HOUSE BILL NO. 117 "An Act extending the termination date of the Board of Certified Direct-Entry Midwives; and providing for an effective date." 9:12:39 AM REPRESENTATIVE DAN ORTIZ, SPONSOR, thanked the committee for hearing HB 117. The bill extended the termination date for the Board of Certified Direct-Entry Midwives to June 30, 2023. It was a 2-year extension at the recommendation of the Division of Legislative Audit. The board was comprised of 5 members: Two direct-entry midwives; one physician licensed by the state medical board; one certified nurse-midwife licensed by the Board of Nursing; and one public member. Under the statute the board examined and issued certificates and permits, established regulations for the certification and practice requirements, ordered disciplinary actions, and approved curricula and standards for education, training, and apprenticeships. The bill had a $21,800 fiscal note which was covered with the revenues from licensing fees. He relayed the list of available testifiers. Representative LeBon asked why the extension was only for 2 years. Vice-Chair Ortiz deferred to the legislative auditor, Kris Curtis, as she recommended a 2-year extension. 9:14:47 AM KRIS CURTIS, LEGISLATIVE AUDITOR, ALASKA DIVISION OF LEGISLATIVE AUDIT, would review the legislative audit report for the Board of Certified Direct-Entry Midwives. She relayed that the Division of Legislative Audit conducted a sunset review of the Board of Certified Direct- Entry Midwives. She thought members had a copy of the audit report, dated June 2020 in their packets. The purpose of a sunset audit was to determine whether a board or commission was serving the public's interest and whether it should be extended. She read a portion of the report: Overall, the audit concluded that the board served the public's interest by conducting meetings in accordance with state laws and effectively certifying midwives. The board adopted regulatory changes to improve the profession but failed to pursue statutory changes due to concerns over related costs. Additionally, the audit found the peer review process was not effectively monitored by the board and improvements were needed over the Division of Corporations, Business and Professional Licensing's (DCBPL) investigative process. In accordance with AS 08.03.010(c)(8), the board is scheduled to terminate on June 30, 2021. We recommend the legislature extend the board's termination date two years, to June 30, 2023, which is significantly less than the eight-year maximum allowed in statute. The reduced extension is due to an issue identified during the audit that may impact the board's ability to protect the public and the board's reluctance to recommend statutory changes in the public's best interest. The details of the issue are not included in this report to preserve the confidentiality of an ongoing investigation. The reduced extension reflects the need for continued oversight. Ms. Curtis directed members to turn to page 7 of the audit showing the standard licensing statistics for the board. As of January 2020, the board had 51 certified direct-entry midwives and apprentice midwives. Page 8 contained a schedule of fees. In FY 17 the fees were increased to address a deficit. As a result, the occupation had one of the highest, if not the highest, fee of any occupation. Ms. Curtis directed members to page 9 which showed a schedule of revenues and expenditures. It showed that the board had a deficit of just over $19,000 as of January 2020. She indicated that at the time of the audit, DCBPL management believed that the deficit would be fully resolved by the end of FY 21. Ms. Curtis indicated the division had three recommendations for improvements beginning on page 11 of the report. She read Recommendation 1: The board should recommend statutory changes that benefit the public. The board identified a need to change certification statutes to align Alaska's midwifery laws with national standards. However, due to the legal costs involved with the project, the board did not recommend statutory changes. Ms. Curtis read Recommendation 2 on page 12: DCBPL's chief investigator should ensure investigations are completed timely. Three cases open over 180 days from July 2016 through January 2020 were evaluated by auditors. All three were found to have unjustified periods of inactivity ranging between 54 and 114 days. It was also noted that supervisory review of two of the three cases was not documented as required by DCBPL procedures, indicating review did not occur or did occur and was not documented. According to DCBPL staff, the inactivity was the result of turnover and competing priorities. Ms. Curtis read Recommendation 3 on page 12: The board should improve oversight of the peer review process. The board delegated peer reviews to the Midwives Association of Alaska's Action and Accountability Committee. However, the board did not establish procedures to provide assurance that reviews were adequately completed. The board did not consider the need for or importance of monitoring the peer review process. According to AS 08.65.030(b), the board may, by regulation, require a CDM undergo a uniform or random period of peer review to ensure quality of care. Inadequate monitoring of the peer review process increases the risk that the reviews will be deficient, which increases the risk to public safety. Ms. Curtis indicated the responses to the audit began on page 23. The commissioner of the Department of Commerce, Community, and Economic Development (DCCED) did not respond to Recommendations 1 and Recommendation 3, as those recommendations were directed to the board. In response to Recommendation 2, the commissioner state that the department was going to add a supervisory investigative position to help with the caseloads. She noted the Chair's response was on page 25. The Chair expressed disappointment with the 2-year recommended extension. Regarding Recommendation 1 the Chair believed that the board should not be penalized for their fiscal responsibility, as it was a way to reduce costs. In response to Recommendation 2, the Chair concurred with the finding but stated that she believed it should not have impacted the term of extension, as the duty to investigate fell on the department. She continued that regarding Recommendation 3, the Chair concurred with the recommendation. 9:20:10 AM Representative Josephson asked about the statutory changes recommended by the auditor and why the board had not approached the legislature for a change. Ms. Curtis responded that it was their perception that it would be costly. She noted in the department's response that although they did not have comments on the recommendation, they remarked that the cost associated with that type of project was small. Representative Josephson noted Ms. Curtis had mentioned some statutory changes that should be made that the board had identified. However, they lacked the resources to make those changes. He wondered why they had not come to a legislator for assistance. Ms. Curtis reported that it was their perception that it would be costly. She noted in the department's response that although they did not have comments on the recommendation, they did not think there would be many costs. There was only a small cost associated with that type of project. Representative Josephson noted that in 2014 Senator Kelly [a previous Alaska Senator from Fairbanks] sponsored and saw the passage of Senate Bill 156 []. He was a legislator at the time and had some concerns with the bill. Although, he voted for it. The bill stripped away the prescriptive statutory authority for direct-entry midwives and gave them the authority to writ the regulations that would define their scope. He wondered if the legislature should be concerned that if there was much disclosure about the case, a person could be identified. He asked if the legislature should be concerned about how direct-entry midwives perceived their own scope of practice. Ms. Curtis indicated she had to proceed with caution based on the recommendation of Legislative Legal Services on her answer. She reported that in the previous sunset audit she had recommended to the legislature to consider alternate forms of regulating the board. At that point, her concern was that with such a small number of licensees and the weight of investigations it would drive the costs so high creating a barrier into the occupation. She feared that if the fees were very high it would prevent people from practicing or lead some of them to drop off. Four years ago, she testified and made the recommendation, no action was taken. In hindsight, the number of licensees only decreased by 3 even with the high fees. A small number of licensees created problems with fees. She would not otherwise answer the representative's question directly. 9:23:51 AM AT EASE 9:26:01 AM RECONVENED Representative Thompson had a question about the length of time of investigations. He wondered if DCCED was responsible for the investigations. Ms. Curtis responded affirmatively. She indicated that there was designated staff within DCBPL that did investigations. Representative Thompson asked if the cost of the investigations was the responsibility of the board. He wondered if licensing fees would have to be raised to meet those costs if necessary. Ms. Curtis indicated AS 08.01.065 required the department to adopt regulations to establish the amount and manner of payment of application, examination, license fees, and permit fees. The statute required that it covered the cost of regulating the board. Essentially, all occupations paid their way. Representative Thompson asked about the length of time for an investigation. He speculated that investigations were taking 180 days. Ms. Curtis Deferred to Ms. Chambers, the director of DCBPL. 9:27:58 AM SARA CHAMBERS, DIRECTOR, DIVISION OF CORPORATIONS, BUSINESS AND PROFESSIONAL LICENSING, DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT (via teleconference), reported that all of the license investigations had the same process. However, the investigations vary depending on the type of suspected infraction. The department had 17 professional investigators to handle the case load. The process prioritized the life, health, and safety cases. The division had struggled for several years with keeping up with some of the case work, especially for the low priority cases that do not pose an immediate threat. She had been working to overcome the delays where possible. Ms. Chambers continued that much of the investigation process relied on receiving documentation from the licensee under investigation and from the complainant. Sometimes it involved obtaining copies of sensitive and confidential medical and hospital records which could take time to process. She believed the division could improve on documenting delays so that all parties could see that the division was actively working the cases and the delays were reasonable. It was an area the Division of Legislative Audit had suggested DBCPL improve. She had put some new standards in place and added staff to reach that goal. 9:30:52 AM Representative Thompson suggested that since the investigative fees were passed onto the board and license holders, it might be helpful to have additional investigators to expediate the investigations. Ms. Chambers relayed that it was one of the things the division did to help improve timeliness and documentation. It was important to have adequate staff to support all of the investigations. The division added an additional supervisor in the previous few months. The division currently had a chief investigator and three senior investigators who report to the chief. The division could certainly use additional investigators to improve quality control as the complexity and volume of cases increased. The downside was that the cost would be passed on to licensees. Ms. Chambers reported that for the last several years the division had worked on some alternative methods that would help spread the cost of investigations, similar to an insurance policy, that would help smaller licensing programs such as the Board of Certified Direct-Entry Midwives (a program that only had about 50 licensees) from having to bear huge costs. Currently, a fully fledged midwives licensee paid about $3500 every 2 years for their license. Even though they had made amazing strides, had willingly accepted the responsibility, and worked through their debt, they were only one major investigation away from incurring additional debt and seeing the cycle continue. Ms. Chambers relayed that the division had worked to propose legislation and legislation had been proposed in the prior several years to change the scheme. However, it would take a statutory change to make a change. She was open to speaking with legislators who might be open to hearing more. Representative Thompson was happy to help with the legislation. Ms. Chambers thanked Representative Thompson. Representative LeBon clarified that his asking to be recognized was relating to the copying of the document. 9:34:03 AM Representative Rasmussen was curious about the 2-year extension given that the reduced extension was cited as being due to an issue identified during the audit that might impact the board's ability to protect the public and the board's reluctance to recommend statutory changes. She assumed that midwives were primarily dealing with pregnant mothers and babies. She thought 2 full cycles of births was a little alarming given the reluctance to seriously address the issues brought out in the audit. She asked Ms. Curtis to speak to the 2-year recommendation versus a 1-year recommendation. Ms. Curtis responded that when the division did a sunset audit it started on the year before it terminates. The current audit was dated June 2020. By the time she reviews the audit with the legislature it was a year later. She indicated that 2 years was really the lowest term of extension because of reporting times to the legislature. Representative Wool was concerned with the timeliness of investigations and the board being penalized due to a lack of investigators within DCCED. He asked how many investigators resided within the department. Ms. Curtis would defer the number of investigators to Ms. Chambers. However, she could speak to the representative's question regarding whether there was merit in talking about the number of investigators and the timeliness of investigations. She clarified that the issue identified was different than her recommendation. Her recommendation about the timeliness of investigators was completely separate from the issue she identified. She continued to explain that more than half of the time she looked at investigative function making similar recommendations. Timeliness was an issue DBCPL was working on improving. Ms. Chambers responded that the division had less than 20 investigators. She had a team of approximately 20 investigative staff. Three of them are paralegal and administrative staff. She had fewer professional investigators that supported the 43 different licensing programs. She strived to train them and keep them focused on particular areas in order to gain knowledge and experience over time. She provided some examples. However, all of the staff can float from program to program depending on need. Direct-Entry Midwives have had a small number of investigative cases but were typically of a serious nature. She suspected that the investigator who would be assigned to midwives would also be working on two or three other healthcare programs at the same time to ensure the division was using its resources efficiently. Sometimes that could have a negative affect on the division's effectiveness. The division tried to strike a balance. Co-Chair Merrick relayed that the committee had been joined by Representative Edgmon. Representative Wool was under the impression that only one investigator was assigned to the Board of Certified Direct-Midwives. He read from a letter from the board that stated that they were not in a position to make activity happen when DCBPL could not keep staff members or prioritize midwifery investigations. He asked how long the current midwifery investigator had been working with the division and whether they had been a part of the audit from the start. Ms. Chambers indicated that there had been significant turnover within the division. Earlier in the current year three of the investigator positions vacant. She offered that division was juggling prioritizing life, health, and safety cases with much lower priority cases and the experience of investigator. There had been turnover for the specific investigator position during the period of the audit. She also indicated that the investigator for the midwifery board would also be working other programs because of the necessity of the resources of the division. Representative Wool thought the board's claim had some merit. He questioned the costs related to the board audit. He wondered the cost of licensing for a nurse compared to a midwife. Ms. Chambers reported that typically a nurse or physician license was about $200. She pointed out there were more than 20,000 nursing licensees and 5,000 to 6,000 physicians, physician assistants, and paramedics that shared in the cost of investigations. The midwifery program had 50 licensees. Economy of scale played a large factor based on how the law was written. The impact was much greater on the smaller programs when there was a sizable investigation. She relayed that her staff maintained positive timekeeping. Therefore, boards and programs were only charged for the time worked on their cases. If there were delays, the board was not being charged. 9:44:10 AM Representative Wool asked if the revenue from billable hours by the investigative staff went to the department. He understood economy of scale. He provided an example. He wondered about a proposal to aggregate licensing and creating a larger pool. A small board of a specialized professional had a larger investigative burden. He asked about the typical cost of an investigation for the midwifery board. Ms. Curtis deferred to Ms. Chambers. Ms. Chambers would be happy to submit a written response. The cost of investigations varied greatly. Co-Chair Merrick asked Ms. Chambers to repeat the dollar amount. Ms. Chambers would like to submit dollar amounts in writing. Representative Josephson asked how many investigators her division had in FY 12 through FY 14. Ms. Chambers recalled that the division had only added 1 or 2 investigators since that time. The division would have had approximately 16 investigators. The division had not grown the investigative section since then. Co-Chair Merrick asked if Ms. Chambers had further comments. Ms. Chambers thought she had covered most of the information. She wanted to report that the board had been working with the division and had seen a stronger and open relationship between members of the board and management within the division to make improvements since the audit. She had witnessed the board taking the recommendations seriously. Co-Chair Merrick indicated the Board chair was available. 9:50:12 AM BETHEL BUH-LYLE, CHAIR, BOARD OF CERTIFIED DIRECT-ENTRY MIDWIVES (via teleconference), reported came on to the board in March 202. She was grateful to Representative Ortiz for sponsoring the board's sunset bill. As a new member of the board, hearing of the board's deficits and what it needs to do better had spurred members to work diligently on doing so. The two audit reviews she believed pertained to the midwifery practice were the statutory changes and the peer review process. Ms. Buh-Lyle reported the board revamped the peer review process in June 2020 and was waiting for it to be finalized through the regulatory process. It was rewritten such that the board took back complete control of its peer review process and gave the board authority to take disciplinary actions as needed. The board had done audits on charts and peer reviews since 2014 and found there had been sufficient oversight. Ms. Buh-Lyle spoke of statutory changes. One of the board members had recently been rewriting the entire statutes to align with international standards. She relayed that on the prior Wednesday the board had a 3-hour work session going line-by-line to bring the standards to the level of a leader in the United States. The documents were headed to the legal department for review. The board was pushing to match the auditor's request. Representative Rasmussen asked if the chair would describe the midwife practice. She wondered what type of health and safety issues might arise that would lead to a claim and an investigation into their practice. Ms. Buh-Lyle responded that the board's current regulations stated that midwives must submit a chart for peer review on any transport of a mother or baby. The issue had to result in a 9-1-1 call. For instance, a baby might struggle to transition well after birth. An ambulance transport would occur and even if a baby was released within 12 hours, there were things midwives were required to do. She provided another example of an emergency warranting ambulance transport. Whether there was a poor outcome, such as the death of a mother or baby, midwives were required to submit the full chart for peer review to ensure proper protocols were followed. In the new peer-review process, the charts were sent to and reviewed by the board. 9:54:54 AM Representative Carpenter clarified that the statutes currently being re-written seemed like a substantial amount. The finding stated that the board needed to change certification statutes. He had quickly referred to AS 08.65.060 through AS 08.65.080 and noted there was not much substance. He was curious what the board was rewriting to accommodate national or international standards. He wondered if she was only talking about certification standards or about the entire midwifery profession. Ms. Curtis elaborated that one of the criteria that the auditor used was to evaluate whether a board was recommending statutory changes in the public's interest. The auditor looked at the board's annual reports. Each annual report for 3 years they identified the need to change the statutes to align their laws with national standards. The auditor did not involve themselves with which statutes needed to change. Rather, the auditor considered that there was a need that they were not filling due to concerns over increasing their licensing costs which was not in the public's interest. Representative Carpenter asked for clarity on risk. He wondered if there was a list of statutes that needed to be changed or were in question that needed to be rewritten. Ms. Curtis responded that that recommendation had nothing to do with the issue identified by the auditor that was causing her to recommend a 2-year extension. Ms. Buh-Lyle indicated that the statutes that the board was looking at changing had to do with word usage. She relayed that the board was proposing to change the word "certified" to "licensed," a national standard. Changing the word would allow for midwives to be paid by more insurance companies. Women would like to be able to choose on a hospital birth. However, some insurance companies would not pay a direct- entry midwife because of the use of the word "certified." The board was moving in the direction of the national recommendations set by the North American Registry of Midwives. Co-Chair Merrick reviewed the agenda for the afternoon's meeting. HB 117 was HEARD and HELD in committee for further consideration.