering the fund" Page 3, lines 29 - 30: Delete ", and the balance shall be paid from available funds in the municipal account created in AS 39.60.0lO(b)" Representative Wilson OBJECTED for discussion. Representative Guttenberg read the amendment (see above). Representative Wilson requested an "at ease." 1:56:15 PM AT EASE 1:59:16 PM RECONVENED Co-Chair Foster invited an explanation from Ms. Pierson. Ms. Pierson asked to call Ms. Cunningham to the table. KELLY CUNNINGHAM, ANALYST, LEGISLATIVE FINANCE DIVISION, explained that the original purpose of the 2 accounts was because the bill was set up as an "opt in and opt out." It was cleaner to have a municipal account and a state account to keep the funds separate. This bill was mandatory for municipalities. The fund reflected the state's payments of 50 percent for the small municipalities or a state employee. There was no need for 2 accounts due to the fact there would not be an "opt out" option. Representative Wilson provided a hypothetical scenario asking for additional clarity about money going into only 1 fund. Ms. Cunningham responded using Representative Wilson's example that for the Fairbanks officer the borough would pay directly to the insurer. No money would flow through the fund. Whereas, a small municipality like North Pole would pay 50 percent directly to the insurer and the state would pay the other 50 percent out of the fund. North Pole would not be sending its 50 percent through the fund. Representative Wilson asked if the state would be paying the other 50 percent directly to the insurance company. There was no pass through involved. Ms. Cunningham replied in the affirmative. Representative Pruitt asked Ms. Cunningham if she would describe the amendment as a clean-up amendment since the last time the committee was looking at the bill. Ms. Cunningham asked Representative Pruitt to clarify his question. Representative Pruitt asked if the amendment was a clean-up bill due to the amendments that were adopted in the prior hearing on the bill. Ms. Cunningham agreed that the amendment was a clean-up action. However, it had to do with the "opt out" option not being available. Representative Pruitt was reminded that the committee had voted to make the provision and opt-in and opt-out option. However, he thought the provision was turned down. He was confused. Representative Wilson WITHDREW her OBJECTION. There being NO further OBJECTION, Amendment 13a was ADOPTED. Co-Chair Foster mentioned that Amendments 13, 6, 7 and 2 still needed addressing. Amendments 6 and 7 had been rolled to the bottom of the agenda. They had been moved but withdrawn. The committee's intent was to withdraw them, but they had already been withdrawn. The committee would not be addressing them. Co-Chair Foster asked Ms. Pierson to explain. Ms. Pierson relayed that the reason for withdrawing Amendments 6 and 7, which defined police and firefighter, were no longer needed. Amendment 10 defined peace officers and was adopted. Co-Chair Foster explained that no action would be taken on Amendments 6 and 7. Representative Guttenberg WITHDREW Amendment 9. 2:05:04 PM AT EASE 2:05:38 PM RECONVENED Co-Chair Foster MOVED to RESCIND Amendment 5 (copy on file): Page 1, line 13, following, "firefighter.": Insert "The department shall create in the fund an account for state employees and an account for employees of small municipalities." Page 2, lines 3-5 Delete "The department shall create two separate accounts in the fund, one account for state employees and a separate account for employees of a small municipality." Representative Wilson OBJECTED. She thought the amendment had been rolled to the bottom of the agenda. Ms. Pierson clarified that Amendment 5 dealt with the fund and there being 2 funds. She read a portion of the amendment (see above). Representative Wilson WITHDREW her OBJECTION. There being NO further OBJECTION, Amendment 5 was RESCINDED. Co-Chair Foster WITHDREW Amendment 2. Co-Chair Foster instructed Legislative Legal Services to draft another committee substitute for HB 23 as amended and to make any necessary conforming changes to the document. He invited Ms. Pierson to explain the withdrawal of Amendment 2. Ms. Pierson explained that Amendment 2 tried to set forth how money was deposited and withdrawn from the fund. With the adoption of Amendment 13a, Amendment 2 was no longer needed. Vice-Chair Gara asked if Amendment 2 had already been passed. Ms. Pierson responded that the committee had not passed Amendment 2. Co-Chair Foster reported that the amendments would be incorporated in a clean committee substitute. He planned to bring the bill back before the committee for committee discussion and a vote. HB 23 was HEARD and HELD in committee for further consideration.