Legislature(2019 - 2020)CAPITOL 106

04/18/2019 03:00 PM HEALTH & SOCIAL SERVICES

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          SB 37-RENEWAL OF VACCINE ASSESSMENT PROGRAM                                                                       
4:47:49 PM                                                                                                                    
CO-CHAIR  ZULKOSKY announced  that  the final  order of  business                                                               
would be CS FOR SENATE BILL  NO. 37(FIN), "An Act relating to the                                                               
statewide immunization  program; and  providing for  an effective                                                               
4:48:40 PM                                                                                                                    
The committee took a brief at-ease.                                                                                             
4:49:49 PM                                                                                                                    
SENATOR  CATHY  GIESSEL,  Alaska   State  Legislature,  as  prime                                                               
sponsor, introduced CSSB  37(FIN).  She explained  the bill would                                                               
renew  the  Alaska Vaccine  Assessment  Program  (AVAP) that  was                                                               
established  in  2014.   The  bill  would authorize  a  statewide                                                               
vaccine program in  the Department of Health  and Social Services                                                               
(DHSS).  Because it is scheduled  for repeal in 2021, the bill is                                                               
a proactive action  to extend it.   This was a bill  in 2014 that                                                               
she  sponsored.   It  monitors,  purchases,  and distributes  all                                                               
childhood  vaccines  and  some  adult  vaccines  to  health  care                                                               
providers, allowing more access for Alaskans.                                                                                   
SENATOR GIESSEL  stated the bill  is an innovative solution  to a                                                               
challenging problem.   She related  that before this  program was                                                               
in play  many health care  providers had  to buy two  supplies of                                                               
vaccines.   One  supply  was  for those  people  who had  private                                                               
insurance or cash  pay.  The other supply was  for folks who were                                                               
Medicaid  beneficiaries  or   beneficiaries  of  some  government                                                               
program such as Vaccines for Children.   The reason for these two                                                               
supplies is that the private pay  vaccines had to be purchased by                                                               
the  providers themselves  at the  full retail  prices.   The two                                                               
supplies could not be interchanged  because the government supply                                                               
was obtained  by the  state using  bulk pricing  at a  much lower                                                               
price.   The two  supplies had  to be  kept separate  in separate                                                               
refrigerators and the  nurses had to keep track  of the insurance                                                               
and which supply of vaccine to  use.  If a provider had purchased                                                               
its own  supply for  private payers  and if  out of  a box  of 10                                                               
vaccines only 9 were used and  then the last one then expired, it                                                               
had to be thrown away.   Providers had to manage their supply and                                                               
the  expiration  dates  so  there was  full  utilization.    This                                                               
program eliminates that confusion and duplication.                                                                              
SENATOR   GIESSEL  noted   the   program   is  a   private-public                                                               
partnership that  is funded  by the  insurers and  the government                                                               
programs.    Everyone pools  their  money  and uses  the  state's                                                               
ability to  buy at bulk prices,  which results in lower  cost for                                                               
the vaccines.  The program  helps the insurance companies because                                                               
it allows  them to  maximize the bulk  buying potential  that the                                                               
state has, thereby keeping costs down  for them, and they in turn                                                               
supply the vaccine for their  subscribers with just the charge of                                                               
the  injection fee  or clinic  visit fee.   The  state asks  [the                                                               
insurers] how  many vaccines for,  say, measles are  needed, they                                                               
estimate that, the state assesses  them that amount of money, and                                                               
then the state makes a big  purchase and stores the vaccines in a                                                               
central  location in  Anchorage.   For  more  distant clinics  in                                                               
places like Bethel,  Nome, or Kotzebue the  manufacturer may ship                                                               
directly to those locations versus the central location.                                                                        
SENATOR GIESSEL  reported the program has  been wildly successful                                                               
and  has reduced  costs, but  more importantly  it has  increased                                                               
vaccine rates.  [The state]  has gotten some awards for increased                                                               
vaccination rates  over the years  that this program has  been in                                                               
place.   The bill would simply  renew that, as well  as provide a                                                               
funding mechanism.                                                                                                              
4:54:16 PM                                                                                                                    
JANE  CONWAY,   Staff,  Senator   Cathy  Giessel,   Alaska  State                                                               
Legislature, on  behalf of Senator Giessel,  sponsor, paraphrased                                                               
from the  written sectional analysis  of [CSSB  37(FIN)] included                                                               
in  the  committee  packets,  which  read  [original  punctuation                                                               
     Section 1:                                                                                                               
     Amends AS  18.09.200(b)(1) by  removing the  "phase in"                                                                    
     language from statute as  the Alaska Vaccine Assessment                                                                    
     Program is now fully implemented.                                                                                          
     Section 2:                                                                                                               
     Amends  AS  18.09.220(a)  by removing  the  "phase  in"                                                                    
     language from statute as  the Alaska Vaccine Assessment                                                                    
     Program is now fully implemented.                                                                                          
     Section 3:                                                                                                               
     Amends  18.09.230 by  creating  the vaccine  assessment                                                                    
     "fund"  in   the  general  fund  for   the  purpose  of                                                                    
     providing   funds  for   the  program   that  will   be                                                                    
     appropriated by the legislature,  that can also include                                                                    
     program receipts,  penalties, money from  other sources                                                                    
     along  with  interest  earned   from  the  fund.  These                                                                    
     appropriations to the fund will not lapse.                                                                                 
     Section 4:                                                                                                               
     Repeals   and   reenacts  AS.18.09.230   allowing   the                                                                    
     commissioner to  administer the  fund in  accordance to                                                                    
     the provisions of the statewide immunization program.                                                                      
     Section 5:                                                                                                               
     Amends 37.05.146(c)(75) changing  the word "account" to                                                                    
     Section 6:                                                                                                               
     Repeals  AS  18.09.220(e)  by removing  the  "opt  out"                                                                    
     option for assessees since the  program is no longer in                                                                    
     the "phase-in" stage.                                                                                                      
     Section 7:                                                                                                               
     Repeals the  sunset provisions  (to repeal  the program                                                                    
     in 2021) that  were in section 5 of  the original bill,                                                                    
     [Senate Bill] 169 in 2014.                                                                                                 
     Section 8:                                                                                                               
     Sets effective date for July 1, 2019.                                                                                      
4:57:03 PM                                                                                                                    
CO-CHAIR ZULKOSKY passed the gavel to Co-Chair Spohnholz.                                                                       
CO-CHAIR SPOHNHOLZ invited Dr. Lou to continue the introduction                                                                 
of CSSB 37(FIN).                                                                                                                
4:57:48 PM                                                                                                                    
LILY LOU, MD, Chief Medical  Officer, Central Office, Division of                                                               
Public Health,  Department of Health and  Social Services (DHSS),                                                               
stated she  served on the  Alaska Vaccine Assessment  Council for                                                               
the first  three years.  She  is a pediatrician and  is president                                                               
of the American Academy of  Pediatrics, Alaska Chapter.  She said                                                               
she  is  disclosing  this  because  there  is  a  letter  in  the                                                               
committee packet  in support of the  bill that was signed  by her                                                               
as the chapter  president a few days before she  took her current                                                               
position with the State of Alaska.                                                                                              
DR. LOU explained  the bill would reauthorize  the Alaska Vaccine                                                               
Assessment  Program  (AVAP),  a  program  that  makes  access  to                                                               
vaccines universal  for all Alaskans.   It expands  coverage from                                                               
the subset of  children who are covered by  Vaccines for Children                                                               
to all  children and  it also  covers some  adults.   The program                                                               
more than  pays for itself, it  allows for Alaska to  get a 20-30                                                               
percent discount in the cost  of vaccines.  She brought attention                                                               
to a  graph in the  committee packet,  which shows that  over the                                                               
three to four  years that this program has been  in effect Alaska                                                               
has saved $11 million in the cost of vaccines.                                                                                  
4:59:44 PM                                                                                                                    
REPRESENTATIVE  TARR surmised  the savings  is because  the state                                                               
would otherwise be  responsible for the cost of  the vaccines for                                                               
the  beneficiaries under  state-run  health programs.   By  doing                                                               
bulk purchasing  the state  is realizing  those savings  on those                                                               
individual vaccinations.                                                                                                        
DR. LOU  replied it  is a  volume discount  because the  state is                                                               
purchasing  vaccines  for  all Alaskans  rather  than  piecemeal,                                                               
including  some  retail  pricing.    The  payers,  the  insurance                                                               
companies  who pay  into the  program, have  realized savings  by                                                               
doing it this way.                                                                                                              
CO-CHAIR  SPOHNHOLZ  asked  which adult  populations  this  would                                                               
apply to.                                                                                                                       
DR. LOU  responded that  the unique part  of Alaska's  program is                                                               
that  the state  offers payers  and  practitioners to  opt in  to                                                               
cover vaccines  for uninsured  adults.  Also  doing this  are the                                                               
states of Vermont and Rhode Island.                                                                                             
DR. LOU continued her presentation  on CSSB 37(FIN).  She pointed                                                               
out  that  this  bill  and   this  program  would  [continue  to]                                                               
streamline  the process  of giving  immunizations  into a  single                                                               
system.  Pediatricians would [continue  with not needing] to have                                                               
two refrigerators, two log systems,  and two completely separated                                                               
bookkeeping systems.  The program was  created in 2015 and is due                                                               
to sunset in  2021.  In 2018 the program  covered 366,000 people,                                                               
50 percent of Alaskans.  [The  state] has demonstrated a trend of                                                               
improving its  vaccination rates through  this system.   She drew                                                               
attention  to a  document in  the committee  packet and  said the                                                               
left half  of the graph  is pretty  flat for these  vaccines, but                                                               
after the  start of  AVAP there  is an increase.   She  noted the                                                               
graph doesn't show all of the types of vaccines.                                                                                
CO-CHAIR SPOHNHOLZ  offered her understanding that  it was stated                                                               
during  a hearing  before the  House Finance  Standing Committee,                                                               
Health & Social  Services Finance Subcommittee, that  some of the                                                               
vaccination  rates  had gone  down  and  subsequently Alaska  had                                                               
higher influenza  rates.   She asked  whether the  graph includes                                                               
influenza vaccine.                                                                                                              
5:02:27 PM                                                                                                                    
JILL LEWIS,  Deputy Director  (Juneau), Central  Office, Division                                                               
of  Public  Health, Department  of  Health  and Social  Services,                                                               
replied that  the graph includes  some of the  selected vaccines,                                                               
but does  not include the  flu [vaccine]  for which the  rate has                                                               
not gone up.                                                                                                                    
CO-CHAIR  SPOHNHOLZ asked  whether this  program would  allow the                                                               
state to increase flu vaccination.                                                                                              
MS. LEWIS responded  yes it would but noted it  doesn't happen to                                                               
show on the chart.                                                                                                              
DR. LOU added  that flu vaccination tends  to fluctuate depending                                                               
on the vaccine  for the year and  how people feel about  it.  She                                                               
confirmed it  is one  of the covered  vaccinations in  the Alaska                                                               
Vaccination Assessment Program.                                                                                                 
DR. LOU  pointed out  that Alaska was  recognized by  the Centers                                                               
for Disease  Control and Prevention  (CDC) for increases  in both                                                               
teen vaccines  and pneumococcal vaccine  for the  population over                                                               
65.     She  said  both   are  important  populations   and  they                                                               
demonstrate that when  something new comes along  this program is                                                               
nimble  enough to  do something  like the  human papilloma  virus                                                               
(HPV) vaccine that prevents cancer.   The department has seen the                                                               
benefits of this program and that it is proven to be effective.                                                                 
DR. LOU recapped  that CSSB 37(FIN) would  reauthorize the Alaska                                                               
Vaccine  Assessment  Program  to remove  the  phase-in  language,                                                               
including  the   opt-in  language,  and  to   remove  the  sunset                                                               
language.  It would not  impact any regulations about exemptions,                                                               
so it is only the provision  of vaccinations.  Alaskans will gain                                                               
the  following  from  reauthorization:   1)  Improves  access  to                                                               
vaccines,  one  of the  few  absolutely  proven effective  health                                                               
interventions; 2)  Removes the  barriers, particularly  for small                                                               
practices  that would  have to  buy a  box of  ten to  give eight                                                               
vaccinations;  3)  Allows  [the   state]  to  take  advantage  of                                                               
discounted  volume  vaccine  pricing;  4) Allows  the  use  of  a                                                               
unified inventory  system, allowing  [the state]  to redistribute                                                               
according  to  need and  not  according  to  box number;  and  5)                                                               
Decreases the cost  as well as the pain and  suffering of vaccine                                                               
preventable diseases.                                                                                                           
DR.  LOU  closed by  reiterating  that  this program  has  proven                                                               
itself  since it  began in  January 2015.   It  has been  a great                                                               
public-private  partnership.   The training  wheels can  be taken                                                               
off  and [the  program] continued  into the  future with  greater                                                               
health for all Alaskans.                                                                                                        
5:05:52 PM                                                                                                                    
MS.  LEWIS provided  a PowerPoint  presentation, entitled  "SB 37                                                               
Renewal  of Alaska  Vaccine Assessment  Program," to  explain how                                                               
the  program  operates.    She  brought  attention  to  slide  2,                                                               
entitled  "SB 37,"  and  stated the  bill  would reauthorize  the                                                               
program,  would take  out  from the  new  language the  temporary                                                               
phase-in  period that  has  already ended,  would  not use  state                                                               
general  funds,  and  would restructure  the  vaccine  assessment                                                               
MS.  LEWIS  turned to  slide  3,  entitled  "What is  the  Alaska                                                               
Vaccine Assessment Program?"   She said the  program provides all                                                               
childhood  and  certain  adult  vaccines  for  privately  insured                                                               
children, which does  not exclude the uninsured  children as they                                                               
are covered under a different  program that is a federal program.                                                               
The program also covers the majority of adults.                                                                                 
CO-CHAIR SPOHNHOLZ  recalled that  earlier it was  described that                                                               
this covers  uninsured adults.   She  asked which  adult vaccines                                                               
are not included.                                                                                                               
MS.  LEWIS  answered that  the  formulary  of what  vaccines  are                                                               
covered  is provided  in the  committee  packet.   She said  [the                                                               
program]  covers  the  vaccines   that  are  recommended  by  the                                                               
national committee that makes vaccine recommendations.                                                                          
DR. LOU  added that  the program  follows the  recommendations of                                                               
the  [Advisory  Committee   on  Immunization  Practices  (ACIP)].                                                               
There  are some  vaccines [the  program] likes,  for example  the                                                               
human papilloma virus  vaccine that is provided  to young adults.                                                               
Part  of  that is  because  the  vaccines  are  felt to  be  most                                                               
effective when  they are given  as soon as  they can be  in young                                                               
adulthood.   She  referred members  to the  information in  their                                                               
packet for the specific details.   Things like SHINGRIX [shingles                                                               
vaccine] are  covered, so the  program is nimble enough  to bring                                                               
new  vaccines  on  board  and the  assessment  is  just  adjusted                                                               
according  to  what  is  available and  what  is  recommended  by                                                               
scientific evidence as effective.                                                                                               
5:08:34 PM                                                                                                                    
MS. LEWIS resumed  her discussion of slide 3.   She explained the                                                               
program  collects   money  by  assessing  health   plans,  health                                                               
insurers,  as well  as  other program  participants.   The  state                                                               
pools  that money  together and  buys vaccines  at the  wholesale                                                               
[price] at a  greatly discounted rate off of  a federal contract.                                                               
It is a price that the  private sector cannot achieve on its own.                                                               
The state is  in a unique position to provide  this benefit.  The                                                               
state purchases and then distributes  the vaccine.  So really the                                                               
bill is about vaccine purchasing and distribution.                                                                              
MS. LEWIS moved to slide 4,  entitled "What is the Alaska Vaccine                                                               
Assessment  Program?"   She said  Alaska is  the only  state that                                                               
gives the providers  the option to cover  their uninsured adults.                                                               
Two  other  states  cover  adults,   but  only  for  the  insured                                                               
population, the  reason being that  there is no assessment  to be                                                               
paid if there is no insurance  coverage to provide the funds.  In                                                               
Alaska there is  an option that if a provider  has a large number                                                               
of  uninsured patients  they can  choose to  opt in  and pay  the                                                               
assessment,  which allows  them  to get  that  same price  break.                                                               
Health  plans are  mandated to  participate,  but providers  that                                                               
want  to get  this price  point  for their  uninsured adults  can                                                               
volunteer  and then  pay  that.   About 9  percent  of what  [the                                                               
program]  covers  is related  to  the  uninsured adults.    About                                                               
32,000  lives  are covered  under  the  program,  so this  is  an                                                               
important option.  Alaska is the only state able to offer that.                                                                 
DR. LOU  pointed out  that the options  for providers  that don't                                                               
opt-in to  the uninsured  adult coverage are  that they  pay full                                                               
price for vaccine or they don't vaccinate those patients.                                                                       
CO-CHAIR SPOHNHOLZ commented  that given what is  known about the                                                               
"herd  protection factor"  and how  important  it is  to get  the                                                               
maximum  amount  of people  vaccinated;  she  thinks most  people                                                               
would support getting the maximum number of people vaccinated.                                                                  
5:11:28 PM                                                                                                                    
MS. LEWIS addressed slide 5,  entitled "AVAP."  She explained the                                                               
Vaccine Assessment Council sets the  assessment rate once a year.                                                               
The current rate  is $8.61 per member per month  for children and                                                               
88 cents for adults per member per  month.  That rate is going to                                                               
decrease  for 2019    it  will  go down  to $7.44  and 53  cents.                                                               
Those rates  are adjusted  each year and  are prospective,  so if                                                               
the vaccines didn't cost as much  as was thought then that amount                                                               
is  factored  into the  next  year's  rate.   Every  quarter  the                                                               
assessed entities, the payers, pay  their assessment based on the                                                               
amount of covered lives they have  for that quarter.  This allows                                                               
the payers to  adjust their numbers during the year  if they have                                                               
a change  in the number  of members participating.   The Division                                                               
of Public Health pools that money and  then uses it to buy off of                                                               
a federal contract at a  discounted price.  Either [the division]                                                               
ships the vaccine  to the providers or it is  shipped directly to                                                               
them.   [The  division] does  not  charge the  providers for  the                                                               
vaccine  because the  insurance plans  have already  paid for  it                                                               
upfront.   Providers then  cover their  patients and  provide the                                                               
vaccines  and the  only thing  they can  bill for  is the  office                                                               
visit, the charge to administer  the vaccine, because that is not                                                               
part of what  this program is collecting assessments  for.  Every                                                               
quarter the providers are required  to report their vaccine usage                                                               
to the department so  it is known how much has  been used and the                                                               
inventories can be monitored and  then [the department] uses that                                                               
information  to  provide  information  back to  the  council  for                                                               
setting the next year's rate.                                                                                                   
5:13:57 PM                                                                                                                    
MS.  LEWIS  displayed  slide  6,  entitled  "Vaccine  Cost,"  and                                                               
related that the state is able  to achieve a vaccine cost that is                                                               
about 20-30  percent lower.   She explained  the slide  shows how                                                               
much just for  the cost to vaccinate a person  through age 18 and                                                               
the  difference  in  the  cost  between  the  Vaccine  Assessment                                                               
Program and the private sector.                                                                                                 
MS. LEWIS  turned to  slide 7,  entitled "Vaccine  Coverage," and                                                               
said  that  in regard  to  the  state's increase  in  vaccination                                                               
rates,  the  program  already  covers about  50  percent  of  the                                                               
population, 44  percent of  the children, and  52 percent  of the                                                               
adults.    Uninsured  children  are  covered  under  a  different                                                               
program and are not represented on the slide.                                                                                   
MS.  LEWIS moved  to slide  8, entitled  "Successes," and  stated                                                               
that overall  it is a win  for everyone.  The  Division of Public                                                               
Health  benefits because  it gets  to reduce  vaccine preventable                                                               
disease,  which  is  one  of   the  division's  main  objectives.                                                               
Providers  get  improved  health outcomes  for  their  vaccinated                                                               
individuals and they  also have a lot easier  stock management of                                                               
their vaccine.   The health insurance industry  pays less overall                                                               
for the cost  to vaccinate.  All Alaskans save  money in the long                                                               
run due to  fewer medical costs and secondary  costs from vaccine                                                               
preventable diseases.                                                                                                           
MS. LEWIS skipped slide 9 and  went on to slide 10, entitled "For                                                               
every $1 spent on  a vaccine in the US...."   She stated that the                                                               
slide  shows how  much can  be saved  for every  $1 spent  on the                                                               
individual types of vaccines in the  U.S.  For example, for every                                                               
$1 spent  on the measles,  mumps, and rubella (MMR)  vaccine, $26                                                               
is saved.                                                                                                                       
MS.  LEWIS concluded  with slide  11,  entitled "In  Closing...."                                                               
She said  reauthorizing this program  ensures a  healthier future                                                               
for all  Alaskans at  a lower  cost, plus  no state  general fund                                                               
5:16:20 PM                                                                                                                    
REPRESENTATIVE TARR  referred to  the nationwide  discussion that                                                               
is  going  on  about  vaccination and  some  people  being  anti-                                                               
vaccination  with subsequent  outbreaks.    She inquired  whether                                                               
this  discussion  is  being  seen in  Alaska  or  is  influencing                                                               
anything in  Alaska.  She  further inquired whether  the division                                                               
is doing anything to overcome that to ensure participation.                                                                     
DR.  LOU stressed  that this  is  an important  issue across  the                                                               
country.   However,  she continued,  vaccine  hesitancy is  quite                                                               
separate from  this bill, which  is only about  vaccine purchase.                                                               
In  regard  to  vaccine  hesitancy, she  said  Alaska  does  have                                                               
vaccine  rates that  are close  to  the borderline  and for  each                                                               
vaccine  there  is  a  different  percentage  that  confers  herd                                                               
immunity.   It  is not  just the  overall immunization  rate that                                                               
matters, but that  collections of people who have  a large number                                                               
of unvaccinated people are where outbreaks can start.                                                                           
REPRESENTATIVE  TARR  concurred it  isn't  one  of the  technical                                                               
details of  the bill.  But,  she noted, one of  the overall goals                                                               
of having  AVAP is  to increase participation  by Alaskans.   For                                                               
example,  when HPV  first came  out there  was some  hesitancy by                                                               
parents around  that vaccine, so  she is inquiring  about whether                                                               
these kinds of things influence participation in the program.                                                                   
DR.  LOU  replied  that  as  a pediatrician,  what  she  and  her                                                               
colleagues do  every day is  try to answer people's  questions so                                                               
they  can  make  those  decisions.     This  bill,  in  terms  of                                                               
vaccination  rates,  would remove  barriers  to  people who  have                                                               
decided to get  vaccinated and the bill would  mean more offices,                                                               
even small  ones, are able to  provide that.  Some  doctors might                                                               
not  vaccinate because  they cannot  afford to  keep a  stock and                                                               
patients might not go somewhere  else that does provide vaccines.                                                               
The bill would  impact that by making it less  difficult and less                                                               
expensive for  people to  get immunized.   She said  she believes                                                               
the increase in vaccination rates is from removing barriers.                                                                    
5:20:23 PM                                                                                                                    
REPRESENTATIVE PRUITT requested  clarification on provider opt-in                                                               
payments.  He  offered his understanding that  the state assesses                                                               
a fee  on [opt-in] providers  to cover  the cost of  the program.                                                               
He asked  whether there  are people  on the  outside of  this who                                                               
might seek to be a part of it, such as individual doctors.                                                                      
MS. LEWIS explained  the program mandates that  the insurers, the                                                               
health  plans, pay  the assessment,  but  it is  voluntary for  a                                                               
provider or  a clinic to  join.  So,  a provider's office  is not                                                               
assessed, but  the health insurance  industry is.   Providers can                                                               
opt in  because that way they  can also get 20-30  percent off of                                                               
their vaccine cost, which otherwise  they wouldn't be able to do.                                                               
The most  likely types  of provider  offices that  are interested                                                               
are  the ones  that  see  a large  proportion  of the  uninsured.                                                               
Quite a few  that have opted in  are in the tribal  system or the                                                               
Federally Qualified  Health Centers (FQHCs) because  they have to                                                               
see everyone who  comes to them whether or not  they are insured.                                                               
The providers all  have to look at  that and see if  it costs out                                                               
for them given  the amount of the uninsured  population that they                                                               
REPRESENTATIVE PRUITT  offered his  understanding that  he cannot                                                               
look at the  financials and determine that that is  the amount of                                                               
actual usage.  He asked how  many providers have chosen to opt-in                                                               
to the program.  He further  asked whether the limitation is just                                                               
the cost  aspect of  it, or  if in  some cases  smaller providers                                                               
don't have  the personnel to  look at this and  determine whether                                                               
it makes sense.   He also asked whether there  could be a greater                                                               
participation  in  the  program  by  providers  who  may  not  be                                                               
utilizing it.                                                                                                                   
MS. LEWIS  responded she does not  have the number of  the actual                                                               
providers that  are paying in  at the  moment, but it  amounts to                                                               
about 32,000  lives that they cover.   That will be  looked at as                                                               
the  program continues  and more  outreach  will be  done to  the                                                               
provider community  to let  them know about  the program  and the                                                               
opportunity.  Until now most of  the outreach has been focused on                                                               
the payer community,  the health plans and those  mandated to pay                                                               
the  assessments, because  there  was that  phase-in period  that                                                               
allowed  it to  be optional,  so it  was important  that all  the                                                               
mandated assessment payers were brought on board.                                                                               
DR. LOU  offered her belief  that there is information  about the                                                               
opt-in providers,  but that  it doesn't  really reflect  what she                                                               
believes Representative  Pruitt's question  is trying to  get at.                                                               
There could  be providers that  don't take  care of kids  or that                                                               
only  have two  uninsured patients  and so  it may  not be  worth                                                               
joining the program.  But if  a provider has 100 patients then it                                                               
becomes worthwhile for them to engage  with the program.  So just                                                               
looking  at the  percentage of  providers wouldn't  represent the                                                               
distribution of uninsured adults.                                                                                               
5:25:30 PM                                                                                                                    
CO-CHAIR  SPOHNHOLZ inquired  about the  mechanism that  requires                                                               
insurers to participate.                                                                                                        
MS. LEWIS answered  that the current statute  requires the payers                                                               
to participate.                                                                                                                 
CO-CHAIR SPOHNHOLZ  further asked what the  authorizing mechanism                                                               
is that  says insurers must  do this.   For example,  whether the                                                               
statute says that anybody who  provides insurance in the state of                                                               
Alaska must do this.                                                                                                            
DR. LOU  replied that in  2014 [the division] asked  for everyone                                                               
to  be  required  to  participate, but  the  bill  was  initially                                                               
written  to allow  for  payers to  opt out  for  the first  three                                                               
years.   During  that period,  she served  on the  council and  a                                                               
growing number  of participants was  seen because they  knew they                                                               
would be required to after three  years anyway.  That gave payers                                                               
the opportunity  to see how  the program  worked and to  join on.                                                               
Essentially all of the payers  participate now, including TRICARE                                                               
CO-CHAIR SPOHNHOLZ offered her belief  that there is an incentive                                                               
to the  payers to participate but  that she wanted to  know about                                                               
the rule.                                                                                                                       
DR. LOU added  that [in 2014] it  was a new program  and now that                                                               
the program  has proven  itself [CSSB  37(FIN)] would  remove the                                                               
sunset.  She offered her belief  that the program has also proven                                                               
itself in the minds of the payers.                                                                                              
MS. LEWIS  noted the mechanism  is in AS  18.09.240.  She  said a                                                               
penalty could  be assessed for  non-compliance.  She  offered her                                                               
belief  that  some  interest  has  been  assessed,  but  not  any                                                               
penalties  for non-compliance  because  the  phase-in period  was                                                               
open for a duration.                                                                                                            
CO-CHAIR SPOHNHOLZ asked what the penalty is.                                                                                   
MS. LEWIS responded  she would get back to the  committee with an                                                               
5:29:22 PM                                                                                                                    
DAVID  TEAL, Legislative  Fiscal  Analyst, Director,  Legislative                                                               
Finance Division,  Legislative Agencies and Offices,  stated that                                                               
CSSB 37(FIN)  is a short and  simple bill that extends  a program                                                               
that  has  been  proven  successful at  both  reducing  cost  and                                                               
increasing the  availability of vaccines.   Although  the program                                                               
operates at  no net  cost to  the state,  there are  three fiscal                                                               
notes.   In February when reviewing  the bill in the  Senate, his                                                               
division  suggested  the  program  be re-established  as  a  fund                                                               
capitalization  rather than  as a  fund transfer.   The  existing                                                               
financing  mechanism is  a fund  transfer method,  which requires                                                               
money to be transferred, or  appropriated, into the fund and then                                                               
appropriated out  of the  fund.  That  meant double  counting the                                                               
money  and a  fixed  appropriation available  to the  department.                                                               
That is because in the appropriation  bill simply said the sum of                                                               
$10 million  is appropriated to  the department, the  $10 million                                                               
being a surmised assessment.                                                                                                    
MR. TEAL  explained that  a fund  capitalization differs  in that                                                               
money only needs to be appropriated  into the fund but not out of                                                               
the fund.  On  the way out in Section 4 of the  bill it says that                                                               
the   commissioner   can   spend  the   money   without   further                                                               
appropriation.   The  constitution  only requires  that money  be                                                               
appropriated once, not twice.   A fund capitalization methodology                                                               
provides increased  flexibility.   If more  providers sign  on to                                                               
the program, or  a new vaccine is added, or  there is an outbreak                                                               
of  flu  or  measles,  or   other  illness,  the  department  can                                                               
immediately   increase  its   expenditures  without   legislative                                                               
action, so it is more flexible.   If there is not enough money in                                                               
the  fund, more  assessments can  come in  without appropriation;                                                               
whatever  amount is  collected is  appropriated to  the fund  and                                                               
there is  no legislative action  required to have  the department                                                               
then  respond  to  the  outbreak.    It  also  eliminates  double                                                               
accounting.  By permitting money in  the fund to be spent with no                                                               
further  appropriation,  the fund  isn't  subject  to the  annual                                                               
sweep of  sub-funds into the constitutional  budget reserve (CBR)                                                               
fund.   That may  not be  important, it hasn't  been in  the past                                                               
because there  has always been a  vote to reverse the  sweep, but                                                               
if there isn't at some  point, that constitutional sweep into the                                                               
CBR could end  the program if health care insurers  refuse to pay                                                               
an assessment  that didn't  get used for  vaccine purposes.   Any                                                               
money that  is left in  the fund carrying  over from one  year to                                                               
the next would be swept into the CBR.                                                                                           
MR TEAL added  that he doesn't see any disadvantage  to moving to                                                               
a fund capitalization  because of the increased  flexibility.  He                                                               
doesn't think that there is a  fiscal problem with it.  There are                                                               
lots of  fund capitalizations out there.   It is a  simpler, more                                                               
direct, less  double counting method,  which is why  his division                                                               
recommended it.                                                                                                                 
CO-CHAIR SPOHNHOLZ commented that it is very practical.                                                                         
5:33:51 PM                                                                                                                    
REPRESENTATIVE  PRUITT offered  his  understanding that  revenues                                                               
generated in a  particular year would have  carry forward ability                                                               
to  the  next  year if  all  of  them  were  not needed  and  the                                                               
assessments would be adjusted based on that.                                                                                    
MR. TEAL  replied the fund would  be non-lapsing, so money  in it                                                               
would carry forward from year to year.                                                                                          
REPRESENTATIVE PRUITT  recognized that Mr. Teal  is explaining it                                                               
would  go from  the  vaccine assessment  account  to the  vaccine                                                               
assessment fund.  He offered  his understanding that currently in                                                               
an account it  doesn't lapse and because it is  an account within                                                               
the  sub-fund the  legislature must  appropriate  the money  into                                                               
that  account   and  then   subsequently  the   legislature  must                                                               
appropriate that money to the actual program.                                                                                   
MR. TEAL responded correct.                                                                                                     
REPRESENTATIVE PRUITT  surmised it  is just like  forward funding                                                               
education,  where the  legislature funds  the fund  and it  would                                                               
automatically pay  for it the  next year as the  legislature then                                                               
put money into the public education fund.                                                                                       
MR.  TEAL answered  correct and  said that  the public  education                                                               
fund  is a  good example  of an  appropriation that  goes in  and                                                               
doesn't  lapse and  then  it flows  to  school districts  without                                                               
further  appropriation per  a formula.    In this  case it  would                                                               
simply flow without further appropriations  as needed to purchase                                                               
CO-CHAIR  SPOHNHOLZ stated  that  an important  element of  using                                                               
[the proposed]  model is  that it would  allow for  responding to                                                               
health challenges in the community.   So, if there were a need to                                                               
dramatically  increase   the  number   of  immunizations   for  a                                                               
particular health crisis [the state]  would be able to respond by                                                               
utilizing the  funds already  on hand,  eliminating the  need for                                                               
having to  come back for  an emergency supplemental,  which would                                                               
be important in an emergency situation.                                                                                         
5:36:29 PM                                                                                                                    
CO-CHAIR SPOHNHOLZ opened public testimony on CSSB 37(FIN).                                                                     
5:36:45 PM                                                                                                                    
NANCY   MERRIMAN,  Executive   Director,   Alaska  Primary   Care                                                               
Association (Alaska  PCA), testified in support  of CSSB 37(FIN).                                                               
She spoke as follows:                                                                                                           
     The  Alaska  Primary   Care  Association  supports  the                                                                    
     operations   and  the   development   of  Alaska's   27                                                                    
     community  health center  organizations.   And together                                                                    
     with  the leaders  of the  community health  centers in                                                                    
     this state,  we strongly  support SB 37  to reauthorize                                                                    
     the Vaccine Assessment Program.   Alaska's 27 community                                                                    
     health centers  are committed  to community  health and                                                                    
     have as one of their  primary and reportable measurable                                                                    
     objectives   to  promote   immunization  for   infants,                                                                    
     children,  and  adults.    In  2014,  when  the  Alaska                                                                    
     [Vaccine]  Assessment Program  legislation was  passed,                                                                    
     health centers were among  the strongest of supporters.                                                                    
     And  a quick  review of  participating providers  today                                                                    
     shows  that  26  of  the  27  community  health  center                                                                    
     organizations  actively  rely  on  this  program  as  a                                                                    
     reliable source for their  immunizations.  This program                                                                    
     allows  these  nonprofit  practices a  streamlined  and                                                                    
     cost-effective way to  purchase, manage, and administer                                                                    
     vaccinations  to  their  patients.    The  assembly  of                                                                    
     private and public dollars  to purchase vaccine through                                                                    
     the  AVAP eliminates  the need  for  health centers  to                                                                    
     manage  and maintain  two separate  stores of  vaccine.                                                                    
     Very  importantly  for  health centers  who  serve  all                                                                    
     patients  who walk  through their  doors regardless  of                                                                    
     their ability  to pay,  it also affords  them a  way to                                                                    
     provide  vaccination  to  lower  income  and  uninsured                                                                    
     adults, preventing  them from  contracting debilitating                                                                    
     infectious  diseases.    The measles  outbreak  in  the                                                                    
     Lower 48,  now having affected 555  children and adults                                                                    
     reminds  us  of  the  toll  of  preventable  infectious                                                                    
     disease   on  an   economy   and   the  public   health                                                                    
     infrastructure.   We  should want  to do  everything we                                                                    
     can  to   make  immunizations  easily   accessible  and                                                                    
     affordable.   This innovative program has  succeeded in                                                                    
     making  both procurement  and  distribution of  vaccine                                                                    
     efficient  and  effective  for  the  State  of  Alaska,                                                                    
     payers,  and  health   care  providers  across  Alaska.                                                                    
     Alaska  community  health  centers work  every  day  to                                                                    
     improve  the immunization  rates  of  all children  and                                                                    
     adults regardless of their ability  to pay and the AVAP                                                                    
     gives them the  framework and cost savings  to do this.                                                                    
     Alaska  PCA strongly  supports  the reauthorization  of                                                                    
     the   Alaska  [Vaccine]   Assessment  Program   through                                                                    
     passage of SB 37.                                                                                                          
5:40:02 PM                                                                                                                    
PATTY OWEN,  Director, Board of  Directors, Alaska  Public Health                                                               
Association, testified in support of  CSSB 37(FIN).  She said the                                                               
Alaska Public  Health Association would  be remiss if  it weren't                                                               
here today  because of the  connection between public  health and                                                               
immunizations.   Immunizations  are one  of the  main pillars  of                                                               
public  health.   An  affiliate  of  the American  Public  Health                                                               
Association,  the  Alaska  association   has  about  150  members                                                               
statewide  of public  health  professionals  and other  community                                                               
members  dedicated  to  improving  the health  and  wellbeing  of                                                               
Alaskans.  The association strongly  supports the bill's passage.                                                               
This innovative  public partnership  will make  vaccinations more                                                               
accessible  to  more  Alaskans.     Thanks  to  immunizations  in                                                               
general,  particularly  childhood immunizations,  [Alaskans]  are                                                               
benefitting  from increased  life expectancy  largely due  to the                                                               
prevention of infectious diseases.   Immunizations have become so                                                               
successful  in  preventing  diseases   that  people  have  become                                                               
complacent  and  resurgence  of   outbreaks  is  being  seen,  so                                                               
vigilance is needed.  Vaccines  are among the most cost effective                                                               
clinical preventive  service and  core component  of preventative                                                               
service that  can be offered.   A strong immunization  program is                                                               
essential to public health infrastructure.                                                                                      
5:42:27 PM                                                                                                                    
CO-CHAIR SPOHNHOLZ left public testimony open.                                                                                  
CO-CHAIR SPOHNHOLZ announced that CSSB 37(FIN) was held over.                                                                   

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