SB 103-WORKERS' COMPENSATION FOR FIREFIGHTERS  2:17:48 PM CHAIR EGAN announced SB 103 to be up for consideration. 2:18:20 PM SENATOR PASKVAN moved to bring CSSB 103( ), 27-LS0595\M before the committee. CHAIR EGAN objected for discussion purposes. SENATOR FRENCH, sponsor of SB 103, recapped that the bill addresses a piece of legislation that passed in 2008 that made statutory changes to the Workers' Compensation Program giving firefighters the presumption of compensability for certain diseases that they incur because of the work they do that so often leads them to exposure to smoke and chemicals. He said, "It was the intent of the legislature that this compensability presumption go to firefighters who had done two things: they'd served for seven years and who had received the required physical exams during that seven year period and had not shown any evidence of the disease." However, a wording change made in one committee had the unanticipated effect of narrowing the scope of the compensability presumption to only those firefighters who had had an initial physical examination at the time of their hire. This was not the intent and it wasn't discussed in committee. It didn't come to light until the Workers' Compensation Board began to implement regulations and began to hear cases brought to it asking to apply the disability presumption. Recognizing the problem, the Workers' Compensation Board passed a resolution supporting an amendment such as the one in this bill today to give the presumption to those firefighters who have worked for seven years, had all the required exams and had shown no evidence of disease. In addition, Senator French said, a letter from the National Council on Compensation Insurance says they believe the cost impact is minimal and think that money may be saved by avoiding future litigation costs. The second change the bill makes is to clarify that the law applies to state as well as municipal firefighting agencies, which picks up a few firefighters who work for the University of Alaska in Fairbanks. The original bill referred to a definition that was on the books at the time that didn't include state firefighters. So, "state or" was added to the existing definition. SENATOR FRENCH said they tried very hard to make the change through regulation, but Legislative Legal said it "just wouldn't fly that way." SENATOR PASKVAN said he wanted to make sure the University of Alaska Fairbanks (UAF) Fire Department wasn't excluded because it is in an unusual class by itself. SENATOR FRENCH responded that page 2 defines "firefighter" as "a person employed by a state or municipal fire department" and that the UAF firefighters are absolutely a subdivision of the state. SENATOR PASKVAN asked if language on page 2, lines 23-28, makes sure of the retroactive component so that they actually undo the problem that was unintentionally created. SENATOR FRENCH replied that's "the meat of the bill." 2:23:01 PM LAW HENDERSON, Workers' Compensation Administrator, Office of Risk Management, Municipality of Anchorage, said he opposed the amendment to AS 23.30.121 [SB 103] for several reasons. He said in 2008 the legislature enacted this presumption to give firefighters a certain protection for diseases that were considered work related. To trigger that presumption a firefighter must establish they were given a qualifying medical examination before firefighting that did not show evidence of the disease as well as an annual medical exam during each of the first seven years of employment that did not show evidence of the disease. MR. HENDERSON said the first problem with the legislation is that the municipality, like most municipalities, didn't even offer annual physical exams in 1986; they weren't even mandatory until OSHA required them in 1989. Moreover, testing for the diseases listed in the statute weren't done or available in most cases until the 90s and in fact some testing still cannot establish some of these cancers. He said the municipality doesn't know what constitutes the medical examination required under the statute. Further, the statute directed the Department of Labor and Workforce Development (DOLWD) to define the type and extent of medical examination needed to trigger the presumption and to create the form for use during these exams, but no regulation is currently in effect defining the type and extent of examination needed. He said although the legislation was passed in 2008, no regulation was presented to the lieutenant governor until early this year and that will take effect later this month. No form has been developed. Thus, the record is devoid of medical examinations necessary to trigger the presumption - even though it might exist going forward. MR. HENDERSON said despite the lack of the needed medical examinations, the Alaska Workers' Compensation Board has nevertheless found in favor of at least one firefighter simply based on his statement that he had had a qualifying medical examination. No medical report was offered and probably doesn't exist. This one case alone will probably cost the city more than $250,000; another case within the municipality may exceed $1.6 million. Several other cases are pending. In addition, because of AS 23.30.121, the municipality is now unable to insure any of its firefighters for losses over $1 million as it has been historically able to do for all workers' compensation claims. He explained that while the municipality is self-insured with a retention level of $1 million per workers' compensation loss per occurrence, when an injury happens to a firefighter, the municipality is now compelled to pay the first $2 million of the loss even if it is unrelated to a disease listed under AS 23.30.121. Thus the legislation has created an unfunded mandate on the municipality and he assumed similar entities throughout the state. He pointed out that smaller entities may be unable to fund a self-insurance program as they may be unable to fund the first $2 million of a loss. MR. HENDERSON said cost and loss of insurance aren't his only concerns. Another is the lack of medical evidence supporting the causation. The Alaska's Workers' Compensation Board has held that if a condition is one of those listed, medical opinions or studies to the contrary are insufficient to rebut the presumption. Thus, this legislation as applied by the board has created an irrebutable presumption. According to the American Cancer Society, cancer is now the second leading cause of death in the United States and one out of every two Americans will be diagnosed with it as some point in their lives. The question is whether firefighting activities put one at a greater risk to these cancers. Twenty-four states have enacted presumption laws similar to Alaska's. The impact of these statutes and the medical research regarding firefighters were recently analyzed in April 2009 and a report by the National League of Cities entitled "Assessing Firefighting Cancer- Presumption Laws and Current Firefighting Cancer Research." The report points to many problems with the legislation. Loss of insurance is one. Another is the lack of medical research establishing a causal relationship between firefighting and a specific type of cancer. According to the report, of the thousands of cancer studies taking place from 1995 to 2008, only 17 studies looked at firefighters as a possible risk factor for contracting cancer. The research concluded there was a lack of substantive scientific evidence currently available to determine that firefighters face greater risk than the general population. 2:29:08 PM Another concern is equity and questions about fairness come up when one class of employees obtains expanded benefits while other employees such as sanitation workers and automotive fleet personnel who may also be exposed to similar hazards as the firefighters are not covered to the same extent. Alaska already has a presumption under AS 23.30.120 that has worked well since statehood, Mr. Henderson said. He urged them to repeal AS 23.30.121 or short of that to reject the proposed amendment as it would make every firefighter who ever developed cancer entitled to the benefits despite the lack of available testing as the examination wouldn't show evidence of the disease during the first seven years of employment as the testing was not available. CHAIR EGAN asked him to summarize. MR. HENDERSON said these tests are available for some cancers but for others it is cost prohibitive or unavailable. SENATOR PASKVAN asked if he or the municipality objected to this law in 2008 when it was passed. MR. HENDERSON answered no; but they did in 2007. SENATOR PASKVAN said it passed in 2008 and this amendment just corrects an unintentional problem. Did he agree? MR. HENDERSON answered no. 2:32:26 PM TOM WESTCOTT, President, Alaska Professional Firefighters Association, Eagle River, said they supported CSSB 103 (L&C), version M. He said this version doesn't change the intent of the original law; on the contrary, it captures the intent and makes it clearer. It has two aspects, the physicals and the definition. The definition captures groups like the UAF fire department. He said some of what Mr. Henderson said wasn't accurate because the Occupational Safety and Health Administration (OSHA) adopts standards and the National Fire Protection Association (NFPA) regulation 1582 has the standard for firefighter physicals. He also noted that at the time this legislation passed, they had to demonstrate the scientific studies backing up the link for cancer to their profession. And while it's true that everyone someday may get cancer, getting it at 40 or 38 makes the difference. Evidence of this was shown over and over again during this process. 2:34:42 PM PAUL HANDBY said he is a career firefighter for Juneau and is a member of Alaska State Firefighters Association. He conveyed that he would be omitted from protection under existing language in SB 103, because he had an extensive pre-employment physical, but each department had the latitude to determine their own required physicals and during budgetary times these physicals on an annual basis can prohibitively expensive. So, many municipalities don't require them. The change in the CS would cover him in the unlikely event he would be stricken by one of the named carcinogens or something that was related to his occupation. CHAIR EGAN asked if he supported SB 103. MR. HANDBY replied emphatically yes. SENATOR FRENCH offered that it is easy to forget the crucial role firefighters play in protecting our communities. It is known that exposure to noxious chemicals that they see in the course of their employment makes them sick. This issue was gone over carefully in 2007 and 2008 when this bill passed. He said he was disappointed in the testimony on this topic from the Municipality of Anchorage. Firefighters take risks for us and this covers them when they're on the job. Once they leave the employment of the municipality, once they retire, they are on their own for their cancers that they develop later on. This bill got a zero fiscal note from the state risk management and it got a letter of support from the National Council on Compensation Insurance. He said they looked "high and low" through the record to find out what supported the amendment that carved out and required that initial exam and couldn't find a single word of testimony supporting it. He wanted Mr. Henderson to bring it to his attention if he found something different. CHAIR EGAN closed public testimony and held SB 103 for a further hearing.