Legislature(2003 - 2004)

03/22/2004 01:31 PM HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
SENATE HEALTH, EDUCATION AND SOCIAL SERVICES STANDING COMMITTEE                                                               
                         March 22, 2004                                                                                         
                           1:31 p.m.                                                                                            
TAPE (S) 04-13                                                                                                                  
MEMBERS PRESENT                                                                                                               
Senator Fred Dyson, Chair                                                                                                       
Senator Lyda Green, Vice Chair                                                                                                  
Senator Gary Wilken                                                                                                             
Senator Bettye Davis                                                                                                            
Senator Gretchen Guess                                                                                                          
MEMBERS ABSENT                                                                                                                
COMMITTEE CALENDAR                                                                                                            
SENATE BILL NO. 373                                                                                                             
"An Act relating to residency and internship permits issued by                                                                  
the State Medical Board; and providing for an effective date."                                                                  
     MOVED SB 373 OUT OF COMMITTEE                                                                                              
SENATE BILL NO. 364                                                                                                             
"An  Act  relating to  liability  for  expenses of  placement  in                                                               
certain mental  health facilities; relating to  the mental health                                                               
treatment  assistance program;  and  providing  for an  effective                                                               
     HEARD AND HELD                                                                                                             
PREVIOUS COMMITTEE ACTION                                                                                                     
BILL: SB 373                                                                                                                  
SHORT TITLE: PHYSICIAN INTERNS AND RESIDENTS                                                                                    
SPONSOR(s): HEALTH, EDUCATION & SOCIAL SERVICES                                                                                 
03/19/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/19/04       (S)       HES                                                                                                    
03/22/04       (S)       HES AT 1:30 PM BUTROVICH 205                                                                           
BILL: SB 364                                                                                                                  
SHORT TITLE: LIMIT STATE AID FOR MENTAL HEALTH CARE                                                                             
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
03/08/04       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/08/04       (S)       HES, FIN                                                                                               
03/19/04       (S)       HES AT 1:30 PM BUTROVICH 205                                                                           
03/19/04       (S)       -- Meeting Canceled --                                                                                 
03/22/04       (S)       HES AT 1:30 PM BUTROVICH 205                                                                           
WITNESS REGISTER                                                                                                              
Dr. HAROLD JOHNSTON                                                                                                             
Director, Family Practice Residency                                                                                             
Providence Alaska Medical Center                                                                                                
POSITION STATEMENT:  Provided information on SB 373.                                                                        
MR. BILL HOGAN                                                                                                                  
Director, Division of Behavioral Health                                                                                         
Department of Health &                                                                                                          
  Social Services                                                                                                               
PO Box 110601                                                                                                                   
Juneau, AK  99801-0601                                                                                                          
POSITION STATEMENT:  Presented SB 364.                                                                                      
MR. ROBERT HAMMAKER                                                                                                             
Treatment and Recovery Section                                                                                                  
Division of Behavioral Health                                                                                                   
Department of Health & Social Services                                                                                          
PO Box 110601                                                                                                                   
Juneau, AK  99801-0601                                                                                                          
POSITION STATEMENT:  Answered questions pertaining to SB 364.                                                                 
MS. STACIE KRALY                                                                                                                
Senior Assistant Attorney General                                                                                               
Human Services Section, Civil Division (Juneau)                                                                                 
Department of Law (DOL)                                                                                                         
PO Box 110300                                                                                                                   
Juneau, AK  99811-0300                                                                                                          
POSITION STATEMENT:  Provided information on SB 364.                                                                        
ACTION NARRATIVE                                                                                                              
TAPE 04-13, SIDE A                                                                                                            
CHAIR FRED DYSON  called the Senate Health,  Education and Social                                                             
Services  Standing  Committee  meeting  to  order  at  1:31  p.m.                                                               
Present at  the call  to order were  Senators Wilken,  Guess, and                                                               
Chair Dyson.  Senators Davis  and Green arrived while the meeting                                                               
was in progress.                                                                                                                
             SB 373-PHYSICIAN INTERNS AND RESIDENTS                                                                         
The committee took up SB 373.                                                                                                   
CHAIR DYSON presented the sponsor statement as follows:                                                                         
     Current  Alaska  statutes  require that  all  residents                                                                    
     participating  in  the WAMI/Family  Practice  Residency                                                                    
     program  receive a  permit by  the State  Medical Board                                                                    
     for a period not to exceed  18 months after the date of                                                                    
     issue.    Renewal  permits to  continue  residency  [or                                                                    
     internship] are also issued by  the board, for a period                                                                    
     not to exceed 18 months after the date of renewal.                                                                         
     Given  that the  program is  a three-year  program, all                                                                    
     residents  are  required  to  get  the  renewal.    The                                                                    
     renewal  process   has  been  fraught   with  problems.                                                                    
     Residents have  needed to  interrupt their  training on                                                                    
     multiple  occasions because  the  renewed permits  were                                                                    
     not issued efficiently.   This legislation would extend                                                                    
     the period from 18 to 36 months.                                                                                           
CHAIR DYSON  indicated that Senators  Davis and Green  had joined                                                               
the meeting.                                                                                                                    
DR.  HAROLD  JOHNSTON,  a  family   physician,  and  director  of                                                               
Providence  Alaska's  family  practice  residency  in  Anchorage,                                                               
testified via  teleconference that this bill  extends the initial                                                               
permit length  for resident  physicians from  18 months  to three                                                               
years  so that  it corresponds  with the  length of  the training                                                               
program.   Family  physicians are  required  to have  a total  of                                                               
three  years  of   residency  training  in  order   to  be  board                                                               
certified.   Current law allows  the permit  for a maximum  of 18                                                               
months.   This requires  that the  residents renew  their permits                                                               
half way  through the training  program; this poses  problems for                                                               
the Division  of Occupational Licensing.   The processing  of the                                                               
licensing renewal  requests has  created difficulties  on several                                                               
occasions,  which  has  almost caused  residents  to  stop  their                                                               
DR.  JOHNSTON explained  that when  the 18-month  requirement was                                                               
originally established, physicians in  Alaska only needed to have                                                               
one year  of training before  being eligible for a  full license.                                                               
The  18-month  term for  resident  permits  allowed residents  to                                                               
complete the first year of  training and still have an additional                                                               
six months  to get paperwork  processed for the  regular license.                                                               
Several years ago the state  law changed, requiring physicians to                                                               
have  two years  of  residency before  obtaining an  unrestricted                                                               
license, which  means the  18-month permit  is inadequate  to get                                                               
the  resident  through his/her  initial  licensing  period.   The                                                               
ideal situation  would be for permits  to be issued for  a three-                                                               
year period from the start  of training because in this scenario,                                                               
there would be no requirement for a renewal.                                                                                    
CHAIR  DYSON  asked  if  there   was  anybody  present  from  the                                                               
administration  or the  [Division of  Occupational Licensing]  to                                                               
speak to the  bill.  Hearing no response, he  then asked, "Do you                                                               
have  any idea,  Dr. Johnston,  how we  got into  this remarkable                                                               
DR. JOHNSTON re-stated  that it was because the  law had changed.                                                               
Originally the 18-month permit was  fine because only one year of                                                               
training  was required  before getting  an unrestricted  license.                                                               
About  two  or  three  years ago,  the  Legislature  changed  the                                                               
requirement, and now  physicians need to have at  least two years                                                               
-  and sometimes  three years  -  of training  before getting  an                                                               
unrestricted  license.   He said  he  has worked  with the  State                                                               
Medical Board  on this  issue, and at  the January  meeting after                                                               
some  considerable debate,  a  resolution  unanimously passed  in                                                               
support of changing this to 36 months.                                                                                          
SENATOR GARY WILKEN moved to report  SB 373 out of committee with                                                               
individual recommendations.                                                                                                     
CHAIR  DYSON  asked if  there  was  any  objection.   Seeing  and                                                               
hearing none, it was so ordered.                                                                                                
1:40 p.m.                                                                                                                       
         SB 364-LIMIT STATE AID FOR MENTAL HEALTH CARE                                                                      
MR. BILL  HOGAN, Director of  the Division of  Behavioral Health,                                                               
Department  of   Health  and  Social  Services   (DHSS)  provided                                                               
background to  members that  diagnosis, evaluation  and treatment                                                               
(DET)  is  an  important  component of  Alaska's  current  mental                                                               
health  care  system.    A  number of  hospitals  in  the  state,                                                               
particularly  in Fairbanks,  Juneau,  Ketchikan, Cordova,  Homer,                                                               
Valdez, Sitka,  Bethel, and Kodiak  provide beds  for individuals                                                               
who  are  experiencing a  psychiatric  emergency  or who  are  in                                                               
psychiatric  crises.   The two  primary  providers are  Fairbanks                                                               
Memorial  Hospital (20  beds) and  Bartlett Regional  Hospital in                                                               
Juneau  (12 beds).   In  many  of the  other communities  listed,                                                               
there are  usually only one  or two  beds used for  this purpose.                                                               
The concept is that by  stabilizing a person in his/her community                                                               
hospital,  he/she  would not  have  to  enter Alaska  Psychiatric                                                               
Institute (API) in  Anchorage but could be served  in his/her own                                                               
MR.  HOGAN continued  that historically  the division  - formerly                                                               
known as Mental  Health - has received bills  from DET providers.                                                               
The  division   has  scrutinized   situations  to   determine  if                                                               
admissions were  appropriate and  has monitored stays  in various                                                               
hospitals; however,  under current statute, the  division doesn't                                                               
have  the authority  to  actively  manage those  stays.   SB  364                                                               
proposes that  [the division] have  the authority  to proactively                                                               
manage  such  stays  in  these  various  facilities.    The  bill                                                               
stipulates that  within 24 hours,  hospitals will be  required to                                                               
notify  the division  of the  rationale for  an admission  and to                                                               
then  work  with  the  division  (over time)  to  ensure  that  a                                                               
patient's  length  of  stay  is   appropriate.    The  bill  also                                                               
establishes   the   provision   that   DET   services   are   not                                                               
entitlements, and  that payment for  services can only be  for up                                                               
to the amount appropriated by  the Legislature; the department is                                                               
under  no  obligation  to  pay   once  those  dollars  have  been                                                               
exhausted.  The department proposes  to work collaboratively with                                                               
DET providers  and is not suggesting  that the number of  beds in                                                               
communities be reduced.                                                                                                         
MR.  HOGAN referred  to an  outline in  the committee  packet and                                                               
highlighted that in FY 00,  approximately $1,901,480 was spent on                                                               
this service.   Through  FY 03, an  increasing number  of dollars                                                               
was spent, with the amount  in FY 03 at approximately $3,384,430;                                                               
the cost  for services  has grown substantially.   There  is less                                                               
money available in  the FY 04 budget, and even  fewer dollars are                                                               
proposed in the FY 05 budget.   He said one stipulation is that a                                                               
portion of  this service is funded  through DSH (disproportionate                                                               
share  hospital)  payments,  which are  payments  that  hospitals                                                               
receive  to offset  the cost  of providing  services to  indigent                                                               
individuals.   He said  that at Senator  Davis's request,  he has                                                               
included the number  of individuals served in  each facility from                                                               
FY  00 through  FY  03;  the summary  also  includes the  average                                                               
length of stay and the cost of providing those services.                                                                        
CHAIR DYSON asked if the savings to the state was $100,000.                                                                     
MR. HOGAN confirmed that savings  would be approximately $100,000                                                               
minimum, once the bill is initiated.                                                                                            
CHAIR  DYSON  asked   why  the  costs  went  up   and  then  down                                                               
approximately $1,000,000  in FY 04  and then another  $435,000 in                                                               
FY 05.                                                                                                                          
MR.  HOGAN explained  that  the  amount went  up  because of  the                                                               
division's  inability to  effectively  manage the  program.   The                                                               
number  of people  served in  FY 03  is lower  than the  previous                                                               
fiscal  year's, "So  I  cannot say  to you  or  say to  committee                                                               
members  that the  cost has  gone up  because we're  serving more                                                               
people, because that is not the case."                                                                                          
CHAIR DYSON questioned if it  was possible that even though there                                                               
wasn't an  increase in  the number of  people being  served, that                                                               
more intense  needs and more comprehensive  treatment drove those                                                               
costs up.                                                                                                                       
MR. HOGAN confirmed that an increase  in the length of stay could                                                               
be one rationale.                                                                                                               
CHAIR  DYSON referred  to  Mr. Hogan's  previous  comment -  "the                                                               
department didn't manage"  - and asked if the  inference was that                                                               
individuals were receiving  inappropriate treatment, or receiving                                                               
more treatment than was appropriate.                                                                                            
MR.  HOGAN responded  this may  be inferred,  however, "until  we                                                               
have the capacity  or the capability to effectively  manage, I am                                                               
just not sure at this point."                                                                                                   
SENATOR  GRETCHEN GUESS  asked who,  under  this proposal,  would                                                               
manage  the  stays.   She  questioned  who  would be  making  the                                                               
decisions at  the end of the  day whether or not  a person should                                                               
be discharged.                                                                                                                  
MR. HOGAN replied  this needs to be developed  and that specifics                                                               
on how  to manage would be  in regulation.  It  is the division's                                                               
intent  to use  Dr.  Hopson,  API's Medical  Director,  who is  a                                                               
psychiatrist and  who directed the Fairbanks  unit before working                                                               
for  the  division at  API.    He  said  if there  is  contention                                                               
concerning a  patient's admission  or discharge,  that discussion                                                               
needs to take place between  two physicians; therefore regulation                                                               
would include a process to include Dr. Hobson in the discussion.                                                                
SENATOR GUESS  asked, "Who trumps?   The medical director  at API                                                               
or the physician on the ground?"                                                                                                
MR.  HOGAN replied  that  this  was not  included  in the  bill's                                                               
intent,  and  it  is  certainly   something  the  division  would                                                               
consider.   He said  that ultimately the  state trumps  since the                                                               
state is paying for the service.                                                                                                
SENATOR GUESS  asked what happens  to the institution and  to the                                                               
patient if the  state does not get notified within  24 hours; how                                                               
would such 24-hour notification be managed.                                                                                     
MR.  HOGAN  responded  this  would be  more  clearly  defined  in                                                               
regulation.  He said this would involve  a lot of work and he was                                                               
not  suggesting that  division staff  manage  this; First  Health                                                               
Services  Corporation   currently  does  this  for   children  in                                                               
residential psychiatric facilities and may possibly be used.                                                                    
SENATOR GUESS  said there was  no mention  in the fiscal  note of                                                               
contract  labor with  First Health.   She  gave the  hypothetical                                                               
example  of  admitting someone  at  the  Fairbanks facility,  and                                                               
inadvertently not reporting this within  the 24-hour period.  She                                                               
asked if the provider would  then not get paid because connection                                                               
with the state was not made within 24 hours.                                                                                    
MR.  HOGAN  said  the  division   would  be  flexible  and  would                                                               
understand extenuating  circumstances, as the desire  would be to                                                               
continue  collaborating   with  providers  and  not   to  set  up                                                               
adversarial relationships.   "We clearly  need a mechanism  to be                                                               
able to more closely monitor these stays."                                                                                      
SENATOR GUESS  said, "You said  in here  that you wanted  to make                                                               
sure  it's not  an  entitlement, and  you moved  a  'shall' to  a                                                               
'may'."   She asked what happens  to a patient in  a situation in                                                               
which there  is no more money  in the budget and  the decision is                                                               
made to  not pay anymore;  can the  hospital not take  the person                                                               
because  the state  has run  out of  money or  does the  hospital                                                               
still have to  take that patient.  She asked  how this works, and                                                               
if costs are then born by others who use that hospital.                                                                         
MR. HOGAN said  it was his understanding that  if someone appears                                                               
in the emergency room, that  hospital is obligated to ensure that                                                               
the individual gets  to the right kind of service,  which in this                                                               
case  would be  API.   This  would be  unfortunate because,  even                                                               
though API  provides excellent service, it  defeats the intention                                                               
of being  close to  home; API  would be  out of  the individual's                                                               
community.   The other  option might  be attempting  to stabilize                                                               
the  person outside  of the  hospital setting,  and the  hospital                                                               
would work with community providers to devise alternatives.                                                                     
SENATOR GUESS  said if  this were an  in-hospital stay,  the idea                                                               
would  be to  get that  person  out of  the hospital  as soon  as                                                               
possible and  into one of  the community service providers.   She                                                               
asked if the  cost per patient at these facilities  was higher or                                                               
lower than at API.                                                                                                              
MR. HOGAN said the cost was higher than at API.                                                                                 
CHAIR DYSON referred to the average  number of days, and asked if                                                               
this was for people who were involuntarily committed.                                                                           
MR. HOGAN replied that this was not absolutely necessary.                                                                       
CHAIR DYSON  ascertained that  people are  evaluated, voluntarily                                                               
or not, at  one of these resources, and in  looking at the number                                                               
of days,  there seems to  be a  fair amount of  disparity between                                                               
the different  institutions.  He  suggested that  someone testify                                                               
on  how  professionals  proceed   with  the  evaluation,  and  in                                                               
particular, address  the length of  time that is reasonable.   He                                                               
suggested  that people  with multiple  diagnoses would  require a                                                               
longer  period  of  time  as  would  people  with  mental  health                                                               
problems  who  had  been traumatized  and/or  who  have  chemical                                                               
dependency issues needing to be stabilized.                                                                                     
SENATOR LYDA GREEN asked about DES/DET.                                                                                         
MR.   HOGAN  replied   that  DES   (diagnoses,  evaluation,   and                                                               
stabilization) usually  refers to shorter  term - three  to seven                                                               
days - while "treatment" is longer term.                                                                                        
SENATOR  GREEN  asked  about  a  discussion  in  the  Legislature                                                               
several years  ago regarding the  DET process, and  recalled that                                                               
the purpose  was to stop  direct entry  into API and  keep people                                                               
situated throughout the state.                                                                                                  
MR. HOGAN confirmed that this was the intention.                                                                                
SENATOR GREEN  asked if this  was in statute  or in policy.   She                                                               
received  a   response  [from  an  unidentified   person  in  the                                                               
audience] that this was in statute.                                                                                             
2:00 p.m.                                                                                                                       
SENATOR GREEN asked if "Fairbanks"  and "Bartlett" were treatment                                                               
facilities whereas  the others were DES  facilities; she received                                                               
confirmation from Mr. Hogan that this  was the case.  She said if                                                               
this  detracts  from  the original  purpose  of  handling  things                                                               
closer  to home,  and "by  pro-rating  and saying  we don't  have                                                               
enough  money to  keep doing  this at  the going  rate, therefore                                                               
we're cutting the  rate or discontinuing it" then  most people in                                                               
crisis will  go to API "which  has another whole set  of problems                                                               
for  us."   She asked  if  there was  a way  to evaluate  whether                                                               
people  were  being  enrolled  correctly  and  getting  into  the                                                               
correct services immediately, a way  in which each facility would                                                               
need  to be  responsible for  this.   She questioned  whether any                                                               
facility  or population  would be  advantaged by  this change  or                                                               
grandfathered-in, and asked,  "Are certain people going  to be at                                                               
the top of the pecking order?"                                                                                                  
MR.   HOGAN  responded   that  there   is   a  movement   towards                                                               
standardized   screening  and   assessment  so   that  the   same                                                               
instrument  would be  used statewide  to stipulate  the level  of                                                               
care  required  for  the  person being  assessed,  but  it's  not                                                               
currently  in  place.    The division  will  actively  work  with                                                               
providers to ensure that people  actually need a certain level of                                                               
service  and the  specified  length of  stay,  but it  ultimately                                                               
comes  down  to one  person's  opinion  against another's.    The                                                               
intent is  to ensure that  people are getting the  required care,                                                               
while at  the same  time containing  the costs  of service.   The                                                               
division intends  to continue working  with communities,  such as                                                               
Palmer, to  develop at least  a couple  of [DET] beds.   However,                                                               
there would be serious reservations  about the state paying for a                                                               
large (16  - 20 bed)  facility, as there  isn't money to  pay for                                                               
the current level of DET services.                                                                                              
SENATOR GREEN  asked where the  dollars come from that  are being                                                               
used for this.                                                                                                                  
MR. HOGAN replied that it was  general fund dollars with some DSH                                                               
SENATOR GREEN asked if DSH was a form of Medicaid.                                                                              
MR. HOGAN said it was not  Medicaid, but was federal dollars.  He                                                               
explained  that DSH  assists hospitals  in providing  services to                                                               
indigent individuals -  those without insurance or  Medicaid - as                                                               
those costs are born by the hospitals.                                                                                          
SENATOR GREEN  asked if anyone  who wasn't indigent  was included                                                               
in these figures.                                                                                                               
MR. HOGAN  replied that  if someone  has Medicaid  or third-party                                                               
insurance, obviously the  service is paid for in that  way.  This                                                               
is designed  for individuals without  Medicaid or  any insurance,                                                               
that is, there is no third-party payor.                                                                                         
SENATOR GREEN added, "and under  185 percent poverty."  She asked                                                               
if this was a new or current qualifier.                                                                                         
MR. HOGAN replied he didn't know, and deferred to Mr. Hammaker.                                                                 
MR.  ROBERT  HAMMAKER,  Manager of  the  Treatment  and  Recovery                                                               
Section, Division  of Behavioral  Health, DH&SS, stated  that the                                                               
185 percent poverty level is current and will continue.                                                                         
CHAIR DYSON asked  about the state's or a  DET center's liability                                                               
if there is a misdiagnosis.                                                                                                     
MR. HOGAN  said he  wasn't sure  and would  be happy  to research                                                               
that question.                                                                                                                  
CHAIR DYSON  continued with the  hypothetical example  of someone                                                               
who is  dangerous to self  or others being misdiagnosed  and then                                                               
doing harm.   He asked if the  state would be in  danger of being                                                               
sued.   In this  situation the state,  in efforts  to responsibly                                                               
reduce  the length  of  stay,  ends up  in  court  with a  person                                                               
saying, 'because of  the complexity of the problem,  that was too                                                               
short  a time,  and the  state in  its efforts  to control  cost,                                                               
forced  an inadequate  evaluation  period' and  then this  person                                                               
goes out and  murders somebody.  He emphasized  that his interest                                                               
was in the  patient receiving the best  treatment appropriate for                                                               
him/her, and  expressed reluctance to switch  this responsibility                                                               
away  from  the  primary  caregiver,  who  ought  to  be  a  very                                                               
qualified professional.   He asked  what other states  have done,                                                               
inquiring as to whether other  states have entitlement language -                                                               
as Alaska does - or if  the language was more permissive, such as                                                               
what is being proposed.                                                                                                         
MR. HOGAN said he didn't know but could research this.                                                                          
CHAIR DYSON referred to people living  on the street who might be                                                               
homeless,  who have  mental health  problems or  substance issues                                                               
and who are dangerous to self  or others, people going through an                                                               
involuntary commitment process.   He said this  process has saved                                                               
quite a  few lives  and in  the long term,  some costs.  He asked                                                               
what  percentage of  this  population is  in  the system,  versus                                                               
people who are referred by  DPS, family members, or mental health                                                               
MR.  HOGAN restated  the question  for  clarification, asking  if                                                               
what  was wanted  was  the number  or  percentage of  individuals                                                               
served  through  DET who  may  have  been  homeless and  who  are                                                               
involuntarily committed.                                                                                                        
CHAIR DYSON  confirmed he  was asking about  people who  "kind of                                                               
come from that  population; I'm sure I'm not doing  a good job of                                                               
defining it."                                                                                                                   
SENATOR GUESS then asked if a  community could not handle a case,                                                               
does  it  currently go  to  API  anyway; she  received  nonverbal                                                               
confirmation  that this  was correct.   She  continued by  asking                                                               
about the cost per bed day for DES, DET, API, and non-API.                                                                      
MR. HOGAN said he could access that information.                                                                                
SENATOR  GUESS  suggested that  if  discussion  on treatment  was                                                               
going  to  be  between  the  medical  director  of  API  and  the                                                               
hospital, to include it in the bill  so that "we don't get into a                                                               
situation where we  have a bureaucrat at the  state level telling                                                               
a doctor in Valdez that they have to let someone go."                                                                           
MR. HAMMAKER responded that a  patient would be discharged to API                                                               
or to an  acceptable community program; he/she doesn't  go from a                                                               
local hospital to having no services.                                                                                           
SENATOR GUESS said that whether  it's discharged to the community                                                               
or remains  in the facility,  the conversation should  be between                                                               
two people  who are  knowledgeable rather  than between  a doctor                                                               
and  a deputy  commissioner or  a head  of a  division, that  is,                                                               
someone without the medical background.                                                                                         
SENATOR DAVIS  said, "You want to  establish that this is  not an                                                               
entitlement and  you said there was  a ruling or an  opinion, and                                                               
you were going to get a copy to me which I did not get."                                                                        
MR. HOGAN  responded that  he had determined  about an  hour ago,                                                               
that this  was oral tradition  within the division,  meaning that                                                               
prior to  his coming  to the  division, he  was told  (until very                                                               
recently)  that  there had  been  an  attorney general's  opinion                                                               
indicating that DET was an  entitlement; however, there has never                                                               
been such a formal, written opinion, he said.                                                                                   
MS.  STACIE  KRALY,  Senior  Assistant  Attorney  General,  Human                                                               
Services  Section, Civil  Division  (Juneau),  Department of  Law                                                               
(DOL),  testified that  there is  no  attorney general's  opinion                                                               
dealing  with  the entitlement  issue  with  respect to  the  DET                                                               
program.  Historically,  about when DET statutes  were amended to                                                               
create  Title 47,  Chapter  31, there  was  litigation in  Juneau                                                               
pertaining   to  an   individual  who   had  been   involuntarily                                                               
committed, received a bill from  Bartlett, and wasn't happy about                                                               
having to  pay it.  Through  the settlement of that  issue, Title                                                               
47, Chapter 31  was drafted and amended to address  some of these                                                               
payment issues.   She referred to the language  of Sec. 47.31.010                                                               
- Eligibility  for assistance -  subsection (a),  "The department                                                               
shall  provide financial  assistance under  this chapter..."  and                                                               
surmised  that there  was at  least an  argument or  a discussion                                                               
regarding taking  the leap from  the word "shall" and  turning it                                                               
into an  entitlement argument  on the  part of  an attorney  or a                                                               
recipient of services, to say,  "you shall provide assistance for                                                               
me."   She said  the argument could  be made -  but it  has never                                                               
been   DOL's  position   or  past   administrations'  -   despite                                                               
information  that  Mr.  Hogan  may have  received  when  he  came                                                               
SENATOR BETTYE DAVIS  said, even though there  was nothing stated                                                               
in  writing  that this  was  an  entitlement, "you  haven't  done                                                               
anything to  follow up on  that since you  found out that  it was                                                               
orally ... just an opinion."                                                                                                    
MR.  HOGAN repeated  that he  had  just confirmed  this with  Ms.                                                               
Kraly at  today's hearing, and  it is  something that he  will be                                                               
following-up on.                                                                                                                
CHAIR DYSON  said the reference  to "the department  doesn't need                                                               
to spend more money than  the legislature appropriates" indicates                                                               
there is  no control  regarding people  who come  in the  door of                                                               
this process.  More has to do  with people who need help and need                                                               
evaluation.   "What  we  appropriate will  be  based upon  [your]                                                               
recommendation, and some consideration  for the state's financial                                                               
situation."   He  asked if,  by  that language,  a commitment  is                                                               
being made  not to have  a supplemental  budget if the  number of                                                               
intakes for the process accelerates for some reason.                                                                            
MR.  HOGAN responded  that he  understood that  DHSS Commissioner                                                               
Gilbertson is not interested in a supplemental at this time.                                                                    
SENATOR GREEN asked how facilities  determine the rates, that is,                                                               
are the rates negotiated or the same across the state.                                                                          
MR. HOGAN  said rates  are determined  according to  a cost-based                                                               
Medicare rate.                                                                                                                  
TAPE 04-13, SIDE B                                                                                                            
MR. HOGAN  continued that rates  vary from hospital  to hospital,                                                               
depending on the cost of providing services at that hospital.                                                                   
SENATOR GREEN  asked if this  was the  only way to  determine the                                                               
MR.  HOGAN  responded that  he  wasn't  sure,  but this  was  the                                                               
current determination.                                                                                                          
SENATOR  GREEN asked  if federal  law  requires the  state to  do                                                               
MR. HOGAN said not to his knowledge.                                                                                            
SENATOR  GREEN considered  that  there were  no federal  matching                                                               
funds to soften what the state does, other than DSH.                                                                            
MR.  HOGAN agreed  that the  use of  DSH dollars  was the  way to                                                               
soften the cost to the state.                                                                                                   
SENATOR GREEN referred  to Sec. 7, "if  the department determines                                                               
that the  amount of appropriations ...  is less than ...  and the                                                               
department has  given notice  ... the  department may  reduce the                                                               
rates  calculated..."  and  asked,  "so  you  could  go  off  the                                                               
Medicare rate at that point?"                                                                                                   
MR. HOGAN responded this would be  an option.  He said the answer                                                               
to the  question of what  this might look  like had not  yet been                                                               
CHAIR DYSON asked what enabled  the savings of $1,050,000 between                                                               
the FY 03 and FY 04 budgets.                                                                                                    
MR. HOGAN  said that part of  the problem is that  the department                                                               
would like  providers to submit bills  within 90 days of  the end                                                               
of the fiscal year.  Currently  providers can submit bills for FY                                                               
03, through  December of  FY 03,  so six  months after  the fact,                                                               
bills are  still being  received from  the previous  fiscal year.                                                               
Therefore,  these dollar  amounts  are for  what's been  expended                                                               
during  those fiscal  years, because  bills are  received through                                                               
the  end of  the calendar  year.  He said  he wished  he had  the                                                               
confidence that  all of  the FY  03 payments were  for the  FY 03                                                               
expenditures,  adding that  nothing has  been done  to limit  the                                                               
cost or to limit expenditures.                                                                                                  
CHAIR DYSON clarified that the  columns on the spreadsheet should                                                               
be shifted  somewhat to the  right.   He asked if  the difference                                                               
between  FY 03  and FY  04 was  a billing/timing  problem, rather                                                               
than  there being  less  people requiring  services  or that  the                                                               
services were more efficient.                                                                                                   
MR. HOGAN agreed this was true.                                                                                                 
CHAIR DYSON  asked if  the additional  savings of  $435,000 would                                                               
result from better management due  to the department's oversight,                                                               
and from the facilities doing better.                                                                                           
MR. HOGAN confirmed this to be so.                                                                                              
SENATOR GREEN asked if the  department typically experienced such                                                               
billing delays regarding medical receipts.                                                                                      
MR. HOGAN responded that other  providers could bill Medicaid for                                                               
up  to one  year  after  the provision  of  service.   From  that                                                               
perspective, six months  could be considered as  reasonable.  The                                                               
department  maintains that  the six-month  delay is  difficult to                                                               
manage; that's why a 90-day  maximum submission time for bills is                                                               
being requested.                                                                                                                
CHAIR  DYSON  stated for  the  record  that  he has  a  perceived                                                               
conflict  of  interest; his  wife  is  a licensed  public  health                                                               
mental  health provider  and  has the  authority  to have  people                                                               
involuntarily  committed.   He then  suggested that  Commissioner                                                               
Gilbertson  or  someone  speaking on  the  commissioner's  behalf                                                               
speak  to the  issue of,  once  the more  intense management  and                                                               
efficient  use of  resources is  achieved, what  will be  done if                                                               
there are  still more people  needing the services, and  "you all                                                               
are hard  and fast  on not  coming back with  a supplement."   He                                                               
said he appreciates  the efforts at getting control  of costs, as                                                               
that could make more money available to serve greater needs.                                                                    
CHAIR DYSON held SB 364 in committee.                                                                                           
There being  no further  business to  come before  the committee,                                                               
CHAIR  DYSON adjourned  the Senate  Health, Education  and Social                                                               
Services Standing committee meeting at 2:30 p.m.                                                                                

Document Name Date/Time Subjects