HOUSE HEALTH, EDUCATION AND SOCIAL SERVICES STANDING COMMITTEE April 6, 1999 3:40 p.m. MEMBERS PRESENT Representative Fred Dyson, Co-Chair Representative John Coghill, Co-Chair Representative Joe Green Representative Carl Morgan MEMBERS ABSENT Representative Jim Whitaker Representative Tom Brice Representative Allen Kemplen COMMITTEE CALENDAR Board of Dispensing Opticians James Rothmeyer - Fairbanks - CONFIRMATION ADVANCED * HOUSE BILL NO. 70 "An Act relating to questionnaires or surveys administered in public schools." - HEARD AND HELD CS FOR SENATE BILL NO. 48(HES) "An Act relating to health insurance provided by and provisions relating to the Comprehensive Health Insurance Association." - MOVED CSSB 48(HES) OUT OF COMMITTEE (* First public hearing) PREVIOUS ACTION BILL: HB 70 SHORT TITLE: PUBLIC SCHOOL SURVEYS SPONSOR(S): REPRESENTATIVES(S) DYSON Jrn-Date Jrn-Page Action 1/25/99 81 (H) READ THE FIRST TIME - REFERRAL(S) 1/25/99 81 (H) HES 4/06/99 (H) HES AT 3:00 PM CAPITOL 106 BILL: SB 48 SHORT TITLE: STATE HEALTH INSURANCE SPONSOR(S): SENATOR(S) MACKIE Jrn-Date Jrn-Page Action 1/28/99 109 (S) READ THE FIRST TIME - REFERRAL(S) 1/28/99 109 (S) HES, L&C 2/24/99 (S) HES AT 1:30 PM BUTROVICH ROOM 205 2/24/99 (S) MOVED CS (HES) OUT OF COMMITTEE 2/24/99 (S) MINUTE(HES) 2/25/99 363 (S) HES RPT CS 2DP 2NR SAME TITLE 2/25/99 363 (S) DP: MILLER, ELTON; NR:WILKEN, PETE KELLY 2/25/99 363 (S) ZERO FISCAL NOTE (DCED) 3/16/99 (S) L&C AT 1:30 PM 3/16/99 (S) MOVED CS (HES) OUT OF COMMITTEE 3/16/99 (S) MINUTE(L&C) 3/17/99 583 (S) L&C RPT (HES) CS 3DP 2NR 3/17/99 583 (S) DP: MACKIE, TIM KELLY, DONLEY; 3/17/99 583 (S) NR: HOFFMAN, LEMAN 3/17/99 583 (S) PREVIOUS ZERO FN (DCED) 3/18/99 (S) RLS AT 11:40 AM FAHRENKAMP 203 3/23/99 (S) MINUTE(RLS) 3/24/99 662 (S) RULES TO CALENDAR AND 1 OR 3/24/99 3/24/99 664 (S) READ THE SECOND TIME 3/24/99 664 (S) HES CS ADOPTED UNAN CONSENT 3/24/99 665 (S) ADVANCED TO THIRD READING UNAN CONSENT 3/24/99 665 (S) READ THE THIRD TIME CSSB 48(HES) 3/24/99 665 (S) PASSED Y20 N- 3/24/99 670 (S) TRANSMITTED TO (H) 3/25/99 567 (H) READ THE FIRST TIME - REFERRAL(S) 3/25/99 567 (H) HES, L&C 4/06/99 (H) HES AT 3:00 PM CAPITOL 106 WITNESS REGISTER JAMES ROTHMEYER, Appointee to the Board of Dispensing Opticians 4001 Geist Road, Number 7 Fairbanks, Alaska 99701 Telephone: (907) 479-4797 POSITION STATEMENT: Testified as appointee to the Board of Dispensing Opticians. JOHN MIDDAUGH, MD, Chief Epidemiology Section Division of Public Health Department of Health and Social Services P.O. Box 240249 Anchorage, Alaska 99524 Telephone: (907) 269-8000 POSITION STATEMENT: Testified on HB 70. ELMER LINDSTROM, Special Assistant Office of the Commissioner Department of Health and Social Services P.O. Box 110601 Juneau, Alaska 99811 Telephone: (907) 465-1613 POSITION STATEMENT: Provided information on HB 70. DAVID GRAY, Legislative Assistant to Senator Jerry Mackie Alaska State Legislature Capitol Building, Room 427 Juneau, Alaska 99801 Telephone: (907) 465-3844 POSITION STATEMENT: Presented sponsor statement for SB 48. MARIANNE BURKE, Director Division of Insurance Department of Commerce and Economic Development P.O. Box 110805 Juneau, Alaska 99811 Telephone: (907) 465-2515 POSITION STATEMENT: Testified in support of SB 48. ACTION NARRATIVE TAPE 99-30, SIDE A Number 0001 CO-CHAIRMAN DYSON called the House Health, Education and Social Services Standing Committee meeting to order at 3:40 p.m. Members present at the call to order were Representatives Dyson, Coghill and Morgan. Representative Green joined the meeting at 4:48 p.m. CONFIRMATION HEARING Board of Dispensing Opticians CO-CHAIRMAN DYSON announced the committee would consider one nominee for the Board of Dispensing Opticians. They would not vote for the nominee but would pass him out of committee for full consideration of the House and Senate. (Resumes were provided for all appointees.) CO-CHAIRMAN DYSON asked James Rothmeyer why he would like to serve on the Board of Dispensing Opticians. Number 0082 JAMES ROTHMEYER, Appointee to the Board of Dispensing Opticians, testified via teleconference from Fairbanks. He said he would like to serve the state and the people of Alaska to ensure that they get the best services from the state's licensed opticians. CO-CHAIRMAN DYSON asked Dr. Rothmeyer if he planned to retire in Alaska. DR. ROTHMEYER said he was going to stay. CO-CHAIRMAN COGHILL offered his thanks to Dr. Rothmeyer to be willing to serve on this board. CO-CHAIRMAN DYSON asked Dr. Rothmeyer if he could call him for his opinion on medical issues, like laser surgery and dispensing of some pharmaceuticals, when they come up. DR. ROTHMEYER answered that he would be pleased to provide whatever he could. CO-CHAIRMAN DYSON informed Dr. Rothmeyer that when the committee had a quorum, they would pass the appointment on to the full House. HB 70 - PUBLIC SCHOOL SURVEYS Number 0277 CO-CHAIRMAN DYSON announced the next order to business as House Bill No. 70, "An Act relating to questionnaires or surveys administered in public schools." CO-CHAIRMAN DYSON handed over the gavel to Co-Chairman Coghill. CO-CHAIRMAN COGHILL called on Co-Chairman Dyson to testify as sponsor of HB 70. Number 0342 CO-CHAIRMAN DYSON noted that there is not a quorum yet, but they will continue testimony. He asked that the committee not vote on HB 70 today since they just got the proposed CS in the last few hours. CO-CHAIRMAN DYSON went on to say that during this past year, there was some controversy whether the Youth Risk Behavior Survey (YRBS) could be administered without active parental permission. In AS 14.03.110 it says " ... whether anonymous or not, that inquires into private family affairs of the student ..." and his first thought was to insert "a private family or personal affairs of the student" in order to make it clear that active parental permission was required. In subsequent discussion with the Department of Health and Social Services (DHSS), they made a clear and convincing case that the logistics of doing that were insurmountable. CO-CHAIRMAN DYSON said for the last two months he has been working on a way that his concerns and parents' concerns for parental consent and control could be satisfied without making a logistics nightmare for the department. The proposed CS is more complicated than he wanted, but it is comprehensive. It is very similar to a proposal in Utah and allows for a once-per-year blanket approval by the parent for surveys, and it sets down some conditions for doing it. He intends to make this easy for the school districts. At enrollment, the parent can sign another piece of paper or check a box on the enrollment form, and then the school district knows they have permission to do the surveys. Number 0604 CO-CHAIRMAN DYSON continued that it his intention that parents will get an additional notification in advance of the survey in case they change their mind to opt out. Even the once a year blanket permission is difficult, but the information that is obtained from the YRBS is valuable. There are federal funding grants that are jeopardized, if not eliminated, if the DHSS is not able to get this information. He will make copies of the actual YRBS available to the committee before they vote. CO-CHAIRMAN COGHILL asked how different the proposed CS is from the original version. CO-CHAIRMAN DYSON answered that it is quite different and more comprehensive. He will also have a sectional analysis available. He called their attention to some important points. On page 2, line 30, subsection (e) is where it talks about getting blanket permission; page 3, line 3, subsection (e) (2) provides for parents to change their mind after they have given written consent. Number 0920 JOHN MIDDAUGH, MD, Chief, Epidemiology Section, Division of Public Health, Department of Health and Social Services (DHSS), came forward to testify. He said they share many of the principles and are trying to get to the right place for everyone. He explained that the YRBS was developed by the National Center for Disease Prevention and Control in collaboration with 71 state and local departments of education and 19 federal agencies. DR. MIDDAUGH explained that the YRBS collects information on middle school and high school students about behaviors that relate to the major causes of disability, injury and disease for their age group and later in their lives. The school-based survey uses a systematic, nationally comparable methodology. It is conducted in all the states and in many school districts; so Alaska could get data and compare itself to other school districts and states. The DHSS was able to conduct this in 1995, did so very successfully, and got valid statewide results that gave them some information about the behaviors of that age group. Number 1012 DR. MIDDAUGH stated this information has allowed the DHSS to craft programs to try to assist and support students who are doing things right; it turns out that most of the students are doing things right, and target programs to students who need additional assistance. Given the success of this survey in 1995, the DHSS anticipated little controversy and similar support and success in 1999. To their surprise, they encountered a lot of questions. There was a lot of misinformation. Questions were raised on different legal opinions, about what constituted a family affair, and about the interpretation of existing laws. Unfortunately, a great amount of incorrect information characterized the YRBS as wanting to be done without parental permission. DR. MIDDAUGH stated that the YRBS always has been and always would be done with parental permission. The YRBS is voluntary, not mandatory. It is done based on the voluntary participation of a local school district. Under current procedures, the districts have an option, if they choose, of conducting the survey with passive permission. If the district wished to get active written parental permission, they clearly can do so. The whole approach has been a partnership to help get information for use in public health and schools to assist the students. Passive parental permission is where there is an implied consent: the schools notify the parents in writing, newsletters, and/or offer the complete survey for parent's review. Any parent or child can then opt out of participating in the survey by informing the school. DR. MIDDAUGH told the committee the problem the DHSS has with active parental permission is that the notices sent home to get parental permission are not returned to the school. Numerous activities are done in the schools with passive parental permission. The difficulties they face in conducting the survey with active parental permission is threefold. The first one is a selection bias because many of the students whose behaviors they are most interested in learning about are just the ones who don't bring the permission slips back. It isn't necessarily a case of the parent objecting to the student's participation, it is a logistic barrier of getting the actual slips back. The second one relates to the cost of doing it. The third one relates to confidentiality. The way the YRBS is done with passive parental permission is that the sample of students to participate is only a small proportion of the students enrolled in the district. The students are not individually identified, but the classrooms are. The questionnaire comes in an envelope with no name on it; the survey is distributed in the classroom so the survey people never know the students' names. Up until actually executing the survey, a parent or child can elect not to do it, and any questions the students don't want to answer can be skipped. When the survey is completed, it is put back in the envelope and turned in. No names are on the surveys, no list of the students who participated is available; so the survey is completely confidential and anonymous. Answers could never be linked back to any individual students. DR. MIDDAUGH explained that with active parental permission, a list of students who have permission has to be maintained by somebody, and potentially it could provide a source of breach of confidentiality later. Every questionnaire would have to be labeled with the student's name, and records would have to be kept to verify that only the students with permission were the ones who participated. These three problems are why it causes a great barrier to conduct these surveys. If the parents wish to undertake active parental permission, they can do so under current procedures. The DHSS would hope to get support to craft a solution that would indeed allow these future surveys done efficiently, maintaining the current situation of local district autonomy to make those decisions, but also to enable the DHSS to efficiently collect this information. DR. MIDDAUGH pointed out one concern in the proposed CS is the burden on the school districts to get parental permission, maintain the list of students with permission and then re-notify the parents before the survey is given in case they want to opt out. The purpose is to get valid, "generalizable" data, and protect confidentiality. The power of the information is to identify the students who need help; help evaluate the programs; provide an advantage to districts for competition of federal grant funds to have the solid data to help them leverage resources. Number 1433 DR. MIDDAUGH stated the DHSS is conducting the YRBS surveys in Alaska in 1999. Because Anchorage elected not to participate, they will not have a "generalizable" statewide result to compare to 1995. They will have results for 28 districts, who are currently participating, involving over 1,300 classrooms and about 25,000 surveys. Two of the districts elected to use active parental permission; all the rest are using passive parental permission and are doing so successfully. DR. MIDDAUGH hopes they can continue the dialog to reach a win-win situation because he believes they share many of the goals. The DHSS wants to protect the scientific validity of the survey, minimize the costs and burdens on the schools districts, while preserving the absolute commitment to notify parents to give them the opportunity to opt out, and then absolutely maintaining the confidentiality and privacy of the data. Number 1490 CO-CHAIRMAN DYSON asked how much money is riding on this. DR. MIDDAUGH answered that he didn't know the answer to that because the goal of the DHSS is to use the data related to public health programs. For example, the drug and alcohol program was able to use the YRBS that resulted in new federal funding of $3 million which was distributed to Alaska communities for drug and alcohol prevention programs. He thought that the Department of Education could better respond to the funding streams available to districts. CO-CHAIRMAN DYSON asked if the $3 million funding requires that the YRBS be done or just that information be gathered. DR. MIDDAUGH said no, there is no money that specifically requires the survey. CO-CHAIRMAN DYSON asked if the data gathered was used to demonstrate what a powerful need exists in Alaska and thereby secure some funding. DR. MIDDAUGH answered yes. CO-CHAIRMAN DYSON asked Dr. Middaugh to address how the once a year blanket permission at enrollment would be a tremendous burden on the school district. Number 1626 DR. MIDDAUGH explained that it takes staff time to collect the permission slips when the students haven't brought them back to school. It wasn't because the parents didn't want the students to participate, but perhaps the parents were out of town or the slip got lost. The DHSS did not use the simple mechanism of handing something to the child to take home to the parents in the passive parental permission exercise. There was a letter to every parent or guardian, there were newsletters, local publicity, Parent-Teacher Association meetings and public meetings to get information. In talking to school district colleagues, the DHSS found out that the logistics of getting a blanket permission at a time before the actual survey would be given, then to enter the data, and use it later would be very cumbersome. CO-CHAIRMAN DYSON asked why it is difficult for the school enrollment form to include another page to sign or check off a box when they are already maintaining registration records. DR. MIDDAUGH said it will require the schools to set up a new mechanism to collect and maintain those permission records which they currently aren't doing. With the turnover in school enrollment, at the time of actually administering the survey, they would have to go back and specifically identify every single child by name who then did or didn't have permission. The logistics, the costs and the practicality of pulling the samples are going to add a tremendous burden to the school districts as well as those conducting the survey. He would argue that the protections of notifying parents and giving them the chance to opt out exists today, is effective and would meet the need of almost every person in the state. CO-CHAIRMAN DYSON commented that most schools are automating their records, and he suggested that the permission information could be sorted on the computer. DR. MIDDAUGH suggested from discussions with the school districts that it isn't as easy as it would seem or appear. Number 1815 CO-CHAIRMAN DYSON asked if Dr. Middaugh thought they couldn't get enough parents to give permission for the survey on an active basis. DR. MIDDAUGH said the mechanisms to get active parental permission are much more cumbersome. In 1995, Juneau used active parental permission, and this year Sitka used active parental permission, and both had a very interesting experience in terms of the extra costs and burdens, the number of volunteers and clerical time it took. In order for the survey to be valid, there has to be a certain response rate; if they don't get the response rate, then they can't generalize the results of the survey. He encouraged the committee to get specific testimony from those who were involved in Juneau and Sitka to relate their experiences, because they speak quite powerfully to the difficulty of doing this. Number 1907 CO-CHAIRMAN COGHILL asked why Anchorage decided not to take the survey. DR. MIDDAUGH answered that they were concerned about a potential lawsuit over the interpretation of the current law if they were to undertake it with passive parental permission. The second issue is they felt the costs and burden on their district were too great to undertake it with active parental permission under the time frame. They did suggest they would entertain the survey if DHSS would pay for all the additional costs of trying to undertake it with active parental permission, but the DHSS had no funds to do that." Number 1953 ELMER LINDSTROM, Special Assistant, Office of the Commissioner, Department of Health and Social Services, came forward to testify. Based upon the concerns of the Anchorage School District raised over a potential lawsuit, he said, "With your permission we did have a potential amendment drafted referenced to the original bill that I think very narrowly addresses the concern that was raised by Anchorage, making it abundantly clear that passive parental permission is permissible for anonymous surveys that are conducted, even though they might inquire into the private or personal matters of the student or the student's family. But again, making it clear it was only related to anonymous surveys where there was no ability to identify individual students who took part in the study or the results for those individuals." CO-CHAIRMAN COGHILL said one of his concerns is the ability of a parent to speak to the very issue of their child taking even an anonymous questionnaire that unduly defiles them. They may not want them to go through that mental exercise. He said he believes parental notification is going to be a high issue. He entertained this amendment under advisement since they don't have a quorum. Number 2042 MR. LINDSTROM referred to the tobacco tax discussion a few years ago and mentioned that the state is obligated over time to show that the increase of the tobacco tax was having the effect they promised it would: it would reduce youth's use of tobacco. The YRBS is the instrument to gather the data to prove to the legislature whether the programs are working. "For youth issues the YRBS really is the gold standard. It is something we hang our hat on everyday in the department." CO-CHAIRMAN COGHILL acknowledged that it is valuable information. He thought it would be helpful if parents did a similar survey. Number 2150 DR. MIDDAUGH said there is an adult survey, and he would love to see it given if they could find funding. "We are identically concerned about confidentiality and anonymity. This mechanism assures that. It absolutely assures that no answer can be identifiable to a person. The power of the data is that it is 'generalizable.' That's why we think this is a major thing that we hope we can convince you of our case to assure our ability to do it. We would be very happy to continue to provide additional information and explore ways to see if we can sort out this conundrum right now." CO-CHAIRMAN COGHILL reiterated that parents do have access to the actual questions prior to the survey. CO-CHAIRMAN DYSON commented that it takes the parents paying attention to the notice and then asking for a copy of the questions. DR. MIDDAUGH explained if parents ask for the questions, they will be mailed to them; they are made available at the school and depending on the local district, a public meeting is held where parents can come and discuss the survey and all the mechanisms for it with someone involved in administering the survey. DR. MIDDAUGH said the DHSS has had a lot of experience with the survey and was caught blind sided. In 1995 things were effective and smooth, the DHSS thought they had gained wide support to continue to do the survey. They hope by continuing to do the survey, it is something that can be supported; and that it does have integrity in the notification mechanism. Their intention is to do it every two years to have good monitoring data to tell whether the programs are working. Number 2253 CO-CHAIRMAN COGHILL remarked that parents quite often will not answer very probing questions which are similar to the ones on the survey. He believes if parents were given the questionnaire, many would resist probing questions, even under anonymous conditions. "In a school setting quite often, the authoritativeness of giving a questionnaire at school almost goes unquestioned by many students just because of the nature of the situation. Therefore, I think that the active participation in the parents, that anybody would agree with, that parental involvement is so important, is worth the effort. As I read this, I am going to be looking for not only the cost of the effort but how to facilitate that effort." TAPE 99-30, SIDE B Number 2336 CO-CHAIRMAN DYSON summarized where he believes they are. They agree that the information is valuable and useful for getting grants, and they agree they want parents in the loop. The disagreement seems to be whether the parental permission will be active or passive. He commented that Dr. Middaugh's position is that active permission is logistically difficult enough to call into question the ability to do the job and get the survey. CO-CHAIRMAN DYSON said, "You didn't say, but were on the edge of inferring there might not be enough parents who would actively agree if it was really easy to get their permission. You didn't say that, but there might not be a high enough percentage of parents that would agree...you have no problem with active permission if we can find a good way to do it that wasn't logistically impractically overwhelming, and because the ways that we've come up with of getting active permission are too cumbersome, you're wanting to go with the best kind of a passive program, with all the ways of notifying." He asked if that accurately characterized Dr. Middaugh's perspective. Number 2271 DR. MIDDAUGH said that was a very close summary. His additional concern is the bias of the survey and the costs related to the mechanisms of active and passive permission based on national experience of published data in Alaska's experience. "Perhaps we could explore what has happened here related to that question. I don't think it is a question that enough parents don't want their kids doing the survey that that is the issue. That's not been our experience. I absolutely do think there are many parents who absolutely do not want their kids to do the survey. I think the goals, and I think we've met the goal, is to give a mechanism for them to have that right protected under existing procedures. I would like a chance to have an opportunity to arrange for you to hear from the districts that have undergone the experience of trying to do the active permission. I also want to make certain that these remarks are only directed for a survey that is completely anonymous and confidential. When we talk about anything else then we're talking a completely different ballpark." CO-CHAIRMAN DYSON asked Dr. Middaugh if he just said that getting the active permission would take enough of a group of students out of it to bias the results, and therefore not give them an accurate enough data base. Numbrt 2208 DR. MIDDAUGH replied it is a concern. CO-CHAIRMAN DYSON commented, "I think you just made my case." DR. MIDDAUGH explained the reason that the question "why do they not get the permission in" is not because the students or the parents object to the questions; it is because the students do not get the permission slips returned. When given an opportunity, they do take the survey, and they do answer it. There's a great amount of information about that. CO-CHAIRMAN DYSON commented it doesn't seem to him that is addressed to the parents who are doing the enrolling. DR. MIDDAUGH continued saying, "Those data are available as well about the acceptability to parents, and again I think actually, the experience here of individuals involved in local districts with their communities can help answer that exact issue that you're getting at about why is it that individuals don't do it. The ones that don't do it, articulate that and clearly don't participate. There's a group that just don't participate. It's not that they object to doing it, and given an opportunity to facilitate their participation, they participate and the information is valuable. It's just about a selection bias. It's very difficult to always get to the non-responders in a survey. Their characteristics are often very different than those who respond. Those are often exactly the kids we're most interested in learning about. I think we can provide a lot of information to back that up in terms of experience." CO-CHAIRMAN DYSON asked if Dr. Middaugh was saying that the parent who, at the time of enrollment doesn't give permission, is the very one they want to get information from. Number 2111 DR. MIDDAUGH said, "No it isn't. I was talking about a specific active written parent permission at the time of the survey. We have no experience with your proposal which would be 'what would parents behavior be at the start of a school year to give a blanket permission for a survey they can't see because it's not available at the time they enroll their kid to be administered six months later.' I think that is an unfair comparison." CO-CHAIRMAN DYSON agreed. I'm glad we got through that. DR. MIDDAUGH said, "Yes we're talking about two different scenarios." Number 2084 CO-CHAIRMAN COGHILL said to Co-Chairman Dyson, "According to the bill you have, having checked that at the beginning of the year, they still have the chance or opportunity to opt out once the survey is brought up for notification to be done, right?" CO-CHAIRMAN DYSON said yes. The committee took an at-ease from 4:35 p.m. to 4:36 p.m. Number 2058 CO-CHAIRMAN COGHILL said his intention is to keep testimony open and deal with this when they have a quorum. HB 70 will be continued until Thursday. CO-CHAIRMAN COGHILL passed the gavel back to Co-Chairman Dyson. SB 48 - STATE HEALTH INSURANCE Number 2024 CO-CHAIRMAN DYSON announced the next order of business as CS For Senate Bill No. 48(HES), "An Act relating to health insurance provided by and provisions relating to the Comprehensive Health Insurance Association." He informed the committee that they would go ahead and take testimony even though there is no quorum. He will call Representative Green down when it is time to vote. Number 2000 DAVID GRAY, Legislative Assistant to Senator Jerry Mackie, came forward to present SB 48. He told them that the sponsor statement comes from the Alaska Comprehensive Health Insurance Association (ACHIA), which was established in 1992 to provide a health insurance pool for individual Alaskans whose health condition was considered uninsurable, or who could not otherwise find adequate health coverage. The legislation mandated that all providers of health insurance in the state must participate in the pool. The association then makes health insurance available to Alaska residents who are high risk. In addition to operating the pool, the board of directors of ACHIA includes two consumer advocates. MR. GRAY commented that two consumer advocates are not able to testify today via teleconference, but they have been very active in the Senate in presenting the reason for this legislation. The legislation also asks ACHIA to periodically report on the effectiveness of this pool in promoting rate stability, product availability, and affordability of coverage. Senate Bill 48 is a direct result of this effort by the association to make the program work better and more efficiently; it is a relatively new program. The legislation has the support of the Division of Insurance. Number 1924 MR. GRAY stated that this legislation is trying to allow more cost- effective plans for the individuals who get coverage under ACHIA; better administer the program; allow flexibility in evaluating the administration of the program; to simplify the administration by decreasing the number of declinations required for eligibility; and to make some other technical improvements to the program. The legislation will allow the board to manage the ACHIA in a more cost-effective and efficient manner. The legislation also brings their program in conformance with new federal requirements particularly as it concerns portability of insurance. Number 1872 MR. GRAY informed the committee that a bill similar to this was introduced at the end of last session, so there was a vehicle during the summer the people involved in health insurance could look over the provisions and see what other improvements. The bill in front of them is the result of recommendations from that review and it was reintroduced. Number 1830 MARIANNE BURKE, Director, Division of Insurance, Department of Commerce and Economic Development, came forward to testify. She informed the committee that the proposed legislation is the outgrowth of a lot of hard work by the members of the board of directors and the division, as well as the input from all of the insurers who write health care in the state. Every insurer that writes health care has a vested interest in making sure this entity is as efficient and effective as possible. This mechanism is a last resort. If people have a condition that precludes them getting coverage anywhere else, they can come to the ACHIA and get coverage. The program is not self supporting. If it were, people could get the insurance from the regular market. It does however provide a mechanism for people to participate in the cost of their health care. The premiums, which are about 175 percent of a standard premium, only covers about 20 percent of the cost. "The remainder is allocated to the insurers that write business in this state on a percentage of premium. If they write 40 percent, they pick up 40 percent of the assessment." Number 1753 CO-CHAIRMAN DYSON asked if they write 40 percent of the policies in the state, they get the opportunity to pick up 40 percent of the cost of this. MS. BURKE answered yes. She continued saying they want to make it as efficient as possible. Costs are high because the people who go into this insurance company have conditions such as hemophilia, where the drug medication alone can cost $4,000 to $12,000 per month; people dying of cancer, people who have terminal conditions, and people seeking organ transplants. It is not a mechanism for people who are rich or poor; it is for people who get hit by a devastating illness and cannot get coverage. Without this mechanism, they would wind up with Medicaid, and the state would be picking up the tab. It gives them dignity and a chance to participate. With ERISA [Employee Retirement and Income Security Act] and the self-insured plans being exempted, it is as fair as it can be. Number 1668 MS. BURKE explained because of existing statutes, the board must use an insurer to provide these services, collect premiums, make payments, and do all of the services of a normal insurance company. They pay four times as much as the next highest state in this country which is $112 per person, per month for the administrative services. That is unconscionable, but the board has no choice. They want the flexibility to be able to go out and make a business decision; to find a qualified administrator to provide these services. MS. BURKE commented they also want to be able to make it less onerous to get coverage. The two declinations required now means two insurance companies have to turn the person down before he/she can come to ACHIA. If someone is dying of cancer, it does not take an insurance company to tell him/her they are not going to cover him/her. The division strongly supports this legislation. CO-CHAIRMAN DYSON asked her if anyone opposed this bill. Number 1592 MS. BURKE said this legislation has been discussed for over three years. Originally it was opposed by Aetna when they insured the state because Aetna would have had to pick up a portion of the cost. Now Aetna is one of the companies represented on the board and they support it. She is not aware of any opposition to this legislation. CO-CHAIRMAN DYSON sent word for Representative Green to come down to vote. He noted that this bill also has a referral to the Labor and Commerce Committee. Number 1518 REPRESENTATIVE GREEN asked if this is picked up by the private insurance companies that'll be scattered over all insurance payers. MS. BURKE answered that is correct. REPRESENTATIVE GREEN asked if she had any idea about how much this would affect premiums. MS. BURKE said the health care premiums in this state are roughly $300 million. The assessments that have been levied have been in the range of $1.5 million. Number 1470 REPRESENTATIVE GREEN asked if high risk people are in a pool, and each insurance company is assigned a certain number of those, would it impact various health insurance companies negatively. Number 1436 MS. BURKE said the ACHIA is actually an insurance company. It collects the premiums and pays the payments for services. This does not work like the auto pool. REPRESENTATIVE GREEN asked if that company is owned and set up by all the other carriers. Number 1388 MS. BURKE explained it was created by the legislature. Clearly it is not a money-making organization; it assesses what it needs to pay the premiums. The board of directors are made up of representatives of the companies writing insurance in this state. It is in the best interest of every health care provider or every insurance company writing health care to have this be as efficient as possible. Inefficiencies will cost them. REPRESENTATIVE GREEN asked how the company would be set up. Number 1329 MS. BURKE replied that by statute there will be five insurance companies who are the largest writers of the state with two additional members who will be consumer advocates. REPRESENTATIVE GREEN wondered if company number six would be a part of it. MS. BURKE said the other companies would be a part of it in the sense that they pay their pro rata share. CO-CHAIRMAN COGHILL asked if people are going to pay a portion of the premium or the cost of health care. Number 1250 MS. BURKE replied if he is referring to the amount the covered individuals pay, they pay premiums just like they would if they were insured by Blue Cross or Aetna. She may have confused them when she said they pay about 20 percent; by that she meant the total cost of all the covered services; their premiums only amount to about 20 percent of that total cost. CO-CHAIRMAN COGHILL wondered if the flexibility that the board is looking for now is to go outside and look for other professional administrative services. MS. BURKE said that is correct. CO-CHAIRMAN DYSON announced with the arrival of Representative Green they now have a quorum. Number 1191 REPRESENTATIVE GREEN made a motion to move CSSB 48(HES) from committee with individual recommendations and zero fiscal note. There being no objection, CSSB 48(HES) moved from the House Health, Education and Social Services Standing Committee. CONFIRMATION HEARING Board of Dispensing Opticians CO-CHAIRMAN DYSON made a motion to advance the confirmation of James Rothmeyer to the Board of Dispensing Opticians. There being no objection, it was so ordered. HB 70 - PUBLIC SCHOOL SURVEYS Number 1140 CO-CHAIRMAN DYSON brought the committee's attention back to House Bill No. 70, "An Act relating to questionnaires or surveys administered in public schools." CO-CHAIRMAN DYSON explained to Representative Green that they held public hearing on HB 70 but needed a quorum to make a motion to adopt the committee substitute as the work draft. Number 1112 REPRESENTATIVE GREEN made a motion to adopt the proposed committee substitute (CS) for HB 70, version 1-LS0263\G, Ford, 4/6/99, as a work draft. There being no objection, proposed CSHB 70 was before the committee. ADJOURNMENT Number 1090 There being no further business before the committee, the House Health, Education and Social Services Standing Committee meeting was adjourned at 5:00 p.m.