Legislature(2009 - 2010)BUTROVICH 205
01/28/2009 01:15 PM Senate HEALTH & SOCIAL SERVICES
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| Picture of Alaska | |
| What You Need to Know: Health Reform in Alaska | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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= bill was previously heard/scheduled
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ALASKA STATE LEGISLATURE
JOINT MEETING
SENATE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
HOUSE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
January 28, 2009
1:16 p.m.
MEMBERS PRESENT
SENATE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
Senator Bettye Davis, Chair
Senator Joe Paskvan, Vice Chair
Senator Johnny Ellis
Senator Joe Thomas
HOUSE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
Representative Wes Keller, Co-Chair
Representative Bob Herron, Co-Chair
MEMBERS ABSENT
SENATE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
Senator Fred Dyson
HOUSE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
Representative Bob Lynn
Representative Paul Seaton
Representative John Coghill
Representative Sharon Cissna
Representative Lindsey Holmes
COMMITTEE CALENDAR
Picture of Alaska
Alice Rarig, PhD Health Planning & Systems
What You Need to Know: Health Reform for Alaska
Lessons from Other States and Issues to Consider
Enrique Martinez-Vidal, Vice President, AcademyHealth
PREVIOUS COMMITTEE ACTION
No previous action to record.
WITNESS REGISTER
WAYNE A. STEVENS, President/CEO
Alaska State Chamber of Commerce
Juneau, AK
POSITION STATEMENT: Introduced the topic.
ROD BETIT, Alaska State Hospital and Nursing Home Association
Juneau, AK
POSITION STATEMENT: Introduced the speakers.
ALICE RARIG, Planner IV
Health Planning and Systems Development Section
Division of Public Health
Alaska Department of Health and Social Services
Juneau, AK
POSITION STATEMENT: Presented data about Alaska's current health
care system and challenges.
ENRIQUE MARTINEZ-VIDAL, Vice President
AcademyHealth and
Director of State Coverages Initiatives
Washington, DC
POSITION STATEMENT: Presented information about national health
care reform strategies and what other states are doing.
ACTION NARRATIVE
1:16:51 PM
CHAIR BETTYE DAVIS called the joint meeting of the Senate and
House Health and Social Services Standing Committees to order at
1:16 p.m. Present at the call to order were Senators Paskvan,
Ellis, Thomas and Davis and Representatives Keller and Herron.
1:18:13 PM
WAYNE STEVENS, President/CEO, Alaska State Chamber of Commerce,
introduced the topic and thanked the legislators for taking the
time to hear this presentation and introduced Rod Betit as
moderator.
1:19:21 PM
ROD BETIT, Alaska State Hospital and Nursing Home Association,
said he was asked to guide the committee through the three parts
of this presentation:
1. Background information about the health care situation in
Alaska.
2. What is going on around the country; what other states are
doing and what is happening on a federal level.
3. A panel of people to answer questions regarding Alaska-
specific challenges and to discuss what the legislature can
accomplish this session.
He introduced Alice Rarig, the senior planner at Alaska Social
and Health Services, to cover her new research into health
coverage in the state.
^Picture of Alaska
1:21:23 PM
ALICE RARIG, PhD Health Planning and Systems, Planner,
Department of Health and Social Services, said she is pleased to
have the opportunity to provide information about the status of
health care in Alaska and to update the committee on facilities,
services and workforce issues that the legislature will need to
be thinking about as they consider health reform options.
1:21:56 PM
Slide 2
She hoped to address the questions of who and how many are
uninsured, where they are and why they are uninsured or
underinsured; state health expenditures; access issues; health
status issues; and employers' offerings of health insurance in
Alaska.
MS. RARIG suggested the committee look at the economic impact of
their decisions and think about who should be covered. Do they
want everyone to be covered? Do they want everyone to have
access? If so, what are the implications of that? She noted that
coverage and access are not synonymous; one can have access
without a source of payment or may have the ability to pay but
no services at hand.
1:23:36 PM
Slide 3
The newest figures available indicate that 123,000 people in
Alaska are uninsured. That is 18 percent of the population, up
from 17 percent according to the last survey. The next survey
will be done in March and the data will be available six months
after that. Using a 3 year average however, 115,000 people or 17
percent of the population is uninsured, including about 21,000
Alaska natives who may have access to some services in their
villages or through tribal entities. This is not portable or
comprehensive insurance but is an important opportunity to
access primary care and some additional services. If they assume
for the United States and Alaska that Alaska natives and
American Indians have some access to care, that can bring number
of people who need something in the way of access and/or
insurance down to below 100,000.
MS. RARIG pointed out that those who are considered covered
include private insurance subscribers and their dependents, the
military and their dependents, and veterans. She encouraged them
to keep in mind the limitations of veterans' care. Also, they
count Denali Kid Care enrollees as covered whether they are
enrolled for one month or the entire year; so those people may
be uninsured for part of the year. Medicare enrollees are
counted as covered despite the difficulty in finding providers
who will accept Medicare in many Alaskan communities.
Slide 4
The numbers may overlap because some people have veteran's
coverage and perhaps Medicare and/or a private insurance policy.
With that in mind, 58 percent of individuals are covered through
employer-based policies; 6 percent have self-purchased policies;
13 percent are in Medicaid or Denali Kid Care; 8 percent have
Medicare coverage, and 14 percent, which is much higher than the
U.S. average, are covered by military or veterans coverage. That
leaves 17 percent uninsured all year except for Alaskan natives
who have access to some services.
Slide 5
MS. RARIG continued that the people most likely to have no
insurance are the self-employed, part-time and seasonal workers,
people who work for small firms, and young adult males. About
1/3 of 18 to 24 year olds do not have insurance coverage of any
kind.
More than half of the uninsured, 52 percent, are employed
adults. Only 9 percent are unemployed people who are employable
and looking for work, and about 40 percent are children.
Slide 6
Another way to look at this is that 84 percent of Alaska's
uninsured are in working families, compared to 76 percent in the
nation as a whole.
1:29:01 PM
Slide 7
Underinsurance is another problem. The Commonwealth Fund has
defined the "underinsured" as people who have health coverage
that does not adequately protect them from high medical
expenses.
It is hard to know which comes first, ill health or bankruptcy,
but they often go together. High deductibles can result in
postponed care. Many people have some care but cannot afford the
co-pay or the deductibles and choose not to get care until and
unless they feel they have to. Benefit limitations can result in
high out-of-pocket costs. And, she reiterated, coverage doesn't
necessarily mean access. It can be a matter of geography; it can
be the provider Medicare acceptance issue or shortages of
providers that mean there are no people available to provide
services. She cited the example of dentists in some rural areas
who have to spend all of their time on emergency treatments
rather than prevention because there are too few providers to do
both.
Slide 8
MS. RARIG advised that there is a great deal of data available
on the department's website from a two year federally funded
state planning grant to look at the uninsured. There is
information from a household survey; an employer survey; "key
informant" interviews; an economic analysis; and an overview of
what other states are doing. The web address is:
http://www.hss.state.ak.us/dph/healthplanning/planningGrant/defa
ult.htm.
Slide 9
Regarding expenditures for health services, two years ago the
Institute for Social and Economic Research (ISER) at University
of Alaska Anchorage (UAA) wrote a carefully prepared summary of
the state's health expenditures and arrived at the total of $5.3
billion for 2005. About $1 billion of that from individuals'
out-of-pocket and premium costs; a little less than $1 billion
from businesses for health insurance or direct services for
their employees; about $.5 billion from local governments; $.8
billion from state government and $2 billion from the federal
government. At an average annual increase of 8.5 percent, which
has been the average for the past 20 years, Alaska would be at
about $6.3 billion now; however the increase has accelerated to
about 12 percent annually over the last six years, which would
put the total at about $7 billion for 2009. She noted that the
ISER study is also available online at
http://iser.uaa.alaska.edu/Home/ResearchAreas/health care.htm.
Slide 10
MS. RARIG introduced a graph by Neal Gilbertsen, [PhD,
Economist, Department of Labor and Workforce Development,
Research and Analysis Section] on Per Capita Health Care
Expenditures, which represents what Alaska and the U.S. per
capita health expenditures are as a percent of per capita
income. Nationally, the percentage has increased from 13 to 16
percent of per capita income, while Alaska has gone from paying
11 percent to 19 percent. This is partly due to that fact that
per capita income in the state has remained fairly steady at
about $33,000 per year in constant dollars while income in the
rest of the country has been going up.
Slide 11
She discussed access to care in terms of what is available for
primary care, hospitals and other facilities, workforce and
reimbursement. There are 24 hospitals across the state, of which
11 are "critical access" hospitals with fewer than 25 beds in
communities where their existence might be threatened without a
reimbursement structure that provides an economic advantage.
There are veterans' clinics now in Anchorage and in Juneau.
Alaska also has 26 community health center organizations serving
people in 141 different sites. Three or four of those are
frontier "extended stay" clinics, which are able to provide
services overnight or for a longer time; they are working with
Medicare and Medicaid payers on an acceptable reimbursement
structure for those. There are also nursing homes, pioneer
homes, assisted living and residential psych treatment
facilities. The department is very concerned about the
community-based programs and levels of care and has been
focusing a lot of attention on improving the capacity for
prevention and community-based services to keep people close to
home.
1:35:31 PM
MS. RARIG touched briefly on the matter of workforce shortages,
saying that there is a lot of anxiety and some real shortages in
physician numbers, mid-level providers, dentists, nurses,
pharmacists and behavioral health workers. There are also some
paraprofessional positions for which Alaska has spotty
shortages; often it is the distribution rather than absolute
number that is a concern. There is national competition for
every warm body that works in health care because there is a
national shortage.
Criteria for enrollment in public programs, such as the
citizenship documentation requirement, has made it difficult in
some cases for people to enroll in Denali Kid Care and Medicaid.
MS. RARIG offered several maps [Slides 12-14] to illustrate the
geographical disbursement of various types of medical
facilities.
· Community Health Centers are well distributed across the
state.
· Hospitals tend to be in the larger population centers in
Southeast, Anchorage, Mat-Su, Kenai and Kodiak except for
the important regional hospitals in Nome, Kotzebue, Barrow
and Dillingham.
· There are many Public Health nursing centers from which
nurses itinerate to other communities; but the distances
between the villages and the regional centers sometimes are
great and the challenges of Alaska weather can be
substantial.
Slide 15
Health Status Considerations in Alaska are slightly different
form those in the rest of the country in that only about six
percent of the state's population is 65 or older as compared
with 13 percent in the rest of the country. It is significant
however, that services do have to be available for that aging
population.
Behavioral health is a major focus in the department, reducing
the number of children with severe emotional disorders who end
up going to outside residential psych treatment centers. The
"Bring the Kids Home" project has been effective in keeping kids
in state.
Alaska is doing fairly well at reducing mortality rates for some
of the chronic diseases such as cancer and heart disease, but
not so well yet with diabetes and suicide. In the area of
lifestyle choices and "built environment" improvements, both the
Division of Public Health and the department are focusing on
continuing to bring down mortality rates and morbidity.
Slides 16-17
MS. RARIG said that a household survey conducted a couple of
years ago enabled them to identify the fact that about 12
percent of Alaskans consider self-employment their primary place
of work, which was not known previously. About 1/2 of the
respondents were in private for-profit enterprises, about 1/4 in
government, 1/8 in not-for-profits and 1/8 self-employed.
1:41:36 PM
Slide 18
Self employed people are less likely to have insurance coverage
than others; but 7 in 10 had coverage under someone else's
policy or under a public program. Government covers about 98
percent of their employees. Private sector employers cover about
87 percent of their employees and the self-employed are about 71
percent covered by something.
Slide 19
Alaska has more upper-income people without insurance coverage
than the rest of the country. This may be due in part to the
fact that access to services isn't as good here.
Slide 20
Alaska has about 11,000 small firms and only about 300 large
firms, those with 100 or more people. The jobs are mostly in the
large firms; so the number of people covered in the small firms
is fewer than 50,000. Over 150,000 work for those larger
enterprises. The larger firms are much more likely to offer
insurance to dependents as well as employees and waiting times
are generally shorter for the larger firms.
Slides 21-29
Alaska has the most seasonal private sector economy in the
nation. There is a 25 percent increase every year from the
January base to July. That is 21 percent higher than the
national average. The greatest variation occurs in Bristol Bay
where there is an 1100 percent increase annually.
The annual seasonal variation in employment is predictable and
consistent. While many seasonal workers are non-resident, many
more are Alaskans. Seasonal employment contributes to problems
in obtaining and retaining health insurance; most insured
workers are full-time employees. Seasonal workers seldom have
sufficient tenure to be eligible to enroll in employer-based
programs. The July employment captures peak enrollment; but many
enrolled will lose employment-based insurance or suffer gaps in
coverage when employment declines to seasonal lows.
MS. RARIG stressed that some jobs have more than one person in
them in the course of a quarter and some people have multiple
jobs; so one needs to distinguish between jobs and people when
thinking about insurance coverage.
1:48:44 PM
In conclusion, Ms. Rarig reiterated that Alaska does have a
strong seasonal economy with a mixed labor pool, a lot of self-
employment and small firms, which means that there are big
challenges in terms of the current employer-based insurance
models.
She encouraged the committee to think about whether the goal of
any reform is affordable and accessible care, affordable
insurance or a blend of both; about what are the target
populations; and about the underinsured. The current system
rests on 200,000 jobs covering about 400,000 people, public
programs that cover 150,000 to 175,000 and about 100,000
uninsured.
1:51:20 PM
^What You Need to Know: Health Reform in Alaska
MR. BETIT introduced Enrique Martinez-Vidal, saying that his
background was important to the Alaska Health Assurance Advocacy
Team (AHAAT), which is behind this presentation. AHAAT is made
up of providers, the business community, consumers and other
interested parties who are trying to understand what makes sense
for Alaska. Mr. Martinez-Vidal is the vice president of
AcademyHealth, which is one of the premier health-policy
institutes in the country. He is also the director of the Robert
Wood-Johnson [State] Coverages Initiatives, which is what he has
been working with the Department of Health on. He has been
around the country helping individual states try to understand
the data and what they need to do.
1:52:48 PM
ENRIQUE MARTINEZ-VIDAL, Vice President, AcademyHealth; Director,
State Coverages Initiatives, said health reform is not just
coverage and access. When states think about coverage and
access, the first thing that comes to mind is how much it will
cost, which leads immediately to cost-containment strategies.
They have also been thinking about quality improvement and
improvement to systems such as the delivery and payment systems;
so it is cost, quality and access that states are trying to deal
with all at the same time.
AcademyHealth is a community of health services researchers,
policy makers and policy analysts. Their mission is to work to
get research and information into the hands of policy makers so
they can make better decisions and to talk with policy makers to
find out what kind of information they really need to make those
decisions.
Slides 1-3
State Coverage Initiatives is an initiative of the Robert Woods-
Johnson Foundation that works with state officials to provide
information as well as direct technical assistance to work on
health reforms.
MR. MARTINEZ-VIDAL began with an overview of his presentation.
He said it will provide a brief background of what is happening
to health coverage across the county; what is driving state
reform and what is going on in other states at this time.
Slide 4
Two maps are color coded to show the distribution of uninsured
adults 18-64 over two time-periods. These illustrate the
decreasing trend in employer-sponsored insurance over time,
which is causing the number of uninsured to increase.
Slides 5-6
MR. MARTINEZ-VIDALpointed out that the uninsured have a wide
range of incomes. He agreed with Ms. Rarig that Alaska's
distribution has a larger number of uninsured at the higher
income levels than does the lower 48. The important thing about
that programmatically is that the uninsured are not a monolithic
population, which means there are different solutions for the
differing populations.
Slide 7
In 1987 it took just over 7 percent of the median family income
to purchase medical insurance coverage; now it takes over 20
percent to buy that same policy.
The U.S. map on slide 8 illustrates the variation in health
system quality across the country.
Slide 9
He touched on the drivers of state health reform, which are high
levels of uninsured, decreasing employer-sponsored insurance
programs and increasingly unaffordable health care costs and
insurance premiums. A lot of research points to the need for
[health insurance] coverage for an effective, efficient health
care system; many problems are due to the fragmentation in our
existing system.
2:00:48 PM
Slide 10
MR. MARTINEZ-VIDAL offered a list of key policy and design
issues, which are covered individually on slides 11 through 16.
He returned to the idea that different populations require
different solutions, but clarified that there are three major
groups to be considered when looking at the uninsured.
· There are those who have very few resources to bring to the
private insurance market and who end up in public programs
like SCHIP. This population needs a 100 percent subsidy. He
suggested that there is some layering possible on top of
that; perhaps some people would need to use the public
program delivery system but could help contribute to it.
Some states have sliding scale subsidies for those over a
certain income level.
· The middle group is those who can bring some resources to
the private sector solution. These are the working poor,
lower income people who just can't afford to direct 20
percent of their income to purchasing an insurance policy.
States are trying to provide some sort of subsidy to the
premium through reinsurance, tax credits, direct premium
assistance, vouchers and other methods.
· The third group is those who have sufficient resources to
participate in the market but choose not to. As Ms. Rarig
mentioned, there might be very viable economic reasons not
to do that; but if they are outside the system, they are
not contributing to the risk pool, and many times these
people are healthier than the other groups.
He asserted that there are only two ways to deal with the issue
of voluntary non-participation: mandate insurance coverage as
Massachusetts has done, or encourage voluntary participation
through education, outreach and simplifying the enrollment
process.
2:04:10 PM
"Who will pay?" and "Who will benefit?" Most states that have
moved ahead with reform have really tried to bring people "into
the fold" in terms of paying for any expansions and reforms. It
comes under the rubric of shared responsibility. Some states
believe there is enough money in the system and the problem is
waste and over-utilization. A lot of research supports that
view, indicating that about 1/3 of expenses in the health care
system aren't necessary. However, redistribution becomes very
difficult politically. Maine tried to do it but was hit with law
suits and had real political problems. The bottom line is, if
redistributing the money in the system isn't possible, the state
has to find a new form of revenue.
Should Health Insurance Coverage be required, and is that
enforceable? Massachusetts is doing it through the state income
tax system. The Baucus [Health Reform] Plan includes a mandate
that would be enforced through the federal tax system. Some
people feel ideologically that such a mandate impinges on their
personal freedoms. There are also administrative issues that
have to be resolved to make this happen; but the biggest issue
in terms of whether this will work or not is economic. If the
government is going to require that people buy insurance, it
will either have to subsidize the middle and low income groups
that simply can't afford it, or increase the eligibility levels
for public programs, which costs money.
That leads to the question of what is affordable coverage. It is
related to benefit design, to subsidies perhaps, and to that
individual mandate. If the state is going to mandate coverage,
it has to determine what is affordable. It is generally agreed
that the premiums, co-pays and out-of-pocket costs should be
related to income and the ability to pay.
MR. MARTINEZ-VIDAL continued that benefit design comes down to
not only the cost of the coverage, but the value of the benefit
plan. Many states have tried allowing carriers to sell mandate-
free policies and found that no one wants them because they
don't offer a good value for the money. There are other ways to
approach the problem; for example, Minnesota is trying to do
benefits design based on evidence of what works. Indiana is
looking at consumer-driven health plans in their public
programs. Tennessee is putting forth policies on "first dollar"
benefits... front-loading the benefits with primary care and
preventive services. Rhode Island is trying to design their plan
based on changing consumers' behavior, getting them to take
advantage of primary care, prevention and chronic care
management.
He explained that the delivery system includes cost-containment,
quality improvement and systems redesign and stressed that there
is no "silver bullet" in terms of what's going to work. States
cannot do just one of these things; they generally have to do
all of them over time. The problem is that many of these things
have short-term costs but long-term benefits, which becomes
problematic for funding.
2:10:10 PM
One thing that many states are trying to do is promote the idea
of a "medical home" also called the "chronic care management
model" or "primary care case management". Covered on slides 17-
20, this gets into redesign of the delivery system by focusing
on creating a centralized, coordinated way to deliver care. The
principals were developed by leading physicians' groups; The
American Academy of Family Physicians; The American College of
Physicians; and The American Osteopathic Association. They are:
· A primary care physician who has a personal relationship
with the patient
· A team approach to provide...
· Comprehensive patient care
· Coordination of services through the primary care physician
· Improved quality and safety
· Expanded access, (which is a big complaint in insurance
circles)
· Reimbursement/payment for the added value
MR. MARTINEZ-VIDAL pointed to studies of the health care systems
in the U.S. and other countries, which have shown that high
access to primary care correlates with low health care spending.
The U.S. is among the countries with the poorest access to
primary care and has the highest per capita spending.
At this time, 31 states have implemented advanced medical homes
in their Medicaid programs and a number of other states are
working across different payers trying to bring their private
sector insurance carriers on board. The big problem is that
Medicare is not at the table on these pilot projects.
AcademyHealth is working with the federal government, not only
to get Medicare to do pilot projects, but to allow them to
participate in state pilots. Many states are using their
community medical centers as medical homes because they have the
infrastructure in place and are already functioning in much the
same way.
2:15:02 PM
Slides 22-50
Most states are taking a pragmatic approach to health reform.
They don't propose a single-payer plan or purely market-driven
plan, but something in the middle. A successful plan will look
at how to build on existing systems, how to improve existing
systems and how to take advantage of and redesign the current
delivery systems.
2:16:04 PM
Maine, Massachusetts and Vermont have been most successful, at
least at the time of enacting comprehensive reforms. They all
have the building blocks of public program expansions and
subsidies for low income consumers.
Massachusetts is the only state with an individual mandate. Both
Massachusetts and Vermont do have employer requirements but they
are minimal; putting too onerous a requirement on employers can
trigger the federal ERISA issue.
What these three states illustrate is that actual reform is
possible. All three worked in a bi-partisan manner and had
Democratic legislatures and Republican governors when their
reforms were enacted.
MR. MARTINEZ-VIDAL highlighted Massachusetts' "Pillars of the
Reform." These include a Section 125 plan requirement, an
administrative mechanism that allows their premiums to come out
of employees' checks on a pre-tax basis. Surprisingly, he said,
a number of employers don't have that in place; so just putting
that requirement in place could save 1/3 of the premium for many
people.
Massachusetts merged their small group and individual insurance
markets, which was easier in Massachusetts than it would be in
many states because the two groups had the same rating rules.
They also raised the dependent age up to 25 so young adults can
stay on their parents' insurance policies. (That is becoming
known as the "slacker law.")
Another thing Massachusetts has done and that many states are
interested in, is a purchasing mechanism called the "Connector,"
which really helps to make their private market function more
efficiently and more competitively. It provides more consumer-
friendly information to people shopping for insurance, allowing
them to compare participating insurers' costs and benefits. It
has been referred to as the "Travelocity of health insurance."
2:20:17 PM
Massachusetts' efforts have been amazingly successful. Within 18
to 20 months they actually reduced the numbers of uninsured by
2/3. Almost 40 percent of those are getting no state subsidies;
they are doing it all through private coverage. They have seen
no "crowd-out," which is when a public program siphons people
out of the private market. In fact, non-group premiums are down
over 40 percent and membership in the individual market has
grown over 50 percent. Only about 1-2 percent of the population
has been exempted from the mandate. He clarified that, if a
state is going to have a mandate, it needs to provide a "relief
valve" for those it can't quite afford to subsidize and for whom
they don't have affordable benefits available.
Vermont's "Blueprint for Healthy Vermont" is really delivery and
payment system redesign. This is a top-to-bottom comprehensive
effort to get everyone involved: the policy makers, the payers,
the hospitals and physicians, the communities, the families and
the individual.
2:22:27 PM
MR. MARTINEZ-VIDAL mentioned that California proposed a huge
reform, which failed. They tried to do access, cost and quality
reforms all at the same time and it may be that the change was
just too big. Unlike Massachusetts, which had been building
their public programs for years and had only about eight percent
uninsured to begin with, California did not have the building
blocks in place and started with about 15-18 percent of their
population uninsured.
2:24:12 PM
Kansas' 2008 legislative plan is looking at cost, quality,
access, transparency issues, implementation of medical homes,
prevention and wellness. He pointed out that they are really
trying to do aggressive outreach and enrollment of those
children who are currently eligible for their public programs.
2:25:27 PM
New Mexico accomplished a higher enrollment in existing plans
but was not able to get their reform through the legislature in
2008. They were able to pass funding for the "eligible but not
enrolled" during the special session.
Pennsylvania is attempting to address affordability, access and
quality. They are now doing a chronic care management program
and working on health information exchange technology through an
executive order.
2:26:21 PM
In terms of substantial reforms that have occurred, MR.
MARTINEZ-VIDAL noted that Indiana is trying to do some consumer-
directed "HSA" (Health Savings Accounts) within their Medicaid
program that are linked with high-deductable insurance plans.
This is very controversial and has not been in place long enough
for anyone to know what the impact will be.
Iowa had a big task force that has come back with some broad
recommendations including public program expansions; Section
125; dependent coverage up to 25; and a medical homes
initiative.
2:27:54 PM
Maryland did both public program expansions and SCHIP parents,
and will phase in childless adults as money is available. They
are also providing subsidies to their small employers (2-9
employees) through the Small Business Health Coverage Act. In
order to qualify for the subsidy, an employer must put a Section
125 plan in place and offer a wellness program to encourage
healthy behaviors and life-style choices among their employees.
2:28:40 PM
The big story out of Minnesota is that they are on the cutting
edge of payment reform and delivery system redesign. They are
not only working on medical homes (what they refer to as "health
care homes"), but are trying to integrate some of their public
health programs into the delivery system.
2:30:00 PM
MR. MARTINEZ-VIDAL touched very briefly on activities in other
states including:
· Slide 36 - New Jersey: Phase one mandate is "Kids First."
Phase two will bring a full mandate, Section 125, subsidies
etc.
· Slide 37 - Washington is working on public program
expansions and a partnership that is like a connector.
· Slide 38-40 - Wisconsin really tried to simplify their
"Badger Care Plus" programs, which are their public
programs. This gets to the issue of their eligible but not
enrolled by streamlining the application process, reducing
the eligibility rules, investing a lot in outreach and
hiring additional staff to process enrollment.
· Slide 42 - HealthFirst Connecticut Authority
Recommendations
· Slide 43 - Kansas 2009 Health Reform Priorities - Health
Policy Authority
· Slide 44 - Ohio State Coverage Initiatives Recommendations
are in the governor's office now
· Slide 45 - Blueprint for Oklahoma - Draft Report
· Slide 46 - Oregon Health Fund Board Report
· Slide 47 - Utah Legislative Health System Reform task force
· Slide 49 - Rhode Island ('07): Their HealthPact benefit
design is fashioned around five wellness initiatives, in
exchange for which consumers' deductable is reduced
substantially (from $5,000 to $750). People haven't taken
it up very readily, so the state is still not sure how
successful it will be.
· Slide 50 - Cover Tennessee ('07) is a portable product that
has a maximum benefit amount of $25,000 and puts all of the
benefits up front.
2:37:25 PM
MR. MARTINEZ-VIDAL said that shortages in the health care
workforce are a major problem here and in many states. Slides
51-58 define that issue and what some states are doing to
address it. He asserted that states do have a strong influence
on the development and practice of the health workforce, but
recognized that it is becoming increasingly difficult [to
maintain sufficient healthcare workers] as the population ages.
There is going to be a greater demand for long-term care, home
health care and other community-based services.
It comes back to delivery system redesign. A lot of research and
discussion has indicated that what is needed now is a different
sort of workforce, more physician "extenders," more nurse
practitioners and other physician support people.
2:38:57 PM
One obstacle to progress in this area is that there is no
central coordinating mechanism or data collection point for
monitoring and planning for the health workforce. Decision-
making is splintered across various state agencies.
2:39:46 PM
Massachusetts did pass another big reform in August 2008 to
strengthen the primary care infrastructure, including an
affordable housing pilot for health care workers.
Oregon is looking at action steps that include expanding
schools' capacity in order to teach more health care students.
2:41:52 PM
MR. MARTINEZ-VIDAL spent a few moments on state quality
reporting activities [slides 59-66], noting that most states
provide public reporting in terms of health plans, hospitals,
nursing homes and ambulatory care settings. Most of the time,
reporting serves two purposes: to drive consumer choice and to
drive internal quality improvement. The biggest move lately is
to report on health care acquired infections.
Some issues related to "report cards" are:
· Where does the data come from?
· What level is the reporting at?
· Displaying the data could pose a problem because the data
may be good but it doesn't always mean a lot without
consumer information around it to make it usable.
MR. MARTINEZ-VIDAL suggested that some common principals of good
performance reporting are to bring together a committee of
interested parties to understand the data issues; pilot the
reporting programs before going to full implementation in order
to iron out the bugs; and try to reduce duplication of efforts
by using data that is already available from other sources.
2:46:46 PM
Many of the recommendations that have been discussed were made
by temporary task forces. Some state health policy commissions
and authorities are more permanent; slides 67-76 cover the
makeup of some of these.
2:49:17 PM
In his experience, Mr. Martinez-Vidal said, he has found the
permanent bodies to be more effective because health care reform
isn't a one-time fix. He cautioned that creating such a body
brings up another set of problems such as where to put it; how
it will be funded; what the governance structure will look like;
and, more important, what its duties will be. In some states the
commission actually runs the public programs.
2:52:01 PM
MR. MARTINEZ-VIDAL highlighted the lessons learned in state
reform efforts so far:
· Successful comprehensive reforms are built on previous
efforts. The successful states have spent years trying to
get to a point where they could make that comprehensive
leap.
· The needed ingredients are leadership, opportunity, the
readiness to act, and persistence. Bi-partisan leadership
is absolutely essential to make it work.
2:53:44 PM
· There are no free solutions. This is not to say that states
should not invest in long-term solutions to find the cost-
drivers; but in the short-term, many of these solutions
will cost money up front.
2:54:21 PM
· It is hard to get agreement on what aspects of health care
reform to address first; but it is clear that comprehensive
reforms need sequencing. Sequential or incremental reforms
have a vision; it means laying the building blocks to reach
the ultimate goal.
2:56:07 PM
Every state has different economic ability and different needs.
That variability is creating a dilemma for federal reform. A
federal reform might have 50 different impacts, so any federal
efforts at reform will have to take that into consideration.
2:58:37 PM
MR. MARTINEZ-VIDAL ended with the final thought that everyone
has a different idea of what they want change to look like; and
if it doesn't help him or her personally, status quo is the
second choice. AcademyHealth and the states are working to make
the second choice reform based on a compromise rather than
status quo.
2:59:26 PM
MR. BETIT thanked Mr. Martinez-Vidal for his presentation. He
said Alaska needs to get a handle on what is going on, what the
data reveals about different populations, and how to address
costs; but he feels the country is on the cusp of change with a
president who wants to move forward. The governor has created a
health care commission; but it is new and still being developed
in legislation.
The question, he said, is "Why should we act?" The answer is
that only about 20 percent of small businesses and individuals
are paying for health care each year. When costs are rising, a
simple price adjustment won't cover it because federal programs
deflect the price increase so more of it falls on the back of
that 20 percent. Alaska needs some thoughtful body to navigate
through all of that and decide what the state's next steps
should be; so pursuing a commission this session makes sense.
3:05:08 PM
REPRESENTATIVE GARDNER noticed that there were only two
references to the Certificate of Need (CON) in this presentation
and asked Mr. Martinez-Vidal if he thinks the CON helps control
health care costs.
3:06:49 PM
MR. MARTINEZ-VIDAL answered that it varies across states,
depending on how it is structured and what the state's needs
are. He admitted that he doesn't often work with states on the
issue because it is so political, but said his experience has
been that, while it can be used as a lever to try to control
costs, many times it is not very successful.
Maryland has started including in the underlying state health
plan that informs the Certificate of Need awards some broader
ideas rather than straight-up need. They were able to use the
state health plan and Certificate of Need process to do more
interesting things such as adding patient safety measures. For
example, an agreement to incorporate patient safety measures in
a new emergency room might be one of the criteria used in
deciding whether to grant a Certificate of Need. Or perhaps a
hospital that wants to offer a particular service for which
there is already enough access, would be granted a CON if it
agreed to provide those services to an underserved population.
So, if the state doesn't want to battle over whether or not to
keep the CON, they might want to start using it in a more
creative way. He reiterated that, in general it hasn't been very
successful in controlling costs.
3:10:36 PM
REPRESENTATIVE HERRON commented that Senator Davis and her co-
chair have worked a great deal on this issue. The remarkable
thing about all of this is that so little has changed. He asked
Mr. Martinez-Vidal what the legislature should do during this
session to capitalize on health care reform efforts currently
under discussion at the federal level.
MR. MARTINEZ-VIDAL answered that the two big things on the table
now at the federal level are the State Children's Health
Insurance Program (SCHIP) reauthorization and the stimulus
package; something will happen in next month on those.
Reauthorization is an opportunity. The discussion is about what
level states are going to be allowed to take the income
eligibility level to. Right now it is at 200 percent of the
federal poverty level; but it looks as if congress may allow it
to go to 300 percent without a waiver. With the stimulus
package, there is a lot of money in it for health information
technology that he is afraid will be squandered because people
don't know what to do with it. He feels the state should really
think about how to capitalize on that. The technology underpins
the delivery system redesign, the quality reporting, and payment
system reforms.
3:14:19 PM
SENATOR PASKVAN asked what Mr. Martinez-Vidal's thoughts are
regarding mandatory overtime and the issue of nurse retention.
MR. MARTINEZ-VIDAL said some states have been using the
prohibition of mandatory overtime as a way to retain nurses.
That also has a down-side; it means hiring more nurses to cover
the hours. California tried it and had issues with less well-
trained nurses on staff; but it does seem to have encouraged
more nurses to stay.
3:15:36 PM
SENATOR THOMAS asked Mr. Martinez-Vidal, regarding the
sequential nature of planning, if he has gathered statistics on
what incremental steps have been most successful to begin
building toward reform. He commented that even developing a
vision is difficult when the goal is so vast.
3:16:43 PM
MR. MARTINEZ-VIDAL responded that the vision most people can
agree on is pretty broad: universal coverage, better quality and
low cost. What has been successful is to incrementally push up
public program eligibility and enrollment first. States have to
address that lowest tier of people who will never be in the
private financing sector, then look at how to subsidize the next
tier. The whole issue of chronic care management, prevention and
wellness is critical to health care reform and goes upstream to
the cost-drivers in the system. He stressed that 80 percent of
costs in the system are driven by the 20 percent of people with
chronic conditions, many of which are preventable.
3:19:03 PM
MR. BETIT commented on Senator Thomas' question "Where do you go
from here." He said that ASHNHA has worked on that this year
with Mr. Martinez-Vidal's help and have produced "Guiding
Principles for Health Care Reform 2009" which identifies four
principles to guide what they think Alaskans would want to see
in a sequential set of steps. He encouraged the committee to
review it and see if it resonates with them.
CHAIR DAVIS commented that Alaska has a lot of building blocks
already in place and said she was pleased to hear that they can
build upon those to get to the bigger goal. Denali Kid Care is
one program they can strengthen this year to help Alaska's
children and is one step toward health care for all of Alaska's
citizens. A bill is being introduced in both houses for the
governor's commission on health care reform and that is another
step. She is hopeful that they can accomplish a lot in this 90
days and that they can continue to build on the blocks they have
in place. She also noted that Senator French has introduced a
bill based on the Massachusetts plan.
3:22:28 PM
CHAIR DAVIS adjourned the meeting at 3:22:28 PM.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Agenda - Health Reform for Alaska.doc |
SHSS 1/28/2009 1:15:00 PM |
|
| AliceRarig Health ReformPresentation.pdf |
SHSS 1/28/2009 1:15:00 PM |
|
| Health Reform for Alaska.ppt |
SHSS 1/28/2009 1:15:00 PM |
|
| Intro - Enrique Martinez-Vidal.doc |
SHSS 1/28/2009 1:15:00 PM |