Legislature(2005 - 2006)HOUSE FINANCE 519
05/05/2005 01:30 PM FINANCE
Download Mp3. <- Right click and save file as
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE BILL NO. 106 An Act establishing the senior care program and relating to that program; creating a fund for the provision of the senior care program; repealing ch. 3, SLA 2004; and providing for an effective date. 2:32:52 PM JOEL GILBERTSON, COMMISSIONER, DEPARTMENT OF HEALTH & SOCIAL SERVICES, noted that HB 106 was a bill relating to health care benefits available to eligible low-income senior citizens. In 2004, the Senior Care program was enacted and provided for needs-based cash assistance and a prescription drug benefit. Today, approximately 6,800 seniors with incomes below the 135% percent of the federal poverty level for Alaska receive $120 a month in cash assistance through the Senior Care program. The program has been successful in reaching senior citizens in Alaska that are truly in need of cash assistance. Commissioner Gilbertson added that the Senior Care program is anticipated to sunset no later than January 1, 2006. HB 106 would repeal the temporary law created last year and replace it with a permanent law that would strengthen the Senior Care program, allowing it to continue. He stressed the crucial need for the State to continue providing support for Alaska's most needy senior citizens beyond January 2006. The proposal to improve Senior Care would be through creation of a supplement to the recently enacted federal Medicare drug benefit for Alaska's seniors. Under the new federal Medicare benefit, many seniors are still required to pay premium and deductible expenses for prescription drugs out of their own pockets. For Alaska seniors with incomes up to 300% percent of the federal poverty level, Senior Care would pay the premiums and deductibles on the seniors behalf; a benefit of approximately $670 dollars per person annually. Seniors with Medigap or other comparable coverage would be eligible to receive the benefit as long as they meet the basic income and asset standards for Senior Care. Commissioner Gilbertson anticipated over 40% percent of the estimated 41,000 Alaska seniors would be eligible for the Senior Care benefit. Passage of the legislation would result in, virtually all seniors in Alaska being eligible for prescription drug coverage through a combination of federal, State, and employer-sponsored drug plans as of January 2006. That represents an incredible achievement; adequate prescription drug coverage remains a top priority for seniors. 2:38:12 PM MARIE DARLIN, VOLUNTEER, ALASKA ASSOCIATION OF RETIRED PERSONS (AARP), JUNEAU, voiced strong support for HB 106, including the amendments before the Committee. She explained that the bill would be helpful and welcome for older Alaskans that are most in need. She urged support. 2:40:22 PM LINDA GOHL, DIRECTOR, ALASKA COMMISSION ON AGING, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, voiced support for the legislation. She noted that seniors would prefer the 300% level, however, HB 106 would provide a reasonable compromise. The drug benefit program is critical. 2:41:57 PM Representative Hawker MOVED to ADOPT Amendment #1, #24G-1, 5/5/05. (Copy on File). Co-Chair Chenault OBJECTED for discussion purposes. Representative Hawker explained that the amendment would change federal poverty level amount from 300% to 175% and sunset June 30, 2007. Representative Hawker noted changes on the amendment, Page 1, Line 9: "Reverts to the unreserved general fund after all valid obligations June 30, 2007 are met". Commissioner Gilbertson voiced support for the amendment. 2:44:37 PM Co-Chair Chenault WITHDREW his OBJECTION. There being NO further OBJECTION, Amendment #1 was adopted. Representative Hawker referenced the four fiscal notes from the Department of Health and Social Services. He inquired how the funding was anticipated to be spent. JANET CLARKE, ASSISTANT COMMISSIONER, DIVISION OF FINANCE AND MANAGEMENT SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, summarized the fiscal note handout. (Copy on File). In FY06, it is estimated that the Senior Care Program will cost $6.87 million dollars; in FY07, the cost will be $13.212 million dollars. Currently, the fund balance is $8.86 million dollars. In FY06, no general funds will be needed for the program because of forward funding. In FY07, approximately $12 million general fund dollars will be necessary. The program, currently, will sunset midway FY06. 2:48:17 PM Representative Hawker asked if the numbers were consistent with the reconciled ones from the senior cash care benefit. 2:49:06 PM JON SHERWOOD, DEPARTMENT OF HEALTH & SOCIAL SERVICES, stated that at this time, there are fewer than 7,000 participants in the program. It is anticipated that once the program begins, that number will increase to 7,000. When the drug benefit is added, the program could increase approximately 4,100, projected by FY07. There is no overlap between those numbers and that the cash assistance program does not provide any drug benefit. 2:50:25 PM In response to comments by Representative Hawker, Commissioner Gilbertson explained that the statement regarding cash benefits was accurate and relates to existing populations. Those individuals will have no premium or deductible through federal law. There is no way to provide them the drug benefit. Cash assistance is the only way to deliver a benefit to them. 2:51:52 PM Representative Hawker referenced the fiscal note, indicating the Senior Care fiscal note for four full-time employees. He asked if any were new positions. Ms. Clarke explained that in the FY06 budget, the Department eliminated all Senior Care positions because the program sunset. Many of those positions still exist and that the note would only ads them back into employment. 2:52:46 PM Representative Holm asked if Amendment #1 would affect the fiscal note. Ms. Clarke replied it did and had been taken into consideration with the revised note. 2:53:14 PM Representative Foster MOVED to REPORT CS HB 106 (FIN) out of Committee with individual recommendations and with the accompanying fiscal notes. There being NO OBJECTION, it was so ordered. CS HB 106 (FIN) was reported out of Committee with a "no recommendation" and with four new zero fiscal notes by the Department of Health & Social Services.