00 CS FOR SENATE BILL NO. 160(L&C)
01 "An Act establishing an Alaska health care program to ensure insurance coverage for
02 essential health services for residents of the state; establishing the Alaska Health Care
03 Board to administer the Alaska health care program and the Alaska health care fund;
04 establishing the Alaska health care clearinghouse to administer the Alaska health care
05 program under the direction of the Alaska Health Care Board; establishing eligibility
06 standards and premium assistance for persons with low income; creating the Alaska
07 health care fund; providing for review of actions and reporting requirements related to
08 the health care program; and providing for an effective date."
09 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
10 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section
11 to read:
12 FINDINGS; PURPOSE. (a) The legislature finds that
01 (1) the current health care system is unsustainable;
02 (2) improving and protecting the health of Alaskans must be a primary goal of
03 the state;
04 (3) all Alaskans should have access to essential health care services that are
05 affordable, that are based on publicly debated criteria, and that consider the well-being of
06 individuals across their life spans;
07 (4) Alaska has an economic interest in ensuring equitable financing of
08 essential health care for Alaskans who do not have access to basic health care;
09 (5) health care policies should emphasize public health and encourage the use
10 of quality service and evidence-based treatment that are appropriate and safe and that
11 discourage over-treatment;
12 (6) health care providers and informed patients must be the primary decision
13 makers who are accountable for an individual's health;
14 (7) health care funding should be explicit, predictable, and economically
16 (8) an economically sustainable health care system requires that providers
17 receive fair and adequate compensation;
18 (9) health care must be balanced with other programs that also affect health;
20 (10) health care must account for the allocation of resources and the human
21 consequences of funding decisions.
22 (b) The purpose of this Act is to address the findings and concerns listed in (a) of this
23 section by creating the Alaska health care program.
24 * Sec. 2. AS 21.54 is amended by adding new sections to read:
25 Article 2A. Alaska Health Care Program.
26 Sec. 21.54.200. Alaska health care program. The Alaska health care program
27 is established to
28 (1) ensure that residents of the state have access to affordable health
29 care insurance;
30 (2) require that residents of the state have, at a minimum, insurance
31 covering essential health care services;
01 (3) reduce unsustainable health care cost increases;
02 (4) establish a system of health care insurance that integrates public
03 involvement and oversight, consumer choice, and competition within the private
04 health care insurance market;
05 (5) use models of health care insurance benefits, service delivery, and
06 payments that control costs and overuse, emphasizing preventative care and chronic
07 disease management within a primary care environment; and
08 (6) provide services for humane and dignified end-of-life care.
09 Sec. 21.54.210. Alaska Health Care Board. (a) The Alaska Health Care
10 Board is established in the division to manage the Alaska health care program.
11 (b) The board shall consist of 13 members, including 12 members appointed
12 by the governor, subject to confirmation by the legislature, and the commissioner of
13 health and social services or the commissioner's designee, serving ex officio. The
14 members of the board appointed by the governor must include
15 (1) one representative who is a licensed insurance producer;
16 (2) one representative from a health insurance company licensed to
17 transact health care insurance in the state;
18 (3) two representatives of the business community other than health
19 care insurers, one representing large businesses, and one representing small
21 (4) one representative each from two Alaska hospitals;
22 (5) one representative of a labor organization;
23 (6) two physicians licensed in Alaska;
24 (7) two health care consumer advocates; and
25 (8) one registered nurse.
26 (c) Except for the commissioner or the commissioner's designee, who serves
27 ex officio, each board member serves for a term of three years beginning on January 1
28 and until a successor has been appointed. A member is eligible for reappointment.
29 (d) If there is a vacancy, the governor shall make an appointment, effective
30 immediately, for the balance of the unexpired term.
31 (e) Members of the board are entitled to per diem and transportation costs
01 under AS 39.20.180.
02 (f) The board shall select a member to serve as chair and a member to serve as
03 vice-chair for a term and with duties and powers necessary to perform their functions.
04 (g) A majority of the board constitutes a quorum for transacting business.
05 Sec. 21.54.220. Powers and duties of the Alaska Health Care Board. (a)
06 The Alaska Health Care Board shall
07 (1) administer, as a fiduciary, the Alaska health care fund established
08 under AS 21.54.280 in accordance with the Alaska health care program established by
09 AS 21.54.200 - 21.54.310;
10 (2) establish types or categories of health care insurance plans offered
11 through the Alaska health care clearinghouse;
12 (3) classify each plan offered through the clearinghouse as a
13 comprehensive or basic health care insurance plan, based on criteria including the
14 financial cost of the plan, including premium cost, deductible costs, and co-pay
16 (4) establish criteria for participation by residents and insurers in the
17 Alaska health care program;
18 (5) establish an Alaska health care voucher system that provides health
19 care insurance to each individual who meets the needs-based participation criteria set
20 out in AS 21.54.240 or who is the beneficiary of contributions made to the fund that
21 specify the individual as the beneficiary under AS 21.54.280(b);
22 (6) ensure that eligible individuals are enrolled in a health care
23 insurance plan that provides essential health care services;
24 (7) prescribe the method for determining individual income for the
25 purpose of the Alaska health care program;
26 (8) establish procedures for enrolling a participant in the Alaska health
27 care program, including enrollment procedures describing when an individual may
28 enroll or select a different health insurance plan offered through the Alaska health care
29 clearinghouse; the procedures established under this paragraph must allow an
30 individual insured by a health care insurance plan offered through the Alaska health
31 care clearinghouse to select a different health care insurance plan from the plans
01 offered through the clearinghouse and to make that selection at least annually;
02 (9) require that participants receive complete information regarding the
03 cost of obtaining health care insurance; and
04 (10) establish procedures for notice and hearings for a person
05 aggrieved by a decision of the board or the Alaska health care clearinghouse;
06 (11) ensure that every Alaskan who is required to participate in the
07 Alaska health care program is offered health care insurance that protects the insured
08 from severe financial hardship caused by the cost of receiving medical care.
09 (b) The board may hold regular and special meetings as the board considers
10 necessary; board meetings may be held by teleconference; meetings shall be recorded
11 and made available on request.
12 Sec. 21.54.230. Alaska health care clearinghouse. (a) The Alaska health care
13 clearinghouse is established in the division.
14 (b) The clearinghouse shall be administered by the director.
15 (c) The clearinghouse shall
16 (1) administer the Alaska health care program under the direction of
17 the Alaska Health Care Board;
18 (2) disseminate information about health care insurance products
19 available through the clearinghouse; and
20 (3) provide assistance in the enrollment process for a small business or
21 an individual.
22 Sec. 21.54.240. Essential health care services; eligibility. (a) Every resident
23 of the state shall participate in the Alaska health care program except a resident who
24 (1) is a beneficiary of a health care plan that provides health care
25 benefits that meet or exceed the benefits for essential health care services;
26 (2) is eligible to be enrolled in a publicly funded medical assistance
27 program providing services that meet or exceed the benefits required as essential
28 health care services;
29 (3) is enrolled in Medicaid or Medicare;
30 (4) is receiving health care benefits under a health benefit plan
31 regulated by 29 U.S.C. 1001 - 1461 (Employee Retirement Income Security Act of
01 1974) that meet or exceed the benefits for essential health care services;
02 (5) has resided in the state for less than one year; however, a person
03 who has resided in the state for less than one year may receive services provided by
04 the Alaska health care clearinghouse under AS 21.54.230;
05 (6) is an individual insured under an individual state plan of health
06 insurance under the Comprehensive Health Insurance Association under AS 21.55;
07 (7) is receiving health care benefits under a medical care program of
08 the Indian Health Service; however, a person receiving health care benefits under a
09 medical care plan of the Indian Health Service may elect to participate in the Alaska
10 health care program; or
11 (8) demonstrates satisfactorily to the board, under criteria established
12 by the board, that the person has deeply held religious beliefs contrary to the Alaska
13 health care program and the requirement to purchase health care insurance for
14 essential health care services.
15 (b) The Alaska Health Care Board shall provide a voucher to a resident with
16 an income that is not more than 450 percent of the most recent federal poverty
17 guidelines, updated periodically in the Federal Register by the United States
18 Department of Health and Human Services under the authority of 42 U.S.C. 9902(2),
19 and who is only eligible for coverage through the Comprehensive Health Insurance
20 Association (AS 21.55). A voucher authorized by this subsection must equalize the
21 cost of insurance under the Comprehensive Health Insurance Association with the cost
22 of purchasing a health care insurance plan that provides substantially equivalent
23 benefits through the Alaska health care clearinghouse. For purposes of cost
24 comparison under this subsection, the Alaska Health Care Board shall determine
25 whether a plan provided under the Comprehensive Health Insurance Association
26 provides substantially equivalent benefits to a health care insurance plan offered
27 through the clearinghouse.
28 (c) A resident with an income that is not more than the most recent federal
29 poverty guidelines, updated periodically in the Federal Register by the United States
30 Department of Health and Human Services under the authority of 42 U.S.C. 9902(2),
31 who is required to participate in the Alaska health care program shall receive private
01 health care insurance coverage for essential health care services at no cost, paid from
02 the fund.
03 (d) A resident with an income between 100 percent and not more than 300
04 percent of the most recent federal poverty guidelines, updated periodically in the
05 Federal Register by the United States Department of Health and Human Services
06 under the authority of 42 U.S.C. 9902(2), who is required to participate in the Alaska
07 health care program shall pay premiums for health care insurance for essential health
08 care services on a sliding scale established by the board.
09 (e) A resident with an income of 300 percent or more of the most recent
10 federal poverty guidelines, updated periodically in the Federal Register by the United
11 States Department of Health and Human Services under the authority of 42 U.S.C.
12 9902(2), who is required to participate in the Alaska health care program shall pay the
13 premium for health care insurance for essential health care services.
14 (f) A person who is an alien is not eligible for assistance under AS 21.54.200 -
15 21.54.310 unless the person is a qualified alien, as defined under 8 U.S.C. 1641, or an
16 alien excepted under 8 U.S.C. 1612(b). However, a qualified alien may only be
17 eligible for assistance under AS 21.54.200 - 21.54.310 if the person is not precluded
18 by the limited eligibility provision of 8 U.S.C. 1613.
19 Sec. 21.54.250. Essential health care services. For purposes of AS 21.54.200
20 - 21.54.310, essential health care services means medical services performed for an
21 individual covered by a health care plan for the diagnosis or treatment of
22 nonoccupational disease or nonoccupational injury. The medical services that must be
23 performed for an individual covered by a health care plan include, as a minimum,
24 (1) preventative and primary care;
25 (2) emergency services;
26 (3) inpatient services and hospital treatment;
27 (4) ambulatory patient services;
28 (5) prescription drug coverage; and
29 (6) mental health services.
30 Sec. 21.54.260. Alternative or additional health care services. (a) An
31 employer may offer health insurance coverage that meets or exceeds coverage for
01 essential health care services.
02 (b) An individual or employer may purchase health care insurance for health
03 care services in addition to the essential health care services required under
04 AS 21.54.200 - 21.54.310.
05 (c) If an employer does not provide a health care insurance plan for all
06 employees or provides a health care insurance plan that meets or exceeds coverage for
07 essential health care services but does not enroll at least 25 percent of the employer's
08 employees in the plan or does not offer to pay at least 33 percent of the premium for
09 health care insurance under the plan, the employer shall pay the department as
11 (1) if an employer's annual gross payroll paid to employees who are
12 required to participate in the Alaska health care plan under AS 21.54.240 is $500,000
13 or less, no payment is required;
14 (2) if an employer's annual gross payroll paid to employees who are
15 required to participate in the Alaska health care plan under AS 21.54.240 is greater
16 than $500,000 but less than $1,000,000, the employer shall pay one percent of the
17 gross payroll; or
18 (3) if an employer's annual gross payroll paid to employees who are
19 required to participate in the Alaska health care program under AS 21.54.240 is
20 $1,000,000 or greater, the employer shall pay two percent of the gross payroll.
21 (d) An employer that establishes a cafeteria plan under 26 U.S.C. 125 (Internal
22 Revenue Code) that offers employees the option to elect health care insurance
23 coverage that meets or exceeds essential health care services is not subject to the
24 payment requirements under (c) of this section, regardless of whether an employee
25 elects to receive the offered health care insurance.
26 (e) In this section, "essential health care services" means those services set out
27 in AS 21.54.250.
28 Sec. 21.54.270. Health care insurance plan; children's coverage. (a) A
29 health care insurance plan that is approved by the director that provides coverage for
30 essential health care services under AS 21.54.200 - 21.54.310 and meets the other
31 requirements established under this title may be offered through the Alaska health care
02 (b) A health care insurance plan offered through the Alaska health care
03 clearinghouse may not deny enrollment to an eligible individual.
04 (c) A health care insurance plan offered through the Alaska health care
05 clearinghouse may include
06 (1) different benefits for network or out-of-network providers;
07 (2) varied levels of copayment, coinsurance, deductable amounts, out-
08 of-pocket maximums;
09 (3) high deductible health plans as defined by 26 U.S.C. 223(c)(2)
10 (Internal Revenue Code); and
11 (4) special insurance terms applicable only to individuals between 18
12 and 30 years of age.
13 (d) A health care insurance plan offered through the Alaska health care
14 clearinghouse that covers children must provide that the coverage will continue until
15 the earlier of the child's reaching 25 years of age or two years after the child no longer
16 resides with the family.
17 Sec. 21.54.280. Alaska health care fund. (a) The Alaska health care fund is
18 established as a separate trust fund of the state. The fund consists of
19 (1) state money appropriated to the fund;
20 (2) federal money appropriated to the fund;
21 (3) private employer and employee health care contributions or fees
22 received by the department and appropriated to the fund;
23 (4) health care premiums received by the department and appropriated
24 to the fund;
25 (5) other appropriations by the legislature;
26 (6) contributions appropriated to the fund from the United States
27 government and its agencies, or from any other source, public or private, provided for
28 purposes that are consistent with the goals of the Alaska health care program; and
29 (7) interest earnings from investments of the fund appropriated to the
31 (b) Contributions may be made to the fund by an employer, employers, or an
01 individual that is specified for a particular beneficiary. If a contribution is made to the
02 fund for the benefit of a particular beneficiary, the beneficiary shall receive a health
03 care voucher in the amount of the contribution that may be used to purchase a health
04 care insurance plan. Money collected under AS 21.54.260(c) is not considered made
05 for the benefit of a particular beneficiary.
06 (c) The board may use the fund for the purpose of administering the Alaska
07 health care program consistent with AS 21.54.200 - 21.54.310.
08 Sec. 21.54.290. Disputes and appeals. A person is entitled to notice and an
09 opportunity for a hearing under regulations adopted by the Alaska Health Care Board
11 (1) the board or the Alaska health care clearinghouse denies enrollment
12 to the person;
13 (2) an accountable health care plan refuses to enroll an individual or
14 fails to provide essential health care services; or
15 (3) the person is adversely affected or aggrieved by a decision of the
16 board or the clearinghouse.
17 Sec. 21.54.300. Reporting. The Alaska Health Care Board shall submit a
18 written report on the operation of the Alaska health care program to the commissioner
19 and to the legislature by January 1 of each year. The report must include
20 (1) the number of individuals enrolled in the Alaska health care
22 (2) the cost savings to the state, to employers, and to health care
24 (3) a measure of patient satisfaction;
25 (4) an assessment of patient access to essential health care services;
26 (5) a description of the changes or adjustments made to the program
27 during the period covered by the report;
28 (6) a discussion of the state agencies delivering redundant services, if
29 any, relating to health care benefits;
30 (7) an evaluation of state programs that regulate or deliver health care
01 (8) recommendations for legislative changes necessary to meet the
02 goals of the program;
03 (9) an evaluation of and recommendations on the following topics:
04 (A) the use of electronic health records;
05 (B) children's health insurance programs;
06 (C) the effectiveness of Medicaid and the potential expansion
07 of the Alaska Medicaid program, including a comparison between the costs of
08 expanding the Alaska Medicaid program and the cost of providing benefits
09 through the Alaska health care program;
10 (D) the effect of mandated benefits;
11 (E) prescription drug bargaining;
12 (F) evidence-based treatment procedures including a
13 comparison of the use of evidence-based treatment in other states;
14 (G) the recruitment and retention of medical professionals in
15 the state;
16 (H) expanding offerings of the University of Alaska in medical
18 (I) maximizing federal funding to implement the program;
19 (J) innovations that could produce health care cost savings,
20 including waivers under 42 U.S.C. 1315 (sec. 1115, Social Security Act),
21 which allows experimental, pilot, or demonstration projects likely to assist in
22 promoting the objectives of the Medicaid statute.
23 Sec. 21.54.310. Regulations. The Alaska Health Care Board shall adopt
24 regulations under AS 44.62 (Administrative Procedure Act) consistent with
25 AS 21.54.200 - 21.54.310.
26 * Sec. 3. AS 21.54.500 is amended by adding new paragraphs to read:
27 (30) "alien" means a person who is not a citizen or national of the
28 United States;
29 (31) "board" means the Alaska Health Care Board;
30 (32) "fund" means the Alaska health care fund;
31 (33) "resident" or "residency" has the meaning given in AS 01.10.055.
01 * Sec. 4. The uncodified law of the State of Alaska is amended by adding a new section to
03 TRANSITIONAL PROVISIONS. Notwithstanding AS 21.54.210, enacted by sec. 2
04 of this Act, the initial terms for members of the Alaska Health Care Board, except for the
05 commissioner of health of social services who serves ex officio, are as follows:
06 (1) four members shall be appointed to serve for a term ending December 31,
08 (2) four members shall be appointed to serve for a term ending December 31,
09 2010; and
10 (3) the remaining members shall be appointed to serve for a term ending
11 December 31, 2011.
12 * Sec. 5. The uncodified law of the State of Alaska is amended by adding a new section to
14 TRANSITIONAL PROVISIONS: REGULATIONS. The Alaska Health Care Board
15 established under AS 21.54.210, enacted by sec. 2 of this Act, may proceed to adopt
16 regulations necessary to implement this Act under AS 21.54.310, enacted by sec. 2 of this
17 Act. The regulations take effect under AS 44.62 (Administrative Procedure Act), but not
18 before the effective date of the statutory changes.
19 * Sec. 6. AS 21.54.210, 21.54.220, and 21.54.230, enacted by sec. 2 of this Act, and sec. 5
20 of this Act take effect immediately under AS 01.10.070(c).
21 * Sec. 7. Except as provided in sec. 6 of this Act, this Act takes effect January 1, 2009.