Legislature(1997 - 1998)
04/23/1998 08:20 AM House FIN
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
April 23, 1998
8:20 A.M.
TAPE HFC 98 - 121, Side 1.
TAPE HFC 98 - 121, Side 2.
TAPE HFC 98 - 122, Side 1.
CALL TO ORDER
Co-Chair Therriault called the House Finance Committee
meeting to order at 8:20 A.M.
PRESENT
Co-Chair Hanley Representative Kelly
Co-Chair Therriault Representative Grussendorf
Representative J. Davies Representative Martin
Representative G. Davis Representative Moses
Representative Foster Representative Mulder
Representative Kohring was not present for the meeting.
ALSO PRESENT
Senator Jerry Mackie; Jay Lively, Deputy Commissioner,
Department of Health and Social Services; Bob Labbe,
Director, Division of Medical Assistance, Department of
Health and Social Services; Karen Pearson, Health Program
Manager, Division of Public Assistance, Department of Health
and Social Services; Loraine Derr, Alaska State Hospital and
Nursing Home Association (ASHNHA), Juneau; Catherine
Reardon, Director, Division of Occupational Licensing,
Department of Commerce and Economic Development.
TESTIFIED VIA TELECONFERENCE - FAIRBANKS
Missy Poeschel, Fairbanks; Margaret Miller, Fairbanks;
Laura Bush, Fairbanks; Sarana Schell, Fairbanks.
SUMMARY
HB 369 An Act relating to Medicaid coverage for certain
eligible children and pregnant women; relating to
primary care case management and managed care
services as optional services and to premiums and
cost-sharing contributions under the Medicaid
program; establishing the Healthy Families Alaska
program; and providing for an effective date.
CS HB 369 (FIN) was reported out of Committee
with a "do pass" recommendation and with (4) four
fiscal notes by the Department of Health and
Social Services dated 4/23/98.
HB 408 An Act establishing the Alaska Seismic Hazards
Safety Commission.
CS HB 408 (FIN) was reported out of Committee
with a "do pass" recommendation and with a new
fiscal note by the Office of the Governor.
SB 110 An Act relating to licensure of landscape
architects.
HCS CSSB 110 (FIN) was reported out of Committee
with a "do pass" recommendation and with a fiscal
note by the Department of Commerce and Economic
Development dated 1/21/98.
SENATE BILL NO. 110
"An Act relating to licensure of landscape
architects."
SENATOR JERRY MACKIE noted that SB 110 related to the
licensure of landscape architects. In order for Alaskan
landscape architects to secure federal projects, the State
must provide landscape architect licensing capabilities.
Alaskan landscape architects are currently excluded from
participating in securing the federal jobs and the money
going to companies located outside of the State. The
legislation would provide the State with another tool to
support the hire of Alaskan workers and companies.
He added that the fiscal note indicates that in accordance
with AS 08.01.065, all licensees are required to pay the
costs of regulating their profession; the program would be
paid entirely by program receipts.
Senator Mackie requested that the Committee entertain the
proposed amendment to the House Labor and Commerce version
of the legislation. The deletion exemptions provide for an
adequate scope of exempted criteria related to
architectural landscaping. The Chairman of the Labor and
Commerce Committee is in concurrence with the proposed
change.
Senator Mackie added that the legislation would not affect
people doing landscaping in their own yards or someone
else's. It would only affect those situations requiring
the landscaping, engineering and/or designing of particular
public projects.
Representative J. Davies noted that language on Page 11,
Line 10, would address concerns of Committee members.
CATHERINE REARDON, DIRECTOR, DIVISION OF OCCUPATIONAL
LISCENSING, DEPARTMENT OF COMMERCE AND ECONOMIC
DEVELOPMENT, spoke in favor of the amendment. She pointed
out that the exemptions added on Page 12, apply to
architecture, engineering and land surveying. Additional
exemptions would also be included for designing buildings.
Existing exemptions cover anything less than a four-plex.
She pointed out that the problem with the language on Page
12, Line 11, was that the word "person" could mean
"business and/or corporation".
Co-Chair Therriault MOVED to adopt Amendment #1. There
being NO OBJECTION, it was adopted.
Co-Chair Therriault questioned the up-front fees. Ms.
Reardon replied that language would allow the entire group
of architects, engineers and landscapers to pay fees
individually, but this would instead allow a sharing of
costs between the three professions. She noted that the
Board of Commissions supported this language.
Representative Mulder MOVED to report HCS CSSB 110(FIN) out
of Committee with individual recommendations and with the
accompanying fiscal note. There being NO OBJECTION, it was
so ordered.
HCS CSSB 110 (FIN) was reported out of Committee with a "do
pass" recommendation and with a fiscal note by the
Department of Commerce and Economic Development dated
1/21/98.
HOUSE BILL NO. 408
"An Act establishing the Alaska Seismic Hazards Safety
Commission."
REPRESENTATIVE JOHN DAVIES noted that Alaska needs to
establish a Seismic Hazards Safety Commission to address a
need it provide a consistent policy framework and a means
for ongoing coordination of programs and public safety
practices related to seismic hazards. Currently, the need
is not being addressed by any State organization. The
Seismic Hazards Safety Commission would encourage long-term
progress toward mitigating the effects of earthquakes.
Representative J. Davies continued, Alaska is on the edge
of the Pacific Plate, which acts like a relentless conveyor
belt, moving about six centimeters a year. It is
inevitable that there will be large earthquakes. The only
question is when will it occur, not if it will. Although,
the State has made great improvements in disaster
preparedness, there has been little corresponding
improvement in measures to reduce dependence on disaster
relief. Creating a seismic commission patterned after
those in California, Oregon, Washington and other states on
major fault lines will help address the issue.
Representative J. Davies pointed out that the scientific
community is working hard on earthquake predication, but is
not yet a reality, except in the most general sense.
Alaska needs to mitigate possible effects of earthquakes by
encouraging appropriate land use and building design which
can reduce loss of life and property, as well as the costs
of recovery when earthquakes occur. He stressed that it
costs a lot of money to rebuild after a large earthquake
and, of course, there is no way to replace lost lives. It
is clearly worth spending some time and money before an
earthquake occurs. The Commission would help the State be
better prepared.
Representative J. Davies distributed a map showing the top
ten quakes in the world between 1904 and 1992. [Copy on
File]. Of the ten largest earthquakes, three of them have
occurred in Alaska. He stressed that this is earthquake
country. Most other states have seismic safety commissions
except Alaska. [Copy on File].
Representative Kelly asked how this information would be
gathered. Representative J. Davies replied that the group
would try to assemble and assess information that is
relevant to earthquake regions.
Representative Martin questioned what more information is
available besides the expertise already existing.
Representative J. Davies explained that the question is, do
cost-effective measures exist which could reduce the
effects of quakes on the population. At this time, Alaska
does not know what research is available and should be
considered. The proposed commission could facilitate that
information and transfer it to municipal building codes and
land use plans. He summarized that there needs to be a
bridging between the research realms and the building
community.
Co-Chair Therriault voiced concern with the proposed size
of the commission. He MOVED an amendment to reduce the
size from "11" to "9" members, 4 of which would be from the
general public and with 6 members constituting a quorum.
The rotation of seats would also need to be shifted, so
that 3 seats would be two years, 3 seats would be four
years, and the others would fall into the normal three-year
pattern shift. There being NO OBJECTION, the change was
adopted.
Representative G. Davis asked how often the group would
meet. Representative J. Davies replied they would meet 4
times a year as specified in the fiscal note.
Representative G. Davis noted that he had a philosophical
problem with forming another commission and believed that a
group meeting that many times a year was excessive. Co-
Chair Therriault pointed out that there was a sunset and
that the commission would need to make progress on
establishing these codes and measures. Representative J.
Davies advised that two of the scheduled meetings would be
by teleconferencing.
Representative Kelly agreed that this was an important
matter and he supported the concern.
Co-Chair Therriault advised that the fiscal note would need
to be recalculated in order to reflect the two less members
on the commission. Representative J. Davies stated that
there should only be one fiscal note originating from the
Office of the Governor.
Representative Mulder MOVED to report CS HB 408 (FIN) out
of Committee with individual recommendations and with the
revised fiscal note. There being NO OBJECTION, it was so
ordered.
CS HB 408 (FIN) was reported out of Committee with a "do
pass" recommendation and with a fiscal note by the Office
of the Governor.
(Tape Change HFC 98- 121, Side 2).
HOUSE BILL NO. 369
"An Act relating to Medicaid coverage for certain
eligible children and pregnant women; relating to
primary care case management and managed care services
as optional services and to premiums and cost-sharing
contributions under the Medicaid program; establishing
the Healthy Families Alaska program; and providing for
an effective date."
MISSY POESCHEL, (TESTIFIED VIA TELECONFERENCE), HEALTHY
FAMILIES, FAIRBANKS, read a letter from one of her clients
who had participated in the Healthy Families Program and
which had helped her make it through serious and difficult
times successfully.
MARGARET MILLER, (TESTIFIED VIA TELECONFERENCE), HELATHY
FAMILY SUPPORT WORKER, FAIRBANKS, testified in support of
the Healthy Families Program and the success it has
manifested in many children's lives.
LAURA BUSH, (TESTIFIED VIA TELECONFERENCE), FAIRBANKS,
spoke to the challenges that new families have in outreach.
The Healthy Families Program has offered prevention and
education for those potentially abusive parents. Children
require special attention to begin the developmental
process in an optimal fashion. The original version of HB
369 would expand Medicaid coverage to poor children with
family's income of up to 200% of the federal poverty level.
She continued, as more families move from welfare to work,
it is appropriate to assist them in becoming self-
sufficient by making affordable health care coverage
available.
SARANA SCHELL, (TESTIFIED VIA TELECONFERENCE), PROGRAM
CONSULTANT - HEALTHY FAMILIES, FAIRBANKS, urged members to
reinstate the language of the original HB 369. That would
place the Healthy Families Program back into State statute
and authorize Medicaid payments for those families out of
work.
The families, which the program works with rarely, contact
the agency for help. A health care provider, with the
family's consent, usually refers the family to a program
assessment worker. Home visits are reserved for only those
families that really need it. She stressed that the
program is voluntary and there is tremendous out-reach
associated with it. She urged Committee members to expand
this program because it works.
JAY LIVELY, DEPUTY COMMISSIONER, DEPARTMENT OF HEALTH AND
SOCIAL SERVICES, provided the Committee with a background
of the legislation. Last fall, Congress passed the Kennedy
Hatch bill which enacted the child health insurance
program. The program made federal money available to
states to expand health care coverage for uninsured
children. Alaska's allotment from the federal legislation
is $5.6 million dollars which requires a state match of $2
million dollars. In Alaska, it is estimated that there are
approximately 23 thousand uninsured children of which about
11,500 are below the 200% poverty level. Mr. Lively
explained that 200% of poverty level is about $33 thousand
dollars for a family of 3 or about $16 dollars per hour
income.
The federal law provides considerable flexibility in
designing the new program. Most importantly, the State can
decide the eligibility level for the child's health
coverage. Mr. Lively continued, the State can determine
the delivery system to be employed to implement the child's
health coverage. Federal law allows using Medicaid,
expanding private coverage or implementing a combination of
the two.
He added that within the framework, the Department proposes
to increase the eligibility level for Medicaid to the 200%
poverty level for all kids and pregnant women. The current
version does not consider the pregnant woman and under the
current Medicaid program, the State provides a minimum
coverage.
Mr. Lively continued, the State already has a Medicaid
bureaucracy established with a payment system, enrolled
providers and the administration to run the program. Using
Medicaid will minimize start up costs and allow the
Department to "piggy back" on an established system with a
large economical benefit.
Mr. Lively spoke to the relationship between child health
and welfare reform. Child health coverage will provide
health to families without them needing to return to cash
assistance. As soon as families work their way off the
cash assistance welfare, the potential is that they will be
in jobs, particularly low-income jobs, which have no health
care attached to them.
Last year, when Congress changed the recidivism rate for
Medicaid from 50% to 60% federal match, freed up general
fund money in the Medicaid program. One argument was that
Alaska use some of the money to expand health care coverage
for those that do not have it. In addition, pregnant women
are currently covered up to 133% of poverty level. The
Department proposes to raise it up to 200% of poverty
level. The thought was that if the kids are covered, then
the prenatal piece of coverage should also be taken care of
in order to guarantee good birth outcomes.
He pointed out that if the Legislature does not act to
authorize a child health program, the State will lose its
allotment of the $5.6 million dollars.
Representative Martin asked if this situation would create
an anti-discrimination for all children living in the
State. Mr. Lively replied that this is not an open
entitlement and would be available only to those individual
families below the allocated level.
Co-Chair Hanley pointed out that the Healthy Families
portion of the bill had been deleted in a previous
committee hearing and that the new federal fund program is
just for kids, and does not extend to pregnant women. The
bill as it exists at this time, deals only with new federal
money passed by Congress to raise the poverty rate of kids
up to 200%. The other portions could be addressed by the
Legislature.
Mr. Lively clarified that currently the State covers
pregnant women at 133% poverty level, children 0-6 at 133%
poverty level, children 6-14 at 100% poverty level and
children from 14-18 at 70% poverty level. At this time, it
is a varied level depending on the age. He stressed that
this system is complicated for the families and the
Department to keep track off. Co-Chair Hanley advised that
the bill as currently written would cover all kids from 1-
18 to 200% at poverty level.
BOB LABBE, DIRECTOR, DIVISION OF MEDICAL ASSISTANCE,
DEPARTMENT OF HEALTH AND SOCIAL SERVICES, responded to
comments by Representative Martin regarding "pregnant
women" versus "pregnancy". He stated that "pregnant women"
are part of the federal grouping which the State has been
allowed to cover. This is a category of clients based on
being pregnant.
LORAINE DERR, ALASKA STATE HOSPITAL AND NURSING HOME
ASSOCIATION (ASHNHA), JUNEAU, noted that Alaskans share a
common goal of safe, healthy children and that ASHNHA
incorporates that goal into its mission of improving health
care of all individuals. Last year, the federal government
made additional funding available for the purchase of
insurance for children's health care coverage. HB 369
would allow the State to take advantage of those funds.
Ms. Derr continued, there is a direct correlation between
lack of prenatal care and giving birth to a low birth
weight infant, and low birth weight accounts for 10% of all
health care costs for children. ASHNHA requests to have
pregnant women included in the funding.
She pointed out that Alaska's hospitals continue to report
growth in uncompensated care from $122 million dollars in
FY93 to $177 million dollars in FY95, as a result of
serving uninsured and underinsured Alaskans who cannot pay
their medical bills. It shows that more Alaskans need care
and are not able to pay for it. Raising the poverty level
to 200% for children up to the age of 19 will go a long way
toward making sure that health care coverage is available
to children.
Co-Chair Hanley referenced Amendment #1. [Copy on File].
He questioned Section (d) and asked if that section could
be addressed by waiver. Mr. Labbe replied that in the area
of managed care, when a client participates, historically,
they would need to file for a federal waiver. At present
time, most states are doing this as a matter of course
through a normal state plan process. The Department has
been advised that this is required.
Co-Chair Hanley wanted to be assured that the language
would keep the same priority listings and would not allow
the Department "open-ended" options. He asked if the way
that section was written would allow the Department to add
new options or change the priorities of the options list.
Mr. Labbe replied that the Department would not be able to
add new options or change the priorities.
Co-Chair Hanley MOVED to adopt Amendment #1.
(Tape Change HFC 98- 122, Side 1).
Following discussion regarding concerns of Representative
Martin, Representative Mulder recommended changing the
language on Page 2, Line 6, of the amendment deleting "for"
and inserting "and". He felt that change would clarify
that the services are not optional and must be consistent
with State law. Mr. Labbe responded that it was
unfortunate that primary care case management was being
considered as optional services; in the past, the
Department was required to receive a waiver for a Medicaid
client to register. The only way in which the federal
government could move it to the State would be to consider
it a new type of State service. He noted that it is not a
service in that sense. What is being managed are services
which the State covers, some of which are mandatory and
some of which are optional. This legislation requests the
authority to organize these systems that way.
Representative J. Davies believed that the proposed
amendment would make an unintended change for services
which already exist. With such a change, the Department
would be required to undertake three things, whereas, with
original language, there would only be two requirements.
Co-Chair Therriault agreed that without the punctuation, it
is clearer that the reference is to an existing set of
services.
There being NO OBJECTION, Amendment #1 was adopted.
Co-Chair Hanley commented that under the current system,
abortions are covered under Medicaid for rape, incest or
life of the mother. He asked to which poverty level would
that continue to occur. Mr. Lively replied at the 133%
poverty level, the Medicaid level and the one used in
Alaska. Co-Chair Hanley pointed out that Alaska has not
chosen one for abortion. He clarified that the income
level for the General Relief Medical (GRM) and the income
level for publicly funded abortions would be the same as
the Medicaid level. He believed that if the poverty level
were raised for pregnant women to 200%, it would also be
raised for abortions to that level. Mr. Lively agreed that
was correct that the Medicaid eligibility would become the
cited level.
Representative Martin referenced the letter from a previous
DHSS Commissioner, Ted Mala, stipulating that no private
information can be given to the Department. He thought
that the Department was prohibited from inquiring about the
financial status of a woman. Mr. Lively replied that there
is an income and eligibility test done on each person
coming on to the Medicaid program.
Representative Grussendorf pointed out that the bill was
directed toward assisting children. He stated that
increasing the level to 200% would make it easier for
pregnant women to make a choice to keep the child as there
would be extra financial assistance to keep the child
healthy. Co-Chair Hanley stated that he would not offer
Amendment #2. [Copy on File].
Representative Foster MOVED to adopt Amendment #2 for the
purpose of discussion. Representative J. Davies stated
that there would be a cost effectiveness associated with
incorporating the amendment. He pointed out that if the
legislation were able to avert two Fetal Alcohol Syndrome
(FAS) outcomes, the entire state match would be paid.
Representative Kelly disagreed, stating that by adding
pregnant women to the legislation could result in negative
ramifications.
Representative Grussendorf criticized that many of our
State's residents were being punished, first through the
cut to the General Relief Medical and now an unwillingness
to allow the funding level to be increased for those women
who want to have their children but would not qualify under
the 200% level. Co-Chair Hanley inquired what percentage
of women between 130% and 200% poverty level, currently
have coverage for pregnancy related services. Mr. Lively
commented that the Department's research covers the number
of persons who do not have coverage which is 870.
Co-Chair Hanley voiced concern, under the federal bill, if
you currently have coverage for kids, and you are at 180%
poverty level, you could not access this new money. He
noted that if the poverty level was increased to 200% for
Medicaid, there would then be some pregnant women who have
insurance, who could opt to access this program through
Medicaid. The federal restrictions are specifically
related to the kid's portion and not to the pregnant woman
portion.
Mr. Labbe agreed that if the Department goes to the 200%
poverty level, there may be some women who are insured who
would drop their coverage, although, he noted that it would
be unlikely to transfer Medicaid for only the pregnancy.
Retaining their coverage, does not mean that they would not
be eligible for Medicaid. In those situations, Medicaid is
the payer of "last resort". Co-Chair Hanley doubted if
most employers offer as good of coverage as Medicaid does.
He believed that some employers could drop their coverage
for the pregnant employee making under the poverty level.
Representative J. Davies questioned why we would not want
to pick the kids up before they are born at the 200% level
rather than waiting.
Representative Foster WITHDREW the MOTION to adopt
Amendment #1. There being NO OBJECTION, it was withdrawn.
Co-Chair Hanley asked what percentage of the new kids who
qualify, already have some level of insurance. Mr. Lively
did not know, pointing out that there is a sizeable number
of kids who currently are not covered at all. Co-Chair
Hanley cited that above 70% of all children has some form
of insurance coverage. The legislation would cover
approximately 11-15% who do not have any coverage. He
believed that we could create a system in which the
government would be providing better service to children
than those with that already have coverage.
Representative J. Davies MOVED to add the Healthy Families
Program back into the bill. Co-Chair Hanley OBJECTED.
Representative J. Davies stated that the action would
create a statutory framework which is already occurring.
Co-Chair Hanley countered that would make that program
Medicaid eligible which would establish an entitlement
program.
A roll call vote was taken on the motion.
IN FAVOR: Grussendorf, J. Davies
OPPOSED: G. Davis, Foster, Kelly, Martin, Mulder,
Therriault, Hanley
Representatives Kohring and Moses were not present for the
vote.
The MOTION FAILED (2-7).
Co-Chair Hanley MOVED to report CS HB 369 (FIN) out of
Committee with individual recommendations and with the
accompanying fiscal notes. There being NO OJBECTION, it
was so ordered.
CS HB 369 (FIN) was reported out of Committee with a "do
pass" recommendation and with four fiscal notes by the
Department of Health and Social Services dated 4/9/98.
ADJOURNMENT
The meeting adjourned at 10:40 A.M.
H.F.C. 13 4/23/98
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