Legislature(2007 - 2008)SENATE FINANCE 532
04/11/2008 09:00 AM Senate FINANCE
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 366 | TELECONFERENCED | |
| + | SB 160 | TELECONFERENCED | |
| + | HB 65 | TELECONFERENCED | |
| += | HB 50 | TELECONFERENCED | |
| += | HB 332 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 2 | TELECONFERENCED | |
| += | HB 226 | TELECONFERENCED | |
SENATE BILL NO. 160
"An Act establishing an Alaska health care program to
ensure insurance coverage for essential health services
for all residents of the state; establishing the Alaska
Health Care Board to define essential health care
services, to certify health care plans that provide
essential health care services, and to administer the
Alaska health care program and the Alaska health care
fund; establishing the Alaska health care clearinghouse
to administer the Alaska health care program under the
direction of the Alaska Health Care Board; establishing
eligibility standards and premium assistance for
persons with low income; establishing standards for
accountable health care plans; creating the Alaska
health care fund; providing for review of actions and
reporting requirements related to the health care
program; and providing for an effective date."
SENATOR HOLLIS FRENCH, Sponsor, introduced SB 160. He
stated that Starbucks pays more for health insurance than
they pay for coffee. General Motors pays more for health
insurance than it does for steel. The reason the bill is
before the Committee is because Corporate American has
decided that there needs to be something done to reduce the
cost of health insurance before it drives businesses out of
business.
Senator French explained that the genesis of the bill began
when Mitt Romney became governor of Massachusetts and faced
the loss of millions of dollars in "dish funds", funds that
the federal government pays to cover hospitals for the costs
of the uninsured. Governor Romney formulated a new,
consumer-driven approach to address health insurance.
Senator French termed SB 160 a consumer-driven bill that
allows individuals to make choices about their health
insurance. It is that market force that will help keep
health insurance costs down.
Senator French reported that there are 100,000 Alaskans
without health insurance. Over 50 percent have jobs. This
bill would use federal, state, and employer money to make
the cost of health insurance affordable.
Senator French drew attention to the controversial aspects
of the bill. The first is "individual mandate". There is a
call in the bill for every single citizen to acquire health
insurance. This is necessary to spread out the risk, which
will lead to lower costs. The upside is "guaranteed issue":
everyone who applies is guaranteed coverage in the form of a
voucher.
9:29:19 AM
Senator French dispelled the myths about the bill. It does
not require those currently insured to change policies. It
should bring policy costs down by up to 15 percent, which is
about equal to the amount those who are insured have to pay
for those who are not insured. He gave an example of the
uninsured receiving care at emergency rooms resulting in a
loss of revenue to hospitals. It was estimated that in 2007
Providence Hospital spent $90 million on the uninsured.
Senator French reported on what the bill would not do:
create more doctors in Alaska or deal with Medicare
reimbursement rates. He opined that eventually there would
be a solution to the problem of the uninsured. He requested
the Committee take a hard look at the bill, which he termed
a work in progress. He stressed the importance of policy
decisions that will be made by the Senate Finance Committee.
9:32:37 AM
Senator French referred to a chart entitled "Alaska Health
Care: The Framework For Change" (copy on file.) There is an
Alaska Health Care Board, which certifies private health
care plans. There is a fund that holds vouchers, similar to
the federal plan, based on a sliding scale. He described
the various plans based on income level. Certified private
health insurance plans are made available for purchase using
vouchers.
9:34:41 AM
Senator French addressed the fiscal notes. The
Administration expects the plan to cost $333 million in FY
2010. Senator French thought that figure to be wildly
overstated. He pointed out on page 2 of fiscal note #1, it
says that "the estimated cost for insurance premiums is
$11,000 per person per year, based on the State of Alaska
employee insurance plan." He pointed out several errors in
that assumption. No one is paying $11,000 per person; that
amount will cover a family of four. The fiscal note
incorporates Indian Health Service recipients. The bill
does not mandate that those individuals join the plan.
Also, the fiscal note does not take into account that there
is an enormous amount of money being paid for uncompensated
care, which causes an increase in health insurance premiums
of about 15 percent.
9:37:13 AM
Senator Thomas asked if there is a minimum requirement of
services and if the Alaska Health Care Board would set up
the policies to be selected by the uninsured. Senator
French said those requirements are found on page 7 of the
bill in Section 231.54.250, essential health care services.
It does not set the level of the deductible or the
copayment.
Senator Olson asked if the program was all-inclusive.
Senator French said it was comprehensive, just like a
regular health insurance policy. Senator Olson asked if
Providence Hospital was in favor of the bill. Senator
French said they were and he referred to a letter of
support. He further explained that hospitals like the idea
of health insurance for all. Insurance companies are also
in favor of such a plan.
9:40:03 AM
Senator Huggins requested information about Massachusetts'
universal health care plan. Senator French explained that
over a year ago, Massachusetts instituted universal health
insurance using the mechanism of the state income tax to
require insurance. They started with a base of 600,000
uninsured and lowered that number by one third. They are
spending about $900 million a year. He said a comparable
cost to Alaska for a similar program would be about $150
million. Other states are considering similar plans.
Senator French mentioned a difficulty with that plan. Now
it is more difficult to see a primary care physician.
Senator Huggins referred to Canada's plan and the difficulty
of getting into see a doctor.
SB 160 was heard and HELD in Committee for further
consideration.
AT-EASE: 9:42:43 AM
RECONVENED: 9:46:53 AM
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