The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 7:30 a.m., on Tuesday, March 2, 1999, in Room 2135 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Senator Randolph J. Townsend, Chairman

Senator Ann O’Connell, Vice Chairman

Senator Mark Amodei

Senator Dean A. Rhoads

Senator Raymond C. Shaffer

Senator Michael A. (Mike) Schneider

COMMITTEE MEMBERS ABSENT:

Senator Maggie Carlton

GUEST LEGISLATORS PRESENT:

Assemblywoman Barbara E. Buckley, Clark County Assembly District No. 8

STAFF MEMBERS PRESENT:

Scott Young, Committee Policy Analyst

John L. Meder, Committee Policy Analyst

Crystal M. Lesbo, Committee Policy Analyst

Beverly Willis, Committee Secretary

OTHERS PRESENT:

Robert R. Barengo, Lobbyist, Board of Medical Examiners, and Nevada Insurance Guaranty Association

Madelyn Shipman, Lobbyist, Assistant District Attorney, Washoe County

David Horton, Lobbyist, Nevada Homeopathic Medical Association

Pat Coward, Lobbyist, Smith Kline Beecham

Tom Wood, Lobbyist, Wyeth-Ayerst Labs, Division of American Home Products

Shirley Petro, Auditor/Investigator, Real Estate Division, Department Business and Industry

Dana R. Bennett, Lobbyist, Nevada State Medical Association

Chairman Townsend presented Bill Draft Request (BDR) 57-821 and BDR 58-367 for committee introduction.

Daryl E. Capurro, Lobbyist, Nevada Motor Transport Association, explained BDR 58-367 would, "eliminate the last vestige of economic regulation with respect to tow car operations and to bus operations."

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The committee addressed Senate Bill (S.B.) 196.

Senator Michael (Mike) A. Schneider, Clark County Senatorial District No. 8, claimed he feels it is important for small business people to have someone available to interpret a health insurance policy when necessary; i.e., senior citizens. He asserted this legislation might be helpful for doctors as well, to help expedite payment of bills.

Assemblywoman Barbara E. Buckley, Clark County Assembly District No. 8, noted in the Sixty-ninth Legislative Session she had sponsored legislation dealing with a patient bill of rights denoting rights for those enrolled in managed care; i.e., expedited reviews, grievance procedures, etc. She noted additional enforcement and help was needed for the patients. Assemblywoman Buckley cited several examples of problem cases. She claimed it became apparent, ". . . that we need a consumer-friendly enforcement system." Assemblywoman Buckley mentioned a number of states that already have this kind of program. She suggested an ombudsman could work from the Office of the Attorney General, recommending this person have a health care background. Assemblywoman Buckley presented Managed Care: Where Do We Go From Here? (Exhibit C). She maintained assistance for consumers to help with the selection of the proper type of policy was necessary. Senator Townsend, Senator Schneider, Senator O’Connell and Assemblywoman Buckley conferred on various methods of assuring education and information is relayed to those purchasing health care.

Charles Musser, Concerned Citizen, presented his support for the ombudsman bill (Exhibit D). Mr. Musser related many instances of his frustration; i.e., stonewalling, loopholes in the Employment Retirement Income Security Act (ERISA). Referring to Exhibit D, Mr. Musser offered several examples.

Paul Gowins, Member, Nevada Healthcare Reform Project, noted this association represents 52 organizations concerned with health care. As noted in his written remarks (Exhibit E), Mr. Gowins maintained his support for this legislation. He commented on his displeasure over the lack of coverage offered by some health insurance programs, even though these programs are supposed to be comprehensive coverage. Mr. Gowins noted, often there is confusion as to the type of health care coverage available to individuals. He covered other items that could be handled by an ombudsman and, once again, offered his support.

Roberta A. Gang, Lobbyist, Nevada Women’s Lobby, stated her wholehearted support for this legislation. Ms. Gang asserted it was very important for the citizens of Nevada to have an ombudsman for health care. Senator Townsend requested assistance from Ms. Gang to discover the state agency in which an ombudsman could best operate.

James R. Jeppson, Chief Insurance Assistant, Division of Insurance, Department of Business and Industry, indicated the commissioner of insurance and the Governor were neutral as to its placement within the insurance division. Mr. Jeppson asserted placement within the insurance division would be preferred; the insurance division did a great deal of work concerning health care inquiries and complaints. Mr. Jeppson noted a health care guide has been published, as well as offering a toll-free phone number. Senator Townsend and Mr. Jeppson discussed the disposition of phone calls received by the Division

of Insurance, pertaining to health care. Mr. Jeppson presented Report to the 70^th Session of the Nevada Legislature on the Number and Nature of Complaints from Consumer of Health Care (Exhibit F) He noted

this report contains indicators on performance, information on complaints processed and categorization by type of complaint.

C. Edwin Fend, Lobbyist, Coordinator, American Association of Retired Persons (AARP), stated he was in opposition to this legislation. Mr. Fend claimed he agreed with the concept; however, did not agree with what is being proposed, or the location of the ombudsman. He maintained that although a great deal of work has been accomplished to pinpoint complaints, etc., not enough information has been forwarded to the consumer. Mr. Fend reiterated his support for the concept of this legislation; however, he could not support the legislation itself. He stated, "I think if we put the ombudsman into the insurance division we are adding to a problem we already have. I think the ombudsman concept should be with the attorney general, where it will have additional clout."

Lawrence P. Matheis, Lobbyist, Executive Director, Nevada State Medical Association, noted his support for the notion of this legislation. Mr. Matheis declared this would need to evolve over a period of time and claimed this type of legislation would eventually be adopted in all states. Mr. Matheis maintained the worst thing would be to do nothing. Senator Rhoads and Mr. Matheis perused issues covered in the Sixty-ninth Legislative Session pertaining to this same topic.

Clark (Danny) Lee, Lobbyist, Nevada Physical Therapists Association, read a statement by Pamela C. Hogan, President of the Nevada Physical Therapy Association (Exhibit G), stating her support of S.B. 196

Robert A. Ostrovsky, Lobbyist, Nevadans for Affordable Health Care, stated the program covered in this legislation would be paid for by an employer tax. According to Mr. Ostrovsky, this would be a health care mandate. Mr. Ostrovsky said, "I do not believe in this bill, and I do not think it should create a situation where the ombudsman has any rights or authority except that between the purchaser of the policy and the policy itself provided." He claimed the ombudsman should serve all concerned.

Larry I. Hardy, Life and Health Underwriters Association of Nevada, maintained agents were already filling the position of health care advocate. Mr. Hardy asserted many are affected by large rate increases till they no longer feel able to purchase health care insurance. He urged the committee to find a way to reduce costs of health care.

Senator Amodei and Mr. Ostrovsky reviewed problems associated with the high cost of health care and possible solutions. Senator O’Connell, referring to Exhibit F pointed out several major problems associated with complaints; i.e., denial of claims, a delay in the settlement of claims and no response to inquiries. She requested information from Mr. Hardy on ways to solve these problems. Senator Schneider maintained one purpose of this legislation would be to help the small businessmen and seniors.

Senator Townsend closed the hearing on S.B. 196 and announced S.B. 196 would be referred to a subcommittee. The hearing was opened on S.B. 241.

Senator Shaffer introduced Sharon Shaffer, Chairman, State Board of Funeral Directors, Embalmers and Operators of Cemeteries and Crematories, who pointed out this legislation would be in the nature of clarification. Mrs. Shaffer presented a summary of S.B. 241 (Exhibit H), reading her remarks into the record. Some items covered pertained to the number of terms to be served by a member of the board. Other details included educational requirements for obtaining a license to practice embalming, along with provisions for various types of authorization.

Senator Townsend closed the hearing on S.B. 241. The hearing was opened on S.B. 246.

Senator Shaffer noted S.B. 246 was an option, not a mandate. He maintained this legislation would eliminate the need for those taking a dental examination to go out of state.

Fred L. Hillerby, Lobbyist, Nevada State Board of Dental Examiners, noted his organization had concerns this legislation could cause discriminatory practices. Mr. Hillerby noted his opposition to S.B. 246. Senator O’Connell and Mr. Hillerby discussed types of tests needed along with criteria required for testing. Mr. Hillerby indicated Nevada’s standards for dental testing were very high.

Joel F. Glover, D.D.S., Lobbyist, Past President, Nevada State Board of Dental Examiners, stated he was here to express opposition to this legislation. Senator O’Connell and Dr. Glover discussed requirements for various types of dentistry and how universal these requirements might be. Senator Shaffer and Dr. Glover perused costs and requirements of these tests.

At this time, Senator Townsend closed the hearing on S. B. 246 and opened the hearing on S.B. 78.

John N. Chappel, Ph.D. Professor Emeritus of Psychiatry and Behavioral Science, University of Nevada, Reno and Health Care Professionals opened his testimony by presenting information on Rose Mary Gamble (Exhibit I). Dr. Chappel declared he felt there was an abuse of power by the State Board of Nursing. Pointing out information in Exhibit I, he maintained this was intrusive behavior. Still referring to Exhibit I, Dr. Chappel directed attention to the order to deliver his records on Ms. Gamble to the nursing board, which he refused to honor; also a letter from the attorney general requiring those records. Dr. Chappel continued his remarks, describing his response (Exhibit J) specifically pointing out what he considered an abuse of power by the State Board of Nursing and the attorney general’s office.

Senator Townsend and Bill Bradley, Lobbyist, Nevada Trial Lawyers Association reviewed options available to object to a subpoena. Amy Halley Hill, Lobbyist, Nevada State Board of Nursing, noted licensing boards were responsible for protecting public safety and as a consequence, the privacy of a licensee may be disturbed. Dr. Chappel stated, "I helped start the impaired physician committee in Nevada. I have treated over 60 physicians and never once, has the Board of Medical Examiners asked for my records." Dr. Chappel reiterated his displeasure of the nursing board.

At this time, Senator Townsend determined to send this legislation to a subcommittee.

Robert R. Barengo, Lobbyist, Board of Medical Examiners and Nevada Insurance Guaranty Association, asserted it was his feeling there were problems with the language in S.B. 78.

Senator Townsend closed the hearing on S.B. 78. The hearing was opened on S.B. 25.

Senator Townsend pointed out the proposed amendment to S.B. 25 (Exhibit K). Senator Townsend; Scott Young, Committee Policy Analyst, Research Division, Legislative Counsel Bureau; and Senator O’Connell discussed whether or not this proposed amendment addresses the concerns for this legislation. Senator Amodei declared:

Senator Amodei continued with his concerns:

Senator Townsend stated his concerns pertaining to section 1, of S.B. 25, with the committee determining an amendment would be in order.

Madelyn Shipman, Lobbyist, Assistant District Attorney, Washoe County, to help clarify language, noted counties have licensing authorities, or departments; they do not have "boards."

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Senator Townsend then presented S.B. 39.

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Although S.B. 45 was scheduled to be heard, it was determined more examination was needed.

The next item to be addressed was S.B. 56.

Senator Townsend referred to an amendment for S.B. 56 (Exhibit L), proposed by the committee, along with another proposed amendment (Exhibit M) presented by David Horton, Lobbyist, Nevada Homeopathic Medical Association. Mr. Horton and Senator O’Connell discussed language with regard to coverage shown in Exhibit M. Senator Townsend joined the conversation by focusing on Exhibit L, he stated, ". . . on page 1, section 1, by deleting lines 7 through 15 . . . the concept had value and we could track it best if we narrowed it to cancer. So we are going to take out [lines] 7 through 15." Mr. Horton replied, "That is correct."

Senator Townsend continued:

At this time, Pat Coward, Lobbyist, Smith Kline Beecham, and Mr. Hillerby offered testimony. Mr. Hillerby referring to concerns regarding language in line 5 of section 1, expressed by Senator Townsend, noted the main change would take place in line 7. Mr. Coward, Mr. Hillerby, Mr. Barengo and Senator Townsend held further discussion on various concerns.

Tom Wood, Lobbyist, Wyeth-Ayerst Labs Division of American Home Products, in an effort to assuage concerns of Senator Townsend, stated he would call this an "off-label bill." Mr. Wood explained, " This means the drug is going to be labeled for another purpose, in treatment for another illness, treatment for another type of disease, other than cancer." Mr. Wood continued, "Due to time and experience, it has been found that this drug can be used in the treatment of cancer, but it is not in the labeling. Hence, ‘off-label." Mr. Wood offered several illustrations of his explanation. Mr. Wood claimed this amendment (Exhibit L), per instructions from the committee, to reflect federal guidelines and to reflect cancer treatment only. Mr. Wood maintained Exhibit L already covered language offered in the amendment (Exhibit M), by Mr. Horton. Mr. Wood reiterated his belief as to what guidelines had been followed. He stated:

* * * * *

Senator Townsend then presented S.B. 74.

Mr. Barengo stated there had been questions raised by the Nevada Trial Lawyers Association (NTLA) pertaining to section 3, line 1 through line 35, on page 5. He noted discussions were held with the NTLA and an agreement had been reached. Mr. Barengo stated the decision was made to remove section 3 from the bill. He claimed, ". . . we would intend to keep the state of the law, as it exists, today, by removing section 3 from the bill."

* * * * *

Chairman Townsend presented S.B. 99.

Senator Townsend informed the committee about a proposed amendment (Exhibit N) to S.B. 99, providing a short explanation.

Senator Schneider inquired about those who might have fulfilled the requirements for a broker-salesman’s license; however, have to wait for 2 years to gain the required experience. Shirley Petro, Auditor/Investigator, Real Estate Division, Department Business and Industry, stated S.B. 99 would not affect this particular situation. Ms. Petro indicated this legislation would apply to new people only.

* * * * *

Next to be addressed was S.B. 145.

James L. Wadhams, Lobbyist, Blue Cross and Blue Shield of Nevada, stated his review of S.B. 145 and declared, ". . . it appears the intent is to regulate these non-insurance contracts. It would appear that, at least, the theory of that regulation, is it has an indirect impact on the access to care." Mr. Wadhams presented an additional proposed amendment (Exhibit O), asserting this would help contain costs of health care and help maintain accessibility. Offering an explanation for Senator O’Connell, Mr. Wadhams clarified requirements on fees, and the length of time in which these should be resolved.

Dana R. Bennett, Lobbyist, Nevada State Medical Association, asserted no harm had been made to the intent, beginning with section 2. Ms. Bennett claimed clarification had been accomplished.

Mr. Wadhams continued with his clarification noting present law requires the consumer claim be paid in a timely fashion, as well as adding interest if not paid promptly. He claimed this legislation expands the requirement, to be sure all contracts; i.e., doctors, are paid in a timely fashion as well. Mr. Wadhams asserted this legislation should make sure the provider of the service is reimbursed.

Mr. Lee claimed his organization could support this legislation, thinking it might curb abuses pertaining to large fees.

Chairman Townsend closed the hearing on S.B. 145 and opened the hearing on S.B. 181.

Senator Townsend called the committee’s attention to a proposed amendment (Exhibit P) to S.B. 181. Mr. Hillerby explained the purpose of this legislation, stating this would allow fees to be collected.

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Next, S.B. 199 was taken under consideration.

As Senator Townsend posed questions pertaining to S.B. 145, Ms. Bennett stated Larry Matheis, Lobbyist, Nevada State Medical Association, would be unable to attend the meeting; however, noted he did not have any objection to language in this legislation, as long as the commissioner of insurance has no objections.

At this time, Mr. Young offered clarification by referring to Exhibit O. Mr. Wadhams offered comments and reasoning for language in Exhibit O. Since there seemed to be some doubt as to specific language needed for S.B.145, Senator O’Connell requested Mr. Wadhams bring what he thought best for this legislation. As a final vote on S.B. 145 had not been taken, action on S.B. 145 was withdrawn.

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At this time the hearing on S.B. 199 resumed. R. Bruce Bannister D.O. Board Member, State Board of Osteopathic Medicine, presented fee/rate schedules (Exhibit Q) to the committee. Dr. Bannister responded to questions from Senator Townsend concerning the amount of revenue generated, with Dr. Bannister claiming that he was not completely sure. Robert Kersey, Secretary-Treasurer, State Board of Osteopathic Medicine, furnished background material on the State Board of Osteopathic Medicine. Mr. Kersey informed Senator Townsend other board members had been notified of this meeting and approved this legislation.

Senator O’Connell posed questions, whether or not this budget would be adequate for several years. Mr. Kersey claimed the budget would be adequate 4 or 5 years.

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Senator Townsend then addressed S.B. 241.

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Senator Townsend declared S.B. 196 would be addressed at a later date in a subcommittee. He noted S.B. 246 would be held until further discussion with Senator Shaffer was forthcoming. Senator Townsend noted S.B. 78 would be held, as there were questions yet to be resolved.

As there was no further business, the meeting was adjourned at 10:55 a.m.

RESPECTFULLY SUBMITTED:

Beverly Willis,

Committee Secretary

APPROVED BY:

Senator Randolph J. Townsend, Chairman

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