Bill Summary – FastDemocracy

State of Alaska
                                                              Fiscal Note
                                                                                                  Bill Version:                    CSHB 30(FIN)
 2020 Legislative Session
                                                                                                  Fiscal Note Number:              5
                                                                                                  (H) Publish Date:                3/11/2020
 Identifier:        HB030CS(FIN)-DOLWD-WC-03-03-20                                  Department:       Department of Labor and Workforce Development
 Title:             WORKERS' COMP: DEATH; PERM PARTIAL                              Appropriation: Workers' Compensation
                    IMPAIR                                                          Allocation:       Workers' Compensation
 Sponsor:           JOSEPHSON                                                       OMB Component Number:              344
 Requester: (H) FIN
 Expenditures/Revenues
 Note: Amounts do not include inflation unless otherwise noted below.                                                                    (Thousands of Dollars)
                                                 Included in
                                    FY2021       Governor's
                                Appropriation      FY2021                                                Out-Year Cost Estimates
                                  Requested       Request
 OPERATING EXPENDITURES               FY 2021        FY 2021       FY 2022                          FY 2023           FY 2024            FY 2025       FY 2026
 Personal Services
 Travel
 Services
 Commodities
 Capital Outlay
 Grants & Benefits
 Miscellaneous
 Total Operating                            0.0           0.0          0.0                                0.0                0.0              0.0              0.0
 Fund Source (Operating Only)
 None
 Total                                              0.0             0.0                 0.0               0.0                0.0              0.0              0.0
 Positions
 Full-time
 Part-time
 Temporary
 Change in Revenues
 1157 Wrkrs Safe (DGF)                             55.0                             110.0              110.0             110.0             110.0             110.0
 Total                                             55.0             0.0             110.0              110.0             110.0             110.0             110.0
 Estimated SUPPLEMENTAL (FY2020) cost:                                        0.0             (separate supplemental appropriation required)
 Estimated CAPITAL (FY2021) cost:                                             0.0             (separate capital appropriation required)
 Does the bill create or modify a new fund or account?       No
 (Supplemental/Capital/New Fund - discuss reasons and fund source(s) in analysis section)
 ASSOCIATED REGULATIONS
 Does the bill direct, or will the bill result in, regulation changes adopted by your agency?                     Yes
 If yes, by what date are the regulations to be adopted, amended or repealed?                                     12/31/20
 Why this fiscal note differs from previous version/comments:
 Updated analysis and revenue estimates.
 Prepared By:                Grey Mitchell, Director                                                                    Phone:         (907)465-2790
 Division:                   Workers' Compensation                                                                      Date:          03/03/2020 04:30 PM
 Approved By:                Hannah Lager, Administrative Services Director                                             Date:
                                                                                                                                OUT OF 03/03/20
 Agency:                     Office of Management and Budget                                                          REPORTED
Printed 3/11/2020                                                         Page 1 of 2                                  HFC 03/11/2 020
                                                                                                                                Control Code: cMqiC
                                                                                                           CSHB 30(FIN) - Fiscal Note 5
                                                 FISCAL NOTE ANALYSIS
STATE OF ALASKA                                                                   BILL NO. CSHB 30 (FIN)
2020 LEGISLATIVE SESSION
Analysis
   This legislation increases workers' compensation insurance benefits for permanent partial impairment (PPI) and extends
   the limit on death benefits for a dependent child from age 19 to age 23 when there is no widow or widower. This
   legislation also requires an employer to notify each employee of the workers' compensation death benefits and to provide
   notice to the personal representative of a deceased employee about time limits for filing a workers' compensation claim,
   as well as where to locate an attorney and grief counselor. Workers' Compensation insurance benefits are paid by insurers
   or by selfinsured employers, and are regulated by the Division of Workers' Compensation.
   The proposed PPI benefit increase amounts to 44%. Since PPI benefits amounted to $9.4 million in 2018, this is estimated
   to increase benefit cost to insurers and selfinsured employers by $4.2 million per year. However, as noted by the National
   Council of Compensation Insurance (NCCI) in its 2019 analysis of the impacts of HB30, "studies indicate that significant
   benefit increases are typically accompanied by changes in claimant behavior. In this case, changes in claimant behavior
   might result in an increased number of PPI claims, potentially higher PPI ratings, and potential for increased attorney
   involvement."
   The impact of increasing the limit on death benefits for a dependent child from age 19 to age 23 when there is no widow
   or widower is not expected to be significant, but cannot be readily calculated by the division. In 2018, there were only five
   claims involving death benefits to children where there was no widow or widower.
   Increased benefit costs to insurers and selfinsured employers do not impact the division's budget. The division does not
   anticipate a cost with developing forms related to the employer notification requirements proposed in the legislation.
   However, there is currently not a definition for "grief counselors" under the Alaska Workers' Compensation Act, so
   regulations will be necessary. Changes to regulations will be combined with planned regulation update packages, so
   additional budget authorization is not needed.
   Revenue to the Workers' Safety and Compensation Administration Account (WSCAA) comes from fees on premiums and
   selfinsured benefit costs. As this legislation will cause an increase in benefit costs, it will result in additional annual
   revenue estimated at $110,040. The increased revenue is estimated at $55,020 in FY2021 because of the midyear fiscal
   year effective date.
(Revised 10/22/19 OMB/LFD)                                                                                           Page 2 of 2
HB030CS(FIN)-DOLWD-WC-03-03-20                                  Page 2 of 2                                               Control Code: cMqiC
Statutes affected: 
HB0030A, AM HB 30, introduced 02/20/2019: 23.30.055, 23.30.045, 23.30.022, 23.30.395, 23.30.190, 23.30.041, 23.30.215, 13.06.050
HB0030B, AM CSHB 30(L&C), introduced 04/10/2019: 23.30.190, 23.30.041, 23.30.215, 13.06.050
HB0030C, AM CSHB 30(FIN), introduced 03/11/2020: 23.30.215, 23.10.699, 23.10.430, 23.30.190, 23.30.041, 13.06.050