Legislature(2005 - 2006)BUTROVICH 205

02/02/2005 01:30 PM Senate HEALTH, EDUCATION & SOCIAL SERVICES


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ SB 60 EXTEND SUICIDE PREVENTION COUNCIL TELECONFERENCED
Moved SB 60 Out of Committee
+= SB 22 MEDICAID COVERAGE FOR BIRTHING CENTERS TELECONFERENCED
Moved SB 22 Out of Committee
          SB 22-MEDICAID COVERAGE FOR BIRTHING CENTERS                                                                      
                                                                                                                                
2:04:43 PM                                                                                                                    
RICHARD BENAVIDES,  staff to Senator  Bettye Davis  introduced SB
22 and  said Senator Davis  feels strongly  that SB 22  will help                                                               
control Medicaid costs.  He added the facility  fees for birthing                                                               
centers  would always  be  lower than  the  hospital fees  mainly                                                               
because birthing center births were low risk pregnancies.                                                                       
                                                                                                                                
CHAIR DYSON said  the information he has  seen indicates facility                                                               
charges for birthing centers and hospitals are comparative.                                                                     
                                                                                                                                
2:06:22 PM                                                                                                                    
MR.   BENAVIDES   submitted   new  information   regarding   cost                                                               
comparisons. He cited from the  packet that Geneva Woods Birthing                                                               
Center,  (Geneva  Woods)  charges  a  $1,500  facility  fee,  and                                                               
Providence  Hospital   facility  fee  is  $4,000   excluding  the                                                               
doctor's fee.                                                                                                                   
                                                                                                                                
2:07:50 PM                                                                                                                    
CHAIR DYSON  asked whether the  hospital fee adds $1,000  for the                                                               
second night.                                                                                                                   
                                                                                                                                
MR. BENAVIDES confirmed  that and added there is  no second night                                                               
at  a birthing  center because  they are  generally uncomplicated                                                               
births.                                                                                                                         
                                                                                                                                
2:09:07 PM                                                                                                                    
CHAIR DYSON stated uncomplicated  births with prepared parents at                                                               
a birthing center are adequate  health care. He said the argument                                                               
is  without the  birthing center  facility charge  being Medicaid                                                               
reimbursement eligible, many poor people  will have to choose the                                                               
more   expensive  hospital   option,  which   then  is   Medicaid                                                               
reimbursable.  He asked  if  any  jurisdictions require  birthing                                                               
centers have a formalized relationship with a hospital.                                                                         
                                                                                                                                
MR.  BENAVIDES  explained  regarding  complications,  the  mother                                                               
would transfer to a hospital.                                                                                                   
                                                                                                                                
2:11:13 PM                                                                                                                    
CHAIR DYSON noted  many doctors and facilities  have a formalized                                                               
relationship  with a  hospital. He  expects the  committee action                                                               
will be to refer SB 22  to the finance committee, which will then                                                               
deal with the  more complicated issues such as the  risk of SB 22                                                               
accelerating the Medicaid costs.                                                                                                
                                                                                                                                
2:12:08 PM                                                                                                                    
CHAIR DYSON called Dr. Murray Butner to testify.                                                                                
                                                                                                                                
MURRAY BUTNER,  MD, Cordova  Community Medical  Center, testified                                                               
that he has  tried to refer some of his  Denali Kid Care patients                                                               
to birthing centers  but was informed that Denali  Kid Care would                                                               
not cover  the facility  fee, thereby  precluding the  women from                                                               
choosing that option. He believes that  SB 22 will save the state                                                               
substantial amounts of money.                                                                                                   
                                                                                                                                
CHAIR DYSON asked  Dr. Butner if he had his  child delivered in a                                                               
birthing center.                                                                                                                
                                                                                                                                
2:14:55 PM                                                                                                                    
DR. BUTNER  answered yes.  He stated  his extensive  knowledge of                                                               
the birthing process allowed him  to choose the option. There are                                                               
pros and  cons of birthing  center births and of  hospital births                                                               
but  he expressed  his  opinion  there should  be  an option  for                                                               
Medicaid recipients.                                                                                                            
                                                                                                                                
CHAIR DYSON  referred to  a note  he was  handed that  said state                                                               
Medicaid pays hospitals a reduced fee.                                                                                          
                                                                                                                                
DR. BUTNER  said he believes that  to be true. He  suggested that                                                               
somebody compare the facility costs  and all associated fees with                                                               
the birthing center fee to get a true contrast.                                                                                 
                                                                                                                                
2:16:49 PM                                                                                                                    
JENNIFER   HELLER,  registered   nurse,  Ilanka   Health  Center,                                                               
testified  she called  Providence Hospital  and was  quoted $3400                                                               
for the facility fee. The facility  fee is $1500 at Geneva Woods.                                                               
Her support for SB 22 is based on providing choices for women.                                                                  
                                                                                                                                
2:18:09 PM                                                                                                                    
HOLLY STEINER, New Life Midwifery  representative stated she is a                                                               
labor delivery nurse and a  certified midwife. She clarified that                                                               
the birth center  fee is a one-time fee, which  does not multiply                                                               
the next  day. It  is rare  to have someone  stay longer  than 24                                                               
hours.  Her practice  turns women  away on  a regular  basis that                                                               
cannot  afford the  midwife fee.  These women  want the  birthing                                                               
center service but  are not afforded that  option. Her experience                                                               
is the same  women are charged $10,000 by the  hospital for their                                                               
births.  Since Medicaid  is paying  for this,  it is  costing the                                                               
state unnecessarily.                                                                                                            
                                                                                                                                
2:20:04 PM                                                                                                                    
Statistics show  that midwifery care  has been proven  around the                                                               
world. The goal is not to make  money but to provide good care to                                                               
women  and  decrease  the  infant   mortality  rate.  Since  1997                                                               
statistics show  a rise in  midwifery births in the  Mat-Su area.                                                               
Since 2002  they have opened  up one  new birth center  and three                                                               
new midwifery businesses in the  valley. In Juneau and Anchorage,                                                               
statistics  show the  same pattern.  In the  long run  this would                                                               
definitely save the state money.                                                                                                
                                                                                                                                
2:22:18 PM                                                                                                                    
CHAIR  DYSON informed  the  room that  SB 22  would  pass out  of                                                               
committee today  and those who want  to testify may wait  for the                                                               
hearing in the Senate Finance Standing Committee.                                                                               
                                                                                                                                
2:22:54 PM                                                                                                                    
BARBARA  NORTON,   Geneva  Woods  Birth   Center  representative,                                                               
testified  Geneva Woods  has a  written  transfer agreement  with                                                               
Providence  Hospital.  It is  a  requirement  for their  national                                                               
accreditation.  She stated  that while  the facility  charges for                                                               
the  hospital may  be contracted  at a  lower rate,  intervention                                                               
increases  costs with  unnecessary procedures  such as  epidurals                                                               
and  induced labor.  The  national Cesarean  section  rate is  27                                                               
percent,  while  birthing center  Cesarean  rate  is between  3-6                                                               
percent  in Alaska.  She believes  midwifery  care decreases  the                                                               
risk of  Cesarean sections,  thereby saving  costs. The  State of                                                               
Florida Legislature passed  a bill several years ago  with a goal                                                               
of  having a  midwife attend  25 percent  of births  because they                                                               
recognized  the significant  cost  savings. She  wants to  ensure                                                               
that low-income  women are  not being  denied the  opportunity to                                                               
have low intervention births.                                                                                                   
                                                                                                                                
2:25:58 PM                                                                                                                    
SENATOR  GREEN  asked Ms.  Norton  to  clarify her  reference  to                                                               
insurance companies.                                                                                                            
                                                                                                                                
MS. NORTON said most insurance  companies pay 80 percent but some                                                               
insurance  companies  pay  100 percent  of  the  birthing  center                                                               
facility fees because  they want to encourage people  to use that                                                               
option.                                                                                                                         
                                                                                                                                
SENATOR  GREEN  cautioned  the  committee  not  to  overlook  the                                                               
possibility that  the federal government would  not reimburse the                                                               
state for birthing center fees.                                                                                                 
                                                                                                                                
2:27:36 PM                                                                                                                    
CHAIR  DYSON  said he  considered  the  option  of making  SB  22                                                               
conditional that Medicaid be available  for birthing centers that                                                               
have an  agreement with  a hospital  or as  part of  the national                                                               
accreditation.                                                                                                                  
                                                                                                                                
2:28:21 PM                                                                                                                    
CHAIR DYSON asked  Jack Nielson when his  department would finish                                                               
the regulations for birthing centers.                                                                                           
                                                                                                                                
JACK  NIELSON, Department  of Health  and Social  Services (DHSS)                                                               
stated  that once  the law  is passed  making birthing  centers a                                                               
covered  service, DHSS  would put  together  regulations for  the                                                               
reimbursement methodology. He commented  the department is unsure                                                               
of federal approval. It could be  a time consuming process and it                                                               
could be a general fund program.                                                                                                
                                                                                                                                
2:29:37 PM                                                                                                                    
SENATOR GREEN agreed with Chair Dyson  that it was a good idea to                                                               
make  SB 22  contingent on  federal approval  for the  waiver for                                                               
inclusion.                                                                                                                      
                                                                                                                                
CHAIR DYSON advised  Jack Nielson and Jerry  Fuller he understood                                                               
DHSS was coming  forth with regulations for  birthing centers and                                                               
that is wasn't contingent on SB 22.                                                                                             
                                                                                                                                
JERRY  FULLER, Department  of Health  and Social  Services (DHSS)                                                               
referred to  legislation passed last  year, which  moved birthing                                                               
centers from  a registration process  to a licensing  process. He                                                               
is not sure where DHSS is in accomplishing that.                                                                                
                                                                                                                                
CHAIR DYSON asked him to find out where the process is.                                                                         
                                                                                                                                
2:30:52 PM                                                                                                                    
MR.  FULLER advised  DHSS is  neutral  on SB  22 and  he and  Mr.                                                               
Nielson were there to answer questions.                                                                                         
                                                                                                                                
SHARON  EVANS, midwife  at Mat-Su  Midwifery, testified  in 2004,                                                               
218 Denali  Kid Care births  were done  by five birth  centers in                                                               
the  Anchorage  area.  Her  position  is  the  state  would  save                                                               
approximately $2500  per patient if  SB 22 becomes law.  Based on                                                               
these numbers  the state  would have saved  $545,000 just  on the                                                               
218 births alone, excluding the supplemental hospital costs.                                                                    
                                                                                                                                
2:33:12 PM                                                                                                                    
She asked  the committee  to support  SB 22  so that  needy women                                                               
will have options and the State of Alaska would save money.                                                                     
                                                                                                                                
2:34:15 PM                                                                                                                    
KAYE  KANNE,  Midwife's  Association  of  Alaska  representative,                                                               
addressed the issue of the  federal government not matching funds                                                               
and  advised the  association  would continue  to  work with  the                                                               
federal  government regarding  recognition  of birthing  centers.                                                               
Meantime the  state would still  realize a savings.  The hospital                                                               
facility fee  does not include  mandatory fetal  monitoring, IVs,                                                               
epidurals,  and Cesarean  section rates.  The hospital  in Juneau                                                               
charges a  minimum of $10,000,  not including the  physician fee.                                                               
She  advised that  Shelby Larsen  is  the contact  person at  the                                                               
state regarding  drafting of the birthing  center regulations and                                                               
that the  association is part  of that project. DHSS  is involved                                                               
in a major  regulation project and the birthing  centers would be                                                               
part of that but it would take time to complete.                                                                                
                                                                                                                                
2:37:36 PM                                                                                                                    
SENATOR ELTON confirmed the major regulation project at DHSS.                                                                   
                                                                                                                                
2:38:30 PM                                                                                                                    
JACK JACOB, MD,  and newborn specialist advised  the committee to                                                               
ask critical questions. He said  the statistics that he has heard                                                               
from  the birthing  centers are  incomplete  regarding costs.  He                                                               
asked the committee  to take into account  the complications that                                                               
occur from birthing center births.                                                                                              
                                                                                                                                
2:40:19 PM                                                                                                                    
DR. JACOBS said  in his experience there is  nothing unsafe about                                                               
birthing center births.  What is unsafe is  the infrastructure in                                                               
the   United  States.   Other   countries   have  created   sound                                                               
infrastructure regarding  safe practices. His impression  is that                                                               
the  birthing centers  do deliver  high-risk mothers.  He advised                                                               
the committee  to gather more information  regarding complication                                                               
rates and death rates.                                                                                                          
                                                                                                                                
2:42:04 PM                                                                                                                    
CHAIR  DYSON  asked  Dr.  Jacobs whether  he  is  inferring  that                                                               
birthing centers contribute to higher death rates.                                                                              
                                                                                                                                
DR. JACOBS  answered if  patients are  screened correctly  and if                                                               
they are low risk patients, then the death rate should be zero.                                                                 
                                                                                                                                
CHAIR  DYSON asked  Dr.  Jacob  if he  knew  of  any cases  where                                                               
complications  were  exacerbated because  the  mother  went to  a                                                               
birthing center.                                                                                                                
                                                                                                                                
DR.  JACOBS  answered yes  and  said  it is  because  appropriate                                                               
screening and infrastructure does not exist.                                                                                    
                                                                                                                                
CHAIR  DYSON asked  Dr.  Jacobs if  he  would recommend  birthing                                                               
centers have a formal relationship with a hospital.                                                                             
                                                                                                                                
DR. JACOB  responded that the issue  is complex. There are  a few                                                               
highly urban countries in Europe that have a good model.                                                                        
                                                                                                                                
Chair Dyson  asked Dr.  Jacobs if he  is inferring  that birthing                                                               
centers should be close to a hospital.                                                                                          
                                                                                                                                
2:44:50 PM                                                                                                                    
DR.  JACOBS replied  if  a  birthing center  is  not  close to  a                                                               
hospital, there needs to be specific plan.                                                                                      
                                                                                                                                
CHAIR DYSON announced a brief recess for discussion.                                                                            
                                                                                                                                
2:45:31 PM                                                                                                                    
CHAIR DYSON called the committee back on record.                                                                                
                                                                                                                                
2:46:34 PM                                                                                                                    
SENATOR  WILKEN moved  SB  22 out  of  committee with  individual                                                               
recommendations and  attached fiscal  note. He added  his concern                                                               
regarding cost. He  stated the Denali Kid Care  program costs the                                                               
state far beyond  what was expected. The  Medicaid climate incurs                                                               
extraordinary costs out of the general fund budget.                                                                             
                                                                                                                                
2:48:41 PM                                                                                                                    
SENATOR  ELTON  offered  the Senate  Finance  Standing  Committee                                                               
would look at costs given the  explosion in health care costs and                                                               
additional  fees charged  at facilities.  He believes  increasing                                                               
options  introduces   a  competitive  business.  He   stated  his                                                               
estimation is that SB 22 would save the state money.                                                                            
                                                                                                                                
2:50:21 PM                                                                                                                    
CHAIR  DYSON recognized  no objections  and  SB 22  moved out  of                                                               
committee.                                                                                                                      

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