Legislature(2009 - 2010)HOUSE FINANCE 519
02/01/2010 01:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB300 || HB302 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 300 | TELECONFERENCED | |
| += | HB 302 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HOUSE FINANCE COMMITTEE
February 1, 2010
1:34 p.m.
1:34:42 PM
CALL TO ORDER
Co-Chair Hawker called the House Finance Committee meeting
to order at 1:34 p.m.
MEMBERS PRESENT
Representative Mike Hawker, Co-Chair
Representative Bill Stoltze, Co-Chair
Representative Bill Thomas Jr., Vice-Chair
Representative Allan Austerman
Representative Mike Doogan
Representative Anna Fairclough
Representative Neal Foster
Representative Les Gara
Representative Reggie Joule
Representative Mike Kelly
Representative Woodie Salmon
MEMBERS ABSENT
None
ALSO PRESENT
William Hogan, Commissioner, Department of Health and
Social Services; Alison Elgee, Assistant Commissioner,
Finance and Management Services, Department of Health and
Social Services
PRESENT VIA TELECONFERENCE
None
SUMMARY
HB 300-APPROP: OPERATING BUDGET/LOANS/FUNDS
HB 302-APPROP: MENTAL HEALTH BUDGET
Department of Health and Social Services
HOUSE BILL NO. 300
"An Act making appropriations for the operating and
loan program expenses of state government, for certain
programs, and to capitalize funds; making supplemental
appropriations; making appropriations under art. IX,
sec. 17(c), Constitution of the State of Alaska; and
providing for an effective date."
HOUSE BILL NO. 302
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date."
1:36:02 PM
DEPARTMENT OF HEALTH AND SOCIAL SERVICES
WILLIAM HOGAN, COMMISSIONER, DEPARTMENT OF HEALTH AND
SOCIAL SERVICES, presented the department's FY2011 budget
overview. He referred to the "Executive Summary" (copy on
file). He defined the department's mission; to promote and
protect the health and wellbeing of all for a strong
Alaska. He attributed the mission to the Alaska
Constitution.
Co-Chair Stoltze asserted that the constitution does not
contain the word "wellbeing." He felt that verbiage
advanced "unprovoked good."
Commissioner Hogan referred to the document titled "Alaska
Department of Health and Social Services 2010 Priorities"
(copy on file). He emphasized that the department's goal is
productivity. He stated the department's focus has been to
help create productive families and individuals that
contribute to their communities and become productive
members of society. He pointed out that the department has
studied outcomes to ensure that the programs and services
provided produce these results.
Commissioner Hogan outlined the main priorities of the
department: Substance Abuse, Health and Wellness, Health
Care Reform, Long Term Care, and Vulnerable Populations. He
highlighted that the department's efforts to address
substance abuse have been focused in four areas:
prevention, early intervention, treatment, and recovery. He
elaborated that as part of the Health and Wellness
priorities, the department focused on program cost
reduction and prevention. Alaska has high rates of chronic
disease, sexually transmitted diseases, and injuries. The
department has also examined increased health care access,
trauma system enhancement, emergency preparedness, and the
health and social service impact on communities that will
experience large economic activity such as a major gas
line. He addressed federal health care reform and noted it
will spur changes at the federal and state levels.
Co-Chair Stoltze asked if the interests of Alaska are being
met in the proposed federal legislation and what are the
department's concerns. Commissioner Hogan explained that
his office works actively with the governor's office in
Washington D.C. and the Alaska delegation to solicit
Alaska's interests. He exemplified two legislative
proposals where Alaska's position is being advocated
through these channels. The first was the National Health
Insurance Exchange. He believes a one size fits all model
would not work for Alaska. The Department is seeking
flexibility within the proposal to create Alaska's own
exchange. Secondly, he expressed concern with the proposed
increase for Medicaid to 133 percent of the poverty level.
He asserted that the federal government should pay for the
entire increase.
Co-Chair Stoltze characterized the measure of success of
the Department's lobbying efforts as "fifty/fifty".
Commissioner Hogan speculated that successful outcomes
depend on the level of influence the state has at the
federal level. He concurred with the assessment.
Commissioner Hogan added that a Health Care Commission has
been established by the Department and has released a
report of recommendations for consideration and
prioritization. He believes the Commission is very useful
in deciphering the federal health care reform legislation.
In addition, the Commission thoroughly examined the four
key components of health care and delivery: access,
quality, cost, and prevention. He noted that the shortage
of health care workers in the state is a continuing
challenge.
1:47:08 PM
Commissioner Hogan continued with issues concerning Long
Term Care. He pointed out that seniors are the fastest
growing population in the state. The department has been
working to ensure seniors have access to in home care, a
high quality nursing home option, and pioneer homes.
Commissioner Hogan announced that the final priority area
deals with Vulnerable Alaskans. He stated that includes
situations of abuse and neglect, juvenile justice, the
developmentally disabled, and Safety Net Programs run
through the Division of Public Assistance, i.e.
Supplemental Nutritional Assistance Program (SNAP), Home
Heating Assistance. He highlighted the Families First
Initiative that identifies individuals with mental health
and substance abuse problems, who are about to lose
temporary assistance benefits. The program offers help to
those individuals and their families.
1:50:25 PM
Representative Austerman asked for an explanation of the
"environmental health and tax". Commissioner Hogan
explained the concept; as large scale economic development
projects take place in an area it impacts communities and
families. He cited the oil pipeline and the associated
societal increase in alcohol abuse and domestic violence.
The department wants to take a proactive role to deal with
potential problems during an economic boom cycle.
Representative Austerman asked for an explanation of the
steps taken to solve the fragmented and un-coordinated
health care system in Alaska. Commissioner Hogan noted that
the recommendations by the Health Care Commission are an
effort to address the problems. He identified a major
problem as access to health care when needed; trying to
avoid emergency room visits by increasing access to a
primary care physician.
1:53:32 PM
Representative Austerman believed that regarding Vulnerable
Populations the system is set up so that individuals and
families never break out of the assistance cycle. Earning
and saving money often disrupts benefits causing the
recipients to lose the personal gains made and dependent on
assistance programs once again. He wondered if it was a
lack of coordination and policy between the federal and
state systems. Commissioner Hogan stated that some of the
problems are with federal requirements. The department is
attempting to recognize the barriers and not let them
interfere with the individual's successful outcome. He
stressed that the department's objective was to avoid
creating dependence on programs
1:56:54 PM
Vice-Chair Thomas wondered how the system can be changed so
that convicted felons can be eligible for the personal care
assistant jobs. He related a constituent's situation.
Commissioner Hogan pointed out that background checks are
required for all health care and social service providers.
He noted there are "barrier crimes" that prevent anyone
convicted of one gaining that type of employment. The
department can grant waivers depending on the situation.
The department might rewrite the regulations to allow for
more flexibility yet keeping client safety a priority.
1:59:18 PM
Representative Gara remarked that the Health Care
Commission suggested that the legislature explore the
expansion of Community Health Care Centers as a key to
providing increased access to health care in Alaska. He
reported that Medicare compensates Community Health Care at
a much higher rate than private practice primary care and
provides low cost health care access. He felt that the
Commission should have made a much stronger proposal as to
their role in a solution to health care delivery problems.
He wondered if there should be an expanded use of Community
Health Centers to Medicare beneficiaries and for primary
care.
2:02:12 PM
Commissioner Hogan agreed that the twenty six federally
qualified Community Health Centers in Alaska are the
foundation of the health care system in the state. He
shared that they have a role to play in providing increased
Medicare access especially to seniors. The department is
looking at the creation of a Medicare access clinic. He
reported that the state lobbied congress to increase
Medicare rates by thirty five percent. However, even with
the increase, many physicians are still unwilling to take
Medicare recipients. He was uncertain that Community Health
Centers get an enhanced Medicare rate over physicians.
Commissioner Hogan offered that the Commission was not able
to offer a definitive recommendation to expand Medicare
access at this time.
2:05:35 PM
Representative Gara asked if the department has a plan this
year to expand medical services through the Community
Health Centers. Commissioner Hogan related that he is not
aware of a specific increment.
Co-Chair Hawker requested that Commissioner Hogan discuss
the difference between the tenure and longevity of
administratively appointed commissions as opposed to
legislatively established commissions. Commissioner Hogan
replied that the Health Care Commission established by the
administration will disband at end of this legislative
session. The department was working with the Legislature to
establish the Health Care Commission in statute. Co-Chair
Hawker wondered if the commission was necessary.
2:07:51 PM
Representative Fairclough wanted an overview of the
department's use of stimulus funds. Commissioner Hogan
replied that an enhanced federal matching percentage in
Medicaid was part of the stimulus package. He explained
that the department received an increase in the federal
match percentage to 61 percent, up from 50 percent of
federal matching funds. The state's general fund match has
decreased to 39 percent down from 50 percent. The change is
also due to Alaska's high unemployment rate. He reported
that the federal match increase is set to expire at end of
the calendar year. He indicated the department anticipates
an additional six month extension of the increase.
Co-Chair Hawker explained that the governor's FY 2011
budget request assumed that the Federal Medical Assistance
Percentage (FMAP) rate increase will be extended. He
announced that there would be an amendment to recognize the
higher rate of approximately $50 million if the increase is
not authorized.
2:11:26 PM
Representative Austerman asked if the state saved $50
million in last year's DHSS budget due to the FMAP
increase.
ALISON ELGEE, ASSISTANT COMMISSIONER, FINANCE AND
MANAGEMENT SERVICES, DEPARTMENT OF HEALTH AND SOCIAL
SERVICES answered that the savings last year was
approximately $95 million, coverage for nine months. She
stated that $50 million reflects coverage for six months
and is too low. The annual state Medicaid match totals
approximately $120 million.
Representative Austerman wondered what the FY 2012 total
would be. Ms. Elgee responded that if the enhanced funding
is removed from the budget the state would replace
approximately $120 million in federal funds with general
funds.
2:13:08 PM
Representative Fairclough asked why there was not a
personal services line under the Suicide Prevention Council
in the budget. She asked if the position has been vacant
for a year. Commissioner Hogan replied that the department
moved the responsibility for coordination and oversight of
the Council to the Division of Behavioral Health. The
position has not been left vacant.
Ms. Elgee furthered that the transfer of staffing support
for the Council was done in FY 2009 and was only a
technical change. Representative Fairclough stated that the
Council claimed that they hire the coordinator and the
position is currently vacant.
Commissioner Hogan pledged to investigate the matter.
2:16:36 PM
Representative Gara repeated his frustration that it is
known that Community Health Centers were part of the
solution to the Medicare crisis. He wondered why it has not
been acted upon by the legislature. He contended that two
successive Commissions came to the same recommendation
without resulting action. He asserted that seniors on
Medicare are having an arduous time getting primary care
and the crisis is growing. Commissioner Hogan replied that
a one-time $1 million increment was received for Community
Health Centers in FY 2009. He reiterated that he believes
it is important but lacks funding.
2:18:59 PM
Co-Chair Hawker asked if Community Health Centers were
intended to be standalone private non-profits or wards of
the government. Commissioner Hogan replied that Community
Health Centers are private non-profits and receive base
grants from the federal government of approximately $650
thousand to provide primary care, dental and other health
services.
2:21:53 PM
Representative Doogan reflected on the $120 million figure
reported earlier and wondered how the number was
determined.
Commissioner Hogan declared that out of the department's
$2.1 billion budget, approximately $1.2 billion is for
Medicaid.
Ms. Elgee shared that Medicaid was made up of many
components and different programs require different match
rates. The base match rates are established and paid for by
the federal government and cannot go lower than fifty
percent. In past years the federal government has provided
more than a fifty percent match base rate but federal
matches have decreased to the minimum level of 50 percent
in recent years. The American Recovery and Reinvestment Act
(ARRA) funding does not apply to any program that currently
receives an enhanced match rates, i.e., Tribal Health
reimbursements and the Children's Health Insurance Program.
ARRA funding [stimulus funds] only applies to Medicaid
programs that receive base match rates. Under the ARRA
legislation the state received an increase to the 61
percent match rate up from the fifty percent base rate for
some Medicaid programs. The $120 million reflects the
difference between a fifty percent and a sixty one percent
match.
Commissioner Hogan referenced the "Fiscal Year Strategic
Plan" (copy on file). He highlighted specific goals and
outcomes. He cited substance abuse as an example of how the
department assessed its programs by focusing on goals and
outcomes. The department is focusing on four outcomes in
the area of substance abuse: reducing the incidence of
fetal alcohol spectrum disorder, reducing substance abuse
related accidents, reducing substance abuse related violent
crime, and reducing substance abuse related suicides. The
department uses very specific measures and relies on the
data to determine progress and set benchmarks to achieve
reduction in the rates. He stressed that the department's
role is to reduce incidents in the population.
2:29:04 PM
Co-Chair Hawker alluded to the involvement of the
Department of Law, Department of Corrections, and
Department of Public Safety with the Governor's domestic
violence and sexual assault initiative as the "prosecution"
piece of the initiative. He asked where DHSS fits in with
the initiative as the prevention and protection piece. He
asked the Commissioner what department should house the
individual that oversees the initiative. Commissioner Hogan
believed his department has a role to play in creating
solutions to the problem along with the Department of
Education and Early Development. He identified prevention
activities through the Division of Public Health, helping
victims of domestic violence and tackling substance abuse
through an array of programs provided by DHSS as parts of
the department's contribution to the initiative. He
believed that the position should be located in the
Department of Law along with a steering committee to form a
coordinated approach.
2:33:35 PM
Representative Joule stated that he appreciated the
spotlight on the domestic violence and sexual assault
problem. He felt it encompassed tackling other pressing
problems such as substance abuse in an integrative approach
that involves prevention, cure, and punishment.
2:35:52 PM
Representative Fairclough stated she has been in
communication with the governor to coordinate an effort to
discuss a more inclusive approach to the domestic violence
initiative that includes the areas of mental health,
substance abuse, education and health and human services.
2:37:35 PM
Representative Gara asked that out of the $1.2 billion
expenditures on Medicaid if roughly $400 million were state
funds and $800 million were federal funds. Commissioner
Hogan affirmed.
Representative Gara referred to the substance abuse
increment (page 14 of the "Executive Summary") of $2.2
million and noted the increase was devoted to distinct
areas of substance abuse. He wondered if any money was
being provided to reduce the waiting lists for all alcohol
and substance abuse treatment programs. Commissioner Hogan
reported that more money may be needed to reduce the
waiting lists. He stated that it was a challenge to meet
all of the needs with the funds provided and took a
strategic approach to allocating the funds. In light of the
fiscal constraints the department focused on the four
outcomes stated earlier.
2:40:57 PM
Representative Gara reiterated his frustration with the
substance abuse treatment waiting lists. He suggested
consolidating the lists to gain a complete assessment of
the needs. Commissioner Hogan agreed that if the needs of
the waiting lists are understood in its entirety than a
plan to provide more services based on actual need can be
implemented to shorten the lists. He exemplified that
residential needs were in more demand than outpatient
services.
Representative Joule requested additional information about
substance abusers on waiting lists by court order.
Commissioner Hogan stated he would provide the information.
He mentioned that the department was creating a substance
abuse Medicaid waiver. The waiver may only provide limited
services but the additional fifty percent federal funds
available if established, would help to expand services.
2:43:15 PM
Commissioner Hogan referred to the Organization Chart on
page 6 of the "Executive Summary" (copy on file) and
described the executive management and structure of the
department. He identified: Ward B. Hurlburt, M.D. Chief
Medical Officer/Director of Public Health; William J.
Streur, Deputy Commissioner for Medicaid and Health Care
Policy; Clay Butcher, Public Information Manager; Wilda
Laughlin, Legislative Relations; Tara Horton, Special
Assistant Patrick Hefley, Deputy Commissioner for Family,
Community & Integrated Services; Allison M. Elgee,
Assistant Commissioner for Finance Management Services.
He also noted that the department works actively with the
various boards and commissions particularly with those
related to the Mental Health Trust Authority. The
department works closely with the Authority and is in
agreement with them ninety five percent of the time.
Commissioner Hogan cited page 7 of the "Executive Summary"
(copy on file). He highlighted the department's
accomplishments. He listed the Family-to-Family Program,
Alaska Heating Assistance Program, Bring the Kids Home
initiative, Senior Long Term Care, and Health Care Reform
as the department's achievements. Commissioner Hogan noted
that the Alaska Heating Assistance Program serves
households with incomes at 225 percent of the federal
poverty guidelines. He stressed the success of the Bring
the Kids Home initiative. The number of children in out-of-
state residential placement is now 110 down from 450 over a
three year period.
Commissioner Hogan remarked that the Senior Long-Term Care,
Senior and Disabilities Services, Home and Community Based
Waivers, and Adult Preventive Dentistry Programs are among
the departments successes. He opined that the department
excelled in H1N1 [Swine Flu] preparedness.
Commissioner Hogan noted the department's efforts to work
with the tribal health organizations to maximize Medicaid
revenue and federal reimbursement.
2:51:53 PM
Commissioner Hogan continued the discussion with the
department's Key challenges on page 9 of the "Executive
Summary" (copy on file). He mentioned that under Vulnerable
Populations, the Bring the Kids Home project faced
challenges in developing in-state residential and community
based treatment options. He added that workforce issues
continue to be problematic with vulnerable populations.
Co-Chair Hawker expressed concern regarding federal
assessment payments for non-compliance of the Indian Child
Welfare Act. He queried the status of the settlement.
Commissioner Hogan reported that the department is working
with tribal partners to ensure requirements for the Indian
Child Welfare Act are implemented and relations with the
tribal partners were improved. He pointed out that results
varied around the state. He acknowledged the department's
past failure.
Co-Chair Hawker clarified that the settlement requires the
state to pay $1.2 million each for FY 2010, FY 2011, and FY
2012. He emphasized the size of the payments and thought
that the issue was significant enough for discussion with
the entire Finance Committee. He attributed failure on the
part of the Office of Children's Services (OCS).
2:57:07 PM
Commissioner Hogan pointed out that child protection was a
difficult job and acknowledged more work had to be done.
Representative Gara talked about the need to add social
workers to OCS as Independent Living Coordinators for youth
coming out of foster care. He noted that there are only
four for the entire state. He expressed disappointment at
the poor statistics regarding youth transitioning out of
foster care. He asked why there are no increases in
Independent Living Coordinators [social workers] in this
year's budget. Commissioner Hogan stated that it is
difficult to retain social workers in the OCS area. He
found it unreasonable to ask for increased positions if the
department cannot retain enough OCS social workers at
current staffing levels. He offered to have further
discussions to implement improvements in the transitional
programs within foster care. Representative Gara hoped that
will continue as a discussion in the DHSS subcommittee. He
suggested that "burn out" due to large caseloads might be
an issue with non-retention of social workers. Commissioner
Hogan replied that the department has implemented measures
to support social workers.
3:03:14 PM
Representative Fairclough recalled that she served on a
previous DHSS subcommittee and discussed the retention
problem. She suggested that often the problem is not just
with caseload but working in a toxic environment every day.
She suggested that positive professional experiences should
be interspersed in their routine.
3:06:01 PM
Commissioner Hogan affirmed.
Commissioner Hogan directed attention to the Overall Budget
Requests on page 13 of the "Executive Summary" (copy on
file). He pointed out that the overall budget reflects a
3.5 percent increase with a 6 percent increase in general
funds. Most of the increase is being driven by growth in
Medicaid.
3:08:33 PM
Representative Kelly wondered where the department would
make cuts if no increase was available. Commissioner Hogan
stated he would start with Medicaid. It makes up more than
55 percent of the budget. He offered three choices to
determine cuts: eligibility, change the rates providers are
paid, and change access to the type and amount of services
available. The other 45 percent of the budget would be more
difficult to determine. The department would work toward
more performance based funding.
Representative Kelly commented that ignoring the Permanent
Fund Dividend, 30 percent of Alaskans are being supported
by the government. He wondered if this figure was high and
how to end the "dependence rut."
3:12:43 PM
Commissioner Hogan stated the department is trying to
promote independence through programs like Families First.
He thought that the 30 percent figure was high.
Co-Chair Hawker recognized the presence of Anchorage Mayor
Dan Sullivan.
3:15:36 PM
Representative Gara asked if there was a way to save money
by having higher income recipients receiving services to
pay more. Commissioner Hogan answered that the department
was doing that where allowed such as with residents of the
Pioneer Home.
Representative Kelly wondered about drug testing for those
on public assistance. He felt this could help stop the
cycle of dependence.
3:20:30 PM
Commissioner Hogan appreciated the comments and was also
frustrated by the addiction problem. He noted that the
Clitheroe Center is a good example for involuntary
treatment. He also commented that this is the "Year of
Public Safety" and hopes there will be a "Year of Substance
Abuse, Prevention, Treatment, and Recovery" in the future.
3:22:57 PM
Co-Chair Stoltze asked if Representative Keller's bill [HB
259] requires mandatory drug testing for public assistance.
Commissioner Hogan stated the department was helping
Representative Keller so he can draft the legislation
within federal guidelines. He was unsure if it was legal.
Co-Chair Stoltze anecdotally related that medical providers
complain about Medicaid patients not showing up for
appointments. He wondered if they can be charged a fee.
Commissioner Hogan reported that he has heard similar
complaints regarding Medicaid patients not showing up for
their appointments. He speculated that legally the doctor
cannot take financial recourse. He agreed to investigate
further.
3:26:48 PM
Representative Fairclough shared that a fee was set up for
patients of the Southcentral Foundation that did not show
up for their appointments. She noted transportation
problems with disabled and the elderly. Commissioner Hogan
wondered if they were Medicaid patients.
Representative Fairclough cited increases in the DHSS
budget for Information Technology Services. She asked if
there was unduplicated numbers for people accessing
multiple services from DHSS. Commissioner Hogan announced
that the department recently created a master client index.
He stated he would send her an unduplicated count of
recipients. Representative Fairclough stated the
information could help provide more coordinated care for
individuals or families in need of multiple services.
3:30:42 PM
Co-Chair Hawker directed attention to page 25 of the
"Executive Summary" (copy on file) that is a historic look
at Medicaid expenditures from FY 1991 to FY 2011. He
pointed out that the expenditures jumped from $173 million
to $1.2 billion in twenty years. During the past several
years 2004-2009 the expenditures were static due to efforts
to control costs. In FY 2009 a spike occurred and was
maintained in FY 2010. He wondered what the causes were.
Commissioner Hogan speculated that the Medicaid spike is
directly related to the economic downturn and an increase
in utilization. He added that there has also been some
increase in the rates paid to providers.
Co-Chair Hawker notified the committee that he would like
to reauthorize the private contractor Janet Clark's
professional services to help reconcile the Medicaid cost
projection process.
3:36:59 PM
Co-Chair Stoltze moved that the House Finance Committee Co-
Chair Hawker be authorized to enter into a contract
extending Janet Clark's professional services contract for
one year in an amount not to exceed $25,000. There being NO
OBJECTION, it was so ordered.
3:37:48 PM
Representative Gara observed that the Medicaid spike
mentioned from years 2008 until 2011 was in federal
spending while state spending remained unchanged. Co-Chair
Hawker replied that he was referring to the aggregate costs
of services provided.
3:41:04 PM
Commissioner Hogan concluded that he attempts to balance
the department's social mission with a business mission so
Alaska gets the return on its investment in DHSS.
Representative Joule offered that if the state wants to
make meaningful inroads the focus should be on prevention
and job opportunities.
Co-Chair Hawker emphasized more focus should be placed on
addiction.
ADJOURNMENT
The meeting was adjourned at 3:44 PM
| Document Name | Date/Time | Subjects |
|---|---|---|
| DHSS 2010 Management Overview.pdf |
HFIN 2/1/2010 1:30:00 PM |
|
| DHSS 2010 Management Overview2.pdf |
HFIN 2/1/2010 1:30:00 PM |
|
| DHSS Overview 2010 Priorities.pdf |
HFIN 2/1/2010 1:30:00 PM |
|
| DHSS Overview 2010 Strategic Plan.pdf |
HFIN 2/1/2010 1:30:00 PM |
|
| DHSS Overview FY11 Executive Summary.pdf |
HFIN 2/1/2010 1:30:00 PM |
|
| HSS Fiscal Plan FY2011 012210 Overview.pdf |
HFIN 2/1/2010 1:30:00 PM |