House Labor & Commerce, 4/15/26, 10am

Back on the record in Labor and Commerce. It's 10:04 AM. Members present: Representatives Carrick, Freer, Hall, Fields, Sadler. And we will resume with House Bill 234. After that, we'll go to Senate Bill 83 and then House Bill 211.

Thank you, Representative Hall, for continuing with your presentation. Thank you, Mr. Co-chair. For the record, my name is Carolyn Hall. I represent House District 16, the West Anchorage neighborhoods of Turnagain, Spenard, and Sand Lake. Before we turn to committee questions, and I believe we still have a couple of our invited testifiers online to help with those questions, If it pleases the committee, Mr. Co-chair, I'd like to go into our presentation for House Bill 234.

Yes, please. Okay. Okay. HB 234.

If I can figure out how to use the clicker. Apparently not. All right, there we go. So starting with some background of the history of emergency dispatchers, um, the first 911 call was in 1968 in Haleyville, Alabama. Interestingly enough, the second 911 call was 6 days later in Nome, Alaska.

Dispatching, once staffed by police and firefighters, began to be handled by civilians as officers were pulled into the field. These first dispatchers were only required to communicate clearly and possess knowledge of street names and locations. Their training focused on using microphones and radios. Today, our emergency dispatchers are highly trained to provide critical pre-arrival instructions to individuals experiencing often traumatic traumatic events. They deliver life-saving instructions before other first responders arrive, quickly calm people experiencing the worst day of their lives, obtain an accurate address and critical details, give instructions, and coordinate emergency responders within a few minutes of receiving that call.

Patient outcome and emergency responder safety are directly affected by the dispatcher's ability to perform this critical work. So as you can see on the screen there, the timeline over the last— well, between 1968 and then up to 1989 and beyond, the The scope of the work of dispatchers has changed dramatically.

So what HB 234 does is it does 3 things. It defines emergency medical dispatchers as first responders that are trained as public safety communicators. Secondly, for tiers 3 and tier 4 members of the PERS, uh, retirement system in Alaska, it would add dispatchers who work for police and fire in state trooper offices to the definition of peace officers or firefighters, which would allow dispatchers to receive the same retirement benefits as their first responder colleagues. Notably, that would include the early retirement option. Instead of waiting for 30 years of service, they could retire as early as 20 years of service.

The last thing that the bill does is it sets the effective date to July 1st, 2026.

The bulk of this bill moves emergency dispatchers from the other category in the PERS system to the peace officer firefighter category of PERS alongside their first responder colleagues. And I want to note that this is a relatively small number of people statewide. Anchorage has the largest cluster of these members with 10. The youngest of, of individuals are currently eligible for normal retirement on June 30th, 2036. Under this legislation, Tier 3 members would move from the all others category to the police/fire category, raising their employee contribution from 6.75% to 7.5%, allowing them to retire after 20 years of service, and their pension benefit calculation would be adjusted from a highest 5-year average to a highest 3-year average.

And I will say, Mr. Co-Chair, I don't believe we have the Division of Retirement and Benefits online for this hearing, but we have been in active conversations with the division, and we are awaiting further guidance from them. When it comes to some of the finer details of this bill. And so we're looking forward to receiving those questions for them and having them participate more fully in a future hearing. So any questions that I'm not able to answer today, of which I'm sure there will be some, we are very happy to work with the committee to find the answers and provide them for you.

For those in the Tier 4 defined contribution plan, the employee contribution rate would not change. Emergency dispatchers would become exempt from early withdrawal penalties if they retire or separate at age 50 or have at least 25 years of service. The most notable change is that emergency dispatchers would have access to medical coverage at any age after 25 years of service instead of needing to reach the Medicare eligible age of 65 with 10 years of service or fulfill 30 years of service. With that, that is the 30,000-foot view of HB 234, and I believe we still have a couple of our invited testifiers online as well as, I believe, Shane West may also be online to help answer questions. Yes, it looks like, um, Suzanne Hall from Soldotna and Aaron Kawara from Juneau are online for questions.

Do members have questions for the bill sponsor or invited testifiers? Um, thank you. Go ahead, Representative. Uh, thank you. Through the co-chair, I really appreciate this bill, and Co-Chair Hall, thank you so much for bringing it forward.

Uh, how many— do we know how many emergency dispatchers we have in Alaska? I don't know if that was covered. I apologize. Through the co-chair, Representative Carrick. Representative Hall, for the record, that is an excellent question, and that is one of the questions that we have asked the Division of Retirement and Benefits.

They are seeking within their own records in their division. I believe they're also going to be reaching out to personnel to try to narrow that down, but it is a difficult number to, to come by at this point. Um, I guess, follow-up. Um, thank you. Through the co-chair, It would just, just, it would be helpful to have like, uh, just a raw estimate, like in the hundreds, in the thousands, and, um, would appreciate DRB following up because I, I think we should do this bill even if it were to have a fiscal impact.

But I'm a little— I was just a little surprised to see that this bill is projected not to have a fiscal impact, and I would be curious maybe to hear from DRB a little bit more about how they're looking at it. And I don't want to generate a fiscal note, but I'm just curious, like, how many people were adding these benefits for. And through the co-chair, Representative Carrick, that is something that we are actively working with the Division of Retirement and Benefits on. The question that's outstanding is, based on the answers that they are able to provide from us, for us, there is a chance it may require an actuarialist, an actuarial analysis, which case that may create a fiscal note. But we're waiting to hear back from DRB before we know how things are going to move forward.

Okay, great. Other questions? Representative Sadler. Thank you. I will echo the concerns of Representative McQuarrie.

If the, if the change in retirement benefits is to have benefit for the dispatchers, I don't see how that can happen at zero cost to the state. So I would look forward to the Curious to see this bill did not get a Finance Committee referral. And if indeed there is no change in the cost to the state of retirement enhancements, then we will be considering amendments to this bill. So my first question is, can anyone— can the sponsor—. Any representative— you want to pause for a second?

Representative Hall, respond. Thank you, Mr. Co-chair. I believe we have Shane Westcott online right now, and he may be able to provide some clarity beyond what I shared with the committee from Representative Carrick and Representative Sadler's questions. Go ahead, Mr. Westcott.

Can everybody hear me? Yes. Okay, perfect. Hi, I'm Shane Westcott with the Alaska Professional Firefighters. Uh, you know, just for clarifying, after having a brief conversation with DRB, uh, we definitely understand, uh, what the questions that Representative Carrick and Sadler have.

Um, there's a few hundred dispatchers in the state that would end up fall on falling under this, uh, this change. Our rough estimates at this time, which DRB is helping us to actually get the exact number, is that we would have somewhere between— less than 1 to 3 dispatchers that would need an actual retirement change in their calculation. So instead of, you know, a 2.5% in a 20-year, they've been doing 2.25% or 2%. And so there'll obviously be excuse me, uh, there'll obviously be some cost with that. The only other, uh, change that we know fiscally that would be different would be even for Tier 4, uh, dispatchers, the percentage doesn't change as far as 8% from the employee and 5% from the employer in that total 22% contribution from municipalities and cities to the state.

But a small portion of that is the occupational death and disability. If you're a non- FERS person, that's a 0.24 percentage. By switching to a FERS, it ends up being a 0.69, and you can imagine why that number is a little bit higher for people that are under those. So, those are the calculations that we're waiting to come back, as well as the total number of those Tier 3 dispatchers that we had talked about. But as you probably heard in testimony earlier today, there's a very, very limited number of people that make it to that timeline to be able to qualify for those retirement, that 30-year retirement.

Follow-up, Representative Settler? Thank you. Continue my question, actually.

Yes, so yeah, I would actually, Mr. Chair, appreciate hearing from the Division of Retirement Benefits. I appreciate Mr. Weskott's expertise in this area. It would be good to hear that information from the Division of Retirement Benefits as well. So my question to the sponsor or any of the people who spoke and invited testimony What are the minimum qualifications for dispatchers?

We've heard a lot about what they do in the job. What are the qualifications to enter this job classification? Generally speaking, not every detail. Uh, through the co-chair, Representative Sadler, many, uh, of Alaska's dispatchers are EMT trained, but beyond that, I would defer to Mr. Westcott. Go ahead, Mr. Prescott.

Yes, through the co-chair. So, statewide, the certifications vary. If you were to be hired for a dispatcher for a police department, you can imagine that they probably have a different certification or qualified training to do those calls versus maybe in a fire service where you're dispatching a lot of EMS calls. There's also, in certain communities in Alaska, you are doing— you're wearing multiple hats and you're having to— excuse me.

To dispatch for both of those. So a lot of individual communities have their own certifications that makes you qualified to respond to or answer and take these calls for 911 emergencies. And follow-up. Yes. Thank you.

I appreciate there are going to be varied certification requirements. My question went to, like, what kinds of requirements are there? I don't know if there are physical tests. I don't know if there's firearms qualification tests. What is the nature of the qualifications?

Not just that they vary, but what is the nature of them?

Through the Coast Guard, you know, this is something that we could probably have if we had some of the dispatchers online. They would be able to tell you exactly what their qualifications are to get through their process, and I think you'll find that they're— yeah, I think that's probably better for a dispatcher to give you their exact qualifications because they're in different portions of the state. Because we're changing the retirement benefits for the— I just want to make sure that we appropriately match the retirement benefits to the qualifications of the people. So that's the end of that question. Ms. Hall or Ms. Kawhara, do you want to talk about qualifications for your positions?

This is Suzanne Hall with the Department of Public Safety Communications Center. I can answer this if it's all right. Sure.

Okay, so I've actually worked in 4 different centers across the state. I started my career at Palmer Police. I worked briefly at MATCOM. I worked for the Fairbanks Alaska State Troopers Dispatch Center, and now I'm here in Spalding. Minimum requirements to start the position are very similar across those 4 centers.

At the time I was hired at each of them, they required a minimum typing speed clerical skills, the ability to remain calm under pressure, and some basic computer skills. The rest of the skills that you need to do the job are trained on the job. So, we'll have basic CPR, first aid training provided by the centers, and most centers dispatch for multiple disciplines, so police, fire, and EMS. Unfortunately, not every center training standards are the same, and there's no state minimum training requirements, so those requirements are up to each center, each community. Where I'm currently at, our training program takes approximately 8 months, 9 months depending.

A lot of it is OJP. We require our dispatchers to be certified as emergency medical and Emergency Fire Dispatchers. Each of those certifications take 40 hours— excuse me, the EMD takes 24 hours, and the EFD, I believe, takes a similar amount of hours. I don't remember offhand, but they require ongoing continuing ed training to maintain your certifications. Additionally, at our center, We provide a lot of other types of training to include all types of things to help our dispatchers kind of take care of themselves and de-escalate other calls.

So we end up highly specialized at the end of the training. I don't think it is a skill set that you would be able to get from a college degree. Each center, you know, trains their employees the way that they need them to be able to perform, to do the job. So to say that we needed the skills at the onset wouldn't be an accurate reflection of a dispatcher's skill set at the end of the Plan C training process. And it is very intensive.

We just did a count of our kind of average in the last 3 years, and our retention through training is around 50%. A lot of them wash out because of the stress of their job. Thanks, Miss Hall. Thank you. Just not a question to follow up.

So I think, uh, Miss Hall, I think I hear you saying that the minimum qualifications are kind of basically clerical, but that someone is not an effective dispatcher until they've had, uh, had on-the-job training and gotten their certification, 40 hours. I missed the certification, but so again, you're not qualified to do the job necessarily when you start, but the intense OJT brings people qualified and equipped to do the job after about 9 months of training. Thank you for that. It helps me understand. Okay.

Yes, and to follow up, that's a lot like a police officer in that that candidate can't necessarily do the job the day that they're hired, but they go through a similar process of training before they're qualified to do their job as well. Representative Carrick has a question. Just a comment, Mr. Co-chair. I just— I really think we should be considering this bill in regards to: are the benefits competent with the scope of the work and the challenges required, rather than looking at this bill from the lens of are the certifications matching the benefits. And I just, I really want to go back to the initial invited testimony from dispatchers and ask this committee to maybe look at it from the lens of are people getting benefits commensurate with the scope of work that they're performing.

Thank you. Representative Kalem. Thank you, Chair. So I think this is for the sponsor. So one of the things that I've been looking at is the age change.

So right now, I, I think the bill proposes that they could retire after 20 years. Is that correct? Through, through the co-chair Representative Colon, it would, it would put them in the same pot and category as police, as peace officers and firefighters, whereby they could retire after 20 years of service. Okay, so where I'm getting hung up on that, I guess maybe just your thoughts, your motivation for changing the age. This isn't just the benefits, but now you're lowering the limit.

I thought the 20 years for firefighters and cops were because, first of all, it's very hard on their physical— physically hard on their body, and two, they could actually die on the job in these interactions. So I'm trying to match what I'm not trying to minimize what these people have to hear and listen to, but there is another level where you're actually— your physical life is at stake all the time. And so I always thought that's why it was at 20. And so just, I mean, maybe just some input or your thoughts about why you think it would be important to do— to bring it down to the same level as the police and fire. Do you want me to go to Shane Westcott on that?

Sure. Okay, Mr. Westcott, do you want to weigh in on that?

Yeah, absolutely. I appreciate it. Again, again, through the co-chair, you know, I think in our time in public safety and learning about public safety, um, you know, we've always gotten smarter, we've been more physically capable, we've tried to add, um, staffing to help with injuries and prevent things like that. But one of the things that have been difficult to address, and it come around until, you know, really the last 10 years or so is the mental aspect. And I just don't think that that can be brought up enough or emphasized enough.

You know, as a firefighter paramedic myself, when I go to a patient, I get to see the patient. I have an in-person interaction with that person. I get to bring them to the hospital and pass them on to a continuation of care. There's a bit of closure for me from my perspective with that person, even though it's only 20 minutes of me intervening in their life. What these dispatchers go through when they answer a phone, when someone's screaming in their ear calling for help and needing assistance, answering that call and dealing with it and getting the appropriate resources to them in a few moments, coaching them through CPR or coaching them through this catastrophic event that they're going through, to then hang up the phone and take the next call There is no closure.

And what we've seen is that that causes long-term effects of PTSD. And, and so that is one of the many, many reasons why these guys should be considered public safety and would fall under the PERS category of closer to 20 years, is because it's not all physical. It's not just about your back. It's not just about your shoulders. It's about your being mentally able to to live through the rest of your life comfortably after you've put your time in to serve the community.

One other thing that I think is important to note here is that this bill and this change in statute does not just make it to where since they're FERS, they can retire earlier, but this also does, and there's a huge component, especially in Alaska, is this opens dispatch centers up for a significant amount of training, funding, and different other revenue sources. By being qualified as public safety, if they're tied to fire departments, we can staff dispatch centers through SAFER grants. We can get them certain levels of funding through different federal grants that allow our rural communities to be able to pay to actually hire more dispatchers and have more than one person that dispatches within the community. It's really easy on this bill to focus on just the retirement aspect, but it's much more about this training aspect and this availability of training and this availability of funding for these 911 call takers to make sure that they have the highest level of training, to make sure they have access to that funding, and so that we can help, you know, not just the anchorages in the world, but the smaller rural communities who are relying on those one or two dispatchers in their area to deal with these calls. [FOREIGN LANGUAGE] Do you have any idea, is there an increased percentage of suicides in this profession or depression?

Do you have any idea around those numbers at all?

As far as specific numbers, no. As you can probably imagine, as these individuals go through their, go through this mental crisis, like sometimes it's very private, sometimes they're able to work through it help. Sometimes there's programs within their organizations to try and get these guys help. But if you know a military veteran, if you know somebody who's worked in public safety or an officer who's had to fire their weapon or a firefighter who's had to pull somebody out of a burning building, the dispatchers are falling into the same category. That's not necessarily something that catches up with them that day.

That's something that they they lose sleep over 20 years down the road. Um, and so the data is difficult to track. I'll do my best to dig up some exact numbers for you, Representative, and I'll see if I can get that to the committee here before the next hearing. That'd be great. Thank you.

Representative Sadler. Thank you, Mr. Chair. Um, I guess Mr. Westcott is the best person to answer this question. I understand provisions— but once you start making changes in the retirement laws, and I've delved into that, very complicated, a lot of play.

But changing the calculation for retirement benefit for dispatchers from the top 5 to top 3 is a significant— can be a significant change in the benefits and increasing an enhancement of those benefits. What I've heard is that often if you have a top 3, that leads to a lot of overtime packing at the last 3 years of a person's career, of a peace officer's or firefighter's career. By changing that retirement calculation the top 5 to top 3, I fear that we would seem to incentivize a dispatcher adding even more stress on themselves during the last 3 years of their career to take on more overtime. So I wouldn't mind hearing comments from Mr. Westcott and any modeling from the Department of Revenue as to what the effects might be, because I think in Tier 3 and 4 we went from top 3 to top 5 to try and ameliorate that problem. So Mr. Westcott, if you have that answer, and if I think it's possible to ask that question to the Department of Revenue as well.

Yeah, obviously, when it comes to DRB, I believe that, you know, they're the subject matter experts when it comes to this. Tier 3 is a high 3. Tier 4 is a defined contribution. So whether you're a dispatcher or a police officer or a firefighter, you have a 401(k). So there is no 3 high in the Tier 4.

4 System. You might be referring to, uh, HB 78, which is a bill that you guys probably heard at some point that's now sitting over in Senate Finance, which brings around a PB package that does have a top 5 component to it. But again, the people that would actually be affected, uh, by this bill, by switching to that 3 high that we're talking about, those are a very, very small group. Like I said, we think it's less than 20 that are— would be qualified for Tier 3 dispatchers. And those are the people that have hung around the longest.

I can't think of a group more deserving of having a different, a better retirement setup for them in this situation for the time that they put in into those rooms, you know, not having like a light at the end of the tunnel for them. So again, it would be the people that would actually be affected by a high 3. It's a very, very small number. Yeah, and going forward. Okay.

I did have another question, if I can go to this. Yeah, and thank you, Mr. Chair. So I guess a sort of a philosophical question. I do hear the anguish in the voices, the emotion in the voices of the dispatchers who tell us graphically about the stresses of their job, and I feel for them, but I don't know if 20-year retirement is going to fix the problem.

It still means that a dispatcher is going to have to go through all the stresses year after year, decade after decade, is— are we really fixing the problem or is there some change in the structure we should have? You know, more time off between calls, larger staffs. Is the retirement at the end of a person's career really the way to address the stress of this dispatching career?

Go ahead, Mr. Wes Scott.

I—. It's—. Excuse me, Co-Chair. Someone has to do the work, Representative Sadler. And these people are willing to step up and, you know, put their mental and physical well-being on the line for the betterment of their community.

And so, you know, giving them the option to have a dignified retirement and giving them an option to, you know, serve their time and move on to the next thing so that they can be healthy in and healthy out, I think that's one of the most commendable things I can do. I would encourage everybody, if you haven't had an opportunity to talk with these dispatchers or see the centers that they work in and how they are going from one call to another, I think it would provide a lot of context to what these individuals go through on a day-to-day basis on their 12-hour shifts. If you're asking if I think that they deserve a 20-year retirement without that short proof group of individuals. And then for the tier 4 members, absolutely, yeah, those people willing to serve the public in the way that they are, most certainly. Through the chair, that was not my question actually, Mr. Westcott, though I appreciate you making the point.

No, my question is, the— in the academic world, a professor will get a sabbatical after 7 years of, uh, of teaching. They get a year off. I don't— my question is, is it possible to have structural changes that will ameliorate the pressure and let someone maintain their sanity in their life throughout even a 20-year career? I don't want to debate the issue with you, but still, the stresses are there every day. Perhaps after 5 years someone gets a year off in a related assignment, or rotating people through a different tier.

I'm just trying to find out a way to let dispatchers keep their sanity without having to wait to the end of a retirement period, whether that's 20 years or 30 years. Any thoughts on that? Representative Hall, I think, did you want to respond to that? Yeah, I'll provide a response after Mr. Westcott. Okay, go ahead, Mr. Westcott, and then we're gonna move on to the next bill to cover the remaining two bills on.

Anyway, we're gonna do a question from Representative Kloman, then move on to the next bill after this one is answered. Through the chair, Representative Sadler. Uh, yeah, I think, I think you bring up interesting points there, and I think that, um, that might be easy for a larger metropolitan city to come up with their own rules on how they could deal with that. But when you live in rural communities in Alaska and they're 2 dispatchers to just have one person have a sabbatical for a year, and now there's only one person who's trained to be the call taker in that area to take these 911 emergencies. That doesn't really seem to fit the need.

And so I think at the end of the day, this is the— making this change is the most clear and concise way to ensure these people are able to be healthy in and healthy out. Thank you. Okay, Representative— or sorry, Representative Hall was going to respond next. Yes, thank you, thank you, Mr. Co-chair. I'd also like to make a note that because emergency dispatching is such a difficult, difficult profession, there is a high level of turnover, and adding, adding dispatchers to the public safety category of PERS, I believe, will help when it comes to recruitment and retention for these critical positions, especially in rural Alaska.

And I'd also like to note it— I'm not sure if this is on basis. If it is not, we will definitely make sure that this gets to the committee. But Representative Colom, you were asking about, um, basically mental health statistics and such as that. And I am looking at a document on my phone that is hard to read because the words are so small, but we do have some stats having to do with psychological disorders and emergency dispatchers and other psychological concerns So we will certainly make sure that this information is presented to the committee. Thank you.

Okay, Representative Klonk. Yeah, thank you, Chair. I think this is for the sponsor of the bill. I was just looking at Section 1 and that definition of emergency medical dispatcher. I couldn't— when I initially read it, I couldn't understand why you were changing to an initial first responder.

But from what was said before, when they said It's not just about the retirement, it's opening up all these other things. So is that, is that one that those 4 words right there, is that what makes the shift? Because the rest of the bill just calls it dispatchers. And I assume it's like, it's referencing this definition, emergency medical dispatcher. But when you look at the original definition, it says it's trained as a public safety telecommunicator.

And I was like, well, Yeah, that's kind of what they do. But can you just cut me— do you have anything on, on line 6, that initial first responder? Is that— maybe that's more important than I think. Through the co-chair, Representative Colon, my understanding is that that makes it abundantly clear that they are considered first responders. Um, colloquially they are known as the first first responders, so this added clarification just further ensures that they are available for certain grants to dispatch centers, etc.

But I'm also happy to also hear from Mr. Westcott too, if you'd like to provide additional nuance that I am unaware of. Go ahead, Mr. Westcott.

Uh, if I'm understanding correctly, uh, we're talking about specifically emergency medical dispatchers. That's what you're asking, Representative Klueh? Yeah, I'm looking at the definition of a dispatcher. The bill is adding the words "initial first responder," and so I'm just trying to get the significance of why we're adding that.

Yeah, and in part, we're emphasizing the point that, you know, these are the first first responders, right? They are public safety. These guys are the ones that are taking the call, getting the appropriate resources going the right direction. So I don't think that there's a ton to look into on that. I think it's, uh, it's helping clarify why they're fitting into this public safety category.

Oh, okay. All right, thank you. Thank you. Okay, um, thank you, Representative Hall. We're going to take a brief ease, and I will hand the gavel back to Representative Hall and transition to SB 83.

We will go at ease for a second.

We are back online. This is the House Labor and Commerce Committee. Our next bill on the agenda is SB 83, Telehealth, by Senator Clayman. Senator Clayman, thank you very much for being here with with your staff, Serena Hackenmiller. Please introduce yourself for the record and begin your presentation.

Thank you, Co-chair Hall and Co-chair Fields, members of the House Labor and Commerce Committee. For the record, I'm Matt Clayman, senator from District H in West Anchorage. Senate Bill 83 is brought forward by health providers in my district who provide both in-person and telehealth services to Alaskans across the state. Senate Bill 83 will ensure pay parity for telehealth, requiring healthcare insurers to to reimburse at the same rate for telehealth services as in-person care. Telehealth reduces barriers to care and allows patients to receive timely and convenient care from the comfort of their own homes.

In Alaska, barriers to care affect individuals in rural areas, those with disabilities, and those with limited transportation options. Telehealth is especially important for chronic disease management, mental health services, and preventive care. The COVID-19 pandemic highlighted the critical need for telehealth access, prompting the Centers for Medicaid and Medicare Services, or CMS, to temporarily implement telehealth parity. While this federal mandate has expired, some telehealth provisions remain in place. What was once a temporary need is now standard practice, and many states have made efforts to solidly— solidify permanent access to these services.

At least 28 states have enacted similar legislation to Senate Bill 83 to ensure fair reimbursement for telehealth services. Alaska's Medicaid program already has telehealth pay parity. This legislation builds upon that existing framework to require the same parity by private insurers. Passage of this legislation will expand access to care, improve and maintain quality of care, and incentivize continued telehealth utilization. And with that, my staff, Serena Hackenmiller, is ready to present a sectional analysis of the bill.

Excellent. Thank you, Ms. Hackenmiller, for being here. Thank you, members of the committee. My name is— for the record, my name is Serena Hackenmiller, staff to Senator Clayman. There are 9 sections in this version.

Section 1 adds a new paragraph to reference the definition of healthcare provider in AS 2107. Section 2 is the main part of the bill, establishing a new subsection under Alaska Statute 21-42-422 requiring that healthcare insurers reimburse healthcare providers for telehealth services at the same rate for that in-person service. Sections 3 through 6 conform existing statutes to Section 2. So Section 3 adds a new paragraph 68, healthcare insurance plans, to the list of provisions which apply to home rule municipalities. Section 4 establishes a new section requiring a home rule or general law municipality offering a group health insurance plan to meet the requirements of Section 2 and provides the definition of health care insurance plan as given in 2152-500.

Sections 5 and 6 amend the statutes to conform with Section 2, including the statutes for group health— group insurance plans covering state employees and self-insured group health insurance plans covering active state employees. Sections 7 and 8 repeal sunset language in session law pertaining to Medicaid telehealth parity. And finally, uh, Section 9 establishes an effective date of January 1st, 2027. Um, updating this from 2026 was the only change in the CS before you from the last committee. Thank you, Ms. Hackenmiller.

With that, I'd like to go right into public— uh, excuse me, invited testimony before turning to committee questions. Emily Ninen with the Alaska Government Relations Director with the American Cancer Society, thank you for joining us. Please introduce yourself for the record and begin your testimony.

Good morning, Chair Hall and members of the committee. For the record, my name is Emily Neen, and I'm the Alaska Government Relations Director for the American Cancer Society Cancer Action Network, which is the advocacy arm of the American Cancer Society. And I am delighted to be here talking about another step in what I think of as telehealth modernization here in Alaska. Alaska. We learned so much during the pandemic.

We learned we could do all sorts of things that we didn't think we could do, um, specifically around how healthcare is delivered. Um, prior to the, uh, pandemic, uh, the last time the state had updated telehealth, um, the telehealth statute was in the late 1960s. So clearly it was time. For us to look at this and, and re-envision, um, the changes that were made, uh, in the first bill in 2022 that passed, um, to look at this issue, um, and really expand the ability to deliver telehealth had a, a tremendous benefit for cancer patients in particular, um, as the, the people that I talk to most regularly and to providers. So as an example, um, one of the things that really helped shape part of what that legislation that passed in 2022, um, was an example from a radiation oncologist in Anchorage.

This, uh, doc had a patient, uh, who was considering, uh, a candidate for radiation, lived in rural Alaska, and, um, they were gonna need to be, you know, before the pandemic suspended these rules, they would've had to flown to Anchorage to have a consult to decide whether they even wanted to pursue radiation treatment. Um, and then once you make that decision, then everything has to sort of get put in place, the, um, the different kinds of scans and prepping for actually starting radiation. So they would've flown in, flown back home, waited a couple weeks, come back in, um, and had their introductory pieces before they could start the radiation treatment. By being able to do that, um, education piece and the shared decision-making between the provider and the patient, um, by telehealth, that saved a trip in and saved that time that they would've had to come in, you know, and then There's a time period for them to get things set up. Um, so that really spoke to the first piece of what we did in the state to modernize our telehealth laws, um, regulatory structure.

This was an experiment. It is now 2026. The experiment has worked, and I'm just so excited to see the ways, um, people are taking advantage of the tools that we have available.

What this bill does is just set the status quo. So what we have now, what we've heard in previous committees, is that this is the status quo, that telehealth visits, equivalent telehealth visits, are being reimbursed at the same rate as in-person visits. What we want to make sure we have is a stable, predictable regulatory environment for docs like the radiation oncologist in Anchorage, and that the patients can know what to expect as well, so that things aren't getting a little topsy-turvy as they— as the rules change along the way. So, this is establishing the status quo. I know that there have been some questions that have come up about what the status quo is, so I look forward to— further discussion and being able to, to air those questions for the record.

And I am happy to be a resource at any time. Thank you. Thank you, Ms. Meenan. Does—. Do committee members have questions?

Representative Sadler. Thank you, Madam Chair. Ms. Meenan, you said that the experiment has worked. I know that health, the status of health, is something that is among the most well-measured and monitored metrics of life. You know, we often hear about the extensions on the life expectancy or infant mortality and so forth, and your assertion that, uh, I suppose it's limited to Alaska, that expanded use of telehealth has worked.

Can you give me any metrics or some objective measures to back that statement up, please? Um, through the chair, Representative Sadler, um, I would love to be able to do that. I'm, I'm not aware of any metrics or measures The information that I have comes from providers and from patients who are taking advantage of these opportunities.

Okay, seeing no further questions from the committee, thank you very much for being here, Ms. Neenan. Thank you. Next, we will turn to invited testifier Nils Andreassen, the Executive Director of the Alaska Municipal League. Thank you for being here, Mr. Andreassen. Please put yourself on the record and begin your testimony.

Testimony. Yeah, thank you, uh, co-chairs, members of the committee. For the record, my name is Nils Andreas. I'm the executive director of the Alaska Municipal League. I do appreciate the opportunity to comment on SB 83.

I realize we've submitted testimony previously almost a year ago. It didn't make it into the record until last month, so I did want to make sure that I came back and had opportunity just to walk through some of the questions that we do have that I don't see reflected in the research that's been done related to this bill. So it's connecting the dots there. And I will say I'm not a health expert. And when I think of telehealth, there's a value proposition that comes from it.

And if it— to the extent that it leads to positive health outcomes, that's a good thing. That's not what I'm here talking about. And especially for the Labor and Commerce Committee, I'm more focused on one of the other sides of the value propositions that I see for telehealth, and that's affordability and lowering costs for Alaskans. So, AML is generally supportive of the intent of this bill and the expansion of telehealth access. Again, related to that healthcare component, telehealth has proven to be an important tool.

Particularly in rural Alaska, and we recognize its value in improving access to care. Our comments today are focused specifically on Section 2, which requires insurers to reimburse telehealth services on the same basis and at least at the same rate as comparable in-person services. We would encourage the committee to carefully consider the distinction between comparable payment and fair and equitable payment. Even national organizations like the American Medical Association which provided documents in the committee record, stopped short of endorsing strict payment parity, instead emphasizing that reimbursement should be fair and equitable, not necessarily equal, particularly given the lack of clear data on cost structure. That distinction matters.

Comparable suggests a fixed equivalency regardless of cost differences. Fair and equitable allows for flexibility based on actual cost outcomes and market conditions. At this point, there's still insufficient data data to determine whether telehealth costs more, less, or the same as in-person care. Looking in a statutory— locking in a statutory requirement for equal payment may be premature without that understanding. A core concern for AML is that this provision may increase overall healthcare costs, particularly for municipal employers providing health plans, the state or other organizations as plan sponsors— and I should note that AML is a plan sponsor— ultimately Alaska's families and workers.

If telehealth becomes additive rather than substitutive, meaning that people use both telehealth and in-person services, then requiring equal reimbursement could increase total utilization and total cost rather than reduce it. Even proponents of telehealth acknowledge that the cost impact is still uncertain, according to committee documents. So we would ask, what analysis has been done to determine that fiscal impact of mandated parity in Alaska, not just for the state of Alaska through a fiscal note, but more broadly? How will this affect premiums for public and private employers? We're also concerned about unintended economic incentives.

Telehealth allows providers to deliver services from anywhere. If Alaska requires payment at Alaska rates, providers may choose to live and operate outside of Alaska where costs are lower while continuing to bill at Alaska reimbursement levels. We already see examples of this model emerging, and while some insurers allow it today, the status quo, codifying it in statute raises broader concerns. We have providers serving Alaska patients while living out of state. In fact, one of the— one example in the committee record describes a provider living in Ohio and delivering ongoing care to Alaska patients via telehealth.

The difference in just grocery costs between Ohio and Alaska are 26 percentage points. So this leads to important questions that I would ask the committee. To additionally consider. Does this policy result in a transfer of healthcare dollars out of Alaska's economy, so-called economic leakage? Does it disincentivize in-state practice, particularly in higher-cost communities?

Do platforms like the Interstate Medical Licensure Compact accelerate this? Over time, could this reduce the physical provider presence in Alaska, especially in rural areas? From a practical standpoint, the bill raises several unanswered implementation questions. And again, if they've come up in prior committees, I apologize for not knowing all of the answers that have been provided, but I didn't see them in the record. So what defines a comparable service?

How is the rate determined? Based on where the patient is located, the provider's location, a statewide average, Anchorage, or another benchmark? How is the status quo currently being implemented, and how does this bill reflect that? How are regional cost differences accounted for? Who provides oversight and enforcement?

How frequently are rates reviewed or adjusted and by whom? Without clear answers, this provision could create uncertainty for insurers, employers, and providers alike. Because this requirement applies to municipal and public employee health plans, it directly affects local governments. These plans are carefully negotiated to balance cost, access, and benefit design. Mandating in statute a specific reimbursement structure removes a key tool from employers and plan sponsors and could force trade-offs elsewhere in benefits, potentially reducing overall value to employees.

Before moving forward, we would respectfully encourage the Committee to seek other— to seek clear answers to the following: What's the projected cost impact of payment parity in Alaska beyond state fiscal note? How will the policy ensure telehealth remains cost-effective, not cost-increasing? What safeguards exist to prevent migration of providers out of state while billing Alaska rates? How will comparable services be defined and regulated? What entity will provide oversight, rate-setting guidance, and enforcement?

And should Alaska consider a fair and equitable standard instead of strict parity to allow flexibility as data evolves? Again, we want to emphasize that AML supports telehealth expansion. We do not object to the broader goals of SB 83. However, this specific provision raises significant cost, economic, and implementation concerns that we believe warrant further analysis by this body before being placed into statute. We encourage the committee to pause on this section, gather additional data, and consider a more flexible approach that achieves both the expanded access and the long-term affordability for Alaska.

Thank you for your time and consideration. Thank you, Mr. Andreasen. So, Co-Chair Fields has a question. Through the chair, yes, I wonder if AML might be able to help look at, are there other states that use a fair and equitable structure? I share your concerns about economic leakage, just because we haven't— universal availability of telehealth is fairly new, so the fact that there has not been economic leakage before doesn't mean there won't be in the future when suddenly this is universally available, and it would seem to create a very strong incentive incentive for employers to locate services in a lower-cost jurisdiction than Alaska, which would reduce in-person availability.

So I just wonder if there's a way that we could tackle that, and maybe your research assistance could be helpful. Um, and then could I ask another question? Follow-up. Uh, I was wondering, is AML a member of the Pacific Health Coalition? Is the Pacific Health Coalition kind of looked at the strict parity language versus alternate language structure Through the chair, Co-Chair Fields, to the first, we haven't done that research, but I think we could check in with our national partners.

Many of leagues like AML also provide insurance, health insurance, so they, they might have information on this. We have access to that and we can work on that for the committee. We're not currently— to the second question, we're not currently a member of the Pacific Health Coalition. Have just We just started that conversation with them, actually, and are looking into it. Well, maybe, Co-Chair Holzer, follow up.

Maybe we might ask Pacific Health Coalition, too, about the precise language and whether strict parity versus a fair and equitable structure would make more sense. I concur. Thank you, Co-Chair Fields. Representative Kollum. Thank you, Chair.

So thank you for your testimony. You laid out a lot of my own concerns as well. But I wanted to try to clarify maybe this I guess this will be a future meeting, the fair and equitable. What I thought— well, my thoughts and what you had said in your testimony, the problem with parity is that the overhead expenses of an office doesn't have the same as someone in their home or in wherever doing telehealth. And so when you say fair and equitable, that would be based on their operating costs for doing that service, correct?

Is that what you're kind of pointing to? Yeah. Representative Colom through the chair. I think that's right. I think so.

My understanding of comparable is the same. So no matter where you're at in the nation, in the world, you will pay whatever it costs in Anchorage or somewhere in Alaska, even though it costs you potentially less elsewhere. Fair and equitable means that you can ratchet that up or down based on where you're actually located and how much it actually costs you to deliver a service. And it could still be relevant to and similar to what an in-person cost might be, but it's based on your actual expenses versus a fixed rate that might come from Alaska. Okay.

Thank you. Okay. Representative Sadler. Thank you. Likewise, Mr. Andresen, you've raised a lot of questions that echoed the question I was coming up with.

If there is a— if we're going to pay the same if you have an office and pay real estate and parking fees and so forth. But you can get the same if you're operating from your home office, who is going to pay the expenses to actually have an in-person place? So this kind of absolute parity or absolute equity would tend to distort the marketplace significantly, I think. And when you first came to the table, I'm wondering, what is AML going to say about this? But now I understand you've asked some insightful questions.

I hope we get answers. But I guess I'll ask a question in your wheelhouse. What is the— what's the universe here? What's the denominator? How much money do municipal governments spend on health insurance and healthcare?

And, you know, okay, that's a tough question. But the question is, how much of a risk is this? Should there be an increase in costs because of the telehealth equity bill? What is the effect likely to be on municipal governments in Alaska? Yeah, through the chair, Representative Sadler, I think I wish I had the answer to that question.

I want to say it's significant. Most of the larger local governments are self-funded. So this would— they're paying direct costs. For, for their employees. Many others might be through some of the insurance agencies that are out there through a political subdivision pool of some sort and, and could experience— I think if, if you add together the additional utilization that telehealth kind of provides and then the cost parity I think you would start to see premiums going up over time.

And that's— it depends on how well the plan sponsor or the insurance company can spread those costs out. But leaving it up to them versus in statute is part of what I think we're talking about. If one of the value propositions of telehealth is lower cost and affordability, We don't want to set in stone higher costs, but we can try to follow up and we can follow up and see what we can find out about the scope kind of scale of local government health insurance expenses. So just to follow up very briefly, so follow up, Representative Sadler. Thank you, Madam Chair.

So what this bill, I think I hear you saying, is increased premiums for governments. This is a statutory increase in more money for providers at the expense of citizens, at the cost of citizens, a less loaded word. Representative Sadler, through the chair, I think that's the fear. And especially for self-funded plans, this would more directly impact them. If insurance— insurers, for instance, are already doing something similar as the status quo, then it's a smaller pool that's impacted at that level because they're better able to manage costs.

But any self-funded plan would experience this pretty directly. Okay, I have a question. Co-chair Fields, um, on this question of cost increase, decrease, neutrality, maybe we can figure out how much Teladoc services cost to write a prescription. I mean, that's one telehealth service that's available through the AlaskaCare Plan now and perhaps could be an indicator. And I don't know if you have the answer to that or if AML participates in teledoc.

I don't have an answer to that. Co-chair Fields, through the chair, I would also like to note for the committee that we also have Heather Carpenter here in the room, the director of the Division of Insurance, as well, to help answer questions. But we will move now to Representative Carrick. Thank you, Madam Chair. I might have a question for Division of Insurance, actually.

And actually, while she— while Ms. Carpenter's coming up, if she would, do we have anybody from Division of Retirement and Benefits online? I am seeing none online, no. So I guess, Ms. Carpenter, not to put you on the spot here, but I see some unusually alarming language in the fiscal note control code CWOCP from Division Retirement and Benefits talking about a structural change with the Department— Commissioner of the Department of Administration and the Director of the Division of Insurance. Can you talk a little bit about that? And because that sounds complicated to me, can you help me understand what in this bill is creating that concern?

For the record, Heather Carpenter, Director of the Division of Insurance Through the chair, Representative Carrick, I'm going to be careful because of course I do not represent the Division of Retirement and Benefits. However, my understanding historically of their concerns is when mandates are drafted in Title 21, which are the insurance statutes, but are telling other entities like Retirement and Benefits how they have to handle and do those things. We don't have authority over their plans. They, you know, would prefer generally things to be drafted cleaner where it's in their statutes and not pointing back to the mandates just being in Title I, and they have to comply with that. So I think there's some concern that me as the Director of the Division of Insurance would have some authority over their plans, which I do not.

But further than that, you would have to hear from Retirement Benefits. Thank you, Ms. Carpenter. So just a quick follow-up, Representative Carrick. Thank you. Through the co-chair, I— so you don't— the Division of Insurance is— I see what is happening a little bit better now.

So, but the Division of Insurance doesn't necessarily agree that that's exactly what would be taking place if this legislation were to pass, wherein DRB would be subject to through the Division of Insurance on this issue. Again, for the record, Heather Carpenter, Director of the Division of Insurance. Through the Chair, Representative Carrick, I haven't posed that question to my attorneys, and certainly it would probably be something that my attorneys, as well as the attorneys for Retirement and Benefits, would want to talk through. So I wouldn't want to take a firm position, just not knowing what the attorneys would say. Thank you.

That's helpful. Okay, Representative Sadler. Thank you, Miss Carpenter. We heard from Miss Neenan with the Cancer Society that telehealth works. It is helping public health.

You're in a position to actually give me some objective data from your perspective as Director of Division of Insurance. Have you seen any change in the cost in the state of Alaska for health insurance and healthcare costs since telemedicine has been adopted to the degree it has? Through the chair, Representative Sadler, we could certainly look at the filings to see if there's any indication for what, you know, the insurers have said they're paying for telehealth. If it's broken out that way, I just don't know off the top of my head. I think, you know, we do believe it's increased access in particular for behavioral health.

And, you know, we have a shortage of behavioral health providers in Alaska. But again, that is more anecdotal and knowing, you know, uh, personal stories. Um, I know the legislature has taken strides, um, 2014, 2016, 2022 to amend telehealth statutes, make it easier for, um, telehealth to be provided in Alaska. Uh, but I just don't have that data off the top of my head about the cost impacts. No, no.

And, and if I don't expect to have it top of your head, but having some information to make sure— this, this bill is a significant change in the structure of healthcare insurance coverage, so knowing what the impacts to date have been of that would be very helpful as we consider this bill. Please provide that. And through the chair, Representative Sadler, I will say that may interest the committee because of course our fiscal note doesn't contemplate cost to the insurer. Insurers. Right now, um, our insurers Moda and Aetna are paying at parity, um, and Premera is following Medicare guidance, which requires parity for, um, when a patient is in their own home, and Medicare allows for other locations to be reimbursed slightly lower.

I believe Co-Chair Fields has a question. Um, through the chair, Ms. Carpenter, I was wondering if you might be able to help if We wanted to consider language to avoid the incentive to locate services outside the state of Alaska to a lower-cost jurisdiction like Ohio. Could we write something where the reimbursement would fall correspondingly if a service that was located in Alaska was transferred to a different state? Through the chair, Co-Chair Fields, um, I want to contemplate that a little bit because right now how reimbursement works works is it's based on the location of the patient. So that could really upend things in insurers', you know, payment systems where it's located.

I will say another layer of this is the insurers' credentialing requirements for a provider doing telehealth. So I can at least share one example, which is Premera, and again, the division doesn't have any statutes that require require us to have any oversight on their credentialing for this situation, but they do require if a provider is going to provide telehealth to an Alaskan that is physically located in Alaska, the provider physically be located in the state. And part of that is because it's just the Blues plan and how the different Blue Cross Blue Shield plans work. So there is some additional layers there, and it may be worth it to hear from some of the insurance companies directly. Follow-up, Co-Chair Fields.

Um, I just like to look into it because especially for some of our multi-state healthcare providers, I wouldn't want one of them to have over time fewer doctors here and have a situation where they essentially screen people in person at a facility but then provide more services in a lower-cost jurisdiction where they happen to have other facilities already. Would be very easy to have that shift in employment. And have frankly higher profit margin, and that would not be a positive effect— unintended but not positive. So, and thanks for thinking about it. Yeah, through the chair, co-chair Fields, we will definitely think about it.

I think the committee will also want to think about specialties. Um, you know, I can just share from my personal experience, I have a pulmonologist that is out of state. There's not a lot of pulmonologists. There's none— well, now there is one in Juneau, but I have a long-term relationship with one. So thinking about those specialty services where we're not going to have a lot of those located in the state, and we want to make sure they're still providing care for Alaskans.

Okay, Representative Carrick. Um, thank you. Through the co-chair, I think I have a question for the bill sponsor's office if possible. Thank you. I believe— thank you, Mr. Andreasen and Ms. Carpenter.

We have Ms. Hackenmiller. Thank you for coming back to the table. My understanding is that the senator had to head off to the Senate to the floor for session this morning. Thank you for being here, Ms. Hackenmiller. No worries.

And if, um, if you don't have an answer to this question, uh, we can circle back to it later, but did the bill sponsor contemplate doing a number that— or a percentage less than full parity but higher than current? Because I, I'm seeing what the problem is, I'm seeing where the sponsor's coming from. There's a huge expansion telehealth services. A lot of people are preferring that for their care, but 100% parity, I, I'm having a hard time wrapping my brain around why that is, that is actually parity, and it doesn't seem equitable to me for providers around the state. And so I just— was there discussion about doing something lower than 100% parity?

For the record, Serena Acker-Miller, staff to Senator Clayman through the chair to Representative Carrick. In this bill draft, we did not. We went straight for complete parity. We were looking at the Medicaid law that exists, the Medicaid telehealth pay parity. There are some conditions in that, and we wanted to do 100% parity.

And part of that is because when speaking with healthcare insurers that this would affect they have stated they are paying at parity. And the— it just wasn't in statute. And there are other types of parity there. You can do percentages. I haven't seen any percentages in other states.

But there's also something called coverage parity that is different. And, and there's all these types of ways that states can do it. And we followed the states. We followed the higher number of states, so we followed 28 states in telehealth pay parity at 100%. Just a quick follow-up.

Follow-up. Thank you for that, through the co-chair. And I know we've talked already about some of our largest providers providing 100% parity already, so there's something to be said about uniformity across the state with insurance insurance providers. But, um, how— this might actually be a question for Ms. Carpenter, so I apologize— how many Alaskans approximately are covered by the healthcare insurers that are currently doing 100% parity? So I think we had mentioned Aetna, Primera, and Moda are doing 100% parity.

And please correct me if I'm wrong, but just trying to get a sense of how many Alaskans already have 100% parity through their coverage. Again, for the record, Heather Carpenter, Director of the Division of Insurance. Um, through the chair, Representative Carrick, I can follow up with numbers and the breakdown. Um, Premera is our largest insurer, of course, in the individual market. Um, Aetna is very small.

Moda is our second, um, largest but significantly smaller than Premera. And just as a reminder, our market makes up 15% of the healthcare marketplace, you know, so you're gonna see significantly more covered by Medicaid, Medicare, federal payers, and those self-insured. One more follow-up. Follow-up. Thank you.

Through the co-chair, what is the Medicaid reimbursement rate on telehealth comparatively? Through the chair, Representative Carrick, I— they are having to pay at parity as a result of the bill passed in 2022, but I just don't know what that reimbursement is, and it's going to depend on what service they're providing. Okay, thank you. We have time for one more question before we set this bill aside, and that question goes to Representative Kollum. Oh, thank you.

Chair, I guess this is— I had some of those questions, so some of that got answered. This is for the bill sponsor staff. When you went through the section on— when you explained Section 7 and Section 8, can you restate that? Because I thought you said it repeals the Medicaid health parity, so maybe I wrote that down wrong. For the record, Serena Hackmiller, staff to Senator Klayman, through the chair to Representative Klimm.

It repeals the sunset language. So in HB 265 in 2022, there was a sunset date. I believe it's 2030. And so we repealed the sunset. And that was because of the success and effects of Medicaid telehealth pay parity.

And I did— I threw that to the chair. I was wondering if a Medicaid specialist was available online. And the reason that we invited Medicaid is because they have 5 years of experience with telehealth pay parity. And if not, we can, we can certainly bring them back for another hearing. And if they— if the committee has questions for them.

I see we have online Ms. Tricia Skitt. She's the operations program manager for the Division of Healthcare Services with the Department of Health. Is that who you're referencing, Ms. Ackerman-Miller? To the chair, yes. Okay, Ms. Skitt, are you able to weigh in?

Good morning, everyone. My name is Tricia Pitt, and I'm the Operations Program Manager with the Division of Health Care Services, and my program oversees Medicaid operations.

Can you repeat the question for me, please, through the chair? Representative Kalem. Well, I was asking about a section in the bill, and the bill repeals the sunset date of 2030, and I'm just wondering Is that a good idea? Why are we repealing sunset date?

Through the chair representative, I'm sorry, I'm not really familiar with the sunset date of the previous bill on that. What I do know is that we are still providing services and getting reimbursement for telehealth. Follow-up, follow-up. So do you feel like— so since you guys have been doing this for 5 years, do you find that this is— this parity that you have been doing, is it successful? Is it difficult?

Are there some pitfalls to it?

Through the chair, representatives, we have not seen any significant changes, increase or decrease. Our concerns or complaints in regards to telehealth services being able to be provided to all members in Alaska, even including our rural areas. Yes, so follow-up. So before the parity though, weren't telehealth services provided before parity? Just a representative, my understanding is I'd have to I have to take that question back.

Honestly, I'm unfamiliar about the level of telehealth services that were provided prior to, and I can look into that and I can get that information back to the committee. Okay, thank you. Thank you very much, Miss Skitt, and thank you to all of our invited testifiers today. And thank you to Miss Hackenmiller for, for being here today to present SB 83. Second, Miller, do you have any closing comments you'd like to make?

No. No, thank you. Okay, thank you very much. With that, we will set this bill aside to another date, and we will transition to the last item on our agenda, which is HB 211, Insurance and Prepaid Legal Plans, sponsored by Representative Jimmy. So Representative Jimmy and staff, Mr. Keenan Miller, if you would please join us at the table, introduce yourself for the record, and give a brief recap of what HB 211 one does.

Thank you for being here.

Uh, um, Co-chair Hall and Co-chair Fields and the Labor and Commerce Committee, for the record, Representative Unangimi, House Bill 211 makes prepaid legal plans easier to access, removing insurance regulations requirements. Legal help is not accessible in Alaska. Lawyers are expensive and usually do not cover rural areas. Alaska Legal Service Corporation turns away more than half Alaskans that seek free or low-cost help. Prepaid legal plans fill the gap for Alaskans to get routine legal help and justice when it is needed.

We have Ian Eagleback, the Assistant Attorney General with expertise on the Consumer Protection Unit, online and available to answer questions. Thank you, Representative Jimmy. I also see Ms. Julia Jansen, the Chief Legal Officer from Legal Shield, available and online for questions as well. Looks like we're going to start with Co-Chair Fields. Thank you, through the Chair, to Representative Jimmy, for being here and for ensuring Mr. Engelbeck is available.

I had a question through the Chair for Mr. Engelbeck. Mr. Engelbeck, what are the consumer protection issues we should be thinking about in terms of prepaid legal plans, and have you done research about prepaid legal plans in other states to see if there are any other lessons that we could learn from other jurisdictions? Thank you.

Through the chair, Representative, I have not done research on how these plans have been implemented in other states, but I think the core of consumer protection is that people should know the deal that they're getting and not be exposed to deceptive conduct.

Um, follow-up, Coacher Fields, through the chair. Does Alaska's existing consumer protection statutes adequately cover prepaid legal plans? Through the chair.

Through the chair, Representative, the Alaska Unfair Trade Practices Act is extensive.

It covers— it's essentially divided into two sections. AS 4550.471(a), which broadly bars all unfair or deceptive acts or practices in trade or commerce. And there's case law interpreting that broad prohibition, but the law is designed to be able to address changes in the marketplace, changes in technology, changes in ways that unscrupulous businesses might try to take advantage of Alaskans. So it is quite a broad law, and I think it adequately would give us the tools to address these issues. [Speaker:KASKEPALA] Follow-up.

[Speaker:KELLY] Follow-up. Through the chair, Mr. Engelbeck, so thinking about subscription services broadly, including but not limited to legal plans, how has that worked in practice, in case law? Are there examples where, say, a subscription service buried in fine print somewhere, when you sign up for this service, you're bound to continue subscribing for a year or longer? Um, has that been an issue? Has the law successfully protected consumers who were unwittingly entrapped in longer subscription periods than they wanted?

Through the Chair, Representative, I don't think there is an Alaska case on point, but deceptive agreements, deceptive misrepresentations about the contents of the contract are explicitly unfair trade practices under Alaska law. And I believe other states in other contexts have brought cases against subscription services that misrepresented the charges that would be applied to consumers. And most states have a law very similar to Alaska's, and I believe those states have been successful. Could I ask a follow-up? Follow-up.

If, if a disclosure was buried in 5 pages of fine print, you know, you're subscribed for a year, would that qualify as deceptive, or would the business be able to say, hey, it was in the fine print, you just didn't read it? Um, is that an answerable question through the chair, Mr. Engelbeck?

Uh, through the chair representative, I would argue that it's deceptive. Our guidance for whether an act is unfair or deceptive when it hasn't been explicitly barred by the Unfair Trade Practices Act is a Supreme Court case called O'Neill. And it— its guidance is essentially that an act is unfair or deceptive if it causes harm to consumers, is against public policy, or falls within the numbers of generally accepted concepts of unfairness, which admittedly is not a hard and fast rule.

Just one more follow-up. Follow-up. Um, Mr. Engelbeck, through the chair, I appreciate your time and Miss, uh, Representative Jimmy's time. We haven't had a bill like this in a while, and I, I think haven't talked about consumer protection a while. So I'd probably ask similar questions on any subscription-related service.

And I guess I would just ask as a follow-up, Mr. Engelbeck, if you could just get back to us with what are things that we should think about as legislators when it comes to consumer protection for bills like this? Not about legal services specifically. I don't know I think legal services should be regulated under insurance. I accept that premise. I just want to make sure that we are also thinking about broader consumer protection considerations.

Thank you. Okay. Thank you, Co-Chair Fields, and thank you, Mr. Engelbeck, certainly for being here. We have a question next from Representative Colon. Thank you, Chair.

I actually have a bill for— or a question to the bill sponsor or staff, and maybe you can answer it. There's two parts of the bill. I'm trying to figure out what does this mean. So I'm looking at page 1, line 12. It's item 3.

An attorney contracted under this subsection does not receive additional payment or reimbursement from the organization for provision of the specified legal services or specified legal expenses. I'm not really— do you know what that means? Yeah, sorry, I'm having a tough time. I'll defer to my staff. Okay, thank you.

Yeah, um, and for the record, Keenan Miller, staff to Representative Jimmy, trying to be louder today. I know that was a note from last time. Um, so what that means is that like any other subscription service, right, it doesn't matter which parts of Netflix or Spotify or a subscription you actually use, right? You pay your monthly fee, you get what you get. It doesn't matter if you use it or don't use every component of the prepaid legal plan in the same way that it doesn't matter whether you're watching horror movies or comedies on Netflix.

You don't pay Netflix anything additional in order to access the different fees that you've already— or the different services that you've already paid a fee to access. And that is what that component means. On page 1, line 12 through 14. Follow-up. Okay, so, so you pay the monthly subscription, you hopefully get the services that you paid for.

So you're saying if you end up not using any of the services, you're not going to get any of your money back? Or I guess I'm confused because it says an attorney contracted. I guess I was looking at it as the attorney doesn't get any of the money, or is this on the consumer side? Um, through the chair to Representative Calom, Miss Julia Jensen with Legal Shield might be able to elaborate on this, but I think the keyword here is probably additional payment, but I'll defer to her expertise. Thank you, Mr. Miller.

Miss Jensen, would you like to weigh in?

This is Julia Jensen. I apologize, I'm just pulling up a copy to see the exact provision that is being inquired about. Could you re-specify what section? Please, Representative Klum. Yes, it's page 1, line 12 through 14.

I'm just trying to get clarification of what that Means, Section 1, page 1.

I believe I'm looking Could you please read the section again? I'm looking at, I believe, a prior draft, so my page 1 is not the same as what you are looking at, I'm afraid. Representative Klonk. So it says an attorney contracted under this subsection does not receive additional payment or reimbursement from the organization for provision of the specified legal services or the specified legal expenses.

Thank you. For the record, this is Julia Jensen, Chief Legal Officer of LegalShield. Through the chair, that language is saying, core to LegalShield not being insurance is that we don't pay claims. And that we don't bear risk. And so, that statement is saying that LegalShield is not paying the provider for services under the plan when they're being made.

Once again, to just make sure that we are not structured as insurance, we're not paying claims.

Follow-up, Representative Klobuchar? I will have to think about it. Okay, no problem. Not sure how else to ask it. No, that's helpful.

I'll figure it out. Ms. Jensen, I apologize, you were listed here as Jansen, so I just want to correct myself for the record that your last name is indeed Jensen. Representative Sadler. Thank you, Madam Chair. I guess Ms. Jensen, Julie Jensen-Jansen, might be the appropriate person to ask this question.

Is there any information on how often clients clients of your service use the maximum benefit they have in a year, whether that's the number of hours or the number of visits or whatever, and how often they have to continue getting additional legal services outside of those provided by the plan to conclude their legal issues? [FOREIGN LANGUAGE] There are no lifetime caps under the plan, and the vast majority of our members, the subscription goes from month to month. And so, the— there's no limit, for instance, on how many times you can call the attorney because you just have a general advice and consultation question. On a new matter, you can continue to say, call for different advice on different matters. That's one classification.

In the plan itself, there'll be, for different types of legal matters, so outside of advice and consultation, depending on the plan that you buy, it will specify how many hours, in some circumstances, or whether it is covered or not. So, for instance, if you are being sued in a civil defense trial, the plan will specify, "For that matter, here's how many hours of pre-trial legal services are covered within your plan and how many hours of trial services are covered within your plan." But those are— legal matter specific and not time specific.

Follow-up. Ms. Jensen, I'm afraid I heard you say at first that there's no limit on the number of calls or consultations, but then you said depending on what plan you buy, there are limits to the calls or consultations. Can you clarify? No. Ms. Jensen.

I apologize. Through the chair, Representative Sadler, all of our legal plans have— are uncapped on the number of advice and consultation calls that you can have. In addition, we offer other legal benefits besides general advice and consultation, such as the one example that I provided was civil defense litigation, where there are some caps that are applicable per matter.

That gets back to my original question. Representative Sadler. Thank you, Madam Chair. And how many people get to the end of their prescribed or paid-for benefits and need additional? You can see what I'm trying to get to is how many people— for how many people are generally— is the prepaid legal and a couple consultations adequate, and how often do they have to contract for services beyond that?

I don't have a precise breakdown for you on that. To the extent that somebody needs additional legal services that are not covered within the plan, we do offer a specified discount for those legal services. And the plan is very clear and explicit on what legal services are included within in the plan that had been purchased and what are excluded or covered under that discount price.

I may come back to you to try and clarify that, but thank you, Madam Chair. Okay. Representative Carrick. Thank you. Through the chair, I just— I don't know if this is helpful to anybody else, but I'm not really familiar with any of this, so I looked up what a prepaid legal plan to specifically covers, just to offer background, and everything I'm reading says that this is usually used for routine defined matters like wills.

I imagine if you were going through, um, what you knew in advance was going to be a, a divorce proceeding that was a little bit complicated, document reviews, general consultations. This is not the same as having an attorney that's dedicated, like a specific attorney dedicated to your specific case for a really complex issue. So I don't know if that's helpful, but it, it sounds like Ms. Jensen's testimony is in line with, with that, in that a prepack legal plan is not going to be something you're using for, you know, extremely complicated, complex issues. And I, I think what I'm understanding is there is a lot of flexibility in these plans if they're offered month to month so that there's an opportu— if you know that a family member's passed away, for example, and you're gonna have to do a lot of work with their will, maybe you get that for a couple of months, a prepaid legal plan, which I know is a common situation. Um, but you would need a different kind of attorney service for you know, a complex business matter or something else.

And I'm just wondering if Ms. Jensen could either corroborate or dispute any of that, because I'm just trying to wrap my brain around who gets a prepaid legal plan, how long do they typically have them for. And I'll just echo what Co-Chair Field said, that I agree with the ultimate premise here that this shouldn't be under the division of insurance, but I think it might be helpful to talk about what a prepaid legal plan actually is.

Through the Chair, Representative, apologies that that hadn't been clarified either earlier today or at the prior committee hearing. So you're absolutely right. These are legal plans are purchased by and large for just ordinary people and families. So they're meant to address kind of day-to-day legal issues that happen in their lives. And just a couple examples.

So we had someone earlier this year who had a plumber over to fix something, and then lo and behold, there was a leak overnight, and $12,000 of water damage happened to their floors. The homeowner could not get the plumber to admit that he'd done anything wrong, and he just was denying responsibility. And so that person was a member of our legal plan and so was able to get attorney advice and the attorney wrote a demand letter to the plumber. Clearly, the water damage was due to the work that he had just done. And because of our demand letter, the homeowner got the $12,000 reimbursement for the damage that he had caused.

That's a very typical example of the kind of real legal issues that ordinary people face in their lives. Another example, traffic tickets. Something that is frequently used. Or think of your, your child is going to school and they're having trouble getting their security deposit back. Another kind of common situation that we have, we also provide estates and wills.

And so all of our members get a free will put in place that can be reviewed annually. Once again, it's just a core service that we provide. Things that are more complex, that's where it might not be covered at all under the plan, or there might be some cap on it. So, for instance, contested divorces are normally something that's not covered under a plan that can be, you know, take a lot of different shapes and be quite expensive. So thank you for asking the question, just to give a better feel for what kinds of matters that these real people need guidance with.

Thank you, Ms. Jensen. We have time for one more question. The question can be for Ms. Jensen or Mr. Engelbeck or the bill sponsor. Looks like Representative Sadler, you have a question. Thank you.

To help me understand, Ms. Jensen, this is for you. I'm new to the field of prepaid legal plans. In my experience, when I need an attorney, I call an attorney. If I need a plumber, I call a plumber. But apparently you've built a business on the subscription model.

But I guess the question I want to understand is how much of your of your business, I guess your revenue, comes from month-to-month prepaid plans versus additional consultation fees that you say you offer at a discount for subscribers. Just what's the split of your business? Oh, yes, um, true, Mr. Chairman. Once again, thank you for the question. So we are not attorneys.

We have no, you know, we have no attorneys on staff. That are providing the legal services that— from the plans that we sell. There are independent lawyers who we have contractual relationships who are providing those legal services. And so, those Arizona barred attorneys are the ones who are providing the legal services. And so, if there's a service that a member an attorney that's in the— outside the bounds of the legal plan, the member is paying that Arizona attorney directly and we're not involved at all.

So LegalShield gets no revenue for legal services that are performed outside of the plan. And there is a discount. Thank you for that. That's really understanding. So there is a discount for the people, you said?

I'm sorry, could you please repeat the question? Clarifying, I believe you said that if there is a discount provided for clients of your prepaid services should they need to contract for additional, there is a discount. Okay, thank you very much. Thank you, Ms. Jensen. With that, Representative Jimmy, do you have any closing comments that you'd like to provide?

Um, Kūniluku, House Bill 210. I just want to take that time for you— opportunity to thank you all for listening for House Bill 210. Okay, thank you very much, Representative Jimmy. For now, we will set this bill aside. That concludes our business for the morning.

The House Labor and Commerce Committee will meet next later today, Wednesday, April 15th, at 3:15 PM. This meeting is adjourned at 11:40 AM.