2003-03-05                     House Journal                      Page 0418
HB 152                                                                                            
HOUSE BILL NO. 152 by the House Rules Committee by request of                                       
the Governor, entitled:                                                                             
                                                                                                    

2003-03-05                     House Journal                      Page 0419
     "An Act relating to payment rates under the Medicaid program for                               
     health facilities and to budgeting, accounting, and reporting                                  
     requirements for those facilities; abolishing the Medicaid Rate                                
     Advisory Commission; and providing for an effective date."                                     
                                                                                                    
was read the first time and referred to the Health, Education & Social                              
Services and Finance Committees.                                                                    
                                                                                                    
                                                                                                    
The following fiscal note(s) apply:                                                                 
                                                                                                    
1.  Fiscal, Dept. of Health & Social Services                                                       
                                                                                                    
                                                                                                    
The Governor's transmittal letter dated March 5, 2003, follows:                                     
                                                                                                    
"Dear Speaker Kott:                                                                                 
                                                                                                    
Under the authority of article III, section 18, of the Alaska                                       
Constitution, I am transmitting a bill to provide greater flexibility to                            
the Department of Health and Social Services to set Medicaid payment                                
rates for Alaska's hospitals, nursing home and other health care                                    
facilities.                                                                                         
                                                                                                    
                                                                                                    
The proposed bill would eliminate the Medicaid Rate Advisory                                        
Commission and place the responsibility for calculating and setting                                 
Medicaid payment rates for health care facilities under the general                                 
authority of the Department of Health and Social Services.                                          
                                                                                                    
                                                                                                    
Historically, the Medicaid facility rate setting process has been                                   
extremely cumbersome and costly for both the state and health care                                  
facilities.  The current rate-setting process is both a barrier to effective                        
cost containment as well as problematic for assuring adequate                                       
reimbursement for Alaska's diverse mix of health care facilities.                                   
                                                                                                    
                                                                                                    
Passage of this legislation will allow the department to develop in                                 
regulation a more flexible, cost-effective rate setting process that will,                          

2003-03-05                     House Journal                      Page 0420
for the first time, allow the department to explicitly take into account                            
the appropriations made by the legislature for the Medicaid program                                 
when setting rates.                                                                                 
                                                                                                    
I urge your prompt and favorable action on this measure.                                            
                                                                                                    
                                 Sincerely,                                                        
                                 /s/                                                                
                                 Frank H. Murkowski                                                 
                                  Governor"