HOUSE FINANCE COMMITTEE May 15, 1999 9:00 P.M. TAPE HFC 99 - 142, Side 1 TAPE HFC 99 - 142, Side 2 CALL TO ORDER Co-Chair Therriault called the House Finance Committee meeting to order at 9:00 p.m. PRESENT Co-Chair Therriault Representative Foster Co-Chair Mulder Representative Grussendorf Representative Austerman Representative Kohring Representative Bunde Representative Moses Representative J. Davies Representative Williams Representative G. Davis ALSO PRESENT Senator Gary Wilken; Senator Loren Leman; Bill Kozlowski; Elmer Lindstrom, Special Assistant, Department of Health and Social Services; Mike Pauley, Staff, Senator Leman; Jerry Luckhaupt, Legislative Legal Counsel, Legislative Affairs Agency; Gina MacDonald, Department of Health and Social Services; Lorna Rambert, Senator P. Kelly; Gina MacDonald, Department of Health and Social Services; Pat Clasby, Alaska State Hospital and Nursing Home Association; SUMMARY SCR 8 Creating the Long-Term Care Task Force of 1999. SCR 8 was REPORTED out of Committee with a "do pass" recommendation and with a published fiscal impact note by the Legislative Affairs Agency dated 4/21/99. CS SSSB 94(FIN) am "An Act relating to the medical use of marijuana; and providing for an effective date." HCS SSSB 94(FIN) was REPORTED out of Committee with a "do pass" recommendation and with a published fiscal impact note by the Department of Health and Social Services dated 5/4/99. CSSB 97(FIN) am "An Act relating to mental health services and programs; relating to liability for payment for mental health evaluation and treatment services; and providing for an effective date." CSSB 97(FIN) am was REPORTED out of Committee with a "do pass" recommendation and with a published fiscal note by the Department of Health and Social Services dated4/21/99. CS FOR SPONSOR SUBSTITUTE FOR SENATE BILL NO. 94(FIN) am "An Act relating to the medical use of marijuana; and providing for an effective date." MIKE PAULEY, STAFF, SENATOR LEMAN testified in support of SB 94 on behalf of the sponsor. Senate Bil1 94 proposes several amendments to the Medical Marijuana Act that took effect this year on March 4. The changes address some serious law enforcement and public health concerns with this new statute, and also some practical concerns about how state agencies are going to implement what the voters have asked them to implement. In crafting this legislation, we have worked closely with the Department of Law, the Department of Public Safety, and the Department of Health and Social Services. I am pleased to report that these three agencies are in support of the legislation before you. SB 94 is also supported by the Alaska State Advisory Board on Alcoholism & Drug Abuse, the Anchorage Police Department, and the Alaska Association of Chiefs of Police. There are three major changes in the bill. The first area is registration. The marijuana initiative approved last fall by voters establishes a state registry of patients who are entitled to use marijuana for medicinal purposes. However, there is no requirement that a patient register - the initiative still provides legal protection for the use of medical marijuana even if the person is not registered with the state. This creates a problem for law enforcement. Because pharmacies are prohibited by federal law from dispensing marijuana, the drug must be obtained through other channels, and it all looks the same through the eyes of a police officer. To ensure that all patients who need marijuana are protected from needless arrest or unwarranted hassle, SB 94 requires patients and their caregivers to register, and to carry a registry ID card. We modeled this after our successful permit system for those who qualify to carry concealed handguns. This system will help police distinguish between legitimate and illegitimate users of marijuana. The second change deals with possession limits. The marijuana initiative established a presumptively legal possession limit of one ounce in usable form, and six plants. But the initiative also includes a paragraph that allows patients and their caregivers to possess an unlimited amount of marijuana, as long as it can be medically justified. The problem is, there is no definition of what is medically justified. The Department of Law and the Department of Public Safety have urged the Legislature to remove; any ambiguity in this area and set the limit at the same amount identified in the initiative, which is one ounce and six plants. SB 94 implements this change. The third area concerns the role of the primary caregivers for patients who are using medical marijuana. SB 94 establishes some wise precautions to limit abuse. Each patient can have only one primary caregiver, and each primary caregiver can care for only one patient, with very limited exceptions. By creating a "one to one", relationship between the patient and caregiver, we will avoid scenarios such as what cropped up in California, where marijuana clubs sprouted up claiming to be the primary caregivers for 500 or 1000 patients. SB 94 also states that no person who has committed a felony violation of drug laws can be a primary caregiver, and no person who is on probation or parole can be a primary caregiver. Vice-Chair Bunde observed that possession and use of marijuana is still against federal law. Mr. Pauley stated that there is nothing that the state can do to provide protection from federal prosecution. An United States Drug Enforcement Agency administrator stated in response to an inquiry by the Unites States Senate Judiciary Committee regarding initiatives legalizing marijuana passed in Arizona and California that: "The California and Arizona initiatives do nothing to change federal drug enforcement policy. The DEA will continue to target major drug traffickers, including major marijuana growers and distributors. We also can take both administrative and criminal actions against doctors who violate the terms of DEA drug registrations that authorizes them to prescribe controlled substances. Doctors are registered with the DEA to prescribe only Schedule II-IV substances. Technically, those doctors who prescribe or recommend Schedule I substances are violating federal law. Then licenses of over 900 physicians have either been surrendered or revoked in the last two years for fraudulent prescribing practices." Vice-Chair Bunde questioned if $5 thousand dollars in general fund program receipts is the charge for the identification card. Mr. Pauley explained that the fee would be $25 dollars. Vice-Chair Bunde suggested that the recipients should pay for the cost of the program. Representative J. Davies questioned if all 900 cases of fraudulent prescribing practices were related to marijuana. Mr. Pauley clarified that the figure includes all fraudulent prescription charges, not all were related to marijuana. Representative Foster asked how persons living in rural areas would register. Mr. Pauley explained that how a patient legally obtains the substance was not addressed in the initiative or the legislation. The patient would first need to obtain a doctor's recommendation that they have a debilitating medical condition that could be alleviated through the use of medical marijuana. The doctor's recommendation would go with an application to the Department of Health and Social Services. If the application is approved the patient would receive a card. The card would protect the patient from state prosecution. The legislation addresses the card on page 5, line 17. Co-Chair Therriault referred to page 5, line 24. He stated that "card" would be added as a technical correction. In response to a question by Representative Grussendorf, Mr. Pauley explained that the medical patient or their primary care giver would be expected to grow their own marijuana. Vice-Chair Bunde observed that an illegal act must be committed before the legal use of marijuana occurs. Mr. Pauley noted that there have not been federal prosecutions of patients in the states that have passed medical marijuana initiatives. Vice-Chair Bunde expressed further concern that the fee was not sufficient to support the program. ELMER LINDSTROM, SPECIAL ASSISTANT, DEPARTMENT OF HEALTH AND SOCIAL SERVICES testified in support of SB 94. He explained that page 7; line 26 allows the department to adjust the fee. The Bureau of Vital Statistic will administer the program. The fee was based on comparisons to other services by the bureau. Co-Chair Therriault questioned if the language would allow the department to charge for other services. Mr. Pauley clarified that the legislation only refers to AS 17.37, relating to medical marijuana. JERRY LUCKHAUPT, LEGISLATIVE LEGAL COUNSEL, LEGISLATIVE AFFAIRS AGENCY observed that the department could theoretically extend the program to include other public health areas. The legislation allows a fee to be administered. The language was placed in statute by the initiative. In response to a question by Representative Foster, Mr. Pauley noted that the initiative stated that individuals suffering from cancer, glaucoma, positive HIV, and AIDS would qualify for medical marijuana use. He added that the use of marijuana has been discredited by a recent Institute of Medicine Report of the Office of National Drug Control Policy. The Alaska State Board of Examiners and Optometry adopted a statement in December 1998 opposing the use of marijuana as a treatment for glaucoma on the grounds that it is not as effective as other treatment. Representative Foster noted that rural Alaskans might have difficulty with the quantity allowable under the legislation. Mr. Pauley pointed out that one-ounce lasting ten days is based on a very high rate scenario. He added that the terminally ill person would also be allowed 6 plants. He did not imagine that terminally ill persons would be working in fish camps. Representative Foster questioned if marijuana could not be shipped by mail. Mr. Pauley did not think that it would be legal to ship marijuana. Co-Chair Therriault explained that the initiative is non- specific. Mr. Luckhaupt pointed out that possession of marijuana is still a crime under federal law. It cannot be transported. Co-Chair Therriault observed that the initiative could not affect federal law. Mr. Lindstrom noted that law enforcement agencies identified difficulties with the initiative. He observed that the intent is to meet the law enforcement concerns without interfering with the underlying patient doctor relationship or making the administration cumbersome. The Administration supports the bill. He assured Representative Foster that the Administration is committed to making the program work in rural Alaska. Mr. Lindstrom discussed the fiscal note. He explained that the legislation changes the program from permissive registration to mandated registration. Registration would be run thorough the Bureau of Vital Statistics for a reasonable amount of money. The additional funds would allow the Department to provide law enforcement agencies with a nightly updated registration. There is a $25 dollar initial registration fee annual fee of $15 or $20 dollars. Co-Chair Therriault questioned if a full time position is needed to take care of 200 permits. Mr. Lindstrom stressed that it is a new program. Staff will have to verify registration information. In response to a question by Representative Foster, Mr. Lindstrom stated that confidentiality laws would prohibit state employees from sharing the information with federal law enforcement agents. Mr. Pauley added that page 2, line 25 addresses confidentiality. The information can only be shared with state or local law enforcement agencies in order to verify registration. Mr. Luckhaupt noted that state statutes protect the caregiver. The state receives some immunity through the tenth amendment. He noted that the federal government started a federal marijuana program in the 1970's. He acknowledged that a state employee could be required to give up the information if subpoenaed by the federal government. Representative J. Davies pointed out that the legislation does not create a new program. It only modifies a program created by the initiative. Mr. Pauley responded that there is no money in the budget to implement any registration without the legislation. Co-Chair Therriault MOVED to ADOPT Amendment replace "and" with "card" on 1 page 5, line 24. There being NO OBJECTION, it was so ordered. Representative J. Davies MOVED to ADOPT Amendment 2 (copy on file). Amendment 2 would change "one-year" to 16-month". Co- Chair Mulder OBJECTED for the purpose of discussion. (Tape Change, HFC 99 - 142, Side 2) SENATOR LOREN LEMAN, SPONSOR stated that he would not oppose the amendment in the spirit of compromise. He did not think that the 12-month requirement was unreasonable. Co-Chair Mulder WITHDREW his objection. There being NO OBJECTION, Amendment 2 was adopted. Co-Chair Therriault clarified that the original request by the Department of Health and Social Services in the operating budget was higher. Senator Leman pointed out that it is still illegal to posses or use marijuana under federal law. Protection is only granted under the state law. Co-Chair Mulder ADOPT HCS CS SB 94 (FIN) HCS SSSB 94(FIN) was REPORTED out of Committee with a "do pass" recommendation and with a published fiscal impact note by the Department of Health and Social Services dated 5/4/99. SENATE CONCURRENT RESOLUTION NO. 8 Creating the Long-Term Care Task Force of 1999. SENATOR GARY WILKEN, SPONSOR observed that the legislation continues the effort of the Long-Term Care Task Force. He anticipated that there would only be a meeting or two of the Task Force. He did not think that the entire funding amount of $15.7 thousand dollars would be needed. Representative J. Davies spoke in support of the legislation. Representative Grussendorf MOVED to report SCR 8 out of Committee with the accompanying fiscal note. There being NO OBJECTION, it was so ordered. SCR 8 was REPORTED out of Committee with a "do pass" recommendation and with a published fiscal impact note by the Legislative Affairs Agency dated 4/21/99. CS FOR SENATE BILL NO. 97(FIN) am "An Act relating to mental health services and programs; relating to liability for payment for mental health evaluation and treatment services; and providing for an effective date." LORNA RAMBERT, SENATOR P. KELLY testified on behalf of the sponsor in support of SB 97. She read the sponsor statement: DHSS reimburses private community hospitals (Designated Evaluation and Treatment Facilities) throughout Alaska to provide emergency mental health inpatient evaluation and treatment services. Hospitals provide these services to individuals who are at risk of harming themselves or others. or who are so severely impaired by mental health symptoms that they are unable to care for themselves. Often these individuals are experiencing severe psychiatric symptoms, such as depressive or psychotic symptoms, and need intensive inpatient mental health services. Senate Bill 97 seeks to clarify the state's responsibility for payment for services and the responsibility of the state to determine the ability of patients to pay for those services. The proposed legislation clarifies client eligibility for these services. Additionally, it establishes procedures for determining eligibility, processing applications, and paying claims. SB 97 creates an entitlement for eligible clients, thus allowing payment for serving those individuals whose mental illness increases their danger to themselves or others. The following are criteria for eligibility: * A patient is determined to be "suffering from a mental illness, and as a result is likely to cause serious harm to themselves or others, or is gravely disabled." and; * The patient's gross monthly household income falls below 185% of the federal poverty guideline. SB 97 amends current statutes defining the state's responsibility for payment for inpatient psychiatric service for those patients needing intensive services. Historically the Department of Health and Social Services (DHSS) has reimbursed hospitals for only those patients who are committed by the courts for evaluation and treatment services. This legislation would require the department to reimburse hospitals for individuals who meet the commitment criteria, but who voluntarily admit themselves into the hospital. These individuals are therefore, not court ordered into care, but could be held under court order if they attempted to leave the hospital. GINA MACDONALD, DEPARTMENT OF HEALTH AND SOCIAL SERVICES offered to answer questions. She noted that the Department does support the bill. She noted that the API 2000 project will reduce the number of beds at the Alaska Psychiatric Institute from 79 to 54. The legislation would provide a clear structure to direct how private hospitals would be paid to perform some emergency mental health functions. In response to a question by Representative Austerman, Ms. MacDonald explained that federal funds would be used through FY 2001. PAT CLASBY, ALASKA STATE HOSPITAL AND NURSING HOME ASSOCIATION stated that the Association supports the legislation. Most hospitals in the state provide some type of emergency mental health evaluation services. Several hospitals also provide treatment services beyond 72 hours. The hospitals around the state have been working with the state as Alaska Psychiatric Institute is downsized. She emphasized that there needs to be a clear understand of when patients are the state's responsibility. Hospitals would be concerned if the services were developed and became an unfunded mandate. Representative Kohring MOVED to report CSSB 97 FIN) am out of Committee with individual recommendations. There being NO OBJECTIONS, it was so ordered. CSSB 97(FIN) am was REPORTED out of Committee with a "do pass" recommendation and with a published fiscal note by the Department of Health and Social Services dated4/21/99. ADJOURNMENT The meeting adjourned at 10:05 p.m. House Finance Committee 7 5/15/99