The 3rd meeting of the Interim Joint Committee on Licensing and Occupations was held on Friday, September 12, 2008, at 10:00 AM, in Room 129 of the Capitol Annex. Representative Joni L. Jenkins, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Gary Tapp, Co-Chair; Representative Joni L. Jenkins, Co-Chair; Senators Tom Buford, Julian M. Carroll, Perry B. Clark, Julie Denton, Ray S. Jones II, Bob Leeper, and Dan Seum; Representatives Larry Clark, Ron Crimm, Tim Firkins, Dennis Horlander, Dennis Keene, Adam Koenig, Charles Miller, Tim Moore, Ruth Ann Palumbo, Carl Rollins II, and Ron Weston.
Guests: Brigadier General Norman E. Arflack, Commissioner, LaTasha Buckner, General Counsel, and Danny Reed, Malt Beverage Administrator, Department of Alcoholic Beverage Control; Jeffery Russell, M.S., C.Ac., and Oliver Barber, State Advisory Committee on Acupuncture; and Todd Leatherman, Executive Director and Kevin R. Winstead, Assistant Attorney General, Office of Consumer Protection.
LRC Staff: Tom Hewlett, Bryce Amburgey, and Susan Cunningham.
Representative Jenkins called the meeting to order and asked for a motion to adopt the minutes from the August 22, 2008, meeting. There was a motion and a second, and the minutes were adopted by voice vote.
First on the agenda, Brigadier General Norman Arflack, Commissioner of the Department of Alcoholic Beverage Control, Danny Reed, Malt Beverage Administrator, and LaTasha Buckner, General Counsel, gave an update on the U.S. Supreme Court's decision on interstate wine shipments, and potential issues for the 2009 General Assembly. Gen. Arflack said one item that the department was concerned about is how potential legislation would impact special events such as the World Equestrian Games in 2010. He said that the department was working with the Public Protection Cabinet and the Governor’s Office to ensure that regulations would be in place and that people from around the world visiting Kentucky would want to return. Gen. Arflack said, regarding the Granholm decision allowing out-of-state wineries to ship into Kentucky, the department was complying with the attempt to level the playing field. He said that Judge Charles Simpson upheld the majority of changes implemented with the passage of Senate Bill 82 in the 2006 General Assembly. However, Judge Simpson ruled that the "in-person requirement" violates the Commerce Clause, and currently the department in not enforcing that section of the KRS. Gen. Arflack said that this decision is still in litigation.
Regarding out-of-state wine sales and licensing small farm wineries, Gen. Arflack said Kentucky has licensed 46 in-state small farm wineries and there are seven applications pending. He said Kentucky has licensed 13 out-of-state small farm wineries and has only one application for an out-of-state winery pending. There is an average of eight consumer inquiries a month regarding out-of-state wine shipments, with a slightly higher number of calls from out-of-state wineries regarding out-of-state shipments.
Senator Carroll asked if the ruling by Judge Simpson had been appealed. Gen. Arflack said it had been remanded back. LaTasha Buckner, General Counsel for the department, added that the department is currently not a party to the suit. Senator Carroll also asked if the department was giving consideration for changes to accommodate the World Equestrian Games. Gen. Arflack said the department was currently working with the Horse Park to ensure that the venue was fully serviced. Danny Reed, Malt Beverage Administrator, added that some of the Horse Park's boundaries were in Scott County, which is a dry county, so the department would have to address that issue. Senator Carroll asked if the department would address revenue issues. Gen. Arflack responded that the department is looking at fee adjustments. Senator Leeper asked what the consumer's options were to order out-of-state wine today. Gen. Arflack said that with the court ruling, consumers could order wine over the phone or purchase via the internet. Senator Buford asked if there had been any violations since Senate Bill 82 had been enacted. Ms. Buckner responded that the only violation would be if an out-of-state winery shipped wine into Kentucky without a Kentucky small farm winery license. Senator Buford also stated that he has been told that some retailers are discontinuing local winery's labels if the winery wasn't siding with them against larger retail chains obtaining the right to sell alcoholic beverages. Gen. Arflack and Mr. Reed both responded that the department had not received any complaints of this nature. Senator Buford asked if the Small Farm Winery Distribution Fund had been exhausted. Virginia Davis responded that the fund was set up in the Department of Agriculture. Senator Tapp said he did not know the balance of the fund and suggested that the Department of Agriculture come to the committee's November meeting to give an update on the entire program. Representative Jenkins said that staff reported to her that consumers are calling to say that common carriers such as UPS and Federal Express do not understand the status of wine shipments and are refusing to transport wine. Gen. Arflack responded that they are aware of the situation and will have a legislative proposal to address the issue. Representative Moore said that as a UPS common carrier he is not allowed to transport alcoholic beverages. Representative Jenkins asked where the department was on the issue regarding minors on the premises where alcohol is served. Gen. Arflack said the department has clarified certain venues designated as concert venues that meet certain criteria to allow minors on the premises.
Next on the agenda, Jeffery Russell, M.S., C.Ac., from Bluegrass Chinese Medicine in Louisville; representing the State Advisory Committee on Acupuncture, gave an update on the status of acupuncture certification in Kentucky. Mr. Russell said prior to the passage of House Bill 17 in the 2006 legislative session, most people in Kentucky did not understand acupuncture. He testified that with the passage of the acupuncture legislation Kentucky rose to the same level of professionalism and public protection as the 43 other states that regulate acupuncturists. The passage of this legislation allows for laws and regulations that permit qualified acupuncturists to work as independent practitioners. He said that when the legislation was passed, 18 people applied and were certified, and there are now 41 certified acupuncturists in Kentucky. He noted that the Kentucky Board of Medical Licensure (KBML) has issued nine letters to cease practice to non-licensed practitioners with little or no response due to the minor penalties that result from non-compliance. Mr. Russell noted that House Bill 17 requires an acupuncturist to notify the patient's treating physician if one of ten specific health conditions is noted on the initial office consultation. Notification must be made before performing acupuncture treatments, even though approval from the treating physician is not required. If the physician does not respond after a second notice the acupuncturists may proceed with treatment. Mr. Russell said it is generally felt that this regulation is unnecessary and a burdensome barrier to treatment for both patients and the practitioners, since there are no medical contraindications or negative implications related to using acupuncture on the ten health conditions. Mr. Russell stated that the Acupuncture Advisory Committee is interested in revising three issues. He said the committee would like to change the current penalty for non-physicians practicing acupuncture without certification from a misdemeanor to a felony; eliminate the requirement to notify physicians of patients who are being treated for any of the ten medical conditions listed in KRS 311.680 who are seeking acupuncture treatment; and to change acupuncturist from certified to licensed. Mr. Russell told the committee that licensure would help patients with insurance coverage that limited payments to licensed practices. Currently they have to travel to other states; Indiana, Ohio and Tennessee, that license acupuncturists for treatment to be covered by insurance.
Representative Keene asked if piercing the skin was considered a medical procedure. Mr. Russell said that prior to the legislation that definition was a gray area, but House Bill 17 clarified the definition. Representative Miller asked how other states' guidelines affected Kentucky's acupuncture statutes. Mr. Russell said that in Tennessee, Ohio, West Virginia, and other surrounding states, licensing acupuncturists allow the practitioner to bill insurance companies and receive reimbursement without questioning his or her credentials. Mr. Russell added that there was no reciprocity from state to state for practitioners. Representative Koenig asked if patients who had insurance coverage currently could apply for reimbursement for acupuncture treatments, and if the certification was changed to licensure would the insurance company be required to pay a claim. Mr. Russell responded that the variance was among policies rather than companies depending on the policy and benefits granted. A claim could be denied because the practitioner was only certified rather than licensed. Senator Jones asked what the requirements were to become an acupuncturist and if a patient could seek acupuncture treatment without a referral from a treating physician. Mr. Russell said that acupuncturists were a standalone profession, and did not require a physician referral. He said; however, that he had developed relationships with internists, D.O.'s, and General Practitioner's as well as surgeons and some of them referred patients to him. Mr. Russell said that to be certified in Kentucky you must attend a school accredited by the National Commission for Certification of Acupuncture and Oriental Medicine (NCCAOM) and complete a course of training comparable to a four-year Master's degree. Chairman Tapp asked how many of the 43 states had licensure versus certification. Mr. Russell responded that he was unsure but thought approximately 80% were licensed. Senator Leeper asked if a medical doctor was required to have training to practice acupuncture and if insurance companies would reimburse medical doctors who practice acupuncture. Mr. Russell said he was aware of only a small number of M.D.'s practicing acupuncture because they are not trained, adding that he did know of doctors who had taken the Joseph Helm's Course for M.D.'s in Berkley, California. Mr. Russell also said that Dr. Moureen Flannery in Berea was now practicing only acupuncture; however, she was not using her credential as a physician to collect insurance.
The final item on the agenda was a report from Todd Leatherman, Executive Director of the Attorney General's Office of Consumer Protection, and Kevin Winstead Assistant Attorney General, on the implementation of Senate Bill 57, the "Christine Talley Act." The act related to personal emergency response systems and was passed by the 2008 General Assembly. Mr. Winstead said the office has a simple plan for implementing the act, beginning with educating the industry and the consumers on how the new legislation affects the Personal Emergency Response System (PERS). He said that a questionnaire would be distributed to associations and companies that provide the service in Kentucky and to community organizations as well as state agencies such as the Department for Aging and Independent Living. He stated the office will also distribute its publication, Helping Seniors. Mr. Winstead said that, beginning in January, all county attorneys will have enforcing authority and that the Prosecutors' Advisory Council will support education and enforcement procedures for the county attorneys. He said, at the appropriate time the Attorney General's Office will have press releases to advise consumers and increase visibility concerning the bill and how the industry and consumers can comply. Mr. Winstead said that while the bill was effective now, there is no requirement for action by the companies until January 1, 2009. He said that after this date the contracts with the companies are required to provide certain provisions to make sure that the consumers using the service can list 911 as the first number called when they signal an emergency. Mr. Winstead said that for any contracts in effect prior to this date, the companies must send out a notice to the consumers allowing them to make changes to their call list. He said companies and consumers should receive this information by the end of September, allowing ample time to make necessary changes. Mr. Winstead said that beginning in January the office would begin the normal process of resolving complaints, taking legal action when necessary. He said this would include enforcing compliance or obtaining civil penalties when appropriate. The maximum penalty could be $10,000 for a knowing violation. He said that all complaints are tracked, allowing the office to have information with regards to changes that would be made to educate and enforce the bill.
Senator Buford thanked the office for their work in implementing the legislation, saying that prior to this act there was no protocol for a company when an alarm came in with no response. Senator Clark asked if the Helping Seniors booklet was printed and available. Mr. Winstead responded that there was a version available; however, these provisions have not been added.
Chairwoman Jenkins asked if there were further questions. Senator Leeper asked Mr. Leatherman if he was aware of rumors of gas prices rising in response to Hurricane Ike. Mr. Leatherman said they were beginning to receive calls and were working to determine the most appropriate course of action in dealing with the situation.
Chairwoman Jenkins asked if there was other business to come before the committee. Representative Crimm said that, approximately one month earlier, the Jefferson County Delegation had been invited to meet with different levels of Bingo operators in Jefferson County. He said that during the meeting they were told disturbing stories regarding their Bingo operations. Representative Crimm asked if staff from the Office of Charitable Gaming could return to the committee for questions to determine the validity of the complaints. Chairwoman Jenkins responded that she would discuss the matter with the Senate Chairman and thanked Representative Crimm for attending the Bingo meeting with herself and Representative Firkins.
There being no further business to come before the committee the meeting was adjourned at 11:55 a.m.