Legislature(2003 - 2004)

05/08/2004 10:35 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
SB 311-INSURANCE & WORKERS' COMPENSATION SYSTEM                                                                               
                                                                                                                                
Number 0123                                                                                                                     
                                                                                                                                
LINDA  HALL,  Director,  Division  of  Insurance,  Department  of                                                               
Community  and  Economic  Development,  said she  is  present  to                                                               
answer questions raised  at the last hearing of SB  311 about the                                                               
rate  making  process.    She   mentioned  that  she  has  spoken                                                               
previously about  lack of  a profitable  market, cost  of claims,                                                               
exorbitant premium  increases, and  the assigned risk  pool which                                                               
needs to be self-funded.  She  noted that there are provisions in                                                               
the bill that affect each one of those areas.                                                                                   
                                                                                                                                
MS. HALL  continued to  say that  what she  really wants  to talk                                                               
about today is  rate making, and the role of  NCCI Holdings, Inc.                                                               
(NCCI)  and  why it  was  not  involved  in  this process.    She                                                               
explained:                                                                                                                      
                                                                                                                                
     NCCI  develops   base  costs.    The   lost  costs  are                                                                    
     incorporated  from data  that's countrywide  and local.                                                                    
     That  is filed  with the  Division of  Insurance.   The                                                                    
     Division  of Insurance  is  the  primary rate  approval                                                                    
     body in the  state.  We review the  proposed lost costs                                                                    
     and either  approve, disapprove or modify  those.  Then                                                                    
     insurance companies  take those base costs,  they adopt                                                                    
     them, or  they file  deviations.  They  then also  do a                                                                    
     multiplier  on  top of  that  for  their own  expenses,                                                                    
     profits, and  contingencies, and  it takes  those three                                                                    
     steps before  we get a  final rate.  Each  component is                                                                    
     based on actuarial analysis.                                                                                               
                                                                                                                                
     NCCI looks at cost.  They  were not able to make a cost                                                                    
     projection, not  because they weren't asked.   I've had                                                                    
     several  communications with  NCCI.   This is  a system                                                                    
     change.  It is not a  benefit change.  NCCI in the past                                                                    
     has  always costed  benefit changes.   This  particular                                                                    
     process is not quantifiable as is a benefit change.                                                                        
                                                                                                                                
Number 0333                                                                                                                     
                                                                                                                                
     I  also  want  to clear  up  rate  increases/decreases.                                                                    
     Today, as  I sit here,  we have  no idea what  the rate                                                                    
     increases  will be  January 1,  2005.   NCCI is  in the                                                                    
     data collection process analyzing  that.  We will start                                                                    
     to get  preliminary figures in  July and August  and go                                                                    
     through  the process  I just  described.   There is  no                                                                    
     guarantee,  and  I've  said   this  I  think  in  prior                                                                    
     hearings,  that we  will have  rate  decreases.   Rates                                                                    
     depend  on  the cost  of  claims.    The goal  of  this                                                                    
     legislation started as  Commissioner O'Claray said last                                                                    
     night.  I  went to the administration with  what I term                                                                    
     the  crisis  in workers'  compensation.    We have  had                                                                    
     insolvencies - five insolvent work  comp companies - we                                                                    
     have very large  rate increases due to  cost of claims,                                                                    
     we  have an  assigned risk  pool that  has been  losing                                                                    
     money at a drastic rate for six years.                                                                                     
                                                                                                                                
     We've looked  at other things,  other than this.   This                                                                    
     was  an attempt  to try  to modify  the system  without                                                                    
     changing benefits.   We looked at  changing our medical                                                                    
     fee  providers to  the Medicare  rate.   It would  save                                                                    
     $50,000.   It is a  huge change  in benefits.   But, we                                                                    
     also felt it  was likely to mean  injured workers could                                                                    
     not find medical  care if we did that.   It's been done                                                                    
     in  several states  lately.   In  a state  the size  of                                                                    
     Alaska it could be  dramatically injurious.  What we're                                                                    
     looking  at is  finding  consistency, predictability  -                                                                    
     the  time-line for  decision  is cut  in  half -  we're                                                                    
     looking to  reduce attorney fees.   In 2002  there were                                                                    
     $11  million  in  attorney fees  and  $1.2  million  in                                                                    
     litigation costs.  We have  roughly $13 million tied up                                                                    
     in  claims costs  just in  the attorney  fee litigation                                                                    
     process.   In general, without changes,  we're going to                                                                    
     continue  to  lose  insurance  companies  and  have  no                                                                    
     chance to develop a competitive, healthy market place.                                                                     
                                                                                                                                
     Earlier  this  week  at  a  better  time  of  day,  you                                                                    
     listened  to me  talk  about insurance  bill, and  I'll                                                                    
     agree  that we  need  to  do regulatory  modernization.                                                                    
     Alaska  has fallen  behind.   We  have one  of the  few                                                                    
     states  left  with  a very  cumbersome  process  called                                                                    
     prior approval.   We  are in that  same place  with our                                                                    
     workers' compensation  system.   We need to  change our                                                                    
     insurance  regulatory system;  we  need  to update  our                                                                    
     workers' compensation  system.  We need  to improve the                                                                    
     state of our marketplace if  we're going to continue to                                                                    
     have  -  even begin  to  have  - affordable  work  comp                                                                    
     insurance.    I  support  the bill  as  it's  currently                                                                    
     written, SB 311.                                                                                                           
                                                                                                                                
Number 0527                                                                                                                     
                                                                                                                                
BARBARA HUFF-TUCKNESS, Lobbyist for  Teamsters Local 959; Member,                                                               
Alaska   Labor-Management   Ad    Hoc   Committee   on   Workers'                                                               
Compensation, testified against  SB 311.  She  mentioned a letter                                                               
she  had drafted  to the  committee.   "This is  a workers'  comp                                                               
reform bill,"  she stated.   She pointed out  that the bill  is a                                                               
62-page  document   with  many  issues.     She  said   that  her                                                               
organization  supports everything  that  Ms.  Hall presented  and                                                               
that  [those  parts  of  bill]  would produce  a  very  good  and                                                               
positive system.   Other parts of  the bill such as  the proposed                                                               
changes concerning the  upgrade of the hearing  officers are also                                                               
supported by her organization, she said.                                                                                        
                                                                                                                                
MS. HUFF-TUCKNESS  spoke about  the major  bone of  contention to                                                               
labor, which is about changes  to how injured workers are treated                                                               
in this state.   She opined that  no one has time to  read all of                                                               
the contents in the bill, and she  said that if the bill does not                                                               
pass there  are claims that there  will be a 20  percent increase                                                               
in  insurance.   She challenged  any insurance  representative to                                                               
come forward with  that information, and she stated  that in 2002                                                               
there  was a  50.6 percent  increase in  medical costs,  a factor                                                               
that  the bill  does not  address.   She noted  that the  bill is                                                               
looking at establishing an appeals commission.  She stated:                                                                     
                                                                                                                                
     We have  said that if  you as a legislative  body [are]                                                                    
     willing to  bring on, at  $500,000 to $1  million cost,                                                                    
     [an]  additional layer  of  government  to this  state,                                                                    
     with three  political appointees  to listen  and review                                                                    
     cases  ... then  we  will agree,  we  will support  you                                                                    
     making that  increased cost ...  but, we draw  the line                                                                    
     at the  de nova review.   We  do not believe  that this                                                                    
     politically  appointed appeals  commission should  have                                                                    
     the  power to  take what  you already  have at  a lower                                                                    
     level now -  and it's a brand new system  ... where you                                                                    
     have  a  hearing  officer  and   attorney  who  is  now                                                                    
     instructing  this panel  at a  lower level  [than] what                                                                    
     the law is.                                                                                                                
                                                                                                                                
Number 0840                                                                                                                     
                                                                                                                                
MS. HUFF-TUCKNESS  asked the  committee to  take another  look at                                                               
the bill  because her organization  does not believe it  is going                                                               
to be good  for injured workers, but  it is going to  be good for                                                               
the  employers.   She opined  that if  the commission  is removed                                                               
from  the  bill,  there  would  still be  a  system  that  brings                                                               
predictability to the process.   She appealed to the committee to                                                               
not pass SB 311.                                                                                                                
                                                                                                                                
Number 0977                                                                                                                     
                                                                                                                                
MICHAEL  JENSEN,  Attorney at  Law,  Law  Offices of  Michael  J.                                                               
Jensen,  stated that  he represents  injured  workers before  the                                                               
workers' compensation  board, as  well as workers  with longshore                                                               
injuries  and federal  workers' compensation  claims.   He stated                                                               
his appreciation for the committee's work  on this bill.  He said                                                               
the  bill has  three parts,  two of  which pertain  to provisions                                                               
regarding the  guarantee association and penalties  for uninsured                                                               
employers.   He asked that  those two provisions be  stripped out                                                               
of the bill  and passed.  However, regarding the  part that deals                                                               
with the appeals  provision, he said he  believes as Commissioner                                                               
Sampson and Ms. Huff do, that it  should be rejected.  It is much                                                               
too political and should be changed  to have the selection of the                                                               
commission members go through the  judicial council.  The de nova                                                               
review should only  be allowed if there is a  procedural issue or                                                               
if there is some evidence that  the hearing panel decision was an                                                               
abuse of discretion, he suggested.   He urged that the provisions                                                               
regarding uninsured  employers and  the guarantee  association be                                                               
passed and the commission section be rejected.                                                                                  
                                                                                                                                
Number 1132                                                                                                                     
                                                                                                                                
CHANCY CROFT  objected to the  recess of the  committee yesterday                                                               
afternoon and  the violation of  the 24-hour notice  provision of                                                               
the  uniform rules  and  the  two-minute limit.    He noted  that                                                               
people who  had already testified  were allowed to  testify again                                                               
without  giving first-time  testifiers an  opportunity to  speak.                                                               
He emphasized that  this bill contains a  very important question                                                               
about  compensation and  he referred  to  the bible  as an  early                                                               
source of compensation information.  He said:                                                                                   
                                                                                                                                
     This bill addresses a problem  that does not exist.  It                                                                    
     jeopardizes an  essential benefit to injured  workers -                                                                    
     that is -  promptness of payment of  benefits.  There's                                                                    
     a study  out of  Maine that  showed that  when benefits                                                                    
     are denied,  that injured workers have  to borrow money                                                                    
     from relatives, they have to  sell assets, they have to                                                                    
     go on  welfare, some of  them even go  into bankruptcy,                                                                    
     and  in the  end, by  the time  they finally  get to  a                                                                    
     hearing,  80 percent  of  their  claims are  determined                                                                    
     valid.                                                                                                                     
                                                                                                                                
He claimed  that the "two  bites to  the apple provision"  in the                                                               
bill adds  confusion instead of  clarification because  one panel                                                               
is in charge of credibility and another is in charge of weight.                                                                 
                                                                                                                                
                                                                                                                                
MR. CROFT  opined that the bill  is going to cause  problems that                                                               
did not exist before, such as  who has or has not participated in                                                               
this bill.   "There are  a lot of  people besides the  Chamber of                                                               
Commerce   that  Ms.   LaBolle  testified   about  that   haven't                                                               
testified, he said.  One third  of the injured workers don't have                                                               
an attorney and  have had no input  in this bill, he  stated.  He                                                               
said that  ways to improve  the workers' compensation  board have                                                               
been suggested  for years  by himself and  others, and  they have                                                               
not  been asked  to contribute  to this  bill.   There are  three                                                               
board members  - the  longest serving board  members and  who are                                                               
management members -  who were not asked for input  on this bill,                                                               
he said.   They would have told the committee  that the decisions                                                               
made by the board are  about evenly split between injured workers                                                               
and carriers,  even though  in the  last year  or two  there were                                                               
more decisions favoring the employer.                                                                                           
                                                                                                                                
He  opined that  the bill  does  not address  any problems  about                                                               
fairness of board decisions, but  adds confusion.  He referred to                                                               
Section 122,  which deals with  the credibility of  witnesses and                                                               
the treatment  of a board decision  like that of a  jury verdict.                                                               
He maintained that the bill  will increase premiums because it is                                                               
going  to cause  delay and  confusion.   He said  the bill  would                                                               
require  more that  $20,000 to  be  spent per  case to  set up  a                                                               
system that  violates the spirit  of Alaska  Constitution because                                                               
it sets  up a specialized  court.   He concluded by  stating that                                                               
passing the bill would raise  premiums more and slow down payment                                                               
to employees.                                                                                                                   
                                                                                                                                
Number 1455                                                                                                                     
                                                                                                                                
LORI  WING, President,  Alaska Independent  Insurance Agents  and                                                               
Brokers,   spoke   about   the  increased   costs   in   workers'                                                               
compensation programs.  She noted  that clerical rates have risen                                                               
by 40  percent this  year and  81 percent  since 1999.   Hospital                                                               
employee rates are  up 54 percent, sand and gravel  digging up 35                                                               
percent,  contractor   supervisors  up  22   percent,  restaurant                                                               
workers  up  29  percent,  street and  road  construction  up  37                                                               
percent, and  roofers, who  took a modest  increase of  4 percent                                                               
this  year, are  up 99  percent since  1999.   She termed  this a                                                               
crisis.    As  an  example,  she talked  about  a  restaurant  in                                                               
Anchorage that  paid $73,000 for workers'  compensation last year                                                               
and  this  year  will  pay  $98,000.    She  cited  several  more                                                               
examples.                                                                                                                       
                                                                                                                                
MS. WING  stated that  the organizations that  have been  hit the                                                               
hardest  are the  not-for-profit  businesses such  as those  that                                                               
provided medical and  social services.  She gave an  example of a                                                               
hospital  in  Dillingham  whose premium  rose  from  $391,000  to                                                               
$524,000  in  one year.    She  emphasized that  employers  would                                                               
rather be putting this money  into employers pockets for benefits                                                               
and compensation packages and safety programs.                                                                                  
                                                                                                                                
MS. WING concluded  with a final example of  a roofing contractor                                                               
in Alaska with  a payroll of $5,000,000 having to  pay a workers'                                                               
compensation  premium of  $2,111,000, whereas  another contractor                                                               
doing security  work in Iraq  with the  same payroll only  has to                                                               
pay $745,000 in  workers' compensation.  She  said that employers                                                               
are begging for relief and she urged passage of SB 311.                                                                         
                                                                                                                                
Number 1638                                                                                                                     
                                                                                                                                
JOHN GIUCHICI,  Member, Workers' Compensation Board,  stated that                                                               
he has  been on  the board for  13 years and  that he  agrees 100                                                               
percent  with what  Chancy Croft  and Barbara  Huff-Tuckness have                                                               
said.   He  said  he  disagrees with  the  reasons  for the  cost                                                               
increases that the  last testifier gave.  It is  not the workers'                                                               
compensation system that is causing   [the cost increases], it is                                                               
the  health and  medical  cost increases  across  the country  in                                                               
conjunction with bankruptcies and low  returns on monies that the                                                               
insurance companies invest, he opined.                                                                                          
                                                                                                                                
MR.  GUICHICI pointed  out that  he agrees  with the  first seven                                                               
sections  of  the  bill  and with  the  penalties  for  uninsured                                                               
employers.   He said he  totally disagrees  with the part  of the                                                               
bill that deals  with the appeals commission that is  going to be                                                               
established.  The  appeals commission should not  have more power                                                               
over and above  superior court judges, who are  neutral and fair,                                                               
and who  have done an  admirable job,  he opined.   For insurance                                                               
carrier attorneys and employee attorneys  to state that [superior                                                               
court judges] don't know anything  about workers' compensation is                                                               
a mischaracterization  of the situation, he  said.  A few  of the                                                               
advocates of  the appeals commission  are promoting that  it will                                                               
save money, yet  no one has been  able to come up  with an actual                                                               
cost amount of savings.  He concluded by saying:                                                                                
                                                                                                                                
     This  appeals   commission  not  coming  -   not  being                                                                    
     referred  - from  the same  body  that refers  superior                                                                    
     court judges,  or any judges  for that matter,  and not                                                                    
     have to  take into account  any of the findings  of the                                                                    
     workers'  compensation board  and the  hearing officers                                                                    
     and  their ability  to substitute  "political judgment"                                                                    
     on their part, is totally unfair to the system.                                                                            
                                                                                                                                
Number 1782                                                                                                                     
                                                                                                                                
MELINDA    TAYLOR,    Communications   Director,    International                                                               
Brotherhood  of   Electrical  Workers  (IBEW);   Executive  Board                                                               
Member, Anchorage Central Labor  Council, associated herself with                                                               
comments made by Mr. Sampson,  Ms. Huff-Tuckness, Mr. Jensen, Mr.                                                               
Guichici, and Mr. Croft.   She spoke about concerns regarding the                                                               
alleged  cost savings  stated in  the bill  and about  the appeal                                                               
process.   She said that when  she worked for the  state she knew                                                               
individuals who had  been injured on the job  and were devastated                                                               
from  having to  face a  maze  of legal,  medical, and  financial                                                               
issues.  She  explained that the only guarantee they  had was the                                                               
knowledge that  the superior court  process would deal  with them                                                               
in a  fair manner.   She opined that the  trust and faith  in the                                                               
right to  a fair hearing  that these workers  have is at  risk in                                                               
this bill.   She asked the  committee to "hold the  bill over and                                                               
let labor and the administration  work together and try to figure                                                               
it out and come up with  the best bill possible for both business                                                               
and the workers."                                                                                                               
                                                                                                                                
Number 1853                                                                                                                     
                                                                                                                                
DAVE  KESTER,  Commercial  Insurance  Broker,  Ribelin  Lowell  &                                                               
Company Insurance Brokers, Inc., testified  in support of SB 311.                                                               
He stated that  there is a very complicated  and diverse workers'                                                               
compensation system  that needs some  fixes.  This bill  does not                                                               
fix  all things,  but it  does  take a  giant step  in the  right                                                               
direction,  he  opined.    He said  he  believes,  regarding  the                                                               
appeals  commission, that  it is  a  good thing  for the  hearing                                                               
officers to  be admitted to the  bar after having three  years of                                                               
workers'   compensation  experience   because   the  issues   are                                                               
complicated.    He  stated  that   he  is  a  volunteer  workers'                                                               
compensation hearing board member and  said that he relies on the                                                               
expertise of  the hearing officers  when hearing cases.   He said                                                               
that it is  a good idea for  appeals to be heard  by the workers'                                                               
compensation appeals  commission rather  than going right  to the                                                               
superior  court because  there  are  additional costs  associated                                                               
with  going  to  the  superior court  such  as  filing  appellate                                                               
briefs,  attorney's  fees, and  the  extra  time  it takes.    He                                                               
pointed out  that injured  workers need  to get  back to  work as                                                               
soon as possible and not wait around for a hearing.                                                                             
                                                                                                                                
Number 1972                                                                                                                     
                                                                                                                                
CHAIR ANDERSON closed public testimony.                                                                                         
                                                                                                                                
REPRESENTATIVE CRAWFORD said  looking at the costs  it seems that                                                               
there is  a problem,  but that the  focus should be  on a  way to                                                               
bring down  medical costs and  not on how  to redo the  system of                                                               
appeals.  He said  he does not want to try to  save the system by                                                               
denying workers benefits, and said  he believes that that is what                                                               
the driver behind  redoing the appeals system is focused  on.  He                                                               
added  that he  would like  to see  [SB 311]  worked on  over the                                                               
interim so that the real cost drivers can be addressed.                                                                         
                                                                                                                                
Number 2040                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG  stated  that   he  has  a  conflict  of                                                               
interest as a small business  owner who pays extraordinarily high                                                               
workers'  compensation  rates  and   who  recognizes  the  crisis                                                               
situation that the state  is in.  He said he  agrees with some of                                                               
the testimony about the cost  drivers, but stated that the system                                                               
is broken  and needs  to be  reformed.  He  opined that  the bill                                                               
should be moved along through the process.                                                                                      
                                                                                                                                
REPRESENTATIVE  LYNN  related  that  [SB  311]  is  an  extremely                                                               
important  bill for  workers who  become injured,  for businesses                                                               
who have  to meet  payroll and  try to  stay in  business without                                                               
excessive costs,  and for  the State  of Alaska  to try  to bring                                                               
these parties together.   He stated his desire to  have a win/win                                                               
bill for all  parties concerned.  The bottom line  is, if someone                                                               
gets hurt  they need to be  treated fairly and taken  care of, he                                                               
said.  The bill needs some work, he concluded.                                                                                  
                                                                                                                                
Number 2101                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG  moved to  report CSSB  311(JUD)(efd fld)                                                               
out  of   committee  with  individual  recommendations   and  the                                                               
accompanying fiscal notes.                                                                                                      
                                                                                                                                
REPRESENTATIVE GUTTENBERG  objected.  He stated  that the purpose                                                               
of workers'  compensation is to  get workers who've been  hurt on                                                               
the job healthy and back to work.   He said he has heard a lot of                                                               
contradictions regarding this  bill.  He quoted  a paragraph from                                                               
Ms. Wing's letter [original punctuation provided]:                                                                              
                                                                                                                                
     The  past few  years these  employers have  experienced                                                                    
     significant   increased   costs   in   their   Workers'                                                                    
     Compensation programs.  These  increases do not reflect                                                                    
     any  corresponding  increase  in workplace  hazards  or                                                                    
     change in  the types of reported  injuries or diseases.                                                                    
     In  fact,  employers   have  successfully  reduced  the                                                                    
     frequency  of workplace  injuries by  almost 40%  since                                                                    
     1990.      Despite   these   safety   gains,   Workers'                                                                    
     Compensation costs  have continued  to rise  far faster                                                                    
     that the medical inflation rate.                                                                                           
                                                                                                                                
REPRESENTATIVE  GUTTENBERG related  that  as he  listened to  the                                                               
testimony on this  bill he was looking for  the mechanical device                                                               
that would lower rates.  He said:                                                                                               
                                                                                                                                
     We've  looked  through  this   process,  but  not  just                                                                    
     restructuring benefits,  the restructuring of  a system                                                                    
     that seems to me that  has some basic significant flaws                                                                    
     that we  haven't ironed out  here.  There are  some ...                                                                    
     questions  about this,  not even  getting  into the  de                                                                    
     novo review.  Costs have to  come down.  I haven't seen                                                                    
     or  heard  that  this  bill is  going  to  produce  any                                                                    
     reduction in  compensation costs  for employers.   I've                                                                    
     heard people  claim they  are, but  I haven't  seen any                                                                    
     evidence  that   they  are.     I  haven't   heard  any                                                                    
     significant  analytical information  that says  they're                                                                    
     going to  come down as a  result of this bill  and this                                                                    
     restructuring.   And,  I don't  know where  the savings                                                                    
     are actually  going to  come.  I  think that's  a major                                                                    
     question.    And,  I  don't  think  it  brings  in  the                                                                    
     stability  and  the   predictability  that  people  are                                                                    
     talking  about,  and  I've seen  no  evidence  that  it                                                                    
     actually will.                                                                                                             
                                                                                                                                
Number 2203                                                                                                                     
                                                                                                                                
REPRESENTATIVE GATTO  pointed out  that it  is pretty  clear that                                                               
"if  you  represent  labor  you're  against  this  bill,  if  you                                                               
represent management,  you're for  this bill.   He said  he feels                                                               
that he is stuck  in the middle.  Medical costs  are going up, he                                                               
noted, and he questioned if the  bill has merit.  He said, "Let's                                                               
suppose  medical costs  weren't  going up.    Let's suppose  that                                                               
there was  no crisis  or anything.   Should  we revise  all these                                                               
statutes  the way  we're  doing without  any  real motivation  of                                                               
money?"  As  a recipient of workers'  compensation several times,                                                               
Representative Gatto reported  that he was very  unhappy with the                                                               
way he was  dealt with.  "In  the long run it worked  out, but in                                                               
the immediate instance, it was disastrous for me," he said.                                                                     
                                                                                                                                
CHAIR ANDERSON  said he believes  the process on SB  311 provided                                                               
many opportunities  for people to  testify, and he said  he takes                                                               
exception  to those  who spoke  otherwise  in this  meeting.   He                                                               
termed  it  sad  that  it  has turned  out  to  be  labor  versus                                                               
employer, but  stated that the  testimony has been  well intended                                                               
with a  reasonable effort to come  to a compromise.   He reported                                                               
that  his staff  has  looked  for compromise  in  these areas:  a                                                               
balanced    appeals    commission    with    representation    of                                                               
employer/employee  interests, continued  participation  of a  lay                                                               
panel,  members in  a hearing  process from  labor and  industry,                                                               
required participation of all three  panel members in hearings to                                                               
insure  fairness, not  just a  quorum of  two, new  guidelines to                                                               
avoid conflicts of interest for  hearing examiners as well as lay                                                               
panel  members,   a  merit  system  of   protection  for  hearing                                                               
officers, 18-month  allowance for existing  workers' compensation                                                               
hearing  officers   to  meet   new  qualifications   for  hearing                                                               
examiners,  and an  elimination  of  legislative intent  language                                                               
that went beyond existing law.                                                                                                  
                                                                                                                                
Number 2323                                                                                                                     
                                                                                                                                
CHAIR ANDERSON continued:                                                                                                       
                                                                                                                                
     And yet  we still come to  an impasse ... where  the de                                                                    
     novo  issue seems  to be  the bone  of contention,  and                                                                    
     just in discussions I've had,  from what I can see, the                                                                    
     hearing  panel  will  still  have  the  sole  power  to                                                                    
     determine the  credibility of witnesses -  that was one                                                                    
     of the arguments - and  also the appeals commission can                                                                    
     still review other findings de  novo on the record, but                                                                    
     can not  hold a new  hearing or take any  new evidence,                                                                    
     unlike  the superior  court.   Unless disturbed  by the                                                                    
     appeals  commission, all  the findings  of the  hearing                                                                    
     panel  remain conclusive.   And,  then the  fourth area                                                                    
     that I  thought led  credibility to  the bill  was that                                                                    
     the  appeals commission  was subject  to review  by the                                                                    
     Alaska  Supreme Court  for an  arbitrary or  capricious                                                                    
     decision.                                                                                                                  
                                                                                                                                
     It's very  difficult to simply  hold this bill  and not                                                                    
     at  least move  it on  to House  Finance Committee  for                                                                    
     more review.   One more day of holding it  and the bill                                                                    
     dies, and whereas  some parties may want  that, I think                                                                    
     it's  our  duty  as  policymakers  to  move  on.    The                                                                    
     governor  said  this is  one  of  his main  priorities.                                                                    
     That  doesn't mean  you have  to vote  for the  bill or                                                                    
     concur  with  it,  but we  have  another  committee  of                                                                    
     referral.                                                                                                                  
                                                                                                                                
TAPE 04-53, SIDE B                                                                                                            
                                                                                                                                
REPRESENTATIVE ROKEBERG restated his motion  to move the bill out                                                             
of committee.                                                                                                                   
                                                                                                                              
A roll  call vote  was taken.   Representatives  Rokeberg, Gatto,                                                               
and Anderson voted  in favor of reporting  CSSB 311(JUD)(efd fld)                                                               
out of  committee.   Representatives Lynn,  Crawford, Guttenberg,                                                               
and  Dahlstrom voted  against it.   Therefore,  CSSB 311(JUD)(efd                                                               
fld)  failed to  be reported  from the  House Labor  and Commerce                                                               
Standing Committee a vote of 3-4.                                                                                               
                                                                                                                                
[Although the bill report for  CSSB 311(JUD)(efd fld) was signed,                                                               
delivered  to the  Chief Clerk,  and read  across the  floor, the                                                               
Speaker  ruled that  CSSB 311(JUD)(efd  fld)  didn't receive  the                                                               
required votes  to move  out of committee.   The  legislation was                                                               
returned to the House Labor and Commerce Standing Committee.]                                                                   

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