2003-03-05                     House Journal                      Page 0420
HB 153                                                                                            
HOUSE BILL NO. 153 by the House Rules Committee by request of                                       
the Governor, entitled:                                                                             
                                                                                                    
     "An Act repealing the statute that sets priorities for the                                     
     Department of Health and Social Services to apply to                                           
     administration of the medical assistance program when there are                                
     insufficient funds allocated in the state budget for that program;                             
     authorizing the department to make cost containment decisions                                  
     that may include decisions about eligibility of persons and                                    
     availability of services under the medical assistance program; 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.  Zero, 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 implement cost                                      
containment strategies for the Medicaid program.                                                    
                                                                                                    

2003-03-05                     House Journal                      Page 0421
Under current law, if funds appropriated to the Medicaid program are                                
insufficient for a given fiscal year, the department is directed to                                 
eliminate optional Medicaid services based on a priority list that is                               
woefully out-of-date.  The existing list is not an effective management                             
tool and if used, would needlessly result in the denial of necessary and                            
cost-effective services to Alaskans in need of health care.                                         
                                                                                                    
                                                                                                    
The proposed bill would replace this obsolescent language with                                      
authority for the department to undertake cost containment based on                                 
three key principles.                                                                               
                                                                                                    
First, the department must pursue all other reasonable cost                                         
containment measures before eliminating any eligibility groups or                                   
services.                                                                                           
                                                                                                    
Second, the department should aggressively pursue strategies to                                     
maximize federal financial participation in the Medicaid program.                                   
                                                                                                    
Third, cost containment decisions should be made in a manner that                                   
best reflect the needs and interests of eligible Medicaid recipients.                               
                                                                                                    
The imperative of slowing the growth of state funding for Medicaid                                  
while at the same time maintaining health care coverage for needy                                   
Alaskans is an issue that can no longer be avoided.  Passage of this                                
legislation will give the department additional tools to meet this                                  
challenge.                                                                                          
                                                                                                    
I urge your prompt and favorable action on this measure.                                            
                                                                                                    
                                 Sincerely,                                                        
                                 /s/                                                                
                                 Frank H. Murkowski                                                 
                                  Governor"