Legislature(2007 - 2008)BUTROVICH 205

02/18/2008 01:30 PM HEALTH, EDUCATION & SOCIAL SERVICES


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ SB 117 WORKERS' COMP: DISEASE PRESUMPTION TELECONFERENCED
Moved CSSB 117(L&C) Out of Committee
Bills Previously Heard/Scheduled
= SB 160 MANDATORY UNIVERSAL HEALTH CARE
Moved CSSB 160(HES) Out of Committee
-- Testimony <Invitation Only> --
             SB 160-MANDATORY UNIVERSAL HEALTH CARE                                                                         
                                                                                                                                
2:12:17 PM                                                                                                                    
CHAIR DAVIS announced the consideration of SB 160.                                                                              
                                                                                                                                
SENATOR FRENCH, sponsor  of SB 160, said this  is a comprehensive                                                               
bill.  He  said the  basic  idea  is  to make  affordable  health                                                               
insurance  available to  every Alaskan  by establishing  a health                                                               
care  board that  would oversee  a fund  and help  certify health                                                               
care  plans.  Four  to  five private  insurance  plans  would  be                                                               
available  to Alaska  citizens who  would get  a voucher  to help                                                               
them buy  one of  these plans.  Most people  would fall  into the                                                               
zone  of between  100  and  300 percent  of  the federal  poverty                                                               
level. They would get a  sliding scale voucher depending on their                                                               
income  which would  help them  buy a  plan. This  doesn't affect                                                               
anyone who currently  has health insurance; it is  only meant for                                                               
those who don't get health insurance  as part of their job. It is                                                               
not government run  or socialized medicine, but  rather using the                                                               
private  market  place to  make  private  insurance available  to                                                               
Alaska citizens through the creation of a health care fund.                                                                     
                                                                                                                                
He  said this  is the  third time  the committee  has heard  this                                                               
bill.  There  was  a  hearing  in  September  2007  in  which  12                                                               
stakeholders including  representatives from small  business, the                                                               
medical  profession, and  the insurance  industry helped  outline                                                               
problems  and difficulties  with one  hundred thousand  uninsured                                                               
Alaskans. Two  nationally prominent health care  experts from the                                                               
Heritage  Foundation  and the  Cato  Institute  commented on  the                                                               
problem  here  and  the  solutions  proposed.  The  CS  that  was                                                               
presented   in  January   2008   was  the   result  of   numerous                                                               
conversations  and comments  since  the bill  was introduced.  He                                                               
said  his  office  has  had   meetings  with  the  Alaska  Nurses                                                               
Association,  Aetna,  representatives   from  the  Department  of                                                               
Health  and  Social  Services, the  Division  of  Insurance,  and                                                               
Commonwealth  North's  Health  Care  Roundtable.  He  has  spoken                                                               
personally with  over a dozen  groups in the  community including                                                               
the Alaska  Association of Health Underwriters,  AFL-CIO's Alaska                                                               
Conference, AARP, and the Alaska  Chamber of Commerce. He will be                                                               
meeting with  the National Federation of  Independent Businesses.                                                               
His office  has had  hundreds of emails  from Alaskans  about the                                                               
bill.                                                                                                                           
                                                                                                                                
2:15:42 PM                                                                                                                    
SENATOR FRENCH  said there are misunderstandings  about the bill.                                                               
He recently  received an email  from a small businessman  who was                                                               
unhappy with an employer levy  because while he'd like to provide                                                               
health insurance  for his  employees, the levy  would put  him in                                                               
the hole.  In fact, Senator French  said, the bill says  there is                                                               
no levy  if an employer  has zero to  10 employees. So,  it would                                                               
actually help his employees at no cost to him.                                                                                  
                                                                                                                                
If  an employer  has between  10 and  20 employees,  the levy  is                                                               
percent  of the  gross payroll.  If an  employer has  20 or  more                                                               
employees  the levy  is 2  percent. There  are even  ways to  get                                                               
around those levies.  If an employer offers to pay  33 percent of                                                               
the premium  costs of a  health insurance plan, there's  no levy.                                                               
If  employers  enroll 25  percent  of  employees in  an  employer                                                               
sponsored  plan,  there's no  levy.  If  an  employer sets  up  a                                                               
Section 125 cafeteria plan, a  plan made available by the federal                                                               
government  to small  businesses, that  plan allows  employees to                                                               
purchase  health  care coverage  with  pre  federal tax  dollars,                                                               
making employers exempt  from the levy.  The cost  of a basic 125                                                               
plan to an employer is $300.                                                                                                    
                                                                                                                                
SENATOR FRENCH said he has used  the internet to get the word out                                                               
to employees with a website.  They have an interactive calculator                                                               
that allows  people to go  to the  website, plug in  their income                                                               
level, and  find out what  it would actually  cost them to  get a                                                               
health  insurance policy.  People from  all over  the state  have                                                               
signed  a letter  of  support  and are  signed  up  to get  email                                                               
updates.                                                                                                                        
                                                                                                                                
He  said the  bill  will not  address  Medicare or  reimbursement                                                               
rates. People  over 65 years  of age  in Alaska will  continue to                                                               
face  difficulties  getting  a  medical doctor  as  long  as  the                                                               
medical reimbursement rates set  by the federal government remain                                                               
so far from  the demands of the market. The  legislation will not                                                               
establish a single payer government-run  program. He said he gets                                                               
some  flack from  the right  alleging  that he's  trying to  push                                                               
socialized  medicine which  is  not true.  The  same people  that                                                               
object to  government run  medical care are  often are  signed up                                                               
for Medicare which  is a single payer system  which covers anyone                                                               
over 65.  This bill  relies on market  forces and  competition to                                                               
lower costs  while at the  same time ensuring that  patients have                                                               
the financial  capability to get  the care they need.  It doesn't                                                               
increase the number of doctors in Alaska.                                                                                       
                                                                                                                                
2:19:51 PM                                                                                                                    
SENATOR FRENCH said  the bill will reduce  the unspoken financial                                                               
penalty  paid by  individuals and  businesses  who currently  buy                                                               
coverage for  people who  opt out or  cannot afford  health care.                                                               
Federal  law requires  that hospitals  give medical  attention to                                                               
everyone who needs  emergency care. When someone  cannot pay, the                                                               
costs are  transferred to those  of us  who can pay.  Fixed state                                                               
and  federal reimbursement  rates for  medical care  prevent this                                                               
cost  shifting  from  being borne  by  government  programs  like                                                               
Medicare and  Medicaid. In 2005  after modest  uncompensated care                                                               
reimbursement from  the state and  federal government,  over $100                                                               
million worth  of unpaid medical  bills were left  outstanding in                                                               
Alaska.  Last   September  during   the  SB  160   hearings  Joel                                                               
Gilbertson reported  that Providence  was likely to  surpass $100                                                               
million  of uncompensated  care  in 2007.  Families USA  estimate                                                               
that this  unspoken tax  will easily surpass  $1000 per  year per                                                               
family  in 2010.  As  costs continue  to go  up,  the free  rider                                                               
problem  will only  get larger  increasing the  penalty of  being                                                               
unprepared with a health care coverage plan.                                                                                    
                                                                                                                                
SENATOR FRENCH  said SB 160 is  a work in progress  and he'd like                                                               
to  offer  an  amendment  inspired by  conversations  with  Chair                                                               
Davis. It  states that Medicaid  will continue to have  a crucial                                                               
role to play in health  reform efforts. The amendment charges the                                                               
health care board to offer  recommendations on possible expansion                                                               
of  Medicaid, taking  into  account the  fiscal  impact of  those                                                               
changes. From these recommendations  the legislature would have a                                                               
basis to act with the fiscal  interests of the state in mind. The                                                               
legislation is  methodical and it's  a well  thought-out proposal                                                               
that won't address all medical issues but it's a good start.                                                                    
                                                                                                                                
2:22:29 PM                                                                                                                    
CANDY SIMS,  Anchorage, AK,  said she  has three  major concerns:                                                               
the cost to the individual if  her family doesn't qualify for the                                                               
voucher system  by making  too much money.  She asked  if there's                                                               
going  to  be some  kind  of  a  sliding  scale. She  said  she's                                                               
concerned about the  penalties mentioned in the  last hearing one                                                               
of which  was if you don't  have insurance, perhaps you  won't be                                                               
able to  go to  college. This would  kill her  daughter's dreams.                                                               
Her  family  doesn't currently  have  insurance  and she  has  an                                                               
incurable disease. She  was able to afford insurance  for a while                                                               
but  at  a  certain  point she  couldn't  afford  both  insurance                                                               
coverage and  the cost  of prescriptions. When  she tried  to get                                                               
coverage for herself and her  daughter, carriers refused to cover                                                               
her when she mentioned her disease.                                                                                             
                                                                                                                                
MS. SIMS said  she received an email from  Senator French stating                                                               
that pre existing  conditions would not be a problem.   She asked                                                               
if the clearing house that would  be set up would offer insurance                                                               
policies for people  with chronic illness. If she  has a problem,                                                               
for example,  if she's  been overcharged, she  asked how  the two                                                               
medical boards would interact.                                                                                                  
                                                                                                                                
CHAIR DAVIS said that she would  bring the sponsor back to answer                                                               
some of  Ms. Sims' questions, but  some of the questions  did not                                                               
pertain  to the  bill. This  bill is  not the  answer to  all the                                                               
problems.                                                                                                                       
                                                                                                                                
2:28:55 PM                                                                                                                    
ANDY MODOROW, staff, Senator French,  said the guarantee issue as                                                               
stated in the  bill does require that an  insurance company issue                                                               
a policy  to an individual who  is within the Alaska  health care                                                               
program. Currently there  is such a law for  Alaska's small group                                                               
market with between two and fifty  and it's one of the things the                                                               
responsibility clauses  in the bill  provide for. It  reduces the                                                               
moral  hazard  that  would come  about  without  having  coverage                                                               
required for everyone.                                                                                                          
                                                                                                                                
He  said  college  access  being   tied  to  health  care  as  an                                                               
enforcement  tool  is not  in  the  bill.  Some people  on  ACHIA                                                               
(Alaska  Comprehensive  Health  Insurance  Association) expressed                                                             
concern about being able to  get coverage. ACHIA is Alaska's high                                                               
risk pool and the current draft  of the bill provides vouchers of                                                               
up to  450 percent  of the  federal poverty  line -  an increased                                                               
amount that should  make coverage affordable for  them. While the                                                               
guarantee issue  clause does  overlap, it  will provide  a safety                                                               
valve while this legislation is being implemented.                                                                              
                                                                                                                                
2:30:50 PM                                                                                                                    
PATRICIA  SENNER,  Advanced  Nurse  Practitioner,  Alaska  Nurses                                                               
Association  (ANA),   Anchorage,  AK   said  the   Alaska  Nurses                                                               
Association  is   very  appreciative   of  Senators   French  and                                                               
Wielechowski  for   introducing  this   bill  and   starting  the                                                               
discussion of how  to solve Alaska's current  health care crisis.                                                               
The members are concerned about  their patients who are unable to                                                               
afford  health care  insurance. She  personally had  to advise  a                                                               
young  man not  to get  a  job so  he could  remain eligible  for                                                               
Medicaid and  be treated for  his leukemia. Many members  work in                                                               
hospitals  where  fewer  and  fewer  patients  have  health  care                                                               
insurance while  at the same time  many of the sources  of income                                                               
for the  hospital are being  siphoned off by private  surgery and                                                               
imaging centers.                                                                                                                
                                                                                                                                
She said it  is difficult for the members to  analyze whether the                                                               
model  outlined in  SB 160  is financially  viable, but  they are                                                               
convinced  that the  solution to  getting affordable  health care                                                               
for  Alaskans is  to have  the cost  of that  insurance be  split                                                               
between the  individual, the  state and  the employer.  They also                                                               
think it is appropriate for the  individual to assume some of the                                                               
responsibility  for  insuring  that   health  care  services  are                                                               
available in Alaska. If Alaskans  want a hospital to be available                                                               
when they  need it, they should  be willing to help  pay for them                                                               
to keep their doors open.                                                                                                       
                                                                                                                                
The  members also  want to  thank  the senators  for including  a                                                               
nurse on the  Alaska Health Care Board. If the  board does become                                                               
a reality, there probably should  be two boards, one dealing with                                                               
financial issues  and running  the program,  and the  other board                                                               
dealing with clinical issues concerning coverage services.                                                                      
                                                                                                                                
2:33:17 PM                                                                                                                    
LARRY  WEISS,  Executive  Director,   Alaska  Center  for  Public                                                               
Policy,  Anchorage,  AK,  said  legislators  have  shown  serious                                                               
interest  in a  difficult problem  and they  have put  it on  the                                                               
table for  wide discussion.  He said he  does have  some concerns                                                               
about the way  the bill is structured and that  SB 160 was chosen                                                               
in  comparison to  several other  possible  health reform  plans.                                                               
When California was considering  health care reform, state policy                                                               
analysts   invited  nine   different   organizations  to   submit                                                               
comprehensive  proposals.  On  one   end  of  the  spectrum  were                                                               
proposals that  recommended minor  tinkering around the  edges of                                                               
the health  care industry.  At the  other end  was a  proposal to                                                               
create the  California Health Service,  a health plan  which made                                                               
all health care facilities publicly owned.                                                                                      
                                                                                                                                
The nine  plans were submitted  to a large East  Coast consulting                                                               
firm.  The final  report provides  a detailed  discussion of  the                                                               
cost and coverage  implications of each of the  nine proposals. A                                                               
second  selected contractor  did  a qualitative  analysis of  the                                                               
options  which  included  such  things  as  access,  utilization,                                                               
continuity  of   care,  quality   of  appropriateness   of  care,                                                               
etcetera. All the documentation is  online.  Anyone in California                                                               
has the ability to look this information up and comment on it.                                                                  
                                                                                                                                
MR. WEISS  said he's  also concerned about  the over  reliance on                                                               
private  health   insurance.  That   means  very   expensive  and                                                               
unnecessary overhead  for the state that  isn't characteristic of                                                               
other approaches.  It will include expensive  deductibles and co-                                                               
payments  for patients.  Research  shows that  this will  prevent                                                               
people  from using  the insurance  once they  have it.  He's also                                                               
concerned that private  health insurance in Alaska  is actually a                                                               
very  concentrated  market where  only  one  insurer controls  60                                                               
percent of all private health  insurance in the state. The market                                                               
here is not competitive.                                                                                                        
                                                                                                                                
MR.  WEISS  expressed concern  for  the  lack of  provisions  for                                                               
quality of  care and  the notion of  individual mandates.  It's a                                                               
punitive  approach  that is  stumbling  in  Massachusetts and  is                                                               
unnecessary with  other plans. He  suggested they take  a serious                                                               
look at programs already in  place that have a demonstrated track                                                               
record, that  are cost  effective and that  have quality  of care                                                               
elements already built in.                                                                                                      
                                                                                                                                
He  thought Medicaid  should be  expanded to  the maximum  extent                                                               
possible and went on to discuss some of its benefits.                                                                           
                                                                                                                                
He  also  recommended  developing   a  comprehensive  package  of                                                               
funding  for the  130 community  health clinics  scattered across                                                               
Alaska to  enable these  non-profit federally  subsidized clinics                                                               
to recruit and retain staff and  to directly serve those who need                                                               
health   care.   This   approach  would   eliminate   unnecessary                                                               
administrative and  other costs  of private health  insurance and                                                               
at the same time directly provide  medical care to those in need.                                                               
Care costs for  community health centers have  been documented to                                                               
be  far below  those  in for-profit  health  care settings.  This                                                               
approach  would   also  address  the  Medicare   problem  because                                                               
Medicare patients  are accepted at every  community health clinic                                                               
in Alaska.                                                                                                                      
                                                                                                                                
2:39:37 PM                                                                                                                    
CHAIR DAVIS said  that Medicaid can be expanded but  this bill is                                                               
strictly intended to provide health care for all Alaskans.                                                                      
                                                                                                                                
2:40:41 PM                                                                                                                    
MARK  VINSEL,  Executive  Director, United  Fisherman  of  Alaska                                                               
(UFA), Juneau, AK, said that UFA  doesn't have a position on this                                                               
bill, but  gave an overview  of the challenges  facing commercial                                                               
fishermen  regarding access  to  health care  and insurance.  UFA                                                               
thinks that  commercial fishermen fall  through the cracks  to an                                                               
extent that  is not seen  in any other demographic  or occupation                                                               
that they might compare themselves  to. A higher percentage lives                                                               
in rural  areas that are less  likely to be served  by a hospital                                                               
or a road system that would  provide the ability to get to health                                                               
care facilities.  Being largely  self-employed with  variable and                                                               
seasonable income  opportunities, affordable health  insurance is                                                               
difficult  to  come by.  This  is  a  problem  that needs  to  be                                                               
addressed.                                                                                                                      
                                                                                                                                
2:43:15 PM                                                                                                                    
WILLIAM STREUR, Deputy Commissioner  for Medicaid and Health Care                                                               
Policy,  Department   of  Health  and  Social   Services  (DHSS),                                                               
Anchorage, AK, said Senator French's  new amendment has increased                                                               
his  interest. He  supported this  bill  and the  intent to  make                                                               
health  care  a reality  for  all  Alaskans.  He spent  30  years                                                               
helping people  get access  to health care  when there  was none,                                                               
mostly  through Medicaid.  He advised  that the  state must  also                                                               
ensure  that there  are providers  of health  care available  and                                                               
willing to accept those seeking  services. Health insurance alone                                                               
does not  guarantee that those  seeking services will  receive it                                                               
if there are no providers.                                                                                                      
                                                                                                                                
MR. STREUR  said this bill  is primarily an access  and insurance                                                               
issue,  and is  not best  placed  under the  sole management  and                                                               
implementation  of   DHSS.  The  issues  DHSS   deals  with  like                                                               
eligibility,  provider  systems,  rates,  and  premiums  are  not                                                               
familiar Medicaid issues.  This is a new paradigm  for Alaska and                                                               
no  one department  may  be currently  equipped  to address  this                                                               
legislation.                                                                                                                    
                                                                                                                                
2:45:40 PM                                                                                                                    
SENATOR COWDERY asked if there  were any cost estimates and where                                                               
the money would come from.                                                                                                      
                                                                                                                                
CHAIR  DAVIS  replied  that  was  not  an  issue  that  would  be                                                               
considered in this committee.                                                                                                   
                                                                                                                                
2:46:36 PM                                                                                                                    
SENATOR  THOMAS  asked  if the  administration  agreed  with  the                                                               
requirement for every Alaskan to have health insurance.                                                                         
                                                                                                                                
MR.STREUR said  the department itself  has not taken  a position,                                                               
but it is a goal that access is available to every citizen.                                                                     
                                                                                                                                
SENATOR DYSON said  that access is different  than requiring that                                                               
everyone have health insurance.  This bill requires that everyone                                                               
have  health insurance  leaving no  self-payers in  the state.  A                                                               
multi-millionaire who chooses  to pay his own bills  would not be                                                               
allowed  to  do  that.  He  asked Mr.  Streur  if  that  was  his                                                               
position.                                                                                                                       
                                                                                                                                
MR. STREUR replied he was not prepared to answer.                                                                               
                                                                                                                                
SENATOR  DYSON  asked  for  confirmation   that  Mr.  Streur  was                                                               
personally in favor of this bill.                                                                                               
                                                                                                                                
MR. STREUR replied he was.                                                                                                      
                                                                                                                                
SENATOR  DYSON  asked  if  Mr.  Streur's  support  included  that                                                               
provision.                                                                                                                      
                                                                                                                                
MR. STREUR replied yes.                                                                                                         
                                                                                                                                
SENATOR DYSON  asked if  Mr. Streur  was in  favor of  forcing an                                                               
insurance company to take any  citizen including one who is being                                                               
very reckless their health, swapping  body fluids or weighing 800                                                               
pounds or  all kinds  of toxic things  and the  insurance company                                                               
would have  to take  that person even  though their  behavior was                                                               
destructive and they were unrepentant.                                                                                          
                                                                                                                                
MR. STREUR replied that as a  former health care insurer that was                                                               
what he was faced with.                                                                                                         
                                                                                                                                
SENATOR  DYSON asked  if Mr.  Streur  was in  favor of  insurance                                                               
companies  being  forced to  take  people  with any  pre-existing                                                               
conditions including ones that are behavior-related.                                                                            
                                                                                                                                
MR.  STREUR  replied  that  if  the  senator  was  talking  about                                                               
destructive  behavior  being allowed,  [he  thought]  it was  not                                                               
covered under this bill but would defer to the sponsor.                                                                         
                                                                                                                                
2:48:54 PM                                                                                                                    
SENATOR ELTON asked who is  paying for the health consequences of                                                               
the behavior  previously cited.  He said  his impression  is that                                                               
much of  those health care costs  are being borne by  the general                                                               
public.  The hospital  in his  community is  a taxpayer-supported                                                               
hospital.  He said  it  would be  helpful to  talk  about who  is                                                               
paying  for  the  health  care   consequences  of  that  kind  of                                                               
behavior.                                                                                                                       
                                                                                                                                
MR. STREUR  replied that  everyone is  paying for  it. Providence                                                               
Hospital has $11 million in write-offs.                                                                                         
                                                                                                                                
SENATOR  DYSON  said instead  of  everyone  paying through  cost-                                                               
shifting, individual  insurance companies will be  forced to take                                                               
anyone  who  applies  even  with  pre-existing  conditions.  Even                                                               
though everyone  is paying now, it  is still a paradigm  shift to                                                               
go out  there and force  someone in private enterprise  to assume                                                               
this burden.                                                                                                                    
                                                                                                                                
CHAIR  DAVIS said  people  who already  have  insurance won't  be                                                               
affected by the bill.                                                                                                           
                                                                                                                                
SENATOR DYSON  said that according  to the  bill if a  person has                                                               
pre-existing  bad  behavior  and is  unrepentant,  the  insurance                                                               
company has  to take him/her,  which is different than  paying as                                                               
part of a public responsibility.                                                                                                
                                                                                                                                
2:52:02 PM                                                                                                                    
SENATOR THOMAS asked for an interpretation  of lines 30 and 31 on                                                               
page 2.                                                                                                                         
                                                                                                                                
SENATOR  FRENCH said  he  appreciated  the committee's  wrestling                                                               
with the essence  of the bill. Those lines  state the requirement                                                               
that an  individual has to  have a health insurance  policy. This                                                               
is a  topic that's playing  out on a  national level. One  of the                                                               
big  disputes between  Barak Obama  and Hillary  Clinton is  that                                                               
Senator Clinton's  plan has a  mandatory insurance  provision and                                                               
Senator Obama's does not.                                                                                                       
                                                                                                                                
He  believes the  mandatory  requirement has  the  better of  the                                                               
argument.  Universal health  care  is not  achievable by  letting                                                               
healthy adults  out of  the insurance  net. Insurance  works best                                                               
when everyone  participates; that  is the  basic idea  behind it.                                                               
Every human being has a body and  they are going to need a doctor                                                               
sooner or later.  If they  don't have insurance someone else will                                                               
pay when  they get sick  or have an  accident. It is  possible to                                                               
set a  policy for young  healthy adults  and people that  hate to                                                               
pay into  the system  in a  way that fits  their needs  but isn't                                                               
onerous and doesn't cost a lot, more  like a cell phone bill or a                                                               
cable bill.  They chip in to  the system to cover  themselves for                                                               
when they do need it. It's part of the human compact.                                                                           
                                                                                                                                
2:54:41 PM                                                                                                                    
SENATOR  DYSON restated  his concern  about the  person who  is a                                                               
multi-millionaire and has never had  a dime's worth of welfare or                                                               
had   anyone  else   pay   his  bill   and   can  easily   assume                                                               
responsibility for their health care but  would not be able to do                                                               
it under this bill.                                                                                                             
                                                                                                                                
SENATOR  FRENCH said  he'd be  happy to  write an  amendment that                                                               
would excuse the half dozen  multi-millionaires in the state that                                                               
currently don't have insurance if  they're willing to post a bond                                                               
sufficient  to cover  their health  insurance problems  when they                                                               
arise or with the posting of  some financial net worth to satisfy                                                               
the health care board.                                                                                                          
                                                                                                                                
SENATOR DYSON said  he suspected that both he  and Senator French                                                               
were guilty  of demagoguing the  issue. To  him it is  a personal                                                               
liberties issue.  Everyone in the  state being forced to  do this                                                               
because of the worry that  this multimillionaire might run out of                                                               
his wealth and  not be able to pay his  own bills is questionable                                                               
policy.                                                                                                                         
                                                                                                                                
He restated  his question about not  allowing insurance companies                                                               
to opt out of taking people with bad behavior.                                                                                  
                                                                                                                                
SENATOR FRENCH said  the flip side of requiring  every citizen to                                                               
get insurance is to make  insurance available in a meaningful way                                                               
to  every citizen.  If people  who  are overweight  or who  smoke                                                               
can't  be issued  policies the  whole thing  falls apart.  As the                                                               
former  witness stated,  everyone pays  those bills.  If a  drug-                                                               
addicted prostitute  wakes up tomorrow  on the streets  of Juneau                                                               
with HIV, the Juneau hospital will  take her in and care for her,                                                               
and everyone  in the state  is going  to pay those  bills because                                                               
this is  a humane society. The  idea that we would  exclude those                                                               
individuals  from an  insurance policy  because of  the decisions                                                               
they  made is  not  part  of a  humane  society.  He agreed  that                                                               
positive lifestyle choices  should get someone a  cheaper form of                                                               
insurance. Healthy  people who  don't smoke  should pay  less for                                                               
insurance but at  some level every person must be  allowed to buy                                                               
a policy.                                                                                                                       
                                                                                                                                
2:57:27 PM                                                                                                                    
SENATOR ELTON said Senator Dyson  always makes him think. He said                                                               
there's a  model for  forcing rich people  to buy  insurance that                                                               
everyone has become accustomed to  - mandatory auto insurance and                                                               
nobody  has protested  it.  He  asked Senator  French  if he  had                                                               
thought  of his  bill in  terms  of what  is now  done with  auto                                                               
insurance.                                                                                                                      
                                                                                                                                
SENATOR  FRENCH  said the  parallels  are  profound. Some  states                                                               
allow people to  post a $100,000 bond to cover  expenses in a car                                                               
crash. It's  conceivable to write  this kind of an  exception for                                                               
health insurance.                                                                                                               
                                                                                                                                
SENATOR DYSON said he didn't  think they were parallel situations                                                               
because what is  required for car insurance is  liability so that                                                               
other people who might be harmed  are covered. It you could force                                                               
people who  were swapping needles or  body fluids, it would  be a                                                               
parallel  situation. Auto  insurance is  not required  unless the                                                               
car is  driven on public roads  which is why that  analogy breaks                                                               
down. It's a difference between  liability coverage and harm done                                                               
to  others as  opposed to  the damage  one does  to oneself.  The                                                               
system  must reward  individual  responsibility  and institute  a                                                               
downside to irresponsible behavior.                                                                                             
                                                                                                                                
He appreciates having an auto  insurance company that gives him a                                                               
reward  for having  25  years of  accident  free insurance.  He'd                                                               
liked to  have a reward  for having  fire alarms and  a sprinkler                                                               
system in his  house. He'd like to have his  brakes and excellent                                                               
tires  inspected  and  he'd  like  to  be  rewarded  for  prudent                                                               
behavior.  Ultimately this  must be  done with  health insurance.                                                               
His  concern  is  that  the   system  is  so  bastardized.  Frank                                                               
Murkowski talked about having the  tax base pay the hospitals for                                                               
taking care  of the indigent.   Then those who assume  the public                                                               
and  human   responsibility  would  pay  directly.   Instead  the                                                               
hospitals  are  forced  to  do this  perverted  system  of  cost-                                                               
shifting so that they shift the  cost to their profit centers and                                                               
the high  return businesses  like imaging in  order to  cover the                                                               
indigent.  It's a  shell game  that masks  the real  cost.   As a                                                               
result, a  part of the  bill has responsible people  covering the                                                               
indigent. He wished  for legislation that would  at least provide                                                               
a  tax deduction  for this  charitable gift  to the  indigent but                                                               
instead there's a refusal to get at the fundamental issues.                                                                     
                                                                                                                                
3:01:27 PM                                                                                                                    
SENATOR THOMAS asked for clarification  of what premiums would be                                                               
paid by different income levels.                                                                                                
                                                                                                                                
SENATOR FRENCH responded  if this bill passes,  a millionaire who                                                               
doesn't have  insurance should get  a 15 percent reduction  in an                                                               
insurance policy through the clearing  house; they wouldn't get a                                                               
voucher since  they are over  300 percent of the  federal poverty                                                               
limit.                                                                                                                          
                                                                                                                                
3:03:54 PM                                                                                                                    
SENATOR ELTON asked  if the board of the  proposed clearing house                                                               
would  approve  private health  insurance  plans  and not  others                                                               
based on deductibles or services covered.                                                                                       
                                                                                                                                
SENATOR FRENCH  replied yes  and he  envisioned a  plan something                                                               
like the state  has now and the voucher would  get the price down                                                               
to where a working Alaskan could afford it.                                                                                     
                                                                                                                                
3:05:41 PM                                                                                                                    
SENATOR ELTON said  he was intrigued by the list  of services and                                                               
asked what happens  if there is no private insurer  that wants to                                                               
participate.                                                                                                                    
                                                                                                                                
SENATOR  FRENCH replied  he didn't  have the  answer. He  said he                                                               
assumed someone would move into that market.                                                                                    
                                                                                                                                
3:06:32 PM                                                                                                                    
CHAIR DAVIS asked Senator French to explain Amendment 1.                                                                        
                                                                                                                                
                          AMENDMENT 1                                                                                       
                                                                                                                                
     OFFERED IN THE SENATE                    BY SENATOR FRENCH                                                                 
         TO:  CSSB 160(   ), Draft Version "V"                                                                                  
                                                                                                                                
     Page 10, line 23, following "Medicaid":                                                                                    
          Insert "and the potential expansion of the Alaska                                                                     
     Medicaid  program, including  a comparison  between the                                                                    
     costs of expanding the Alaska  Medicaid program and the                                                                    
     cost of  providing benefits  through the  Alaska health                                                                    
     care program"                                                                                                              
                                                                                                                                
SENATOR FRENCH  said Amendment 1  was prompted by  a conversation                                                               
between himself  and the chair  to make  the most of  Medicaid by                                                               
comparing  it to  the  cost of  providing  benefits through  this                                                               
bill. If a huge imbalance was  found, a push could be made toward                                                               
Medicaid.                                                                                                                       
                                                                                                                                
3:08:42 PM                                                                                                                    
SENATOR ELTON moved to adopt Amendment 1, labeled 25-LS0728\V.1.                                                                
There being no objection, the motion carried.                                                                                   
                                                                                                                                
He said this amendment adds  a requirement to report on something                                                               
that makes sense. It does  not require action by the legislature,                                                               
but provides information  upon which a decision could  be made in                                                               
the future.                                                                                                                     
                                                                                                                                
SENATOR  DYSON  said  that most  providers  argue  that  Medicaid                                                               
reimbursement  rates  are significantly  less  than  the cost  of                                                               
providing  the  service  and  that's  why  indigent  people  have                                                               
difficulty finding  someone to provide  the service. He  asked if                                                               
it's possible  for the  state to reimburse  the provider  for the                                                               
difference between the Medicaid rate and the actual cost.                                                                       
                                                                                                                                
3:11:19 PM                                                                                                                    
SENATOR ELTON moved to report committee substitute for SB 160,                                                                  
as amended, from committee with individual recommendations and                                                                  
attached fiscal note(s).                                                                                                        
                                                                                                                                
SENATOR DYSON objected.                                                                                                         
                                                                                                                                
A roll call vote was taken. Senators Elton, Thomas, Davis voted                                                                 
yea; and Senator Dyson voted nay; so CSSB 160(HES) moved from                                                                   
committee.                                                                                                                      

Document Name Date/Time Subjects