03/04/2002 09:10 AM Senate FIN

                                                                                                                                
     SENATE BILL NO. 341                                                                                                        
     "An Act making a special appropriation for a study of                                                                      
     recipients of welfare and Medicaid; and providing for an                                                                   
     effective date."                                                                                                           
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Kelly  spoke  to the  bill,  relaying  conversations  held                                                            
during  hearings  on the  FY  03 supplemental  budget  requests  for                                                            
Medicaid  funding,  regarding the  "root  causes" of  state  welfare                                                            
dependency. He  noted studies have been conducted  to determine age,                                                            
income levels  and other factors of welfare recipients.  However, he                                                            
remarked there  is no data reflecting, "exactly why  it is that they                                                            
got there in the  first place." He spoke to the correlation  between                                                            
recipients  and  drug  abuse,  alcoholism,   single  parenthood  and                                                            
limited education  as found in national  research, although  no such                                                            
studies have been conducted in Alaska.                                                                                          
                                                                                                                                
Co-Chair  Kelly stated  this legislation  is "designed  to find  out                                                            
what kind of choices people  are making in their lives that possibly                                                            
they  have some  control  over that  ultimately  leads  to being  on                                                            
welfare."                                                                                                                       
                                                                                                                                
Senator Ward asked  if the proposed study would attempt  to identify                                                            
why certain recipients  relocated to this state and whether Alaska's                                                            
benefit programs are a "magnet".                                                                                                
                                                                                                                                
Co-Chair Kelly  responded it is his  intention such questions  would                                                            
be included in the survey.                                                                                                      
                                                                                                                                
BOB LABBE, Director,  Division of Medical Assistance,  Department of                                                            
Health  and  Social  Services,  testified  via  teleconference  from                                                            
Anchorage  and suggested  conducting the study  in conjunction  with                                                            
the Division.  He listed a cost-benefit of this option  would be the                                                            
ability  to  receive  50-percent  federal  matching  funds  for  the                                                            
project.  He   referenced  a  January   1996  Division  of   Medical                                                            
Assistance  report  prepared by  the  McDowell Group  regarding  the                                                            
characteristics  of Alaska  Medicaid  recipients.  He recalled  this                                                            
report was undertaken to  answer the question of whether people were                                                            
relocating  to Alaska  specifically  to receive  benefits, and  more                                                            
generally, what factors  were responsible for the increased caseload                                                            
at that time.                                                                                                                   
                                                                                                                                
Co-Chair  Kelly  commented  this  is a  good  suggestion  and  worth                                                            
considering.                                                                                                                    
                                                                                                                                
Co-Chair  Kelly shared he  had reviewed the  1996 report, which  was                                                            
useful although  it must be updated  due to changes in demographics                                                             
in the  age of the population.  He repeated  "consistent"  testimony                                                            
relating to Medicaid  indicates, "one of the biggest  drivers is the                                                            
aging population."                                                                                                              
                                                                                                                                
PEGGY  BROWN, Public  Policy  Analyst,  Alaska Network  on  Domestic                                                            
Violence  and Sexual Assault  testified she  was present to  monitor                                                            
the legislation and welfare reform in general.                                                                                  
                                                                                                                                
Senator Hoffman asked if the witness supports the legislation.                                                                  
                                                                                                                                
Ms. Brown supported  the knowledge  of why recipients are  dependant                                                            
upon  welfare,  as  it would  assist  agencies  in  providing  aide.                                                            
However, she did  not think such a study would benefits  recipients.                                                            
She understood the purpose  of identifying those recipients from out                                                            
of state given  the increased costs in Medicaid, but  her concern is                                                            
for those who already live in Alaska.                                                                                           
                                                                                                                                
Co-Chair  Kelly asked  if the  Department  would be  subject to  any                                                            
restrictions on the perimeters of such a study.                                                                                 
                                                                                                                                
Mr. Labbe  surmised it would  not, so long  as the study focused  on                                                            
the factors  influencing the  cost of the  Medicaid program,  or had                                                            
another Medicaid-related purpose.                                                                                               
                                                                                                                                
Co-Chair  Kelly asked  if such a  study could  address other  public                                                            
assistance programs as well.                                                                                                    
                                                                                                                                
Mr.  Labbe answered  the study  could  be "constructed"  to  include                                                            
other  state public  assistance  programs  as  well and  still  meet                                                            
federal standards.  He explained this  is because many participants                                                             
of other public assistance  programs also receive Medicaid benefits.                                                            
                                                                                                                                
Co-Chair Kelly  asked if there would be restrictions  on the kind of                                                            
information a  study could collect if federal funding  was involved.                                                            
                                                                                                                                
Mr. Labbe was  unaware of any restrictions  imposed with  the use of                                                            
this  federal  funding. He  noted  the Division  has  undertaken  "a                                                            
number  of activities  over the  years" utilizing  federal  Medicaid                                                            
matching  funds. "Sometimes  the relationships  are very direct  and                                                            
some  are a  little  less direct,"  he  stated  with regard  to  the                                                            
correlation  between  the  projects  and the  Medicaid  program.  He                                                            
suggested  the  proposed  survey questions  should  be  reviewed  to                                                            
determine any conflict with receipt of the federal funding.                                                                     
                                                                                                                                
Co-Chair Kelly  had concern "that we couldn't get  the scope of what                                                            
we  need  if we're  attached  to  federal  dollars  and any  of  the                                                            
requirements  they might  have." He appreciated  the suggestion  and                                                            
stated the  Committee would  discuss the  option. He encouraged  the                                                            
Division to update the 1996 McDowell study.                                                                                     
                                                                                                                                
JIM NORDLUND,  Director, Division  of Public Assistance,  Department                                                            
of Health and  Social Services, testified in Juneau  that he did not                                                            
foresee  any  difficulty  in  utilizing   federal  funding  for  the                                                            
proposed study. He noted,  "there is a great deal of overlap between                                                            
those people"  who receive temporary public assistance  and Medicaid                                                            
benefits.                                                                                                                       
                                                                                                                                
Co-Chair Kelly ordered the bill HELD in Committee.