Legislature(2001 - 2002)

04/11/2001 02:51 PM HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                     ALASKA STATE LEGISLATURE                                                                                   
       SENATE HEALTH, EDUCATION & SOCIAL SERVICES COMMITTEE                                                                   
                          April 11, 2001                                                                                        
                             2:51 p.m.                                                                                          
MEMBERS PRESENT                                                                                                               
Senator Lyda Green, Chair                                                                                                       
Senator Loren Leman, Vice Chair                                                                                                 
Senator Gary Wilken                                                                                                             
Senator Jerry Ward                                                                                                              
Senator Bettye Davis                                                                                                            
MEMBERS ABSENT                                                                                                                
All Members Present                                                                                                             
COMMITTEE CALENDAR                                                                                                            
SENATE BILL NO. 135                                                                                                             
"An Act relating to mental health information and records; and                                                                  
providing for an effective date."                                                                                               
     MOVED CSSB 135(HES) OUT OF COMMITTEE                                                                                       
SENATE BILL NO. 116                                                                                                             
"An Act relating to the Alaska temporary assistance program; and                                                                
providing for an effective date."                                                                                               
     MOVED CSSB 116(HES) OUT OF COMMITTEE                                                                                       
CONTINUATION OF MEDICAID PRESENTATION BY THE DEPARTMENT OF HEALTH                                                               
AND SOCIAL SERVICES                                                                                                             
PREVIOUS COMMITTEE ACTION                                                                                                     
SB 135 - See HESS minutes dated 4/9/01.                                                                                         
SB 116 - See HESS minutes dated 4/9/01.                                                                                         
WITNESS REGISTER                                                                                                              
Elmer Lindstrom                                                                                                                 
Special Assistant                                                                                                               
Department of Health &                                                                                                          
  Social Services                                                                                                               
PO Box 110601                                                                                                                   
Juneau, AK  99801-0601                                                                                                          
POSITION STATEMENT:  Explained the provisions of CSSB 135(HES).                                                               
Bob Labbe, Director                                                                                                             
Division of Medical Assistance                                                                                                  
Department  of Health &                                                                                                         
  Social Services                                                                                                               
PO Box 110601                                                                                                                   
Juneau, AK   99801-0601                                                                                                         
POSITION STATEMENT:  Provided information about the Medicaid                                                                  
John Sherwood                                                                                                                   
Division of Medical Assistance                                                                                                  
Department  of Health &                                                                                                         
  Social Services                                                                                                               
PO Box 110601                                                                                                                   
Juneau, AK   99801-0601                                                                                                         
POSITION STATEMENT:  Provided information about the Medicaid                                                                  
Jim Nordlund,  Director                                                                                                         
Division of Public Assistance                                                                                                   
Department  of Health &                                                                                                         
  Social Services                                                                                                               
PO Box 110601                                                                                                                   
Juneau, AK   99801-0601                                                                                                         
POSITION STATEMENT:  Explained the changes in CSSB 116(HES).                                                                  
Commissioner Karen Perdue                                                                                                       
Department  of Health &                                                                                                         
  Social Services                                                                                                               
PO Box 110601                                                                                                                   
Juneau, AK   99801-0601                                                                                                         
POSITION STATEMENT:  Provided information on the Medicaid                                                                     
Mary Diven                                                                                                                      
Division of Medical Assistance                                                                                                  
Department  of Health &                                                                                                         
  Social Services                                                                                                               
PO Box 110601                                                                                                                   
Juneau, AK   99801-0601                                                                                                         
POSITION STATEMENT:  Provided information on the Medicaid Early                                                               
Screening and Detection Program for Breast and Cervical Cancer.                                                                 
ACTION NARRATIVE                                                                                                              
TAPE 01-32, SIDE A                                                                                                            
Number 001                                                                                                                      
CHAIRWOMAN LYDA GREEN called the Senate Health, Education & Social                                                            
Services Committee meeting to order at 2:51 p.m. All members were                                                               
present.  The  first order of business to come before  the committee                                                            
was SB 135.                                                                                                                     
           SB 135-MENTAL HEALTH INFORMATION AND RECORDS                                                                     
SENATOR  WARD  moved to  adopt  CSSB  135(HES),  Version  C, as  the                                                            
working document  of the committee.   There being no objection,  the                                                            
motion carried.                                                                                                                 
CHAIRWOMAN GREEN  asked Mr. Elmer Lindstrom to describe  the changes                                                            
made in the committee substitute.                                                                                               
MR.  ELMER  LINDSTROM   explained  that  in  December   of  2000,  a                                                            
legislative  audit was released that  took the Department  of Health                                                            
and Social  Services  (DHSS)  to task for  its inability  to  gather                                                            
client-specific  data  from  community  mental  health  centers  for                                                            
persons served  with general fund  grant dollars.  Community  health                                                            
centers are  funded through two mechanisms;  one being Medicaid  and                                                            
the  other a  grant-in-aid  program.   DHSS  has very  good data  on                                                            
clients served  through Medicaid  but the same  type of data  is not                                                            
collected   for  services   provided  with   grant-in-aid   dollars.                                                            
Legislative  Budget and Audit (LBA)  pointed out that DHSS  ought to                                                            
know the cost  per client, who is served, the services  provided and                                                            
the outcomes of  clients who receive services from  the grant-in-aid                                                            
dollars.   DHSS  concurs with  the  legislative audit,  however  the                                                            
statute is  very ambiguous  as to DHSS's  authority to collect  that                                                            
information,  which CSSB 135(HES)  will clarify.  DHSS has  a lot of                                                            
experience  dealing  with confidentiality  issues;  virtually  every                                                            
division has  confidential records.   He is frequently asked  by the                                                            
legislature why  DHSS cannot make more information  available rather                                                            
than being accosted for leaking information.                                                                                    
SENATOR LEMAN  asked if DHSS has a  system for archiving  or purging                                                            
records that are no longer useful.                                                                                              
MR. LINDSTROM  said  he does  not know  the exact  procedure but  he                                                            
guessed that most records are ultimately archived or destroyed.                                                                 
CHAIRWOMAN  GREEN referred to page  30 of the legislative  audit and                                                            
     Without this ability, the  Department of Health and Social                                                                 
     Services  cannot identify the  total population of mental                                                                  
     health  clients served,  nor detect  if Medicaid payments                                                                  
     are  being made  for  clients also  funded  through  state                                                                 
She noted that  feeds in with cost  containment efforts underway  by                                                            
the Legislature.  She pointed  out that  regarding confidentiality,                                                             
the same  information  is required  of  an insurance  company.   She                                                            
informed  committee  members  that  Pat  Davidson  from Legislative                                                             
Budget and  Audit was present  to answer  any questions members  may                                                            
CHAIRWOMAN  GREEN  said  that  SB  135 is  prospective  and  she  is                                                            
concerned that many people  are being asked to offer information but                                                            
have refused.   She asked  Mr. Lindstrom if  it would be helpful  to                                                            
put a retroactive clause in the bill.                                                                                           
MR. LINDSTROM  clarified  that the committee  substitute contains  a                                                            
retroactive  clause.  He stated that  although a retroactive  clause                                                            
makes  sense  on  a  conceptual   level,  providers  have   resisted                                                            
providing that information  in the past.  A working group made up of                                                            
DHSS  employees,  providers  and consumers  has  been  assembled  to                                                            
determine which data should  be provided.  He expressed concern that                                                            
the working  group may come  up with a slightly  different  data set                                                            
than what is  required in the bill.   DHSS would prefer not  to have                                                            
the retroactive clause as it is likely to generate opposition.                                                                  
Number 619                                                                                                                      
CHAIRWOMAN  GREEN commented  that the information  requested  in the                                                            
bill is  what the legislature  needs.   She asked  if SB 135  should                                                            
include any other information that DHSS needs.                                                                                  
MR.  LINDSTROM  said in  an  ideal world,  without  the retroactive                                                             
clause,  DHSS will  probably  have good  baseline  data for  several                                                            
years in the future if  it begins on July 1.  It would be useful for                                                            
DHSS  collect retroactive  data  but  he suspects  that  may not  be                                                            
possible as a practical matter.                                                                                                 
CHAIRWOMAN GREEN  asked if there is any way to frame  it in terms of                                                            
disputed claims.                                                                                                                
MR. LINDSTROM  said he did not know and would need  time to get more                                                            
CHAIRWOMAN  GREEN decided  to leave  the retroactive  clause in  the                                                            
bill and  pass it on to  the Senate Judiciary  Committee, where  Mr.                                                            
Lindstrom could present that information.                                                                                       
SENATOR  WARD moved  CSSB 135(HES)  from committee  with  individual                                                            
recommendations.  There being no objection, the motion carried.                                                                 
  CONTINUATION OF THE MEDICAID PRESENTATION BY THE DEPARTMENT OF                                                            
                    HEALTH AND SOCIAL SERVICES                                                                              
MR. BOB LABBE, Director,  Division of Medical Assistance, Department                                                            
of Health and Social Services,  informed the committee that he would                                                            
continue to provide  background information on the  Medicaid program                                                            
and focus on the  potential expansion of Medicaid  services. [During                                                            
his  discussion,  Mr. Labbe  referred  to  a DHSS  handout  entitled                                                            
Medicaid Financing.]                                                                                                          
MR. LABBE explained  that the Medicaid  program contains  variations                                                            
in the amount  of the state match for different services.  The basic                                                            
match rate is 60.13 percent;  that rate fluctuates every year, based                                                            
on how Alaska's  per capita income compares to the  national average                                                            
per capita  income.  Some Medicaid  services, however, have  a fixed                                                            
federal match  rate: 90  percent for family  planning services;  100                                                            
percent  for services  provided to  Alaska Natives;  and 72  percent                                                            
from the block  grant for the Denali  Kid Care program.   The Denali                                                            
Kid Care program  rate will vary every  year based on the  change in                                                            
the underlying  Federal Medical Assistance  Percentage (FMAP)  rate,                                                            
as those two are linked.                                                                                                        
CHAIRWOMAN GREEN asked  what determines the fluctuation in the rate.                                                            
MR.  LABBE said  it  is based  on  how Alaska's  per  capita  income                                                            
compares to  the national per capita  income.  The formula  is based                                                            
on data that  is fairly old.  For  example, 1993-1995 data  was used                                                            
for the 1999 formula.                                                                                                           
MR. LABBE said  the rates can go up  or down, but DHSS is  concerned                                                            
that this is a  risk area for Alaska because the federal  government                                                            
has changed  how it  will calculate  per capita  income in  general.                                                            
The new  calculation will  take effect next  year; that change  will                                                            
negatively  impact Alaska so the federal  match rate will  decrease.                                                            
DHSS  is working  with  Alaska's congressional  delegation  on  that                                                            
issue right now to avoid a drop next year.                                                                                      
CHAIRWOMAN GREEN  asked when that will impact the  State of Alaska's                                                            
MR. LABBE said the change  will take effect in October of 2001 so it                                                            
will affect the 2002 state  budget.  He pointed out the same problem                                                            
occurred last  year because Senator  Murkowski had secured  a three-                                                            
year arrangement  for Alaska that expired.  It is  an area that DHSS                                                            
has spent a lot of time on.                                                                                                     
MR. LABBE informed  the committee  that Pro-Share is part  of DHSS's                                                            
Medicaid  financing,  but it is  being phased  out.   DHSS has  been                                                            
allowed  to send  funds out  to certain  public  facilities and  the                                                            
money  was  returned  as  a  match.    The  federal   government  is                                                            
curtailing that process.                                                                                                        
MR. LABBE  explained  that the  next section  contains  data on  the                                                            
number of eligible  clients in each category (children,  adults, the                                                            
elderly,  and the disabled)  and the costs  to serve those  clients.                                                            
That data is used  to project what changes might be  on the horizon.                                                            
This model  shows the difference between  the impact of new  clients                                                            
versus the  impact of  new costs.   If the number  of clients  stays                                                            
constant,  the budget may  increase because  of increased costs  and                                                            
vice versa.                                                                                                                     
CHAIRWOMAN  GREEN asked  if DHSS  has any  ability,  if the  federal                                                            
agency reduces its match, to reduce the state portion.                                                                          
MR. LABBE  replied if the  federal share goes  down, DHSS will  need                                                            
more  state funds  to equal  the amount  of the  expenditures.   The                                                            
other option would be to lower the expenditures and services.                                                                   
CHAIRWOMAN GREEN  asked if any legislation ties the  amount of state                                                            
funds to potential changes in federal funding.                                                                                  
MR. LABBE said there was  a language section, which was taken out in                                                            
the past  when this  subject was  dealt with,  that allowed  DHSS to                                                            
continue budgeting  the general fund  at the match, assuming  if the                                                            
federal funds  didn't materialize, more general funds  would be made                                                            
CHAIRWOMAN GREEN  asked if DHSS has the ability to  go the other way                                                            
if, for example, the federal match dropped 5 percent mid-year.                                                                  
MR. LABBE  stated DHSS  pays the  total amount  for services  and is                                                            
then reimbursed.   If the federal match dropped, DHSS  would have to                                                            
decide how to handle it.                                                                                                        
MR. LABBE referred  to page 38 of the handout, entitled  Fiscal Year                                                            
Analysis,  and noted  DHSS served  76,664 Alaskans  last year;  this                                                            
year the  number is  81,178 and  about 5,000 people  per month  have                                                            
become eligible.                                                                                                                
CHAIRWOMAN  GREEN asked  how  that translates  to  the general  fund                                                            
amount and the federal match.                                                                                                   
Number 1415                                                                                                                     
MR.  LABBE said  it  is in  DHSS's  supplemental  appropriation.  He                                                            
thought  the general  fund  amount  is $9  million while  the  total                                                            
amount of federal  and other funds  is $80 million.  The  next chart                                                            
shows the trend  line for eligible children from 1996  through 2002.                                                            
The eligible  number  increased in  1999 because  of the Denali  Kid                                                            
Care program  but DHSS  projects that  number will  taper off.   The                                                            
number of  adults receiving  services continues  to trend  downward,                                                            
primarily due  to welfare reform.   The number of elderly  receiving                                                            
services has continued  to increase but it has not increased as much                                                            
as one  might expect given  the demographics.   He believes  that is                                                            
because the  income standards have  remained flat while the  younger                                                            
retirees  tend  to have  more  income and  assets.   The  number  of                                                            
disabled clients continues  to increase - that is the most expensive                                                            
CHAIRWOMAN GREEN asked why the number continues to increase.                                                                    
MR. LABBE said he believes  the increase is due to multiple factors.                                                            
First, the  baby boom generation is  aging.  Second, technology  has                                                            
allowed people  to survive  medical conditions  they would  not have                                                            
survived  in the  past.   Third,  medical  services  in Alaska  have                                                            
improved so people are staying in the state.                                                                                    
CHAIRWOMAN  GREEN  asked if  that  number  includes Tax  Equity  and                                                            
Fiscal Responsibility Act (TEFRA) clients.                                                                                      
MR. LABBE said it does include TEFRA children as well.                                                                          
SENATOR WILKEN suggested  that DHSS determine the slope of that line                                                            
in relation to the increase or decrease of the population.                                                                      
MR.  LABBE  said it  would  be  good  to get  that  information  but                                                            
acknowledged  that it is a little  harder to get census data  on the                                                            
disabled population.                                                                                                            
CHAIRWOMAN  GREEN  asked if  Senator  Wilken  was referring  to  the                                                            
change in the general population.                                                                                               
SENATOR WILKEN said he was.                                                                                                     
MR. LABBE explained  the next chart contains the number  of eligible                                                            
clients by month and the  payment amount by month.  The overall cost                                                            
in FY 01 is  $4.4 million over FY  00.  The next chart compares  the                                                            
amount of state and federal  funds spent between 1991 and 2000.  The                                                            
general fund  costs have  increased slightly  but much less  so than                                                            
the federal  fund costs.   DHSS has become  much more aggressive  in                                                            
claiming 100 percent of  the federal reimbursement for Indian Health                                                            
Service (IHS)  clients. The next chart  (page 45) is a bar  graph of                                                            
Medicaid expenditures  by fund source.  Again, the  state funds have                                                            
remained relatively flat compared to federal funds.                                                                             
MR.  LABBE  discussed  the  Medicaid  expenditures  by  category  of                                                            
CHAIRWOMAN  GREEN  noted the  chart  reinforces  the fact  that  the                                                            
highest cost is for the disabled and the elderly.                                                                               
MR. LABBE  pointed out that  the elderly  receive Medicare  so their                                                            
expenses  are lower  for  hospital and  physician  services  because                                                            
Medicare is the  primary payer.   Medicare does not  pay for nursing                                                            
home expenses so that is a big ticket item.                                                                                     
SENATOR LEMAN  asked what kind of expenses would fall  in the waiver                                                            
costs category.                                                                                                                 
MR. JOHN SHERWOOD, Division  of Medical Assistance, said that waiver                                                            
costs provide  for care coordination, respite care,  chore services,                                                            
payment   for  services   in  an  assisted   living  facility,   and                                                            
rehabilitation services for the developmentally disabled.                                                                       
Number 1796                                                                                                                     
CHAIRWOMAN  GREEN asked  if those  services  are part  of the  wrap-                                                            
around concept where clients remain in the home.                                                                                
MR. SHERWOOD  said they are.  He explained  that these services  are                                                            
for people who would qualify  for a nursing home or an institutional                                                            
setting but have opted to be cared for in the community.                                                                        
MR. LABBE added  that nursing home  expenditures have remained  flat                                                            
relative to waivers yet  nursing homes cost about five times as much                                                            
per  person.  Regarding  the developmentally   disabled population,                                                             
Harborview is  no longer operating so more of the  expenditures show                                                            
up on  the community-based  side of  Medicaid.  He  noted that  is a                                                            
growing area.                                                                                                                   
CHAIRWOMAN  GREEN  asked  if  anything  will  cause  the  number  of                                                            
disabled  participants  to decrease  or  whether those  clients  are                                                            
disabled to the  extent that they will not leave the  program unless                                                            
they move.                                                                                                                      
MR. LABBE said the only  thing on the horizon is a new effort called                                                            
"ticket   to  work,"   which  focuses   on  getting   persons   with                                                            
disabilities  into  the workforce.   The  state has  received  grant                                                            
funds from the federal  government to develop that program.  Some of                                                            
the coordinators are now working in employment offices.                                                                         
CHAIRWOMAN GREEN asked  if putting the disabled clients into another                                                            
program is being addressed in another bill.                                                                                     
MR. JIM NORDLUND said it could be related to that.                                                                              
MR. LABBE said  the next chart reiterates the issue  on nursing home                                                            
costs, which have remained  flat relative to the waiver costs, which                                                            
continue to grow.   DHSS does rate adjustments in  the facilities as                                                            
rates increase.  The patient base has dropped but costs rise.                                                                   
CHAIRWOMAN GREEN asked about the flat base.                                                                                     
MR. LABBE  explained  the number of  patient days  spent in  nursing                                                            
homes has decreased  over the last several years because  people are                                                            
being served in community settings.                                                                                             
CHAIRWOMAN  GREEN asked  if clients  are moving  into nursing  homes                                                            
later in life.                                                                                                                  
MR.  LABBE  said  that is  true  of  some  clients  but alternative                                                             
services  are  available  so clients  do  not  need a  nursing  home                                                            
setting  as soon.   He  noted that  pharmacy  costs are  one of  the                                                            
largest components  of growth  in the Medicaid  program, which  is a                                                            
national  issue. He  expects  that issue  to be  addressed with  the                                                            
debates on the  Medicare prescription drug benefit.   He pointed out                                                            
that the use of  prescription drugs increases as more  sophisticated                                                            
drugs are  being developed  to handle conditions.   That has  helped                                                            
reduce inpatient hospital costs.                                                                                                
CHAIRWOMAN  GREEN  said  the  same   applies  to  the  mentally  ill                                                            
population.  She asked  whether this would gradually fall off if the                                                            
Medicare changes are adopted.                                                                                                   
MR. LABBE said it is hard  to tell right now.  DHSS anticipated that                                                            
a Medicare prescription  drug benefit would help the  state costs in                                                            
the sense  that people on  Medicaid who get  Medicare would  receive                                                            
that benefit.   The  current proposal  by President  Bush, which  he                                                            
says is  temporary, would  exclude Medicaid  clients.  However,  the                                                            
full discussion  of a prescription  drug  benefit for seniors  would                                                            
help the state if that  ever occurs.  He expects that debate to take                                                            
at least a couple of years.                                                                                                     
CHAIRWOMAN GREEN said that will cost "big bucks."                                                                               
COMMISSIONER PERDUE pointed  out that both the U.S. House and Senate                                                            
have included  earmarks in the budget  for that. The Senate  has put                                                            
in  $300  billion   while  the  House   put  in  $500  billion   for                                                            
prescription drug  plans this year.  President Bush's  Helping Hands                                                            
program is much more modest.                                                                                                    
MR. LABBE said  the next chart shows an increase to  100 percent for                                                            
payments to  tribal programs.  The  Native health system  is growing                                                            
so DHSS is trying to maximize  the use of that program to the extent                                                            
possible.    He indicated that DHSS  pays for those services  and is                                                            
then reimbursed  by the federal  government.   The next chart  shows                                                            
Medicaid  payments  by district.    The following  chart  shows  the                                                            
number of providers  in each district  and the amount paid  to those                                                            
COMMISSIONER  PERDUE clarified that  the number of eligible  clients                                                            
in each district  is the number of  people who have actually  signed                                                            
up for services.                                                                                                                
MR. LABBE said  the last page (57)  contains the program  areas that                                                            
DHSS does not  currently cover.  A bill is before  the committee (SB                                                            
38) to  cover services for  breast and cervical  cancer.  There  has                                                            
been discussion  within the department  about covering services  for                                                            
TB infected  individuals.  That is  a small group.  Community  based                                                            
care for persons with Alzheimer's  and related disorders is one that                                                            
the Long Term  Care Task Force recommended.  He noted  a proposal is                                                            
being discussed  to cover services for children aging  out of foster                                                            
CHAIRWOMAN GREEN asked what age group that would cover.                                                                         
MR. SHERWOOD answered  that it would be for children  who age out of                                                            
state custody, which is usually at age 18.                                                                                      
MR.  LABBE  explained  that  Medicaid  would   provide  health  care                                                            
coverage until those children turn 21.                                                                                          
CHAIRWOMAN GREEN asked if the federal government chose 21.                                                                      
MR. LABBE  said it is an  option the federal  government offered  to                                                            
the states.                                                                                                                     
MR. SHERWOOD said  he did not think it has to be 21;  services could                                                            
be provided to age 19.                                                                                                          
CHAIRWOMAN  GREEN  commented that  families  are generally  able  to                                                            
cover their  children until  age 22 or 23  so she was wondering  why                                                            
that isn't consistent.   She asked if the state could  opt for 22 or                                                            
MR. SHERWOOD said he believes 21 is the maximum.                                                                                
MR.  LABBE  said  another  area  of  great  interest  to  disability                                                            
advocates is coverage  for working disabled individuals  to a higher                                                            
income level.   The bill  that passed a few  years ago allows  those                                                            
individuals  to receive Medicaid Services  if their income  is up to                                                            
250 percent  of the poverty  level.  The new  proposal is to  remove                                                            
that limit altogether.   He said the problem, for  the most part, is                                                            
insurability of persons with disabilities in the workforce.                                                                     
CHAIRWOMAN  GREEN  asked if  the income  constraint  is  not a  good                                                            
indicator  for  that   population  because  of  the  difficulty   of                                                            
purchasing insurance.                                                                                                           
MR. LABBE said the other  piece of that is the scope of the coverage                                                            
that Medicaid  provides, such as personal attendant  care, which may                                                            
not be covered by most insurance companies.                                                                                     
CHAIRWOMAN  GREEN pointed out that  those costs are often  a routine                                                            
part of settlements.                                                                                                            
MR. LABBE  said several states  have begun  to cover the parents  of                                                            
children who are covered  under programs similar to Denali Kid Care.                                                            
Research  has shown that  if parents have  access to coverage,  they                                                            
are  more likely  to  get  coverage  for their  children.    Another                                                            
possible expansion  of services to  adult Medicaid clients  could be                                                            
preventive  and restorative  dental services.   Currently,  Medicaid                                                            
covers  immediate  relief of  pain and  infection  so it  is a  very                                                            
limited benefit.  Some  Medicaid clients have very serious problems,                                                            
and a number  of problems  could be avoided  if preventive  care was                                                            
CHAIRWOMAN GREEN  asked if, under the current program,  clients with                                                            
dental problems must be treated in the emergency room.                                                                          
MR. LABBE  said dentists  will  provide immediate  service, but  the                                                            
current program does not cover annual check-ups for adults.                                                                     
CHAIRWOMAN GREEN asked if any permutation of that is possible.                                                                  
MR. LABBE said adult dental  service is on the options list and that                                                            
is covered,  but  the current  statutory  definition  is limited  to                                                            
immediate  relief of pain.    He stated that  a bill in Congress  [H                                                            
600],  called   the  Family  Opportunity   Act,  was  part   of  the                                                            
President's proposal.                                                                                                           
TAPE 01-32, SIDE B                                                                                                              
MR. LABBE said that bill  would cover disabled children at up to 300                                                            
percent  of the  federal  poverty  level.   Right now,  children  of                                                            
higher income levels can  be covered only if they need institutional                                                            
care.  H 600  would cover a broader  group in that it would  include                                                            
any child  that meets the  test for disability.   That bill  has not                                                            
yet passed  Congress but it  may be an option  after the end  of the                                                            
year.  H 600  also includes home and  community based care  services                                                            
for children under 21 with psychiatric disorders.                                                                               
CHAIRWOMAN GREEN asked  if the 300 percent of poverty level standard                                                            
would apply to the parents' income.                                                                                             
MR. LABBE said  it applies to the  family's income.  He added  there                                                            
could be  a family  premium of up  to 5 percent  of income  charged.                                                            
There could  also be some  co-pay and the  states could also  enroll                                                            
the child in  a health plan offered  through an employer  as long as                                                            
the employer was paying at least 50 percent of the cost.                                                                        
CHAIRWOMAN GREEN asked  if the state could supplement the premium to                                                            
the employer.                                                                                                                   
MR. LABBE said it could.                                                                                                        
CHAIRWOMAN GREEN  said she wishes that was being done  with a lot of                                                            
the options.                                                                                                                    
MR. LABBE said  this is something new so they will  see how it plays                                                            
out.   He  pointed out  that  every year  there  seems to  be a  new                                                            
option, and there seems  to be a lot of national interest on ways to                                                            
deal with uninsured and health care issues.                                                                                     
MR. LABBE said that was the end of his presentation.                                                                            
The committee took a brief at-ease.                                                                                             
CHAIRWOMAN GREEN called  the committee back to order.  The committee                                                            
took up SB 116.                                                                                                                 
SENATOR WARD  moved to adopt CSSB  116(HES) as the working  document                                                            
of the committee (Version  J).  There being no objection, the motion                                                            
CHAIRWOMAN GREEN asked Mr. Jim Nordlund to come forward.                                                                        
MR. JIM  NORDLUND, Director  of the Division  of Public Assistance,                                                             
DHSS, explained  that the only difference between  Version J and the                                                            
previous  version  adopted  by  the committee  is  the  addition  of                                                            
language on  page 1, line 11, that  reads, "unless the second  needy                                                            
parent  is determined  under  regulations  of the  department to  be                                                            
physically  or mentally  unable to  perform gainful  activity."   He                                                            
explained that  language is the status quo of the  way both the AFDC                                                            
and ARAP  programs operated.   If one parent  is incapacitated  in a                                                            
two-parent  family, the benefit will  not be cut in half  during the                                                            
summer months.                                                                                                                  
Number 2183                                                                                                                     
SENATOR LEMAN asked what  standard is used by the Division of Public                                                            
Assistance to  determine physical or mental disability  for purposes                                                            
of work.                                                                                                                        
MR. NORDLUND  replied  that definition  is in regulation  and  is in                                                            
committee members' packets.                                                                                                     
CHAIRWOMAN  GREEN noted it is in 7  AAC 45.235.  She asked  if, when                                                            
the legislature passed  its welfare reform legislation several years                                                            
ago,  it  was  ahead  of Congress  and,  by  the  time  the  federal                                                            
government  implemented  its  law, Alaska's  law  was  a little  bit                                                            
askew.  Although DHSS has  used the standard in the federal law, the                                                            
court  has said  the  statute must  be  corrected so  this  language                                                            
confirms what DHSS has been doing.                                                                                              
MR. NORDLUND  said that  is correct.   He pointed  out the  critical                                                            
issue in  the court case  was removing the  language that refers  to                                                            
the unemployment  of the  family's principal  wage earner.   That is                                                            
the last remnant  of the old AFDC  law.  When that "bath  water" was                                                            
thrown out, the "baby"  went with it, the "baby" being a category of                                                            
folks that had always been exempted.                                                                                            
CHAIRWOMAN GREEN  said she has worked closely with  DHSS to get this                                                            
legislation  to the point  where DHSS  can live  with it until  next                                                            
year, when this subject will be revisited.                                                                                      
There being no further  discussion, SENATOR WARD moved CSSB 116(HES)                                                            
from committee  with  individual recommendations.    There being  no                                                            
objection, the motion carried.                                                                                                  
The committee took a brief at-ease.                                                                                             
TAPE 01-33, SIDE A                                                                                                              
CHAIRWOMAN GREEN called  the meeting back to order at 4:05 p.m.  All                                                            
members were present.   She announced that the committee  would hear                                                            
information  from  DHSS on  the  Breast and  Cervical  Cancer  Early                                                            
Detection  Program.   The  conversation  about  this topic  will  be                                                            
generic as  the committee does not  have the bill [SB 38]  before it                                                            
at this time.   Time permitting, DHSS will also talk  about Medicaid                                                            
funding  for  Alzheimer's  and  Dementia   diseases  and  any  other                                                            
programs that  Alaska has had the opportunity to participate  in but                                                            
has chosen not to.                                                                                                              
COMMISSIONER   KAREN  PERDUE,  Department   of  Health  and   Social                                                            
Services, informed  committee members that Mary Diven  would give an                                                            
overview of the  screening program and the treatment  program option                                                            
and how they fit together.                                                                                                      
CHAIRWOMAN  GREEN noted the National  Council of State Legislatures                                                             
published a basic primer  on the federal Medicaid program that is an                                                            
excellent source of information.                                                                                                
MS. MARY DIVEN,  DHSS, gave the following overview  of the screening                                                            
program.  The  Center for Disease Control (CDC) runs  the Breast and                                                            
Cervical  Cancer  Early  Detection  Program,  which is  designed  to                                                            
reduce mortality  and morbidity from  breast and cervical  cancer by                                                            
early detection;  screening a large population of  women who are low                                                            
income and  groups of women  who are the least  likely to go  in for                                                            
annual  screening.   The CDC runs  programs throughout  most  of the                                                            
state and women can get  access through public health centers.  Some                                                            
diagnostic  providers will,  once a woman is  screened and  found to                                                            
have  a  likelihood  of cancer,  do  a  diagnosis  of  that  cancer.                                                            
Because there  is no funding through the CDC for treatment  of those                                                            
cancers,  last  October Congress  passed  legislation  allowing  for                                                            
treatment through  a Medicaid option  with an enhanced state  match,                                                            
for those women diagnosed  through the CDC program and for women who                                                            
have no insurance to pay for treatment.                                                                                         
CHAIRWOMAN  GREEN asked Ms.  Diven to review  for the committee  the                                                            
purpose for  the original CDC screening  program and to explain  why                                                            
this program was set up.                                                                                                        
MS. DIVEN  answered that  low income women  and women among  certain                                                            
minority populations  were dying from breast and cervical  cancer in                                                            
larger numbers  because they were not getting annual  pap smears and                                                            
mammograms.   The CDC  set the program  up to  reduce the  mortality                                                            
rate by trying to detect the cancers early.                                                                                     
CHAIRWOMAN  GREEN  asked if  the CDC  or  public health  system  has                                                            
always  collected data  on diagnoses  of breast  cancer and  whether                                                            
that information is saved in a database.                                                                                        
COMMISSIONER  PERDUE said DHSS started  a cancer registry  in Alaska                                                            
in the last couple of years.                                                                                                    
MS. DIVEN noted the first  data from that registry is being compiled                                                            
CHAIRWOMAN  GREEN explained  that  she is  trying to  find out  what                                                            
CDC's original  purpose was and how we have segued  to where we are.                                                            
COMMISSIONER  PERDUE replied that  CDC's original intent  was not to                                                            
collect data,  it was to provide the screening.  She  clarified that                                                            
screening means  that actual mammography and pap smears  are done to                                                            
find out if women have the disease.                                                                                             
CHAIRWOMAN GREEN took a brief at-ease.                                                                                          
MS. DIVEN said  the private diagnostic providers are:  the Anchorage                                                            
Neighborhood  Health Center,  Eastern Aleutian  Tribes in Cold  Bay,                                                            
the Cordova Community Medical  Center, two providers in Eagle River,                                                            
the Interior Neighborhood  Health in Fairbanks (screening only), and                                                            
Family Planning in Kachemak Bay.                                                                                                
CHAIRWOMAN GREEN asked  how a woman gets to the diagnostic provider.                                                            
MS. DIVEN  answered a  woman can go  to a screening  provider  for a                                                            
clinical breast exam, a  mammogram if the woman is age-eligible, and                                                            
a pap smear.   If there's an abnormality on the pap  smear, she will                                                            
go  to a  diagnostic  provider  - a  gynecology  provider.   If  the                                                            
results of  the clinical  breast exam are  abnormal, she will  get a                                                            
diagnostic  mammogram  or  a fine  needle  aspiration  to  determine                                                            
whether the lump is a cyst or a cancerous lump.                                                                                 
CHAIRWOMAN  GREEN  asked   how  women  find  out  about  this  early                                                            
detection service.                                                                                                              
MS. DIVEN  told the committee  there is a  general outreach  program                                                            
and each community designs  its own outreach.  Some providers do "in                                                            
reach."   They look  through their  client records  to see if  their                                                            
female clients are age  and income eligible.  In Anchorage, the YWCA                                                            
has a large outreach project  named Encore.  The YWCA works with the                                                            
ministerial  association  and does  outreach from  downtown  through                                                            
Mountainview  and Muldoon to  reach women in  the lowest income  zip                                                            
codes. The two organizations  have group gatherings where a provider                                                            
gives information  to women and a  list of providers to go  to.  The                                                            
church or other groups  make arrangements to transport the women for                                                            
screening  services.   In addition,  coupons are  given to women  in                                                            
public assistance offices  and job placement offices.  In Fairbanks,                                                            
outreach is  done through the public  health center.  In  Anchorage,                                                            
coupons  have gone out  in utility  bills to women  living in  lower                                                            
income  zip codes.  Coupons  are also  enclosed in  newsletters  for                                                            
various groups, for example in Asian American newsletters.                                                                      
CHAIRWOMAN GREEN  asked if this program would not  necessarily apply                                                            
to a woman who  goes to her doctor with a problem  and then realizes                                                            
how much the  diagnosis and treatment  will cost and says,  "I can't                                                            
afford this."                                                                                                                   
MS. DIVEN  answered this  would only be for  women screened  through                                                            
this federal program.                                                                                                           
CHAIRWOMAN GREEN asked how many women are screened each year.                                                                   
MS. DIVEN answered a little more than 4,000.                                                                                    
CHAIRWOMAN GREEN  asked if Alaska Native women are  eligible through                                                            
the CDC screening  but use the Indian  Health Service (IHS)  if they                                                            
need further treatment.                                                                                                         
MS. DIVEN answered yes, as do women with health insurance.                                                                      
CHAIRWOMAN  GREEN asked Ms. Diven  to explain how this program  will                                                            
work for women  who have health insurance that get  a CDC screening.                                                            
MS. DIVEN  referred to a  chart she provided  to the committee  that                                                            
provides a side-by-side  comparison of eligibility  requirements for                                                            
the  screening   program  and  eligibility   requirements   for  the                                                            
treatment  program.   One  of the  goals of  the CDC  program is  to                                                            
encourage  women who  may not be  getting screenings  because  their                                                            
deductible  is too high to  get a screening.   However, those  women                                                            
would  not be  eligible  for  the treatment  program  because  their                                                            
insurance will  pay for it.  Many  insurance companies do  not cover                                                            
preventive  services,  including  pap  smears,  so  women  would  be                                                            
eligible  for  a  pap smear.    Insurance  companies  must  pay  for                                                            
mammograms  under  state law.   So,  women  with insurance  are  not                                                            
eligible for treatment because they have coverage.                                                                              
COMMISSIONER   PERDUE  added  that   regarding  the  issue   of  the                                                            
deductible,  the concept behind the  screening program is  to get as                                                            
many women  as possible to  get screening  because the earlier  they                                                            
are diagnosed,  the better their outcomes  are.  So, the  reason for                                                            
the  difference between  the  screening  program and  the  treatment                                                            
program is that the CDC is trying to encourage the screening.                                                                   
MS. DIVEN clarified  that women with insurance are  not eligible for                                                            
the  treatment program  because  they already  have  coverage so  it                                                            
would be considered double dipping.                                                                                             
CHAIRWOMAN  GREEN asked if,  regarding the  screening, women  can be                                                            
uninsured or underinsured,  but regarding treatment,  a woman is not                                                            
eligible if underinsured, only if uninsured.                                                                                    
MS. DIVEN  said that's  correct.   She repeated  that Alaska  Native                                                            
women are  eligible  for the screening  but the  treatment would  be                                                            
covered at an IHS facility.                                                                                                     
CHAIRWOMAN  GREEN asked  whether  this would  refer  to someone  who                                                            
lives in an  area where there is no  Indian Health Service  facility                                                            
but there is a local hospital.                                                                                                  
MS. DIVEN  explained  that according  to the  federal guidelines,  a                                                            
Native American  woman who lives in  New York City where  there's no                                                            
Indian  Health Service  facility available  would  be eligible.   If                                                            
that  woman  lives  in  Bethel  where   there  is  an  IHS  facility                                                            
available, she would not be eligible.                                                                                           
CHAIRWOMAN GREEN asked  if this is not as applicable to Alaska as it                                                            
might  be  in  a  high  population  area  with   pockets  of  Native                                                            
COMMISSIONER PERDUE said yes.                                                                                                   
MS.DIVEN added that regardless,  the federal government will pay 100                                                            
percent of  the cost.  Even if the  CDC determined that access  here                                                            
was too limited  to be applicable,  it would not cost state  general                                                            
funds, all IHS payments are 100 percent reimbursable.                                                                           
MS. DIVEN then  explained that income and insurance  eligibility for                                                            
the  screening program  is  checked  every year.   Clients  sign  an                                                            
agreement  that says they  are income eligible  and their  insurance                                                            
eligibility is  checked.  For the treatment program,  eligibility is                                                            
limited  to the  duration  of treatment  for  that cancer  and  then                                                            
eligibility ends.                                                                                                               
CHAIRWOMAN GREEN  expressed concern that the end of  treatment for a                                                            
particular cancer is a very sketchy date.                                                                                       
MR. LABBE  agreed.  He  said this program  differs from the  typical                                                            
approach,  in  terms  of tying  eligibility  to  the  completion  of                                                            
treatment.  Usually  a client's income either goes  up or some other                                                            
factor makes  the client  ineligible.  In  this case, DHSS  plans to                                                            
use its  contractor  who does high  risk case  management to  track,                                                            
with the  physician and the  patient, the  course of treatment.   At                                                            
the time  treatment  is determined  to be concluded,  DHSS would  be                                                            
notified and coverage would be terminated.                                                                                      
CHAIRWOMAN  GREEN asked if  that client would  be covered if  she is                                                            
diagnosed with ovarian cancer six months later.                                                                                 
MS. DIVEN said  if her breast cancer treatment is  not over, she is,                                                            
but if her breast cancer treatment is over, she would not be.                                                                   
CHAIRWOMAN  GREEN pointed  out that ovarian  cancer is connected  to                                                            
breast  cancer so  if there  is a tie  to the  previously  diagnosed                                                            
condition,  it raises questions  as to how  we know where to  start,                                                            
where to end, and how to forecast the number of eligible people.                                                                
MS. DIVEN  asked if  Chairwoman Green  was referring  to the  health                                                            
care financing  document with the questions and answers.   She noted                                                            
that document  was done by  a federal agency  and it raised  as many                                                            
questions as it answered.                                                                                                       
CHAIRWOMAN  GREEN  said  breast  cancer  patients  are  often  still                                                            
undergoing  care six years after they  are diagnosed.  If  something                                                            
were to  happen after  the treatment  was concluded,  for example  a                                                            
metastasis,  it could be tied to the  breast cancer.  She  expressed                                                            
concern about  what this approach  does to the out years.   She said                                                            
if the legislature  opens  up this program  up to people based  on a                                                            
diagnosis,  then it needs to clearly  define what else is  included.                                                            
She  said   the  Medicaid  program   is  inconsistent,  unfair   and                                                            
COMMISSIONER PERDUE replied  that the health business is frustrating                                                            
in that someone  is always just outside of the line.   The system is                                                            
a patchwork  of care  and the  lines are  arbitrary.   She said  she                                                            
receives  probably  one  letter  per  week  from a  person  with  an                                                            
incredibly sad story who  was not eligible.  She added that the need                                                            
is so tremendous that Congress,  in its wisdom, has said there is no                                                            
other way,  absent a universal access  discussion, to get  access to                                                            
this care.   Commissioner  Perdue said that  26 women are  diagnosed                                                            
each year  in Alaska  with cervical  cancer so  she would guess  the                                                            
number of cases of ovarian cancer is similar.                                                                                   
CHAIRWOMAN  GREEN indicated  that her concern  is that once  a woman                                                            
has been diagnosed  with breast cancer,  she is checked for  ovarian                                                            
cancer as part of the follow-up.                                                                                                
MS. DIVEN stated  that whether a direct  causal relationship  exists                                                            
is   probably   determined   by  the   physician   and  eligibility                                                             
determinations  would come under the managed care  piece.  Regarding                                                            
the  asset-testing  question,  this  is a  public  health  screening                                                            
program and the  goal is to detect the cancers as  early as possible                                                            
to increase the survival  rate.  For the treatment program, the memo                                                            
from  the Health  Care  Financing  Administration  says  that  asset                                                            
testing is  prohibited because it's  tied to the screening  program.                                                            
CHAIRWOMAN  GREEN asked if other Medicaid  programs are tied  to any                                                            
CDC screening  programs or whether this is a hybrid.   She said it's                                                            
a catch-22 though and may  as well be tied to one's driver's license                                                            
as it  makes no sense  to say it's  got to be  done one way  because                                                            
it's tied to the CDC program.                                                                                                   
COMMISSIONER PERDUE said it's a little more direct than that.                                                                   
CHAIRWOMAN GREEN was not sure.                                                                                                  
MR. LABBE said the cash  assistance program is somewhat analogous in                                                            
that it guaranteed  Medicaid eligibility historically.   A person on                                                            
SSI or AFDC qualified for Medicaid.                                                                                             
CHAIRWOMAN GREEN  stated those programs are needs-based  and clients                                                            
have to lay out their assets:  bank accounts, and real estate.  This                                                            
program requires nothing and doesn't even allow anyone to ask.                                                                  
COMMISSIONER  PERDUE said that the  early detection program  is most                                                            
similar to TEFRA.                                                                                                               
CHAIRWOMAN  GREEN asked  if income  is disregarded  under the  TEFRA                                                            
COMMISSIONER   PERDUE  explained   the  income   of  the  child   is                                                            
considered; the  income of the parents is disregarded.   The concept                                                            
is the  same in that  the treatment  is a major  expense so  it will                                                            
have a major impact on the family.                                                                                              
MR. LABBE said for example, treatment for a disabling condition.                                                                
COMMISSIONER  PERDUE pointed out the  family can have a fair  amount                                                            
of money, but the child's income is what determines eligibility.                                                                
CHAIRWOMAN GREEN felt the  concept is not the same because the early                                                            
detection  program is  for the adult  who has  made the choice,  for                                                            
whatever  reason,   legitimate  or  poor,  to  not  have   insurance                                                            
coverage.   She expressed  concern that every  time we go down  this                                                            
path we remove another  group of people from an insurance pool.  The                                                            
Denali  Kid Care program  took 17,000  people out  of the  insurance                                                            
pool and as we ratchet  down the number of people who buy insurance,                                                            
we make it less  possible in a state of so few people,  many of whom                                                            
are  under self-insured  plans  already,  to get  reasonably  priced                                                            
insurance.  She maintained  that participants  of health care  plans                                                            
have been  sliced out to  such a fine point  already that she  can't                                                            
imagine how the  comprehensive health insurance will  continue to be                                                            
funded.   She said this is  a bigger problem  than the extension  of                                                            
CDC free screening to breast  and cervical cancer and funding health                                                            
care  based  on a  diagnosis,  which  she  thinks  is a  very,  very                                                            
dangerous  path  to  go  on  because  she  is  not  an  advocate  of                                                            
socialized medicine.                                                                                                            
COMMISSIONER  PERDUE commented that  the small population  in Alaska                                                            
plus the high  number of federal insurees,  such as active  military                                                            
and veterans,  already chops out a higher proportion  of people from                                                            
the private insurance market  than in any other state so that is one                                                            
variable Alaska has always  faced.  Plus, Alaska has a higher number                                                            
per capita of  small business people, businesses of  25 employees or                                                            
less or self employed,  and lots of seasonal people.  Alaska has had                                                            
a heck of a road  with this pool and the only product  out there for                                                            
that  individual  who  gets  sick  and needs  the  coverage  is  the                                                            
Comprehensive Health Insurance  Association (CHIA), which requires a                                                            
waiting period to protect  the actuarial cherry picking of the pool.                                                            
CHAIRWOMAN  GREEN said she would prefer  to see legislation  go in a                                                            
direction  to really help  people with insurance  over a long  term,                                                            
not just  for one diagnosis  and the duration  of that illness.  She                                                            
asked if, while  a women is covered  under this insurance,  she were                                                            
to break  her ankle,  whether she  would be covered  for that  under                                                            
auxiliary services.                                                                                                             
MS. DIVEN said she would be.                                                                                                    
Number 397                                                                                                                      
SENATOR LEMAN  expressed concern  that people  ought to assert  some                                                            
responsibility.   He said  when he hears  testimony from people  who                                                            
say they  can't afford insurance  and he sees  how they spend  their                                                            
money, he wonders  how to help them  make good lifestyle  choices so                                                            
that insurance  can be provided.   He questioned  how much  income a                                                            
person would receive and be at 250 percent of the poverty level.                                                                
CHAIRWOMAN GREEN said it is about $50,000 for a family of four.                                                                 
SENATOR LEMAN  thought that at $50,000 a person ought  to be able to                                                            
participate   and  share  in   a  cost  to   be  a  participant   in                                                            
responsibility.    He noted  the  state  is not  doing  anything  to                                                            
encourage people  to make the right  choices and while this  program                                                            
may  be for  a good cause  the  state needs  to get  people to  plan                                                            
because bad things might happen.                                                                                                
COMMISSIONER  PERDUE pointed out that  one problem is that  the cost                                                            
of insurance  depends on the profession  a person chooses.   A small                                                            
business  person   might  purchase  insurance  through   the  Alumni                                                            
Association  or the  latest  small employer  coverage  pool but  the                                                            
premium will  be much higher than  coverage for a state employee  or                                                            
school   district  employee.   The   cost  of   insurance  is   very                                                            
discriminatory to the profession  people choose.  In Alaska a lot of                                                            
people  are attached  to the formal  insurance  system (federal  and                                                            
state)  and  then  there  are  a  lot  of  small  markets  that  are                                                            
unorganized.   The cost is very high  for some of those insurances.                                                             
SENATOR LEMAN  agreed regarding full service insurance  but he asked                                                            
about catastrophic  insurance  coverage because  a $30,000 hit  or a                                                            
$100,000 hit will  devastate a lot of people.  Most  people can work                                                            
off a  $1,000 cost.   He noted if  the state had  a fund that  could                                                            
cover  catastrophic  illnesses  that everybody  participates  in  to                                                            
avoid adverse  selection, then everybody in the world  might want to                                                            
come to  Alaska if they've  got bad things  happening and that  fund                                                            
would be driven into bankruptcy.   If that could be avoided, part of                                                            
everyone's  permanent fund  dividend could go  into a fund.   If you                                                            
take the 100,000 people  who are uninsured or severely underinsured,                                                            
times $2,000,  the fund would  have $200 million.   That could  be a                                                            
good source of money for catastrophic care.                                                                                     
SENATOR DAVIS  said she appreciates  the fact that Chairwoman  Green                                                            
wants  to  look  at  spending  for  the  Medicaid  program  and  she                                                            
understands Senator  Leman's comment about personal  responsibility,                                                            
but the  CDC decided  to put monies  out there  so people could  get                                                            
screened because there  is a need.  People died because they weren't                                                            
diagnosed early enough  to get the treatment that they needed.  When                                                            
people  are screened  early and get  treatment,  they have a  better                                                            
chance of surviving.   She said she  knows people, through  work and                                                            
personal  relationships,  who  could not  afford  even  $1000 for  a                                                            
catastrophic  illness program.  Many  people don't draw a  permanent                                                            
fund dividend  because their checks are being taken  from them. They                                                            
might owe the  IRS or student loans  or they might have owed  a debt                                                            
that  someone  got  first  dibs  at  their  dividend.    This  early                                                            
screening program  applies to a small group of people.  Of the 4,000                                                            
people screened,  35 were  diagnosed.  Those  4,000 people  wouldn't                                                            
have come for  screening had they had insurance or  the money to pay                                                            
for it.   They  would have  gone  somewhere privately  because  they                                                            
wouldn't want  to come to the public trough.  She  thought a program                                                            
such as Senator  Leman described would  take some time to  work out.                                                            
In the meantime,  70 women could benefit  from this Medicaid  option                                                            
at a  cost of $175,000  to the state.   She felt  it would be  worth                                                            
doing while the  legislature begins to work on a long  term program.                                                            
SENATOR DAVIS said she  has a problem with bringing new clients into                                                            
the program  and then being forced  to cut services.  She  suggested                                                            
working on that area and  suggested that a long term task force is a                                                            
viable solution.                                                                                                                
CHAIRWOMAN GREEN said her  frustration is how to justifiably say the                                                            
program will  cover only these two  diagnoses if a person  is at 250                                                            
percent of  the poverty level when  people with different  diagnoses                                                            
are  at 135  percent of  the  poverty level  and don't  qualify  for                                                            
anything.   Suddenly an arbitrary  rate is applied to this  group of                                                            
breast and  cervical cancer  clients.  However,  the state  is under                                                            
the constraints  of the  federal Medicaid  instruction packet.   She                                                            
noted  70 women  will be  eligible; 28  of those  are Alaska  Native                                                            
women who  will receive  services  from the IHS,  leaving 42  women.                                                            
The state will  pay $175,000 and the  federal government  will match                                                            
that up to about $525,000.   That will cover about $10,000 to 12,000                                                            
per woman for the life  of that breast cancer incident, which she is                                                            
sure is woefully inadequate.                                                                                                    
COMMISSIONER PERDUE said it will cover that amount for one year.                                                                
CHAIRWOMAN  GREEN said  that would cover  maybe 1/7  or 1/10  of the                                                            
cost  of surgery,  and would  not  include oncology,  radiation,  or                                                            
MR.  LABBE  said DHSS  served  about  300  women  last year  in  the                                                            
Medicaid program  who had breast and cervical cancer.   He looked at                                                            
the individual  recipient  dollars and they  range $173 to  $69,000.                                                            
The numbers  are based on  the fiscal year,  so the $173 cost  might                                                            
have been for  one doctor's visit  at the end of the fiscal  year or                                                            
before  the person  moved out  of the state.   The  high number  was                                                            
probably due to  the fact that client had many services  during that                                                            
one year.  But  using that range, DHSS came up with  those estimates                                                            
by determining an average  across all services to come up with a per                                                            
member, per month or per year cost.                                                                                             
CHAIRWOMAN  GREEN asked  if DHSS is  dealing with  the range  of the                                                            
full  true and  complete  fee that  the  hospital charges  for  that                                                            
MR. LABBE said  it is not.  DHSS sets  rates for hospital  payments.                                                            
It generally  reimburses the  fair rate for  reasonable cost  rather                                                            
than actual charges.  Regarding  the physician schedule, DHSS pays a                                                            
fee that is typically lower  than the charges and yet physicians are                                                            
willing to  see Medicaid patients.   Physicians are not required  to                                                            
participate in the Medicaid program, it is voluntary.                                                                           
COMMISSIONER  PERDUE  clarified   that  about  6,000  providers  are                                                            
enrolled in the Medicaid program.                                                                                               
CHAIRWOMAN  GREEN asked if that includes  clinics, doctors,  nurses,                                                            
therapists, masseuses, chiropractors, and doctors.                                                                              
COMMISSIONER  PERDUE said it  does.  She  hoped that many  insurance                                                            
companies are not paying 100 percent.                                                                                           
CHAIRWOMAN GREEN  said she admires DHSS for getting  those rates but                                                            
they have nothing  to do with the reality of what  it costs to go to                                                            
the hospital  for the rest  of the world.    She estimated  that any                                                            
surgical  procedure   that  requires   a  surgeon,  a  back-up,   an                                                            
anesthesiologist,  after care,  and one night  in a hospital,  would                                                            
cost a minimum  $15,000 to $20,000.   So, the information  that says                                                            
the state  is going  to pay  for coverage  for  breast and  cervical                                                            
cancer is not really accurate.                                                                                                  
COMMISSIONER  PERDUE  responded  by  saying  that  based  on  DHSS's                                                            
experience  of 300 women  a year that are  already covered,  the per                                                            
unit cost per year is x.   It's not saying that a full blown stage 3                                                            
cancer  costs x amount,  it is saying  the public  cost on  average,                                                            
based on experience, is this number.                                                                                            
CHAIRWOMAN  GREEN said that  this is an entitlement  program.   DHSS                                                            
has forecast  42 non-Native Alaska  women coming in the door.   If 7                                                            
come in,  it'd be  a great  year but, if  117 come  in, the door  is                                                            
open.  DHSS could  have estimated $10 or $500,000  as the state fund                                                            
COMMISSIONER  PERDUE  explained that  it's  based on  the number  of                                                            
women who have been screened over a period of years.                                                                            
CHAIRWOMAN  GREEN asked what  the prediction  was for the number  of                                                            
children  who would  be  insured under  Denali  Kid  Care when  that                                                            
program started.                                                                                                                
COMMISSIONER PERDUE said it is right at the predicted level.                                                                    
CHAIRWOMAN GREEN asked if that number was 17,000.                                                                               
COMMISSIONER PERDUE said it was.                                                                                                
CHAIRWOMAN GREEN said she never heard that.                                                                                     
COMMISSIONER  PERDUE said that was  the number when the program  was                                                            
ramped up.                                                                                                                      
MR.  LABBE agreed  and  said DHSS  started  out assuming  a  smaller                                                            
number based on the data it had from the Census Bureau.                                                                         
CHAIRWOMAN  GREEN said the  fiscal note implies  that the cost  will                                                            
continue to go  up every year and asked whether that  is based on an                                                            
increase  in the  cost of  services, an  increase in  the number  of                                                            
people coming  through the door or whether it is a  reduction in the                                                            
federal portion.                                                                                                                
MR. LABBE  said the  projected  cost increases  were essentially  an                                                            
estimate of DHSS's  traditional expectation, an 8  percent increase,                                                            
which is a mix  of more people and higher costs of  services. It was                                                            
not an elaborate analysis of this particular group.                                                                             
CHAIRWOMAN  GREEN  noted  that  after five  years  the  increase  is                                                            
substantial  and,  based on  everything  else,  the program  is  not                                                            
likely to go up and level  off so the expectation is that there will                                                            
be more  and more money  each year.   She asked  what assurance  the                                                            
state has  that the federal  government will  maintain its  level of                                                            
COMMISSIONER PERDUE said it is in federal statute.                                                                              
CHAIRWOMAN GREEN asked  if DHSS has a contract for a period of time.                                                            
TAPE 01-33, Side B                                                                                                              
MR. LABBE  thought that Congress  might change  the statute  when it                                                            
appropriates the money.                                                                                                         
COMMISSIONER  PERDUE added  the statutes  don't  expire but  they're                                                            
silent on the question  of how long they're in place.  She has never                                                            
seen Congress repeal one in terms of what coverage they offer.                                                                  
CHAIRWOMAN  GREEN   asked  if  Congress  has  reduced   the  federal                                                            
participation rate.                                                                                                             
COMMISSIONER   PERDUE  said   Congress  has   not  but  that   is  a                                                            
MR. LABBE  said the  match formula  has not been  changed since  the                                                            
program started.                                                                                                                
COMMISSIONER  PERDUE  commented that  one  of the  variables in  the                                                            
program  is  what Senator  Green  was  describing  and that  is  the                                                            
stacking  effect.   Some of  the 42  women won't  leave the  program                                                            
after one  year because they're  not well,  and new women will  come                                                            
in.  DHSS doesn't  know how many and  how fast they'll move  through                                                            
the system,  but some will not make  it.  The cost will increase  to                                                            
some degree because it won't have just 40 new people every year.                                                                
CHAIRWOMAN GREEN  said the general time-frame with  breast cancer is                                                            
five years  before one goes  back to pre-cancer  status.  She  asked                                                            
how  CDC developed  the  part  of  the program  where  treatment  is                                                            
considered complete.                                                                                                            
COMMISSIONER PERDUE said  DHSS will have to work on that should this                                                            
bill pass,  and it  will be difficult.   DHSS will  have to  rely on                                                            
physicians for that determination.                                                                                              
CHAIRWOMAN  GREEN asked  if DHSS has  any choice  in when  treatment                                                            
ends or whether that is in the federal guidelines.                                                                              
COMMISSIONER  PERDUE  said  that is  an  area  where DHSS  has  some                                                            
flexibility as opposed to the income or the assets.                                                                             
CHAIRWOMAN  GREEN  was unsure  how DHSS  could  say "no  more" at  a                                                            
certain point.  This is a  method by which  government will  pay off                                                            
care providers,  hospitals, doctors,  oncologists, and radiologists                                                             
for a pittance  of their  charges and leave  this person debt  free.                                                            
It's just cost  shifting at its best.  She questioned  why the state                                                            
does  not do that  for  prostrate, colo-rectal,  and  all the  other                                                            
cancers patients.                                                                                                               
COMMISSIONER   PERDUE  said  cost   shifting  already  occurs   with                                                            
uncompensated care.                                                                                                             
CHAIRWOMAN  GREEN asked  what the  requirement is  for hospitals  in                                                            
Alaska for admittance of a patient.                                                                                             
COMMISSIONER  PERDUE said if a person  in this state needs  surgery,                                                            
their expectation  is  they would  not be denied  service.   Patient                                                            
dumping  laws  do  not allow  that.    A lot  of  hospitals  have  a                                                            
financing plan  for elective care.  Hospitals can  write off charity                                                            
and bad debt when  they determine there is no way  to get the money.                                                            
CHAIRWOMAN  GREEN said  this Medicaid  plan is  the worst  conceived                                                            
plan she's  ever read.  It's wrong,  unfair, and discriminatory  and                                                            
does  nothing  but  tell  providers  how  much  they'll  accept  for                                                            
services.  Chairwoman  Green asked for suggestions  of other ways to                                                            
resolve  this problem.   She  said she  would prefer  to double  the                                                            
state's portion and tell  the Medicaid people thanks, but no thanks,                                                            
we want to craft our own  plan and allow people to pay a premium, to                                                            
pay a co-pay, and to allow  corporations to get involved.  She noted                                                            
the State of Georgia  is designing a private/public  program similar                                                            
to that.                                                                                                                        
SENATOR DAVIS  noted the State of Georgia is putting  a lot of money                                                            
into that program.                                                                                                              
CHAIRWOMAN GREEN agreed  it's a huge amount, hundreds of millions of                                                            
dollars.  She  again commented that she would prefer  a method other                                                            
than Medicaid  because she has a very difficult time  saying that we                                                            
can hold everyone else  with a life-threatening illness to an income                                                            
standard of 133 percent  of the federal poverty level but breast and                                                            
cervical  cancer patients  are  held to  an income  standard of  250                                                            
percent.    She asked Commissioner  Perdue  if she can think  of any                                                            
other way to create a supplement plan.                                                                                          
COMMISSIONER  PERDUE said DHSS used  to have a catastrophic  illness                                                            
program,  which might  still be  on the  books.  It  wasn't for  one                                                            
particular  diagnosis.  Right now,  under Chronic and Acute  Medical                                                            
Assistance  (CAMA), the state only  covers certain diagnoses.   CAMA                                                            
has been  cut back  and this  year hospitals  are being  cut out  of                                                            
CHAIRWOMAN  GREEN repeated  that she would  rather take a  different                                                            
approach  to this problem  but if  no other  approach is  available,                                                            
this program will have  to have a sunset date.  She pointed out that                                                            
this bill came before the  committee with five "no recommendations."                                                            
SENATOR DAVIS  said she recommended  "do pass" and intends  to do so                                                            
in the future.                                                                                                                  
CHAIRWOMAN  GREEN  indicated  she  was  originally  shown  five  "no                                                            
recommendations,"  which is not a very good indication  of the level                                                            
of support.    She asked  if there  is any  way to  coordinate  this                                                            
program with CHIA.                                                                                                              
COMMISSIONER  PERDUE informed Chairwoman  Green that patients  would                                                            
have to deal with  the waiting period issue, which  is a big problem                                                            
for people in need of emergent treatment.                                                                                       
CHAIRWOMAN  GREEN  asked if  Medicaid  coverage is  retroactive  for                                                            
preexisting conditions.                                                                                                         
MR. LABBE replied it is retroactive for up to 90 days.                                                                          
SENATOR LEMAN suggested  requiring a higher co-pay for people at the                                                            
higher income level.                                                                                                            
CHAIRWOMAN GREEN  said a similar proposal was discussed  in '92-'93.                                                            
SENATOR  LEMAN said  it's taken  a long  time and  we still  haven't                                                            
gotten results.                                                                                                                 
COMMISSIONER PERDUE said many other states haven't either.                                                                      
CHAIRWOMAN  GREEN noted  co-pays and  premiums cannot  be used  with                                                            
this program.                                                                                                                   
COMMISSIONER  PERDUE agreed  because  that would  upset the  federal                                                            
MR. LABBE informed  the committee the breast and cervical  treatment                                                            
program  through  Medicaid  has a  modest  co-pay  of 5  percent  of                                                            
outpatient   hospital   allowed    charges,   which   isn't   really                                                            
significant.  The  inpatient  rate is  $50  a day,  up  to $200  per                                                            
CHAIRWOMAN  GREEN  asked   how  much  5 percent   of  the  allowable                                                            
outpatient hospital charges would be?                                                                                           
MR. LABBE said  it would depend on the charge.  Outpatient  services                                                            
are usually  chemotherapy or  radiation but  the patient must  pay 5                                                            
percent for each visit.                                                                                                         
COMMISSIONER PERDUE maintained  that the dilemma is if you limit the                                                            
percent of  poverty for the treatment  program, you'd have  to limit                                                            
it for the screening program as well.                                                                                           
MS. DIVEN agreed they have to be tied together.                                                                                 
CHAIRWOMAN GREEN  asked if it has to be at or below  the 250 percent                                                            
COMMISSIONER PERDUE  asked if Chairwoman Green would  want to offset                                                            
the cost to the screening program with state general funds.                                                                     
SENATOR LEMAN  suggested using  a voluntary  contribution pool.   He                                                            
guessed many Alaskans would like to contribute to that.                                                                         
CHAIRWOMAN  GREEN suggested  using tobacco  tax settlement  money to                                                            
augment this.   She said she would truly like to do  the right thing                                                            
because this is a very  difficult problem.  She knows there is great                                                            
pressure for this bill to be heard and passed.                                                                                  
COMMISSIONER PERDUE  said there is no logic to fashioning  a program                                                            
that doesn't  take advantage of the  treatment cost sharing  because                                                            
the treatment is more expensive than the screening.                                                                             
CHAIRWOMAN GREEN noted  if they are tied together the available pool                                                            
of people coming in for screening will be reduced.                                                                              
COMMISSIONER  PERDUE  clarified  that if  screening  eligibility  is                                                            
lowered, federal money  will be left on the table.  It would be less                                                            
expensive  for the  state  but it  doesn't make  sense  to not  take                                                            
advantage of the ratio for the treatment program.                                                                               
CHAIRWOMAN  GREEN said  she spoke  to staff  in Senator Murkowski's                                                             
office  who told  her of the  fairly large  range the  state has  in                                                            
other Medicaid programs, regarding the match.                                                                                   
COMMISSIONER  PERDUE  said   the state   can't  have  two  different                                                            
standards for the screening.                                                                                                    
SENATOR LEMAN said not  unless the state does a supplemental program                                                            
and that  could be funded  a number of ways.   He again suggested  a                                                            
voluntary contribution pool.                                                                                                    
CHAIRWOMAN  GREEN noted  there is  free and  reduced cost  screening                                                            
around the  state and vans  travel throughout  the state to  provide                                                            
mammograms in November  because it is breast cancer awareness month.                                                            
COMMISSIONER  PERDUE maintained that  from a public health  point of                                                            
view  it makes  sense  to make  the screening  widely  available  so                                                            
people have access to it.                                                                                                       
CHAIRWOMAN  GREEN said  she has  a great  deal of  frustration  that                                                            
people get to an age of  risk and choose not to do anything on their                                                            
own.  She  asked Commissioner  Perdue and  DHSS staff for any  ideas                                                            
about how to restructure  this program.  She felt  a one year sunset                                                            
date is  a bit unsatisfactory  because it  will leave people  in the                                                            
lurch.   She  pointed  out  that she  believes  it is  important  to                                                            
document  what   is  being  done  and  to  submit  reports   to  the                                                            
legislature so  that it knows exactly what's happening  and what the                                                            
actual costs are.                                                                                                               
COMMISSIONER PERDUE said DHSS could supply those.                                                                               
Number 349                                                                                                                      
SENATOR  LEMAN said  he is interested  in  significant correlations                                                             
between certain  behaviors and breast  cancer, and what can  be done                                                            
to discourage  those behaviors.   He expressed  concern that  if the                                                            
state  invests in  treatment,  it ought  to encourage  behaviors  to                                                            
prevent the disease. He  pointed out there's a very high correlation                                                            
between lung cancer and smoking.                                                                                                
COMMISSIONER PERDUE  pointed out Alaska's health data  from the last                                                            
decade shows the obesity  rate in Alaska is growing fast and that is                                                            
a risk, as well as smoking and poor diet.                                                                                       
CHAIRWOMAN GREEN agreed the obesity problem is nationwide.                                                                      
COMMISSIONER  PERDUE said  all of  the risk factors  for cancer  are                                                            
unknown.    It could be  genetic or environmental,  as well  as diet                                                            
and smoking.                                                                                                                    
CHAIRWOMAN  GREEN announced that the  committee would meet  again on                                                            
Wednesday and Friday of next week.                                                                                              
SENATOR WILKEN asked Chairwoman Green if DHSS would do a                                                                        
presentation on the Alzheimer's program next week.                                                                              
CHAIRWOMAN GREEN said it would.                                                                                                 
SENATOR DAVIS asked whether Chairwoman Green intends to schedule SB                                                             
CHAIRWOMAN GREEN said she has not yet decided.                                                                                  
SENATOR DAVIS requested that Chairwoman Green schedule SB 38 for a                                                              
SENATOR WILKEN acknowledged the committee is struggling with                                                                    
balancing the needs of this group with the fiscal realities of the                                                              
state and offered to help wherever possible.                                                                                    
CHAIRWOMAN GREEN thanked all participants and adjourned the                                                                     

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