Legislature(2009 - 2010)CAPITOL 120
03/11/2010 01:00 PM House JUDICIARY
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HJR 35 - CONST AM: HEALTH CARE 1:48:31 PM CHAIR RAMRAS announced that the first order of business would be HOUSE JOINT RESOLUTION NO. 35, Proposing amendments to the Constitution of the State of Alaska prohibiting passage of laws that interfere with direct payments for health care services and the right to purchase health care insurance from a privately owned company, and that compel a person to participate in a health care system. 1:48:46 PM REPRESENTATIVE MIKE KELLY, Alaska State Legislature, speaking as one of the joint prime sponsors, indicated that HJR 35 - a resolution proposing amendments to the Alaska State Constitution - is in response to proposed federal healthcare- reform legislation, which is meant to address the issues of access, affordability, and quality. However, he remarked, many people are unsure that the federal legislation is going to adequately address those issues. [Should HJR 35 pass the legislature and be adopted by the voters at the next general elections, it would change the Alaska State Constitution such that] it would preclude the passage of laws that prohibit or penalize direct payment for healthcare services, or laws that prohibit or penalize the purchasing of healthcare insurance, or laws that compel one to participate in a healthcare system, or laws that penalize one for refusing to participate in a healthcare system. He acknowledged that passage of HJR 35 and ratification by the voters of its provisions into the Alaska State Constitution could create a conflict with the aforementioned federal legislation should it pass as well. He offered his understanding, though, that 35 other states are considering legislation similar to HJR 35. REPRESENTATIVE HOLMES relayed that one of the main concerns she has with HJR 35 is that it could have severe, negative impacts on any proposed changes to existing federal programs such as Medicare, and those addressing Veterans Affairs (VA) benefits and the issue of tribal health. REPRESENTATIVE KELLY indicated that that might be the case, but surmised that others could better address that issue. In response to a question regarding the resolution's fiscal note, he indicated that he would research its analysis further. 1:56:42 PM PEGGYANN McCONNOCHIE relayed that she and her husband own three small businesses, two of which have employees, and offered her belief that the aforementioned federal legislation is going to result in two of her businesses going out of business, and won't necessarily resolve the problems it is meant to address. She added that a system similar to that being proposed by the federal government is already in place in New Zealand, where her husband is from, and opined that it doesn't work there, particularly with regard to pre-existing conditions. Alaskans should come up with their own solution to the problems of access to healthcare and its costs, she opined, and predicted that the proposed federal legislation is going to impose unreasonable burdens on Alaskans and their businesses, especially small business like those she and her husband own. She said she is excited about the possibility of getting a chance to vote on the proposed changes to the Alaska State Constitution as embodied in HJR 35. She surmised that the ratification of those changes would protect small business from being taxed for not providing healthcare insurance. In conclusion, she urged the committee to pass HJR 35. REPRESENTATIVE HOLMES asked Ms. McConnochie whether she would be concerned if passage of HJR 35's proposed changes to the Alaska State Constitution resulted in it becoming difficult to make future changes to certain existing federal programs. MS. McCONNOCHIE, citing her nescience regarding such programs, declined to venture an opinion, but noted that small business owners already face increasing taxes and costs. 2:00:29 PM ANDREA DOLL, Director, Legislative Information Standing Committee, Retired Public Employees of Alaska (RPEA), remarking that the prospect of a national public health plan being imposed on individuals has made people either very happy or very fearful, explained that the RPEA feels that HJR 35 is an example of an exaggerated response to the aforementioned proposed federal healthcare-reform legislation. Because HJR 35 is proposing to amend the Alaska State Constitution, it has raised concern among many RPEA members that voter ratification of its proposed changes would tie the hands of current and future legislators and thereby preclude them from addressing Alaska's healthcare issues, and from considering the full array of options currently available. This is a shortsighted approach, particularly given that no one yet knows what the proposed federal legislation will ultimately entail. MS. DOLL said that although keeping the federal government out of the [business of] healthcare might be a political philosophy that appeals to a significant sector of the population, to take steps to amend the Alaska State Constitution is drastic and potentially harmful. The RPEA, therefore, is asking the committee to reconsider such an approach, and to defeat HJR 35 as currently written. In response to a question, she reiterated that what's of concern to the RPEA is that voter ratification of HJR 35's proposed changes to the Alaska State Constitution would close off legislators' future options. REPRESENTATIVE HOLMES, characterizing HJR 35 as a bit of a kneejerk reaction to the proposed federal healthcare-reform legislation, reiterated her concern that voter ratification of HJR 35's proposed changes to the Alaska State Constitution could have severe, negative impacts on any future changes to existing federal programs, such as the Medicare system, which, as many could agree, needs changing. MS. DOLL concurred, reiterated some of her previous remarks, predicted that passage of HJR 35 would engender litigation, and pointed out that such litigation wouldn't solve anything. 2:09:30 PM PATRICK LUBY, Advocacy Director, AARP Alaska, said that the AARP Alaska is opposed to HJR 35, and feels that the Alaska State Constitution shouldn't be amended except for very serious reasons. The problems that HJR 35 purports to address don't actually exist yet and may never exist, since no one knows what Congress will do, and the AARP Alaska feels that Alaska should keep its options open, especially with regard to an issue as serious as healthcare. He added: Although Alaska does not have managed care in the HMO model using capitated cost, we do have new models that do managed care. Healthcare now and in the future will be all about networks and coordinated delivery of services; pay for performance, paying physicians and hospitals for more quality care, medical homes, not paying providers for what's referred to as "never- events" - which Medicare is already doing and is being picked up as a model by Medicaid and private insurers - ... will only increase in the future. Cost containment is going to be the main focus of healthcare debate in the future. In Alaska, we must do something about the uninsured. Currently, 17 percent of Alaskans between the ages of 50 and 64 have no insurance at all. When they need healthcare, they often ended up in the emergency room - the most expensive place to get it. They also usually cannot pay their bill. Those of us that do have insurance end up picking up their tab. The average cost of the uninsured for every Alaskan family is $1,900 annually. Employers, including the State of Alaska, also pick of the cost of those employers who do not provide coverage to their employees. [The] AARP wants to make sure that all of us participate in healthcare coverage so that we can end this cost-shifting. [House Joint Resolution 35] ... would allow people to opt out of coverage. The rest of us would still be stuck with their bills. We look to our legislators [to] provide solutions to problems. Why close down this option that might be very helpful to Alaska in the future? We recommend a "nay" vote on HJR 35. Thank you. MR. LUBY, in response to questions, relayed that the AARP Alaska thinks that requiring some type of coverage - wherein everyone participates and no one has to pick up someone else's bill - is the sensible approach to take; that when something is done at the national level, people would be able to either join some type of [insurance] pool or enter into some type exchange; and that if one doesn't pay for one's own health insurance - or one's employer doesn't - there would be penalties, penalties which would serve as an incentive to get people to actually purchase the coverage, to make sure that everyone has some type of basic coverage. 2:14:36 PM DAVE ROLAND, Policy Analyst, Show-Me Institute, mentioned that he's provided members' with his written testimony, and that he has a background in constitutional law. With regard to the question of whether legislation such as HJR 35 is premature, he opined that now is the time to take action, and surmised that passage of HJR 35 would give Alaskans the opportunity to decide for themselves whether they think that their right to decide whether or not to purchase healthcare insurance should be constitutionally protected. He also offered his belief that although under the Supremacy Clause of the U.S. Constitution, federal law preempts state law, there is reason to believe that with regard to the issue of mandated healthcare insurance, if the voters ratify HJR 35's proposed constitutional changes and a legal conflict then arises, the courts might instead rule that the Alaska State Constitution preempts federal statute. 2:20:13 PM CHRISTIE HERRERA, Director, Health and Human Services Task Force, American Legislative Exchange Council (ALEC), relayed that the ALEC applauds HJR 35 - which is modeled after "our own, 'freedom of choice in healthcare Act,' now in ... 38 states" - because the ALEC believes that it will ensure continued access to health services; that when government controls healthcare dollars, it makes treatment decisions based on what's best for government; and that patients, not bureaucrats, should decide what's best for patients. The ALEC also applauds HJR 35 because the ALEC believes that the resolution would stop mandates that just don't work. She indicated that although the ALEC believes it's important for people to have health insurance coverage, it also believes that a government requirement to purchase it would be ineffective, bureaucratic, and costly. For example, in Massachusetts, which has mandated the purchase of health insurance since 2006, such insurance cost 40 percent more than in the rest of the country], a third of the population still doesn't have coverage, it's harder for the newly-insured to see a physician, emergency room usage has increased by 17 percent, and legislators expect a $2 billion to $4 billion shortfall over the next decade. MS. HERRERA relayed that the ALEC also believes that HJR 35 would help Alaskans shield themselves from the proposed federal healthcare-reform legislation, and from any attempt by the State of Alaska to prohibit direct payment for medical care, and that it would result in a federalism clash if Congress passes a law that either forces people to purchase insurance or prohibits direct payments. On the latter point, she offered her understanding that the U.S. Supreme Court has already ruled in favor of the states when they take steps to protect their citizens' freedoms. She then offered her belief that the problem of people seeking medical services but refusing to purchase health insurance is going to exist anyway regardless of whether HJR 35 passes and its proposed changes to the Alaska State Constitution are then ratified by the voters; "even if ... a mandate did solve the 'free-rider' problem, we would still be forced to pay for the newly-insured with subsidies to purchase the required insurance," she added, and offered her understanding of what the provisions of the proposed federal healthcare-reform legislation might entail and how they might affect a low-income family of four. MS. HERRERA offered her belief that HJR 35 won't affect federal programs - such as Medicare and Medicaid - or that it would tie the hands of legislators thereby preventing them from addressing possible changes to such federal programs. Instead, she ventured, HJR 35 would ensure that the cornerstone of any future reforms is the preservation of patients' rights. She offered her understanding that a study performed by the Cato Institute estimates that the proposed federal healthcare-reform legislation would require more than 100 million Americans to drop their existing coverage and buy more expensive coverage that they may not want or need. She concluded by reiterating that the ALEC applauds HJR 35. 2:24:33 PM CHAIR RAMRAS, after ascertaining that no one else wished to testify, closed public testimony on HJR 35. The committee took an at-ease from 2:24 p.m. to 2:26 p.m. REPRESENTATIVE DAHLSTROM moved to report HJR 35 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HJR 35 was reported from the House Judiciary Standing Committee.