Legislature(2019 - 2020)DAVIS 106
02/20/2020 03:00 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HB229 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 229 | TELECONFERENCED | |
HB 229-HEALTH INFORMATION/DATABASE/PUBLIC CORP.
3:09:50 PM
CHAIR SPOHNHOLZ announced that the only order of business would
be HOUSE BILL NO. 229, "An Act establishing the Alaska Health
Care Transformation Corporation; relating to an all-payer claims
database; and providing for an effective date."
CHAIR SPOHNHOLZ noted that that the committees would hear a
"Healthcare Transformation Project Update" [in conjunction with
the scheduled hearing of HB 229].
[Chair Spohnholz passed the gavel to Chair Zulkosky.]
3:10:09 PM
The committee took an at-ease from 3:10 p.m. to 3:11 a.m.
3:11:02 PM
CHAIR ZULKOSKY noted that HB 229 was referred to the House Labor
and Commerce Standing Committee and the House Health and Social
Services Standing Committee had been invited to the meeting.
3:11:25 PM
REPRESENTATIVE SPOHNHOLZ reported that, according to the Kaiser
Family Foundation, in 1991 Alaska health care spending per
capita was $2,558, lower than the rest of the United States
average of $2,672. However, by 2014, Alaska was spending
$11,064 per capita for health care, a 38 percent higher cost per
capita in Alaska, while the rest of the United States averaged
about $8,045. She added that the health care cost inflation in
Alaska was 7.9 percent, while in the Lower 48, this inflation
was 5.5 percent, according to the Centers for Medicaid and
Medicare. Even though Alaska has the most expensive health care
in the United States, the state has some of the worst health
outcomes in the country. She pointed out that health care was a
huge cost to state government; in Alaska, the cost of Medicaid
was about $1.2 billion, even as this was "just a fraction of our
total health care spend." She shared an ISER (Institute of
Social and Economic Research) report from September 21, 2018,
which estimated about $8.2 billion was spent in the State of
Alaska on health care.
REPRESENTATIVE SPOHNHOLZ stated that recent efforts to reform
health care included the Alaska Health Care Commission, the
inclusion of tele-health coverage under Medicaid with its
possible inclusion in the private market, and Medicaid Expansion
adopted in 2015 which reduced the amount of uncompensated care
in the state and included some federal match dollars. She
referenced Senate Bill 74, passed in 2016, which incorporated a
large series of innovative Medicaid reforms and saved the state
hundreds of millions of dollars. In 2018, health care price
transparency legislation was passed which required public
posting of the price and estimates for the most frequently
offered health care services. She acknowledged that although
much had been accomplished to chip away at health care costs in
the State of Alaska, there was still a lot of progress to
realize.
REPRESENTATIVE SPOHNHOLZ spoke about the Alaska Healthcare
Transformation Project, created in part from Senate Bill 74, as
there was a need for cross sector collaboration in health care.
It would require a view of the total health care environment to
be able to drive down health care costs, she said. She
explained that the transformation Project included members of
the House of Representatives, the Senate, the administration,
private providers, hospitals, tribal health, labor
organizations, patient advocates, business representatives and
more. She reported that the goal of the project was to reduce
the cost of health care in Alaska while increasing access to
health care and improving its quality.
REPRESENTATIVE SPOHNHOLZ stated that, although all the measures
described were important building blocks, they were incremental,
and it was necessary to determine what was needed to transform
the health care delivery system in Alaska. The group decided it
was necessary to have a comprehensive understanding of the costs
of health care, how much was being spent, and what it was being
spent on. She paraphrased from the Sponsor Statement for HB 229
[included in members' packets], which read as follows [original
punctuation provided]:
HB 229 would establish the Alaska Healthcare
Transformation Corporation (AHTC), an independent,
legal authority to manage an All-Payer Claims Database
(APCD). Health care costs around the United States
are increasing at an alarming rate. Alaskan health
care costs are increasing at an even higher rate
compared to other states. Alaska's health care costs
38% more than the rest of the United States. How can
costs be contained while improving health care quality
and outcomes across the state? The Alaska Healthcare
Transformation Project, a group made up of payers,
providers, policymakers, and patient advocates, has
been meeting since 2017 to work together on this
issue. One of their recommendations was to establish
an APCD.
An APCD is an aggregation of health care data. The
health care data is a collection of claims data from a
comprehensive range of sources such as private health
insurers, state employee health benefits programs,
prescription drug plans, dental insurers, Medicaid,
and more. The value of an APCD is that it allows for
analysis and informed decision-making for health care
consumers and policy makers. It is also a powerful
tool for understanding the health care market.
Additionally, analysis of geographic, demographic and
other areas of potential disparity can help inform
policy assessments and improvements.
Understanding the underlying cost drivers and market
pressures of the cost of health care is important to
developing policies and solutions. An Alaska Health
Care Transformation Corporation tasked with
establishing an APCD will provide a foundation for
ongoing analysis, development, implementation and
support for health care policy. There are 20 states
that have an APCD. If passed, this legislation will
provide the means to develop health care policies that
can improve access and affordability for all Alaskans.
3:17:52 PM
REPRESENTATIVE SPOHNHOLZ, in response to Chair Zulkosky,
reiterated that the APCD was "an aggregation of de-identified
health care data; a collection of claims data from a
comprehensive range of services."
3:18:13 PM
REPRESENTATIVE FIELDS asked if the aggregation of existing data
bases would still allow for knowing which claims occurred in
which hospitals and surgery centers and which insurance plans
covered these procedures. He asked if it would be anonymous
beyond this.
REPRESENTATIVE SPOHNHOLZ said that the details for the operation
of APCD would be determined by the Alaska Healthcare
Transformation Corporation. She opined that, as other states
had already been doing this work, the Healthcare Transformation
Corporation would look at those specific operations. She
expressed the desire to have every health care payer in the
State of Alaska contribute their information in a de-identified
manner so as not to single out individuals.
REPRESENTATIVE FIELDS asked whether "paid" was defined as the
amount of the bill or the amount an insurance company actually
paid for a procedure. He asked if it was legal to require the
insurers to share this data.
REPRESENTATIVE SPOHNHOLZ acknowledged that there was existing
authority to require the data be shared, except for Employee
Retirement Income Security Act (ERISA) plans, which were
regulated by the federal government. She shared that currently
there were discussions with U.S. Senator Lisa Murkowski for the
requirement that ERISA plans participate in APCDs. She stated
that the value of an APCD was that it allowed for analysis and
informed decision making by different parties. Considered to be
a superior data source, the APCD included actual paid claims,
and not charged amounts, which was a powerful tool for
understanding the health care market, she related.
REPRESENTATIVE SPOHNHOLZ stated that these could help identify
areas of practice where prices were increasing, or utilization
was growing in an unhealthy way, to better drive policy reform.
She shared that the vision was for a public interface for Alaska
consumers to better understand the cost for certain health care
services. She stated that some values had been incorporated
into this concept. She relayed that, as health care operated in
multiple jurisdictions in the state, within several different
departments, the creation of a health care transformation
corporation would allow a certain amount of independence, with a
clear focused charge, for long term results. She suggested that
the board of the health care transformation corporation be
appointed by the governor and then confirmed.
3:23:36 PM
CHAIR ZULKOSKY asked about the Health Care Commission.
REPRESENTATIVE SPOHNHOLZ explained that the Health Care
Commission had been started by former Governor Sarah Palin and
had reviewed a broad range of topics, including elements of the
Patient Protection and Affordable Care Act and its role, along
with Medicaid Expansion, in health care transformation in the
state. She noted that, as both Medicaid Expansion and the
Patient Protection and Affordable Care Act were unpopular in the
state, the Health Care Commission was defunded, and its work was
ended. She declared that it was necessary to have some
"sideboards" on what a health care corporation could do, and to
also allow the corporation to execute.
3:24:56 PM
REPRESENTATIVE STUTES asked who would fund the new corporation.
REPRESENTATIVE SPOHNHOLZ directed attention to the fiscal notes,
which she noted could change as they went through the process as
it was still too soon to know the final costs. She pointed out
that the cost of health care in Alaska was expensive and
accelerating. A stated goal of the health care transformation
project was to reduce this cost of healthcare inflation to 2.5
percent. She shared that there were various workgroups of the
project.
REPRESENTATIVE STUTES opined that the State of Alaska would pay
for the project.
REPRESENTATIVE SPOHNHOLZ replied that the project would be paid
for by both the state and the private sector.
3:28:13 PM
REPRESENTATIVE STUTES asked for an example of private sector
partners.
REPRESENTATIVE SPOHNHOLZ said there had been funding from the
Mat-Su Health Foundation, the Rasmussen Foundation, Providence
Health Systems, and others.
REPRESENTATIVE STUTES asked what would prevent this project from
becoming de-funded.
REPRESENTATIVE SPOHNHOLZ offered her belief that those working
on the project would try to learn from the mistakes of the
Health Care Commission, specifically that a project needed
sideboards. She declared that the project had no authority
beyond the creation of the APCD.
3:30:01 PM
REPRESENTATIVE JACKSON asked who would own the corporation.
REPRESENTATIVE SPOHNHOLZ replied that this would be a public
corporation and the owners would be the State of Alaska. She
offered examples of other such public entities, including the
Alaska Housing Finance Corporation and the Alaska Railroad.
REPRESENTATIVE JACKSON asked if this was a medical databank.
REPRESENTATIVE SPOHNHOLZ explained that it would be a database
for paid healthcare claims in Alaska, and that it would not hold
individual patient information.
REPRESENTATIVE JACKSON asked what product the State would
receive for its investment in the corporation.
REPRESENTATIVE SPOHNHOLZ explained that the State would receive
information to use for policy reforms. She said that it was not
possible to know how to solve a problem until you understood the
problem. She acknowledged that, although a lot was known about
Alaskan healthcare data through individual lenses, 20 other
states were using an APCD as a foundational building block for
healthcare reform.
REPRESENTATIVE JACKSON asked if there had been conversations
with Senator Murkowski and whether pharmacists were included in
this databank.
REPRESENTATIVE SPOHNHOLZ replied that pharmacy payments would be
part of this database.
REPRESENTATIVE JACKSON suggested a volunteer approach.
REPRESENTATIVE SPOHNHOLZ relayed that there was interest in
working with the Alaska federal delegation to ensure the federal
health care claims paid in Alaska could also be contributed to
the database.
3:34:04 PM
REPRESENTATIVE HANNAN asked for a definition of ERISA.
REPRESENTATIVE SPOHNHOLZ explained that an ERISA plan was a
self-funded, self-insured plan, offering the State of Alaska and
the University of Alaska as examples. She pointed out that, as
they were regulated by the federal government, these plans were
not required to comply with state law.
REPRESENTATIVE HANNAN offered her belief that, as most Alaskans
were in ERISA plans, it would be important to include them.
REPRESENTATIVE SPOHNHOLZ acknowledged that a good number of
Alaskans were covered by ERISA plans, with the State of Alaska
the largest of these. She declared that the state would want to
participate and, here in the state, it would not be necessary to
ask the federal government for permission to put the state's own
data into the database. She acknowledged that there was not the
authority to tell the Veterans' Administration or [Indian Health
Service] to comply.
REPRESENTATIVE HANNAN asked if other ERISA plans could
voluntarily choose participation without any changes to federal
law.
REPRESENTATIVE SPOHNHOLZ opined that they could voluntarily
comply.
REPRESENTATIVE HANNAN noted that most other health trusts
discussed the inability to keep up with the growth rate for plan
occupants and asked if any other ERISA plans were interested.
She shared the concept of "medical tourism" which encouraged
people to leave Alaska for health care somewhere cheaper and
suggested that all services for Alaskans be included in the
database, whether delivered in or out of state.
REPRESENTATIVE SPOHNHOLZ said that she could not speak for the
other ERISA plans, although there were active conversations
through the Alaska Healthcare Transformation Project.
3:37:55 PM
CHAIR ZULKOSKY asked whether the tribal health plans would be
compelled to provide data.
REPRESENTATIVE SPOHNHOLZ replied they would not be compelled.
CHAIR ZULKOSKY asked if the many Alaska Native organizations
participating in federal employee health benefits be compelled
to provide information.
REPRESENTATIVE SPOHNHOLZ replied that she had not yet explored
this.
3:39:48 PM
REPRESENTATIVE FIELDS asked if there were other corporations in
other states with regulatory powers which included the
collection of information from private parties. He pointed out
that the proposed bill allowed penalties to be established to
ensure compliance with mandatory healthcare data reporting
requirements. He asked if employer funded plans were
potentially subject to fines and if there was any precedent. He
asked who could be fined if there was failure to provide the
requested healthcare data.
REPRESENTATIVE SPOHNHOLZ said she was not yet prepared to answer
all these questions as the project was still in its early
phases, although there was an expert to provide invited
testimony on APCDs. Regarding the authority, it would be
necessary to see what authority other corporations in Alaska had
to fine people.
REPRESENTATIVE FIELDS asked what additional data would be
captured that was not currently available.
REPRESENTATIVE SPOHNHOLZ said that she would follow up in
detail, that they wanted other perspectives, and that they did
want employer plans to participate.
3:43:53 PM
REPRESENTATIVE STUTES asked who would interpret the data and how
would that lower health care costs. She asked if tribal health
had been engaged.
REPRESENTATIVE SPOHNHOLZ replied that tribal health had been
involved with the process from the beginning and was represented
on the project management committee. She opined that, although
reducing health care costs may not be possible, bending the cost
curve downward was a goal. She suggested that there would be
rules and guidelines for access to the information, although it
would be available to policy analysts, researchers, and policy
makers in the legislature and government, as well as the
community at large for analysis in ways to reform the health
care system. She acknowledged that there was not clear evidence
that all payer claims databases "absolutely lower health care
costs." She emphasized that, although the reduction of
healthcare costs "might be pie in the sky," it was her hope to
bend the cost growth curve. She reiterated that the current
health care cost inflation was 7.9 percent in Alaska. She
offered her belief that a recognition for the cost of services
would identify outliers who were overcharging. She shared that
her focus on healthcare reform policy was because she had seen
the impact on individuals and families from a health care
crisis. She stated that an APCD would remove the ongoing finger
pointing in the medical industry and allow for movement forward.
REPRESENTATIVE STUTES asked for clarification that a statewide
database could determine which areas were too expensive.
REPRESENTATIVE SPOHNHOLZ explained that this database was for
specific healthcare services and was not regional. She added
that preventative care could keep people healthier and that a
review for the costs to the range of provided services could
reveal the opportunity for health care reform. She pointed out
that the cost of services in Alaska could be as much as ten
times those same services in the Lower 48.
3:51:02 PM
REPRESENTATIVE SPOHNHOLZ, in response to Representative Jackson,
explained that the corporation was proposed to be a public,
private partnership with state funding, and potentially some
federal and private sector funding. In further response to
Representative Jackson, she explained that an APCD would allow
for fact checking with comprehensive information for the
spending on health care.
3:52:54 PM
REPRESENTATIVE FIELDS reported that the increase to the state
health care insurance plan had been less than 2 percent, and
that, since 2015, even with an increase of insurance for more
than 50,000 people, the state was spending less on Medicaid. He
asked where there had been success for arresting the cost curve
and what were the reductions for ERISA plans.
REPRESENTATIVE SPOHNHOLZ said there would be some testifiers to
answer those questions.
REPRESENTATIVE CLAMAN mused that, as all the federal insurance
coverages were not required to participate, it seemed unlikely
to collect 100 percent of the data.
REPRESENTATIVE SPOHNHOLZ reiterated that APCDs had been created
in 20 other states and had proven to be useful. She relayed
that there had been discussion for a nationwide all payer claims
database, even as that discussion was unlikely to advance. She
acknowledged that this was a big step for Alaska and pointed to
various healthcare reform initiatives launched in the last five
years in Alaska. She declared that the problem for healthcare
cost growth had not been solved, and emphasized that it was
necessary to come together for solutions. She pointed out that
this draft was a conversation starter to advance a significant
policy measure. She shared her hope to work together toward a
better proposal.
3:57:27 PM
REPRESENTATIVE STUTES opined that it would be good for the
proposed bill to have hearings in the House Health and Social
Services Standing Committee.
REPRESENTATIVE SPOHNHOLZ allowed that this was the reason for
the joint committee meeting. She reported that health care in
Alaska was in multiple jurisdictions, including Department of
Labor & Workforce Development, Department of Administration, and
Department of Health and Social Services. She noted that the
structure of the corporation was outside all these departments,
as it would be housed in the Department of Commerce, Community &
Economic Development along with the other public corporations.
REPRESENTATIVE STUTES expressed her assumption that the proposed
bill would be heard again in the House Labor and Commerce
Standing Committee.
4:00:13 PM
REPRESENTATIVE PRUITT asked how to pay for the corporation.
REPRESENTATIVE SPOHNHOLZ explained that it would be paid through
the general fund, federal match, and private sector match.
REPRESENTATIVE PRUITT asked what was meant by private sector
match.
REPRESENTATIVE SPOHNHOLZ reported that the project had been an
equal match between the state and the private sector, including
profits and non-profits. She offered her belief that the
attached fiscal notes would change as the proposed bill evolved.
REPRESENTATIVE PRUITT suggested that there was not a guarantee
for funding from the private sector. He asked how to deal with
the situation when participants no longer wanted to participate.
REPRESENTATIVE SPOHNHOLZ replied that she was not currently
prepared to discuss the fiscal notes in detail. She
acknowledged that it would be necessary for some clarity about
the relationship if the funding were to be based on private
match. She declared that she was "fairly agnostic" about how
the APCD was funded. She suggested that this would be discussed
in more detail during the invited testimony.
REPRESENTATIVE PRUITT asked how to ensure confidentiality.
REPRESENTATIVE SPOHNHOLZ said that the invited testifiers could
better answer this.
4:03:27 PM
REPRESENTATIVE CLAMAN asked whether there was an existing
federal match program if the money was provided.
REPRESENTATIVE SPOHNHOLZ said that she would follow up on those
specifics, noting that there were some potential options.
REPRESENTATIVE CLAMAN relayed that he would be more reassured
with an existing match program. He asked about current access
to the Medicaid data.
REPRESENTATIVE SPOHNHOLZ said that the State of Alaska already
had access to the Medicaid data, which included about one-third
of the patient population.
REPRESENTATIVE CLAMAN asked if there was currently access to any
other health care data.
REPRESENTATIVE SPOHNHOLZ replied that, although data was
accessible, it was not well used because the State of Alaska had
to contract for analysis. In response to Representative Claman,
she explained that, as the state contracted for analysis, there
was not routine access to the information, which created
difficulty for policy researchers to collect the data.
REPRESENTATIVE CLAMAN asked if the data from the health
facilities reporting program was currently available.
REPRESENTATIVE SPOHNHOLZ said that she did not know.
4:07:41 PM
CHAIR ZULKOSKY asked if the project had performed any analysis
of the existing Medicaid data.
REPRESENTATIVE SPOHNHOLZ replied, "Yes."
REPRESENTATIVE TARR asked to better understand analysis and use
for the collection of data after it was aggregated.
REPRESENTATIVE SPOHNHOLZ explained that the way to define the
data was determined by the amount of data, but there would still
be the ability to understand from where it originated even as it
was de-identified. She stated that there was no desire to
undermine any competitive advantage by revealing information in
a public place. She suggested various people to discuss these
questions. She noted that, as 17 percent of Alaskans were in
the private marketplace, it was necessary to review the costs.
REPRESENTATIVE TARR pointed out that none of the smaller-
population Western states had APCDs.
REPRESENTATIVE SPOHNHOLZ offered her belief that putting
together the APCD was determined by the benefits versus the
economics. She stated that the goal was to buy access to
another existing database and populate it with information, as
it was the functionality that was required.
4:13:52 PM
REPRESENTATIVE STUTES asked if there were experts to interpret
the data.
REPRESENTATIVE SPOHNHOLZ replied that this would be dependent on
how the corporation was structured. She referenced a proposed
fiscal note from the Division of Insurance which estimated
proposed staffing by seven people. She added that she was
unsure if this was the correct number and that she was open to
discussion.
4:15:19 PM
REPRESENTATIVE FIELDS asked how to collect the data and what was
the correct structure for analysis. He reported that there had
been a 40 percent reduction in workers' compensation cost and
asked if collaboration was being reviewed for the project.
REPRESENTATIVE SPOHNHOLZ reiterated that there was indeed a
"pretty significant health care cost problem in this state."
She pointed out that the collaborative process used by the
Medical Services Review Panel was a different kind of process,
as it looked at individual claims to make determinations for
appropriate care. She declared that this was far beyond the
authority that had been proposed to give to the health care
transformation council. She explained that this council would
allow analysts to comb through the data to better understand
ways to re-design the health care system. She stated that this
was an important building block to better understand the picture
for health care expenses.
REPRESENTATIVE FIELDS asked if she had viewed the Medical
Services Review Panel as a potential structure without the
bureaucracy.
REPRESENTATIVE SPOHNHOLZ replied that she had not.
4:17:21 PM
REPRESENTATIVE PRUITT asked who could access and analyze the
data. He offered his belief that the proposed corporation would
be extensive and do more than simply house a database. He
reminded the committee about the issues of confidentiality.
REPRESENTATIVE SPOHNHOLZ stated that she did not mean to suggest
there would be unfettered access to the data. The APCD would,
instead, be a structure from which to request data on a regular
basis. She explained that the proposed corporation would
identify safe, secure, and de-identified processes by which
researchers and policy analysts could request the data. She
directed attention to page 3, [lines 21-28], of the proposed
bill, which listed the purpose of the corporation as follows:
(1) collect and analyze existing health care
cost and quality data;
(2) create an objective, reliable, and
comprehensive central repository of health care
information;
(3) provide researchers, policy makers, and
the public timely and transparent access to health
care information while protecting individual privacy
and proprietary data;
(4) enable researchers, policy makers, and
the public to make informed health care decisions and
reduce unnecessary health care costs.
REPRESENTATIVE SPOHNHOLZ pointed out that this draft legislation
was an opening conversation as conceived by the cross-sector
stakeholder committee. She stated that she welcomed further
suggestions or "sideboards that you'd like to put on it."
REPRESENTATIVE PRUITT said that he wanted to understand the
scope. He asked if the idea was for only the researchers to
analyze. He questioned the associated costs for different
structures.
REPRESENTATIVE SPOHNHOLZ acknowledged that these were good
questions for discussion.
4:23:37 PM
REPRESENTATIVE SPOHNHOLZ, in response to Representative Jackson,
reiterated that the project cost had been split equally between
the government allocated appropriation and the private sector
through the non-profit community. She added that a bending of
the Medicaid cost curve down from its current inflation of 4.4
percent to 2.5 percent would result a savings of more than $30
million in one year, adding that this was only about 20 percent
of the total healthcare spend. She reported that, of the $8.2
billion spent on health care in Alaska, most was from the
public, from Medicaid, state employees and retirees, and that a
bend of the cost curve would result in a huge savings with a
minor investment.
REPRESENTATIVE JACKSON stated that currently every Alaskan was
paying for this cost bend and asked how far down the road this
was from a reality.
REPRESENTATIVE SPOHNHOLZ shared an analogy for the decision to
make a house repair for water dripping into the living room. A
person could continue to replace the carpet annually or they
could fix the roof and create annual savings. She declared that
this was "a matter of getting our fiscal house in order for the
state." She emphasized that it was necessary to resolve health
care cost growth, restating it was outrageous how much money
Alaskans were spending on health care.
REPRESENTATIVE JACKSON offered her belief that it was necessary
to resolve the issue for all Alaskans.
4:28:59 PM
REPRESENTATIVE FIELDS asked how explicitly providers and
employers had bought into this significant change in the rate
structure. He asked if the proposed corporation would
ultimately have the power to dictate changes in rates to a wide
range of employers.
REPRESENTATIVE SPOHNHOLZ said that she was not advocating for a
capitated payment structure in the proposed bill.
4:30:16 PM
SCOTT LEITZ, Project Director, NORC, University of Chicago,
explained that NORC [formerly called the National Opinion
Research Center] was one of the largest social science research
organizations in the country. He reported that over the past
year he was the project director for NORC during its work with
the Alaska Healthcare Transformation Project. He stated that
the research had resulted in a series of recommendations to the
project steering committee, which fell into four larger scopes:
conduct some meta-analyses of previous Alaska studies; do an
historic scan of previous work in Alaska around Alaska health
care innovation; conduct a national scan of promising models
which other states were exploring; and then, based on this work,
create a roadmap with recommendations for how to best move
forward to consider revising and revamping some issues around
Alaska's healthcare system. He relayed that these reports had
confirmed that the cost of health care in Alaska was high on a
relative basis compared to the rest of the United States. He
noted that the costs were driven by a variety of complicated,
interrelated factors.
MR. LEITZ stated that a lack of more recent, detailed data
hindered efforts to better understand what was happening in the
health care system and what was driving costs. Those findings
formed a core for two central recommendations: (1) the state
should establish an APCD; (2) the information needed to be
analyzed by a trusted entity, in order to bring forth
recommendations in a collaborative, stakeholder way. He shared
that much of the work to correctly orient the health care system
was built around the availability of data and information to
drive those decisions. The policy decisions were greatly
informed by the information available to the public and would
allow discussions based on the data. He noted that almost all
the institutions studied had APCDs. These databases enabled
them to better understand the cost drivers, and to allow policy
to be crafted around focused issues. The analysis of data had
to be performed by an entity who was broadly trusted among the
stakeholders and had the capacity to conduct analysis. He
pointed out that, as reform of health care was a long road, it
was necessary for the trusted entities to continue work across
multiple administrations.
REPRESENTATIVE FIELDS asked for an explanation to the "sea
change" for the changing rate in health care costs in Alaska
from the fastest-growing rates between 2000 - 2014, to the
slowest in the country since then.
MR. LEITZ said that it was multi-factorial. He explained that a
review of the data compared the overall costs for Alaska health
care spending relative to the rest of the country. He
acknowledged that the costs were significantly higher in Alaska
both on a per capita and an aggregate basis. He expressed his
agreement that efforts had slowed the health care cost spending
in Alaska. Regardless of which measure, the spending levels
were higher in Alaska. He noted that, although there would be
year-to-year changes based on negotiations and changes in the
state Medicaid program that might temporarily slow growth, the
overall trend was for rates of growth still higher than the
national rates.
4:39:44 PM
CHAIR ZULKOSKY asked if the APCDs in the other 20 states were
similarly structured, with a corporation managing the databases.
MR. LEITZ stated that this varied with each state. He
emphasized that it was most important that people felt the
structure led to independence of the organization, that the data
produced was neutral, and that the information was trusted to be
valid, neutral, reliable, and not biased by stakeholders.
CHAIR ZULKOSKY asked about the results if it was not possible to
compel a significant number of providers to share information.
MR. LEITZ acknowledged that Alaska did have some unique
characteristics, as there was a higher proportion of individuals
with TRICARE and Indian Health Service. He said it was possible
to glean an enormous amount of information from commercial
claims, as well as Medicare and Medicaid claims which were
available to the state. He noted that, as many large employers
dealt with healthcare costs, there was a lot of interest in
participation in APCDs and that a great deal of information was
available to form much better healthcare policy. He suggested
that "the guiding star shouldn't necessarily be getting to 100
percent; it should be making sure that you have representative
data that allows you to say things about the commercial market,
the Medicaid market, and other markets that exist within your
state."
4:45:13 PM
REPRESENTATIVE CLAMAN asked about results if only 30 or 40
percent of data was available, instead of in the 80 percent
range, and whether this would change the perspective for the
value of that data.
MR. LEITZ estimated that 23 percent of the Alaska population was
covered by Medicaid and about 12 percent was covered by
Medicare, equaling more than a third of the state's population,
and that this data was available. He opined that this combined
with the individual marketplace would offer data for about 60
percent, even if none of the ERISA plans chose to participate,
and that this was a "pretty representative group of being able
to look at what cost trends look like within the state." He
offered his belief that this would provide deep and solid
information about the Alaska marketplace as many of the same
insurers contracted with many of the same provider organizations
cutting across the sectors. He acknowledged that, although more
data was better than less data, there was solid information
available.
REPRESENTATIVE CLAMAN asked for clarification that the value of
the data dropped if there was less than 50 percent available.
MR. LEITZ replied that given the nature of the union trusts in
Alaska, there would hopefully be a willingness to participate in
this database to gain more broad information about health care
costs to allow them to better manage their plans. He added that
any data from portions of the private market that were not
currently captured would still give a lot more information to
better form public policy than what was currently available. He
stated: "I don't know what the magical number is; I wish I did,
and I don't know that there is such a thing." He declared that
it was highly likely to capture substantially more than 50
percent of the market with this database.
REPRESENTATIVE CLAMAN declared that he had real questions about
participation and the expense until he had greater confidence
for the level of participation. He stated that there was not a
compelling case for the benefit of the cost if the percentage of
available data was lower than 50 percent.
4:50:39 PM
REPRESENTATIVE FIELDS expressed his doubt that there would be 50
percent of data if only Medicaid, Indian Health Service, and
ERISA plans were available.
MR. LEITZ offered his belief that TRICARE was about 10 percent
of the state population, Medicare and Medicaid were about 35
percent of the state population, and he was not sure of the
employer sponsored insurance population. He declared that about
50 percent of the state population was covered by private
insurance through an employer, although he did not know how many
of these were self-insured versus fully insured. He stated that
the individual market in Alaska was about 8 percent. Therefore,
the combined total of Medicare, Medicaid, and the private
directly purchased insurance accounted for about 40 percent of
the market. As the employer sponsored insurance was about 50
percent of the market, and it was assumed that half of that was
fully insured, that would allow availability of data from about
60 percent of the market.
4:52:45 PM
REPRESENTATIVE SPOHNHOLZ clarified that the total amount of
money spent on Medicaid was about $2.2 billion and had grown
from $1.3 billion in 2012 per the report from the Department of
Health and Social Services.
REPRESENTATIVE TARR pointed out that Vermont was the only other
small population state that had an APCD, and she asked how the
database would work with such small populations.
MR. LEITZ said that, regardless of state population and given
the diversity of Alaska, the information from the database
allowed the ability to look at regional differences. He offered
his belief that states had to make individual decisions for how
they wished to analyze the information and, regardless of
population, be able to "really dig in; look at the more local
level of what's driving health care cost growth and patterns of
use and other things, and then make those decisions at a local
level" for what made sense to address it. He noted that there
was not a perfect correlation between size and an interest in an
APCD, but it was instead driven by cost growth and an interest
in understanding patterns of utilization for policy decisions.
REPRESENTATIVE TARR said that she would appreciate any
additional thoughts.
4:57:04 PM
REPRESENTATIVE HANNAN asked what state the highest percentage of
data had reported to the APCD and how that state got to that.
MR. LEITZ said that another testifier could have that
information.
REPRESENTATIVE HANNAN asked about the data for retirees, as they
were the fastest growing demographic in Alaska, and whether the
databases could account for this demographic and the effect on
health care costs.
MR. LEITZ replied that the APCD, collected in a de-identified
way, would allow an analyst to see age groupings and patterns of
utilization for those groups, as well as costs associated with
the services delivered to those groups. He added that the APCD
revealed variations in service use and patterns, showed high
utilization areas in a state, why they existed, and if they were
prevalent in specific demographic groups. That would allow
these to be addressed and get the system oriented to reduce
those variations. He explained that the APCDs allowed the
breakdown for analysis by ages, by geographic areas, and by time
of insurance coverage, to allow deeper research to better
understand how to solve some of the challenges to the high cost
of healthcare.
5:00:17 PM
CHAIR ZULKOSKY passed the gavel to Chair Spohnholz.
5:00:33 PM
REPRESENTATIVE CLAMAN opined that because of the complexity of
the proposed bill, it should include a referral to [the House
Health and Social Services Standing Committee].
[HB 229 was held over.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 229 and supporting documents.pdf |
HL&C 2/20/2020 3:00:00 PM HL&C 2/21/2020 3:15:00 PM |
HB 229 |
| Alaska Healthcare Transformation Project Presentation HHSS and HLC.pdf |
HL&C 2/20/2020 3:00:00 PM |
Health Care Transformation |