Legislature(2019 - 2020)BUTROVICH 205

01/27/2020 01:30 PM HEALTH & SOCIAL SERVICES

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Audio Topic
01:31:13 PM Start
01:32:10 PM HB96
03:04:44 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB 96 PIONEERS' HOME AND VETERANS' HOME RATES TELECONFERENCED
Heard & Held
-Invited Testimony Followed by Public Testimony-
<Time Limit May Be Set>
                    ALASKA STATE LEGISLATURE                                                                                  
      SENATE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE                                                                    
                        January 27, 2020                                                                                        
                           1:31 p.m.                                                                                            
                                                                                                                                
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator David Wilson, Chair                                                                                                     
Senator Natasha von Imhof, Vice Chair                                                                                           
Senator Cathy Giessel                                                                                                           
Senator Mike Shower                                                                                                             
Senator Tom Begich                                                                                                              
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
OTHER LEGISLATORS PRESENT                                                                                                     
                                                                                                                                
Senator Elvi Gray-Jackson                                                                                                       
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 96(FIN)                                                                                 
"An Act relating to Alaska Pioneers' Home and Alaska Veterans'                                                                  
Home payments, rates, and services."                                                                                            
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 96                                                                                                                   
SHORT TITLE: PIONEERS' HOME AND VETERANS' HOME RATES                                                                            
SPONSOR(s): REPRESENTATIVE(s) FIELDS                                                                                            
                                                                                                                                
03/15/19       (H)       READ THE FIRST TIME - REFERRALS                                                                        
03/15/19       (H)       STA, HSS                                                                                               
03/26/19       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
03/26/19       (H)       Heard & Held                                                                                           
03/26/19       (H)       MINUTE(STA)                                                                                            
03/28/19       (H)       STA AT 3:00 PM GRUENBERG 120                                                                           
03/28/19       (H)       Heard & Held                                                                                           
03/28/19       (H)       MINUTE(STA)                                                                                            
04/02/19       (H)       STA AT 4:00 PM GRUENBERG 120                                                                           
04/02/19       (H)       Moved CSHB 96(STA) Out of Committee                                                                    
04/02/19       (H)       MINUTE(STA)                                                                                            
04/03/19       (H)       STA RPT CS(STA) 2DP 4NR                                                                                
04/03/19       (H)       DP: SHAW, FIELDS                                                                                       
04/03/19       (H)       NR: LEDOUX, WOOL, STORY, KREISS-TOMKINS                                                                
04/09/19       (H)       HSS AT 3:00 PM CAPITOL 106                                                                             
04/09/19       (H)       -- MEETING CANCELED --                                                                                 
04/11/19       (H)       HSS AT 3:00 PM CAPITOL 106                                                                             
04/11/19       (H)       -- MEETING CANCELED --                                                                                 
04/18/19       (H)       HSS AT 3:00 PM CAPITOL 106                                                                             
04/18/19       (H)       Heard & Held                                                                                           
04/18/19       (H)       MINUTE(HSS)                                                                                            
04/23/19       (H)       HSS AT 3:00 PM CAPITOL 106                                                                             
04/23/19       (H)       Moved CSHB 96(STA) Out of Committee                                                                    
04/23/19       (H)       MINUTE(HSS)                                                                                            
04/24/19       (H)       HSS RPT CS(STA) 4DP 1NR 1AM                                                                            
04/24/19       (H)       DP: DRUMMOND, TARR, ZULKOSKY, SPOHNHOLZ                                                                
04/24/19       (H)       NR: JACKSON                                                                                            
04/24/19       (H)       AM: PRUITT                                                                                             
04/24/19       (H)       FIN REFERRAL ADDED AFTER HSS                                                                           
04/29/19       (H)       FIN AT 1:30 PM ADAMS ROOM 519                                                                          
04/29/19       (H)       Heard & Held                                                                                           
04/29/19       (H)       MINUTE(FIN)                                                                                            
05/02/19       (H)       FIN AT 1:30 PM ADAMS ROOM 519                                                                          
05/02/19       (H)       Heard & Held                                                                                           
05/02/19       (H)       MINUTE(FIN)                                                                                            
05/03/19       (H)       FIN AT 1:30 PM ADAMS ROOM 519                                                                          
05/03/19       (H)       Moved CSHB 96(FIN) Out of Committee                                                                    
05/03/19       (H)       MINUTE(FIN)                                                                                            
05/06/19       (H)       FIN RPT CS(FIN) NT 4DP 6NR                                                                             
05/06/19       (H)       DP: KNOPP, JOSEPHSON, ORTIZ, FOSTER                                                                    
05/06/19       (H)       NR: JOHNSTON, TILTON, LEBON, MERRICK,                                                                  
                         SULLIVAN-LEONARD, WILSON                                                                               
05/07/19       (H)       CORRECTED FIN RPT CS(FIN) NT 4DP 6NR                                                                   
05/07/19       (H)       DP: ORTIZ, KNOPP, JOSEPHSON, FOSTER                                                                    
05/07/19       (H)       NR: JOHNSTON, LEBON, TILTON, MERRICK,                                                                  
                         SULLIVAN-LEONARD, WILSON                                                                               
05/10/19       (H)       TRANSMITTED TO (S)                                                                                     
05/10/19       (H)       VERSION: CSHB 96(FIN)                                                                                  
05/10/19       (S)       READ THE FIRST TIME - REFERRALS                                                                        
05/10/19       (S)       HSS, FIN                                                                                               
01/27/20       (S)       HSS AT 1:30 PM BUTROVICH 205                                                                           
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
REPRESENTATIVE ZACH FIELDS                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified as sponsor of HB 96.                                                                            
                                                                                                                                
DAVID TEAL, representing self                                                                                                   
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Provided background information on HB 96.                                                                 
                                                                                                                                
TRISTAN WALSH, Staff                                                                                                            
Representative Zach Fields                                                                                                      
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Presented the sectional analysis for HB 96                                                                
on behalf of the bill sponsor.                                                                                                  
                                                                                                                                
CLINTON LASLEY, Acting Deputy Commissioner                                                                                      
Family, Community, & Integrated Services                                                                                        
Department of Health and Social Services (DHSS)                                                                                 
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Answered questions during the hearing on HB                                                               
96.                                                                                                                             
                                                                                                                                
BRAD RIDER, representing self                                                                                                   
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of HB 96.                                                                            
                                                                                                                                
MARGIE BEEDLE, representing self                                                                                                
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of HB 96.                                                                            
                                                                                                                                
DOUG LARSON, representing self                                                                                                  
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of HB 96.                                                                            
                                                                                                                                
LUANN MCVEY, representing self                                                                                                  
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of HB 96.                                                                            
                                                                                                                                
JUDY CRONDAHL, representing self                                                                                                
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of HB 96.                                                                            
                                                                                                                                
LAURA STATS, representing self                                                                                                  
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of HB 96.                                                                            
                                                                                                                                
BRIEN DAUGHERTY, representing self                                                                                              
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of HB 96.                                                                            
                                                                                                                                
KEVIN HENDERSON, representing self                                                                                              
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of HB 96.                                                                            
                                                                                                                                
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
1:31:13 PM                                                                                                                    
CHAIR DAVID WILSON  called the Senate Health  and Social Services                                                             
Standing Committee meeting  to order at 1:31 p.m.  Present at the                                                               
call to order  were Senators von Imhof,  Giessel, Begich, Shower,                                                               
and Chair Wilson.                                                                                                               
                                                                                                                                
         HB 96-PIONEERS' HOME AND VETERANS' HOME RATES                                                                      
                                                                                                                                
1:32:10 PM                                                                                                                    
SENATOR   WILSON  announced   the   consideration  of   COMMITTEE                                                               
SUBSTITUTE  FOR  HOUSE BILL  NO.  96(FIN),  "An Act  relating  to                                                               
Alaska Pioneers' Home and Alaska Veterans' Home payments."                                                                      
                                                                                                                                
He stated his intention to hold the bill.                                                                                       
                                                                                                                                
1:33:12 PM                                                                                                                    
At ease                                                                                                                         
                                                                                                                                
1:34:32 PM                                                                                                                    
CHAIR WILSON reconvened the meeting.                                                                                            
                                                                                                                                
1:35:08 PM                                                                                                                    
REPRESENTATIVE  ZACH FIELDS,  Alaska  State Legislature,  Juneau,                                                               
Alaska, sponsor  of HB 96,  delivered a  PowerPoint on HB  96. He                                                               
reviewed slide 2. HB 96  has three goals: maintain Pioneer Homes'                                                               
commitment  to Alaska's  elders;  stabilize  revenue and  improve                                                               
financial sustainability of Pioneer  Homes; and provide certainty                                                               
and predictability to residents and department.                                                                                 
                                                                                                                                
REPRESENTATIVE FIELDS reviewed slide  3, Committee Substitute for                                                               
House Bill 96:                                                                                                                  
                                                                                                                                
   • Adjusts rates for inflation since 2004                                                                                     
   • Adds Levels IV and V to be consistent with Agnew Beck                                                                      
     Report and SB74                                                                                                            
   • Allows for the Pioneer Home Division's suggested                                                                           
     index, Social Security Cost of Living Adjustment                                                                           
   • Passed 35-4 in House of Representatives                                                                                    
He added  that HB 96,  which passed the House,  acknowledges that                                                               
costs increase over  time. Before the recent  steep rate increase                                                               
for  Pioneer Home  residents, the  rates had  not kept  pace with                                                               
inflation for  several years. HB  96 would  add Levels IV  and V,                                                               
consistent with  the Agnew Beck  Report, and Senate Bill  74, the                                                               
legislature's  broad look  at Medicaid  reform in  2016. Further,                                                               
adding Levels IV and V is  important for an aging population with                                                               
additional needs for dementia care.                                                                                             
                                                                                                                                
1:37:07 PM                                                                                                                    
SENATOR  BEGICH asked  if he  could  give the  rationale for  the                                                               
original rates  and for changes  made in House Finance.  He asked                                                               
whether the sponsor was comfortable with those changes.                                                                         
                                                                                                                                
REPRESENTATIVE FIELDS  replied he is  supportive of the  rates as                                                               
addressed by  the House Finance  Committee, which are a  bit more                                                               
modest than the  ones he introduced. However,  the rates directly                                                               
line up  with inflation-adjusted  rates since  2004. As  the bill                                                               
went  through  the House  State  Affairs  and Health  and  Social                                                               
Services  Committees, there  was strong  support from  the public                                                               
for keeping  rates at  an inflation-adjusted  level and  having a                                                               
predictable trajectory for the future.                                                                                          
                                                                                                                                
REPRESENTATIVE   FIELDS   reviewed   slide  4,   Pioneer   Homes:                                                               
Background:                                                                                                                     
                                                                                                                                
   • Established in 1913                                                                                                        
   • Originally created as home for indigent men as                                                                             
     Territory of Alaska grew and aged                                                                                          
   • Expanded throughout the 20th Century: there are                                                                            
    currently   homes   in    Sitka,   Fairbanks,   Palmer,                                                                     
     Anchorage, Ketchikan and Juneau                                                                                            
   • Population in 2019 was 592                                                                                                 
   • Rates currently adjusted by regulation                                                                                     
   • 2004-2018 Inflation rose 30%, but rates only rose 15%.                                                                     
     In 2019, rates rose as high 140%                                                                                           
                                                                                                                                
He  said  many  generations  of Alaskans  worked  to  expand  the                                                               
system, including a colleague in  the House who helped the Palmer                                                               
Pioneer Home get  certification as a veterans'  home. That effort                                                               
is important for  a state with the highest  per capita population                                                               
of veterans in the country.  This bill provides an opportunity to                                                               
provide  additional  stability  since rate  increases  have  been                                                               
irregular and,  in some cases,  dramatic. If the problem  is that                                                               
rates were  not keeping pace  with inflation, he would  argue the                                                               
state overcorrected with steep rate increases.                                                                                  
                                                                                                                                
REPRESENTATIVE FIELDS  reviewed the bar  graph on slide  5, which                                                               
shows that many Pioneer Home  residents are private payers. These                                                               
residents pay  a significant portion  of the cost of  their care,                                                               
but not  the entire amount.  Since the rate increase,  the number                                                               
of  private payers  has  declined.  One issue  he  and the  House                                                               
Finance considered  was how  to maintain a  healthy payer  mix to                                                               
provide  financial stability  for the  homes and  to ensure  that                                                               
incoming residents are representative of Alaskans.                                                                              
                                                                                                                                
REPRESENTATIVE  FIELDS shared  the  proposed levels  of care  and                                                               
costs on slide 6:                                                                                                               
                                                                                                                                
     Level I: $2,976/mo                                                                                                         
     Level II: $5,396/mo                                                                                                        
     Level III: $7,814/mo                                                                                                       
     Level IV: $8,500/mo                                                                                                        
      Level V: Rate to be determined by the Department to                                                                       
        reflect the cost of care for services listed and                                                                        
     complex behavior management                                                                                                
                                                                                                                                
        • Rates serve as base starting point, adjusted for                                                                      
          inflation from 2004                                                                                                   
        • Rate increases may be annual, and will be capped                                                                      
          at the most recent Social Security Cost of Living                                                                     
          Adjustment                                                                                                            
        • Allows rates   to    more   consistently   track                                                                      
          inflation-based increases in cost of care                                                                             
                                                                                                                                
He  noted that  under this  bill, Level  V costs  are not  capped                                                               
because those  complex behavioral  health needs will  be provided                                                               
in a  physically separate part  of the Pioneer Home.  Those costs                                                               
will not  be paid out  of pocket because  the costs are  so high.                                                               
This fits in with the broader  attempt to control health care and                                                               
Medicaid  costs,  and   save  money  for  the   state.  When  the                                                               
behavioral  health wings  are operational,  it should  allow some                                                               
people at the Alaska Psychiatric  Institute (API) to be housed at                                                               
the  Pioneer  Homes. That  could  save  the state  a  significant                                                               
amount since the  cost of housing people  with complex behavioral                                                               
health needs  at the Pioneer  Homes would be less  expensive. The                                                               
Agnew Beck report  reviewed the Pioneer Homes' role  in a broader                                                               
attempt to find  financial stability for the  state's health care                                                               
system.                                                                                                                         
                                                                                                                                
1:41:33 PM                                                                                                                    
SENATOR  VON IMHOF  asked  what per  person  maximum amount  will                                                               
Medicaid pay regardless of acuity.                                                                                              
                                                                                                                                
REPRESENTATIVE  FIELDS  answered  that   the  Medicaid  rate  for                                                               
eligible  recipients  at the  Pioneer  Homes  is the  Residential                                                               
Supportive Living (RSL) rate of  $162.70. There is a potential of                                                               
an RSL acuity  add-on of $359.58. He understood  that no resident                                                               
has  received  the RSL  rate.  The  state  will receive  all  the                                                               
federal  receipts  under HB  96  and  the department's  currently                                                               
enacted rates.  Thus, the Pioneer  Homes will not  lose potential                                                               
federal revenue by adopting a more modest set of rates.                                                                         
                                                                                                                                
SENATOR VON IMHOF asked if that is a daily rate.                                                                                
                                                                                                                                
REPRESENTATIVE FIELDS answered  yes, that the $162.70  is a daily                                                               
rate.                                                                                                                           
                                                                                                                                
SENATOR VON IMHOF  asked for the total monthly  amount to compare                                                               
it to  the Level  II rate of  $5,396 per month  or the  Level III                                                               
rate of $7,814.                                                                                                                 
                                                                                                                                
REPRESENTATIVE FIELDS answered it is $4,881 per month.                                                                          
                                                                                                                                
SENATOR  VON IMHOF  pointed out  that Level  III or  IV residents                                                               
would have a  gap. The gap could be filled  by private insurance,                                                               
the resident's private income, or  by state funds. She asked what                                                               
incentive the  Pioneer Homes  has to  accept residents  at Levels                                                               
III and  IV versus  Levels I  and II  where most  of the  cost is                                                               
covered.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  FIELDS  replied  that   as  the  bill  progressed                                                               
through the  House, the Alaska Pioneer  Homes' director testified                                                               
that the  Pioneer Homes admit Alaskans  without considering their                                                               
ability to pay.  As far as he  knows, that is not  in statute but                                                               
is long-standing practice.                                                                                                      
                                                                                                                                
SENATOR VON IMHOF said she  would like assurance that the Pioneer                                                               
Homes will accept all levels of  care. She would guess that there                                                               
is probably  a waiting list  for all  levels of acuity.  Her only                                                               
concern is that with a finite  number of beds for Levels III, IV,                                                               
and V,  nothing will  keep costs  from going  up faster  than the                                                               
Medicaid daily coverage. She asked how  to make sure the gap does                                                               
not widen more than the CPI [Consumer Price Index] each year.                                                                   
                                                                                                                                
REPRESENTATIVE FIELDS responded that  the question begs a broader                                                               
look  at the  financial  situation with  the  Pioneer Homes.  The                                                               
state has an interest in providing  a mix of individuals, some of                                                               
whom are self-pay. Inevitably some  will not be self-pay and some                                                               
will be on 100 percent  payment assistance, particularly as these                                                               
residents progress  toward higher levels  of care and  are forced                                                               
to liquidate their  savings. There is a question  about rates for                                                               
individuals and the population composition  in the Pioneer Homes.                                                               
A mix is  good for the financial situation for  residents and for                                                               
the Pioneer Homes. He related  his understanding that the Pioneer                                                               
Homes were once  certified as nursing homes. Now most  of them do                                                               
not  qualify because  of the  physical constraints  of the  older                                                               
buildings, such as  doorway widths. Renovating them  to make them                                                               
eligible for  the much higher  nursing home  reimbursements would                                                               
be a  significant capital expense.  Whether the  department could                                                               
consider nursing  home reimbursement  for certain homes  that may                                                               
be newer to capture federal funds is a good question.                                                                           
                                                                                                                                
1:47:05 PM                                                                                                                    
CHAIR WILSON acknowledged the presence of Senator Gray-Jackson.                                                                 
                                                                                                                                
1:47:14 PM                                                                                                                    
SENATOR  GIESSEL asked  whether  the reimbursement  rate was  for                                                               
Medicaid or Medicare.                                                                                                           
                                                                                                                                
REPRESENTATIVE  FIELDS answered  that  the  reimbursement is  the                                                               
Medicaid RSL, Residential Supported Living rate.                                                                                
                                                                                                                                
SENATOR   GIESSEL  related   her  understanding   that  residents                                                               
typically receive Medicare, that  some have private insurance and                                                               
their own assets.  When these residents can no  longer meet their                                                               
costs, it is necessary for them to go on Medicaid.                                                                              
                                                                                                                                
REPRESENTATIVE FIELDS reported that in  February 2019, 451 of 496                                                               
licensed  beds were  filled. The  higher number  of residents  he                                                               
cited  earlier  is because  of  turnover  in  those beds.  As  of                                                               
February 2019, 51 percent of  people were private pay, 20 percent                                                               
were on Medicaid  waiver at the RSL rate, and  29 percent were on                                                               
state-subsidized   payment  assistance.   He   deferred  to   the                                                               
department for Medicare figures.                                                                                                
                                                                                                                                
SENATOR  GIESSEL  said  she  would  hold  the  question  for  the                                                               
division director.                                                                                                              
                                                                                                                                
SENATOR BEGICH  asked if anyone  has done an analysis  on whether                                                               
capital projects to enable Pioneer  Homes to receive nursing home                                                               
rates would pay for themselves.                                                                                                 
                                                                                                                                
REPRESENTATIVE  FIELDS  said  he  had  asked  about  the  broader                                                               
question  of  nursing home  rates,  but  he  has not  asked  that                                                               
specific question about  return on investment. He  thought it was                                                               
a worthwhile question to follow up on.                                                                                          
                                                                                                                                
SENATOR BEGICH  replied that he  has struggled with  the dramatic                                                               
increases  in the  governor's  budget. About  51  percent of  the                                                               
Pioneer Home's residents  are private payers. If  the state wipes                                                               
out the private  payers' ability to cover  their costs relatively                                                               
early on,  that means 100 percent  of the cost will  end up being                                                               
the state's burden because these residents will not be evicted.                                                                 
                                                                                                                                
REPRESENTATIVE FIELDS answered that is correct.                                                                                 
                                                                                                                                
SENATOR  BEGICH asked  what  analysis  of has  been  done on  the                                                               
impact of  those rates.  He related  his understanding  that this                                                               
bill  will allow  those private  payers to  continue to  pay when                                                               
patients  become  more  in  need  of  services,  so  that  burden                                                               
wouldn't fall entirely on the state.                                                                                            
                                                                                                                                
REPRESENTATIVE  FIELDS responded  that it  is accurate  to assume                                                               
that doing the  right thing for Alaska's elders  and helping them                                                               
stay in  the Pioneer Homes is  in the financial best  interest of                                                               
the  Pioneer Homes.  He noted  that he  asked former  Legislative                                                               
Finance  Director David  Teal, who  provided  testimony in  House                                                               
Finance on this issue, to answer questions members may have.                                                                    
                                                                                                                                
1:51:46 PM                                                                                                                    
SENATOR  GIESSEL related  that  married  couples are  financially                                                               
affected when  one spouse needed to  be in the Pioneer  Home. The                                                               
couple's assets  can be rapidly depleted  leaving the non-Pioneer                                                               
Home  resident destitute.  She asked  if he  has considered  that                                                               
issue, so that these couples will not have their assets drained.                                                                
                                                                                                                                
REPRESENTATIVE FIELDS  said the  tragic stories  he heard  in his                                                               
district  were a  primary motivation  for introducing  this bill.                                                               
Senator Giessel was  right that the committee  could consider how                                                               
payment  assistance  affects a  married  couple  versus a  single                                                               
person. The legislature  does not want people  to become homeless                                                               
or  not  be able  to  care  for their  kids.  He  has heard  from                                                               
constituents with one spouse in  the Pioneer Home while the other                                                               
is at home caring for their children.                                                                                           
                                                                                                                                
REPRESENTATIVE FIELDS reviewed slide 7, Complexity of Care:                                                                     
                                                                                                                                
     Current Levels                                                                                                             
      Level I: Services include housing, meals, emergency                                                                       
     assistance, recreation, home activities                                                                                    
                                                                                                                                
      Level II: Services include all Level I services plus                                                                      
       Medicaid administration, health related services,                                                                        
     staff  assistance, incl  assistance with  daily living,                                                                    
     supervision, reminders. (Non-night shift)                                                                                  
                                                                                                                                
     Level  III: Services  include all  services of  Level I                                                                    
     and  Level  II,  with   24-  hour  hands-on  assistance                                                                    
     provided.                                                                                                                  
                                                                                                                                
     Proposed  Levels  Level  I: Services  include  housing,                                                                    
     meals, emergency assistance, and recreation                                                                                
                                                                                                                                
     Level  II:  Services  include   Level  I  services  and                                                                    
     medication  administration,  health  related  services,                                                                    
     and  intermittent assistance  with activities  of daily                                                                    
     living                                                                                                                     
                                                                                                                                
     Level  III:  Services  include Level  I  and  Level  II                                                                    
     services   as  well   as   extensive  assistance   with                                                                    
     activities of daily living                                                                                                 
                                                                                                                                
     Level IV:  Services include  Level I,  II, and  III, as                                                                    
     well  nursing   services  for  24  hours   a  day,  and                                                                    
     intermittent behavior management                                                                                           
                                                                                                                                
     Level V: Services include all  those included in Levels                                                                    
     I-IV, as well as extensive behavior management                                                                             
                                                                                                                                
The  department is  moving from  three  levels of  care to  five,                                                               
consistent with  the direction  under Senate  Bill 74.  Since the                                                               
average   age   of   Pioneer   Home   residents   has   increased                                                               
significantly, the percentage of  residents who have dementia has                                                               
increased,  which means  a higher  level of  care is  needed. The                                                               
homes are evolving to meet that need.                                                                                           
                                                                                                                                
REPRESENTATIVE  FIELDS referred  to slide  8, Rates  and Impacts.                                                               
This slide consisted of bar  graphs comparing rates predating the                                                               
recent  rate increase,  the current  rates  including the  recent                                                               
rate increases, and  the proposed rates under HB 96.  He said the                                                               
blue bars represent  rates before the rate hike,  the orange bars                                                               
represent the new  rates, and the green bars  represent the rates                                                               
under the [CSHB 96(FIN) version  31-LS0646\S]. The green bars are                                                               
inflation-adjusted 2004 rates, he said.                                                                                         
                                                                                                                                
REPRESENTATIVE FIELDS  pointed out that  slide 8 includes  a copy                                                               
of an  Anchorage Daily News  article with the  headline, "Pioneer                                                               
Home  residents   and  families  struggle   with  'heartbreaking'                                                               
decisions  after rate  increase." He  said 16  Level I  residents                                                               
decided to leave after the rate increases.                                                                                      
                                                                                                                                
SENATOR  VON IMHOF  noted that  the orange  bars are  the monthly                                                               
rates  enacted last  year and  the  green bars  are the  proposed                                                               
rates. She asked for the costs of operating the homes.                                                                          
                                                                                                                                
REPRESENTATIVE  FIELDS answered  that the  department has  stated                                                               
that the Pioneer Home costs are the same as the orange bars.                                                                    
                                                                                                                                
SENATOR  VON  IMHOF  asked  if the  fiscal  note  represents  the                                                               
difference between the green and orange bars.                                                                                   
                                                                                                                                
1:57:05 PM                                                                                                                    
REPRESENTATIVE FIELDS said he believes that is correct.                                                                         
                                                                                                                                
SENATOR VON  IMHOF asked how  the legislature can  determine that                                                               
the new monthly rates of  $11,185, $13,333, and $15,000 represent                                                               
the cost  that does not inflate  each year and that  it is giving                                                               
the state good  value. She said she didn't know  if that would be                                                               
a comparison to  other Pioneer Homes in the  state, Pioneer Home-                                                               
like facilities in the Lower 48, or a comparison over time.                                                                     
                                                                                                                                
REPRESENTATIVE  FIELDS replied  the  next  slide that  references                                                               
regional comparisons might address that.                                                                                        
                                                                                                                                
SENATOR BEGICH asked  if the fiscal note  reflects the difference                                                               
between  a capped  and uncapped  rate.  The $15,000  amount is  a                                                               
capped rate under  the existing scenario, but  under the uncapped                                                               
rate that  limit wouldn't be  there. The department  might simply                                                               
be projecting higher fiscal costs without knowing them.                                                                         
                                                                                                                                
REPRESENTATIVE FIELDS  said there was considerable  discussion in                                                               
House Finance about how real the  fiscal cost is and how much the                                                               
department will  actually collect. He  concluded that there  is a                                                               
considerable  uncertainty about  how  consumers  react to  prices                                                               
that  are  well  above  market  levels. He  would  defer  to  the                                                               
department and Mr. Teal for further discussion.                                                                                 
                                                                                                                                
SENATOR  BEGICH  said  that  is  the  crux  of  it  for  him.  He                                                               
discovered  some  minor discrepancies  in  the  fiscal note  that                                                               
still amount to a few million dollars.                                                                                          
                                                                                                                                
1:59:48 PM                                                                                                                    
CHAIR WILSON  noted that  the committee  could ask  Acting Deputy                                                               
Commissioner  Lasley for  a brief  explanation  about the  fiscal                                                               
note.                                                                                                                           
                                                                                                                                
REPRESENTATIVE  FIELDS,  in  response   to  Senator  von  Imhof's                                                               
question about value,  said the Pioneer Home is  not the cheapest                                                               
assisted  living situation.  However, experience  has shown  that                                                               
Alaskans value the quality of care  and sense of community in the                                                               
Pioneer Homes  and will pay more  for it. However, demand  is not                                                               
utterly  elastic  in terms  of  how  much  more people  would  be                                                               
willing  to  pay. The  Pioneer  Home's  value  is more  than  the                                                               
typical  assisted-living facility  that people  might contemplate                                                               
sending their  parents to out  of state. The comparison  of long-                                                               
term  costs in  the Pacific  Northwest  shows that  if the  rates                                                               
under rates in  HB 96 were enacted, it would  not be underpricing                                                               
the private market  for assisted living in Alaska  or the region.                                                               
People will  still pay a premium  for that higher level  of care.                                                               
Pioneer Homes do  not provide enough beds to  distort the market.                                                               
He  related that  about 450  or 500  people a  year represents  a                                                               
small percentage of statewide long-term care beds.                                                                              
                                                                                                                                
CHAIR WILSON  pointed out that  Alaskans pay the most  for health                                                               
care  cost  in world.  Some  can  argue  that the  Pioneer  Homes                                                               
provide the  types of  services a  skilled nursing  home facility                                                               
does.  He asked  whether the  rates tied  to the  cost of  living                                                               
reflect increases  in health  care costs  from 2004  until today.                                                               
For some residents, the Pioneer  Home is assisted living, but for                                                               
others it is a skilled nursing facility.                                                                                        
                                                                                                                                
REPRESENTATIVE FIELDS  reviewed slide 9,  Cost of Long  term Care                                                               
in  Pacific Northwest,  Long  Term Care  Cost  Comparison -  2019                                                               
Genworth. He  said he thought the  cost of health care  in Alaska                                                               
has grown faster  than the cost of long-term care  in the Pioneer                                                               
Homes. Alaska has controlled per  capita Medicaid since 2015. The                                                               
legislature  passed Senate  Bill 74,  trying to  contain Medicaid                                                               
costs  and drive  down uncompensated  care. In  turn, those  cost                                                               
savings are passed  on to private insurers,  including the state.                                                               
The state  has seen  better coverage of  the population  at large                                                               
leaving  the  state  to  carry less  of  the  uncompensated  care                                                               
burden.                                                                                                                         
                                                                                                                                
SENATOR VON IMHOF said the chart  [on slide 9] shows that nursing                                                               
homes cost more  than assisted living homes in  any location, but                                                               
the cost of  nursing homes in Anchorage and Alaska  appears to be                                                               
two  to three  times  as much  as in  Seattle  and Portland.  She                                                               
acknowledges  the need  for nursing  homes, but  these facilities                                                               
are significantly more  costly in Alaska. She asked  what it will                                                               
mean if Pioneer  Homes move into the nursing home  field. She and                                                               
asked where people currently get nursing home assistance.                                                                       
                                                                                                                                
2:05:05 PM                                                                                                                    
REPRESENTATIVE  FIELDS  replied he  is  not  suggesting that  the                                                               
Pioneer  Homes  provide a  concentration  of  a higher  level  of                                                               
acuity   care.  He   expressed   concern  that   the  bill   will                                                               
inadvertently  provide  a  higher  level of  care  for  a  higher                                                               
percentage  of the  population, which  could put  the state  in a                                                               
risky  financial situation.  He acknowledged  some percentage  of                                                               
Levels I and  II payers is good for the  homes. The Pioneer Homes                                                               
provide  some care  that could  potentially  qualify for  nursing                                                               
home levels of reimbursement. If  so, the state could obtain more                                                               
revenue. However,  after reviewing the costs,  one could conclude                                                               
that the  department has controlled  the costs since  the Pioneer                                                               
Home rates are  not nearly as high as nursing  home rates. Still,                                                               
it  is hard  to compare  because  the Pioneer  Homes serves  some                                                               
assisted living residents and a  significant percentage of people                                                               
would need  to seek nursing  home care  outside of Alaska  if the                                                               
Pioneer Homes  were not an  option. The diverse  population makes                                                               
it hard to compare, he said.                                                                                                    
                                                                                                                                
SENATOR  BEGICH asked  why there  is such  a difference  in cost.                                                               
Nursing homes costs in Seattle  are about $13,000, and $11,000 in                                                               
Portland, but private  nursing home care in  Anchorage and Alaska                                                               
is $30,000. He  asked if the cost  in Alaska was due  to a narrow                                                               
market, and so higher premiums  are charged, or whether there are                                                               
actual  costs. That  goes  back to  Senator  von Imhof's  earlier                                                               
question about cost  versus the market. He said he  does not want                                                               
Pioneer Home prices to match  inflated market prices. He asked if                                                               
any analysis has been done.                                                                                                     
                                                                                                                                
REPRESENTATIVE FIELDS deferred to  Director Lasley for additional                                                               
background on  the [2019] Genworth  report. He said  he primarily                                                               
reviewed the assisted  living costs on the  graph because Pioneer                                                               
Homes fall  under that category.  He wanted  to be sure  that the                                                               
chart  did  not  distort  the market  by  radically  underpricing                                                               
assisted living facilities.                                                                                                     
                                                                                                                                
REPRESENTATIVE FIELDS  presented slide  10, Social  Security Cost                                                               
of  Living,   which  showed  the  percentage   of  cost-of-living                                                               
adjustments  since 1975.  "That  really adds  up  over time,"  he                                                               
said.  That will  provide  a steady  trajectory  to capture  cost                                                               
increases  and  provide  predictability  for  residents  and  the                                                               
department.                                                                                                                     
                                                                                                                                
REPRESENTATIVE FIELDS turned to slide  11, CSHB 96. He summarized                                                               
his presentation  by stating  that HB  96 provides  stability for                                                               
residents  and the  department,  ensures  timely and  predictable                                                               
rate increases,  and updated levels  of care to reflect  an aging                                                               
population  with higher  levels of  dementia. He  noted that  the                                                               
bill gives the department the  flexibility to raise rates without                                                               
using   the  lengthy   regulation  process.   That  process   had                                                               
discouraged  the department  from  adjusting rates  to keep  pace                                                               
with costs.  The bill  also provides  residents and  their family                                                               
members peace  of mind  when making  tough decisions  about where                                                               
and how to take care of their elder family members.                                                                             
                                                                                                                                
CHAIR WILSON invited David Teal to the table.                                                                                   
                                                                                                                                
2:09:38 PM                                                                                                                    
DAVID TEAL, representing self, Juneau,  Alaska, noted that he was                                                               
the former Director  of Legislative Finance, but  he was speaking                                                               
as  a  private  citizen  at  the request  of  the  bill  sponsor.                                                               
Legislative  Finance  had  concerns   about  the  lack  of  data,                                                               
particularly financial  data of Pioneer Home  residents and those                                                               
on the  waiting list. That  prompted the concern that  the fiscal                                                               
impacts  might  be  too  optimistic.  He  said  that  large  rate                                                               
increases  at Level  I, which  is  for little  or no  assistance,                                                               
means  that  those people  at  Level  I have  options,  including                                                               
staying in  their apartment or  at home. Legislative  Finance was                                                               
concerned that  it was possible  that some  self-paying residents                                                               
might opt to leave the Pioneer  Homes looking for a cheaper place                                                               
to stay.  Legislative Finance had no  idea how many might  do so,                                                               
but  based  on the  information  that  Director Lasley  provided,                                                               
Legislative Finance  estimated that the savings  projected by the                                                               
governor were perhaps $5 million too aggressive.                                                                                
                                                                                                                                
MR. TEAL  said there is  a request  for additional funding  in FY                                                               
2021 because  Level 1 residents  have elected to leave.  If these                                                               
residents are replaced  by people who cannot fully  pay, then the                                                               
program receipts will not materialize.                                                                                          
                                                                                                                                
MR. TEAL said  Legislative Finance did not  consider any personal                                                               
aspects,  but strictly  reviewed whether  the fiscal  projections                                                               
made  sense. Given  the  lack of  data,  Legislative Finance  was                                                               
concerned  the  administration  was  too  optimistic  about  cost                                                               
savings. He said  he has not kept up with  the governor's bill so                                                               
he has  nothing to say about  the rates. There is  currently more                                                               
data available,  but he does not  think it is sufficient  to make                                                               
good revenue or cost projections.                                                                                               
                                                                                                                                
SENATOR BEGICH  asked about  the graph on  slide 9  that compares                                                               
the cost  of long-term care  in Pacific Northwest. He  noted that                                                               
assisted living rates include Levels I  and II and some Level III                                                               
rates. He asked where the $7,126  figure for the cost of assisted                                                               
living at Pioneer Homes was derived.                                                                                            
                                                                                                                                
2:15:44 PM                                                                                                                    
TRISTAN WALSH,  Staff, Representative  Zach Fields,  Alaska State                                                               
Legislature, Juneau,  Alaska, answered that slide  9 was produced                                                               
by  the [Division]  of Pioneer  Homes and  refers to  the enacted                                                               
rates put into place in August.                                                                                                 
                                                                                                                                
REPRESENTATIVE  FIELDS  added  that  the  Pioneer  Home  assisted                                                               
living cost  in the graph  was the average  of Levels 1,  II, and                                                               
III and  the Pioneer Home  nursing home  cost was the  average of                                                               
Levels IV  and V to try  to approximate the assisted  living care                                                               
costs versus what is more nursing home costs.                                                                                   
                                                                                                                                
SENATOR BEGICH  said those are not  the rates in the  bill, which                                                               
are slightly lower.                                                                                                             
                                                                                                                                
REPRESENTATIVE FIELDS replied correct.                                                                                          
                                                                                                                                
MR. WALSH presented the sectional for CSHB 96 Version 6:                                                                        
                                                                                                                                
     Section  1. This  section amends  AS 47.55.020(b),  the                                                                    
     statute  regarding  admission  to a  Pioneer  Home,  to                                                                    
     raise the amount of monthly  income a resident may keep                                                                    
     for  incidental  expenses  from   $200  to  $500.  This                                                                    
     section also  makes conforming  changes to  reflect new                                                                    
     language added in Section 5 of this bill.                                                                                  
                                                                                                                                
MR. WALSH added that Section 1  was an amendment that was offered                                                               
in the House Finance Committee.                                                                                                 
                                                                                                                                
     Section  2. This  section amends  AS 47.55.020(d),  the                                                                    
     section of statutes relating  to payment assistance, to                                                                    
     raise the amount of monthly  income a resident may keep                                                                    
     for  incidental  expenses  from   $200  to  $500.  This                                                                    
     section also  makes conforming  changes to  reflect new                                                                    
     language added in Section 5 of this bill.                                                                                  
                                                                                                                                
     Section  3. This  section  amends  AS 47.55.030(a)  the                                                                    
     section  relating  to  payment   by  a  resident,  with                                                                    
     conforming  language that  reflects Section  5 of  this                                                                    
     bill.                                                                                                                      
                                                                                                                                
     Section  4.  This  section   repeals  and  reenacts  AS                                                                    
     47.55.030(b),  which charges  the  Department to  adopt                                                                    
     regulations regarding  a monthly rate for  Pioneer Home                                                                    
     residents, to reflect changes made in Section 5.                                                                           
                                                                                                                                
     Section 5.  This section amends AS  47.55.030 by adding                                                                    
     a  new  section,  (f).  This  section  works  to  limit                                                                    
     Pioneer Home  Rate increases to  no more than  the rate                                                                    
     of inflation,  as measured by  Social Security  Cost of                                                                    
     Living  Adjustment,  using  current monthly  and  daily                                                                    
     rates  (adjusted   for  inflation  since  2004)   as  a                                                                    
     starting point.                                                                                                            
                                                                                                                                
     Section  6.  This  section  amends  AS  47.55.070,  the                                                                    
     statute regarding  indebtedness of  a home  resident to                                                                    
     the  State, with  conforming  language  to reflect  the                                                                    
     changes made in Section 5 of this bill.                                                                                    
                                                                                                                                
     Section 7.  This section  makes conforming  changes, by                                                                    
     repealing sections of  statutes requiring public notice                                                                    
     for proposed  rate changes, which could  be infrequent.                                                                    
     Section 5 of this bill sets this as an annual process.                                                                     
                                                                                                                                
MR. WALSH  pointed out  that Section 7  allows the  department to                                                               
enact   rate   increases    through   statutory   authority,   as                                                               
Representative Fields described earlier.                                                                                        
                                                                                                                                
SENATOR BEGICH  asked if  the allowances  will also  be inflation                                                               
proofed or do  the allowances need to be visited  every few years                                                               
and reset.                                                                                                                      
                                                                                                                                
MR. WALSH answered  that he thought the allowances were  set as a                                                               
single increase, but he would check.                                                                                            
                                                                                                                                
CHAIR  WILSON invited  Acting Deputy  Commissioner Lasley  to the                                                               
table.                                                                                                                          
                                                                                                                                
2:21:00 PM                                                                                                                    
CLINTON LASLEY, Acting Deputy  Commissioner, Family, Community, &                                                               
Integrated  Services, Department  of Health  and Social  Services                                                               
(DHSS), Juneau, Alaska, introduced himself.                                                                                     
                                                                                                                                
SENATOR GIESSEL clarified that citizens  enter and have assets to                                                               
pay for residency. Residents also  have Medicare. She related her                                                               
understanding  that once  residents  use up  all personal  assets                                                               
Medicare will  still be  in place, but  these residents  would be                                                               
asked to apply for Medicaid to help cover their costs.                                                                          
                                                                                                                                
MR.  LASLEY replied  that Pioneer  Homes  cannot accept  Medicare                                                               
because Medicare  is hospitalization.  The Pioneer  Homes receive                                                               
Medicaid waiver  coverage. The Medicaid waiver  has financial and                                                               
medical requirements for individuals  to be eligible. Individuals                                                               
must be below  resources and must meet the nursing  home level of                                                               
care  to be  eligible for  Medicaid waiver.  The homes  currently                                                               
have 96  out of the  450 elders in the  home who qualify  for the                                                               
Medicaid  waiver. The  Pioneer  Homes try  to  shape the  program                                                               
around  the Medicaid  waiver requirement  because individuals  at                                                               
some  point need  a  higher  level of  care  and  will require  a                                                               
Medicaid   waiver   or    assistance,   with   strict   financial                                                               
requirements for that.                                                                                                          
                                                                                                                                
SENATOR  GIESSEL  clarified  that   Medicare  would  cover  their                                                               
medications.                                                                                                                    
                                                                                                                                
MR. LASLEY  answered that  their Part D  plan would.  The Pioneer                                                               
Homes  require  that every  elder  have  Medicare  Part D  or  an                                                               
equivalent.                                                                                                                     
                                                                                                                                
CHAIR WILSON asked when the new rate increases took effect.                                                                     
                                                                                                                                
MR. LASLEY  said the new rates  went into effect on  September 1.                                                               
The notification went out at the end of July.                                                                                   
                                                                                                                                
CHAIR  WILSON  asked  if  he  knew how  many  residents  had  had                                                               
financial  hardships, the  number  who  were provided  additional                                                               
assistance from  the state, and  the number who left  the Pioneer                                                               
Homes.                                                                                                                          
                                                                                                                                
2:24:28 PM                                                                                                                    
MR.  LASLEY said  a presentation  before the  House Finance  last                                                               
week noted that the Pioneer  Homes tracked those who left because                                                               
of the  rate increases. He noted  16 residents stated it  was due                                                               
to the rate  increase. The majority were in  Anchorage area. Some                                                               
of them  had moved into the  three new facilities that  opened in                                                               
Anchorage, Palmer, and Wasilla in the past year.                                                                                
                                                                                                                                
CHAIR  WILSON  asked  if  Pioneer  Home  residents  were  offered                                                               
payment  assistance  from the  additional  $15  million that  was                                                               
added to  the program for  people who  could not afford  the rate                                                               
increases.                                                                                                                      
                                                                                                                                
MR.  LASLEY  said  the  Pioneer  Homes  held  conversations  with                                                               
everyone who  was concerned how  to pay for the  increased costs.                                                               
Administrators  and social  workers  helped  them understand  the                                                               
payment   assistance  program   so   residents  understood   that                                                               
individuals could stay  in the Pioneer Homes  regardless of their                                                               
ability to pay.  When the notification of rate  increase went out                                                               
at  the  end  of  July,   the  notification  included  a  payment                                                               
assistance application.                                                                                                         
                                                                                                                                
SENATOR VON  IMHOF asked  if HB  96 allows  the Pioneer  Homes to                                                               
charge  separately for  supplies, equipment,  and other  services                                                               
not included in the monthly rate.                                                                                               
                                                                                                                                
MR. LASLEY answered  that nothing in the bill  limits the Pioneer                                                               
Home from charging for supplies. Every  elder in the homes who is                                                               
private pay gets an invoice every  month for their supply use and                                                               
copays for  medication from the  Pioneer Homes'  central pharmacy                                                               
that the majority of residents  use. Supply charges are typically                                                               
minimal and  individuals on the  payment assistance plan  are not                                                               
charged  for  supplies. Historically  that  has  been charged  to                                                               
their state indebtedness account.                                                                                               
                                                                                                                                
SENATOR  VON IMHOF  said  it was  good to  hear  that the  supply                                                               
charge has  been minimal. She  did not  know what kind  of checks                                                               
and balances could be put in place for supply charges.                                                                          
                                                                                                                                
MR.  LASLEY  replied the  charge  for  supplies  is at  cost.  He                                                               
believed the pharmacy charge for  medications was cost plus three                                                               
percent.                                                                                                                        
                                                                                                                                
SENATOR BEGICH discussed  the burden that falls on  a couple when                                                               
all their assets are required when  one of them is in the Pioneer                                                               
Home.  He  said  his  constituents  have  considered  divorce  to                                                               
protect assets.  He asked  if the  Pioneer Homes  understood that                                                               
current rates could break up families.                                                                                          
                                                                                                                                
MR.  LASLEY responded  that the  department testified  last year,                                                               
that  the  Pioneer  Home  regulations are  closely  tied  to  the                                                               
Medicaid waivers because typically  only Level IV residents could                                                               
qualify  for the  waiver. Historically,  individuals at  Level IV                                                               
end up requiring  the Medicaid waiver. Last  year, the department                                                               
also increased the spousal support  limit, to mirror the Medicaid                                                               
waiver requirements.  The Medicaid  waiver resource limit  for an                                                               
individual or couple is $132,000, plus a family home.                                                                           
                                                                                                                                
2:31:08 PM                                                                                                                    
SENATOR BEGICH  pointed out that  the private nursing  home rates                                                               
as  shown on  slide  9 are  quite  high. He  asked  if these  are                                                               
arbitrary figures  or if  these figures are  based on  the actual                                                               
cost of  care for  a nursing  home. He  asked how  the department                                                               
calculated its original rates.                                                                                                  
                                                                                                                                
MR. LASLEY answered  that the department set the  rates last year                                                               
based on what  it cost to provide services in  the Pioneer Homes.                                                               
The Pioneer  Homes had a $64  million budget in fiscal  year (FY)                                                               
2019. The Pioneer Homes expenditures  were about $60 million. The                                                               
department  testified  that  the  FY  2020  projected  costs  for                                                               
services would  be $60 million.  Assisted living homes  in Alaska                                                               
are not required  to publish rates, but nursing  homes or skilled                                                               
facilities  must  do  so  to  qualify  for  state  reimbursement.                                                               
Skilled home  nursing reimbursement  rates are  set by  the state                                                               
based on  nursing homes' actual  costs. The department  relies on                                                               
the  Genworth study  for  rates because  it  surveys its  members                                                               
every year.                                                                                                                     
                                                                                                                                
SENATOR  BEGICH highlighted  that there  are vast  differences in                                                               
nursing  home rates,  but assisted  living  rates are  comparable                                                               
across the board.  He wanted to be sure the  fiscal note reflects                                                               
the actual cost of  care, not what the cost of  care in a private                                                               
facility that  might not be  accurately reporting. The  graph [on                                                               
slide  9] consists  of a  map of  services. He  expressed concern                                                               
that the  fiscal note  might be reflecting  increased costs  as a                                                               
result of HB 96.                                                                                                                
                                                                                                                                
MR. LASLEY  answered that the fiscal  note of $60 million  is the                                                               
cost of providing services at the Pioneer Homes system.                                                                         
                                                                                                                                
SENATOR BEGICH  asked if  the size  of the fiscal  note is  not a                                                               
result of the  bill adding increased costs to  the Pioneer Homes'                                                               
operations.                                                                                                                     
                                                                                                                                
SENATOR  BEGICH  observed that  under  this  bill the  department                                                               
would  not be  required to  write  regulations. He  asked if  the                                                               
department's  fiscal  note  shows  the  reduction  of  regulation                                                               
projects.                                                                                                                       
                                                                                                                                
MR.  LASLEY replied  regulation  costs were  not calculated.  The                                                               
department's  cost of  writing regulations  falls outside  of the                                                               
Pioneer Homes  and is performed by  the Department of Law  or the                                                               
DHSS commissioner's office.                                                                                                     
                                                                                                                                
CHAIR WILSON said the committee  could ask the department for the                                                               
cost of writing regulations.                                                                                                    
                                                                                                                                
SENATOR  BEGICH added  that  he  wanted it  to  be  fair. If  the                                                               
department is  going to  put the cost  of writing  regulations in                                                               
all  bills the  legislature  writes, then  the department  should                                                               
show the reduction in cost of not requiring regulations.                                                                        
                                                                                                                                
CHAIR WILSON  said he is  all about  accurate notes. He  has many                                                               
conversations with  different departments  about the  accuracy of                                                               
costs and the reduction of costs in legislation.                                                                                
                                                                                                                                
2:37:31 PM                                                                                                                    
CHAIR WILSON opened public testimony on HB 96.                                                                                  
                                                                                                                                
2:37:47 PM                                                                                                                    
BRAD RIDER, representing self, Juneau,  Alaska, said he has lived                                                               
in Juneau  since 1960. His family  came to Alaska because  of his                                                               
dad's dream of  what it offered. Both his parents  are in Pioneer                                                               
Home. When the rate increase  went into effect, his mother's rate                                                               
went from  just over $4,000 to  just over $11,000. If  his father                                                               
has another  stroke, his rate  will be  over $24,000 a  month and                                                               
they will be wiped out. Pioneer  Homes were designed to take care                                                               
of elderly  people in  Alaska. The  state needs  to take  care of                                                               
Alaskan elders.                                                                                                                 
                                                                                                                                
CHAIR WILSON  reminded everyone that comments  could be submitted                                                               
in writing to senate.hss@akleg.gov until Wednesday.                                                                             
                                                                                                                                
2:42:33 PM                                                                                                                    
MARGIE  BEEDLE,  representing  self,  Juneau,  Alaska,  said  her                                                               
mother has  lived in  Juneau for  70 years and  is in  the Juneau                                                               
Pioneer  Home.   She  followed  this   bill  last   spring,  gave                                                               
testimony, and watched it gain  bipartisan and public support, so                                                               
she  was surprised  that  the department  raised  the rates  last                                                               
year. These  increases ranged from  40 to 140 percent,  a sudden,                                                               
extreme  increase   which  left  residents  and   their  families                                                               
reeling. Residents  have moved out following  the price increase.                                                               
She knows  of one  person in  Juneau who  had been  a private-pay                                                               
resident.  That  person's  family  calculated that  the  cost  of                                                               
remodeling the house  to accommodate a wheelchair  and paying for                                                               
respite care was less than the  Pioneer Home's rate. If a private                                                               
pay  resident is  replaced by  one  on Medicaid  who has  greater                                                               
needs,  the  cost to  the  state  is  greater.  Her mother  is  a                                                               
private-pay resident at Level II  of the new five-tier system and                                                               
her rate increased  40 percent. She had  purchased long-term care                                                               
insurance. Before the department  raised the rates, her insurance                                                               
covered her  residential service  rate plus  her room  and board.                                                               
After the  increase, the  maximum benefit  amount falls  short by                                                               
over  a $1,000  a month.  That discrepancy  will increase  as her                                                               
needs increase. She  is 90 and in the middle  stages of Alzheimer                                                               
disease.                                                                                                                        
                                                                                                                                
MS.  BEEDLE said  her mother  carefully planned  for the  Pioneer                                                               
Home.  If this  rate increase  stands, the  situation her  mother                                                               
carefully planned  for will have drastically  changed. Her mother                                                               
was a businesswoman, so  she understands cost-of-living increases                                                               
and how modest  adjustments need to be made. Her  mother does not                                                               
understand how the  Pioneer Home community should  be required to                                                               
pay 100 percent  of the cost for  others who are not  held to the                                                               
same standards.  If this bill  is not enacted, the  population of                                                               
the Pioneer Homes will continue to change.                                                                                      
                                                                                                                                
2:46:18 PM                                                                                                                    
DOUG LARSON,  representing self,  Juneau, Alaska, shared  that he                                                               
is a life-long resident of Juneau.  His parents came to Alaska in                                                               
the  50s, married,  and  had children.  They  contributed to  the                                                               
state and community. His parents  were responsible and throughout                                                               
their lives and  invested in long-term care,  taking into account                                                               
the  rates   they  expected  to   pay.  The  rate   changes  were                                                               
devastating. His  dad is 92  with dementia.  His rate went  up 95                                                               
percent.  This  bill will  increase  rates  over time  and  gives                                                               
people time to plan and figure  out a new strategy. Moving out of                                                               
state  for many  elderly, like  his parents,  would be  difficult                                                               
because of health  reasons plus his parents do not  want to move.                                                               
HB 96 is a more reasoned approach to senior care funding.                                                                       
                                                                                                                                
2:49:36 PM                                                                                                                    
LUANN MCVEY, representing self, Juneau,  Alaska, said she came to                                                               
Alaska in  1957 with her  parents, who were  career professionals                                                               
with the federal  government. Her parents are now 87  and live in                                                               
their   home,  but   the  challenges   of   aging  impact   their                                                               
independence. Her parents are one  major health event away from a                                                               
serious  life change  that could  require a  permanent move  to a                                                               
long-term facility. Medicare does not  pay for long-term care. As                                                               
residents  of  the  state since  territorial  days,  her  parents                                                               
always envisioned their final days  would be spent in the Pioneer                                                               
Homes,  which  was  meant  to  be  an  affordable  senior  living                                                               
facility. This administration  has raised the rates  to the point                                                               
that now even  her parents, who receive  federal pensions, cannot                                                               
afford it.  HB 96  has reasonable limits  on Pioneer  Home rates,                                                               
which will allow elders to live  at the Pioneer Home without fear                                                               
of becoming destitute.                                                                                                          
                                                                                                                                
2:51:56 PM                                                                                                                    
JUDY CRONDAHL,  representing self, Juneau, Alaska,  said very few                                                               
seniors who  can live in  their own homes  choose to live  in the                                                               
Pioneer  Home. The  Pioneer  Homes provide  a  vital service  for                                                               
those  who cannot  care for  themselves. The  Pioneer Homes  were                                                               
built  and   established  in  recognition  and   appreciation  of                                                               
contributions made by pioneers to  the territory of Alaska and as                                                               
a means to provide in-state  alternatives to seniors who could no                                                               
longer remain in their homes.  Pioneer Homes provide high-quality                                                               
care,  but  do  not  provide   luxury  accommodations.  The  rate                                                               
increases will encourage  seniors who can afford it  to leave the                                                               
state. These  prices will  force the rest  who stay  to liquidate                                                               
their estates in order to move  into a Pioneer Home and depend on                                                               
Medicaid  when  all  other  resources  are  depleted.  She  urged                                                               
members to pass HB 96 from committee.                                                                                           
                                                                                                                                
2:53:24 PM                                                                                                                    
LAURA  STATS, representing  self,  Juneau, Alaska,  said she  has                                                               
been in Juneau  since 1981 raising a family. She  was speaking on                                                               
behalf of her  mother-in-law, Betty Daugherty, who is  98 and has                                                               
lived  at the  Juneau Pioneer  Home since  2011. She  ventured to                                                               
Alaska  in the  1940s. She  came partly  because her  Great-uncle                                                               
Heckman had  journeyed to  Ketchikan and  devised the  fish trap.                                                               
She taught high  school after raising six children.  In 2019, her                                                               
rate increased  from $6,795,  at the equivalent  of Level  IV, to                                                               
$13,333.  She is  a  private payer  who  had long-term  coverage,                                                               
which  lasts four  years.  Since 2011,  her  rates have  doubled,                                                               
which is greatly unfair. She  suggested that the state find other                                                               
income  streams such  as adopting  an  income tax  and using  the                                                               
Alaska Permanent Fund.                                                                                                          
                                                                                                                                
2:56:22 PM                                                                                                                    
BRIEN  DAUGHERTY, representing  self,  Juneau, Alaska,  explained                                                               
that Laura Stats spoke about  his mother. The Daugherty family is                                                               
an old Alaska family. Going to the  Lower 48 is not an option for                                                               
them because  the family  has always lived  in Alaska.  The Sitka                                                               
Pioneer Home  was built when  Alaska had few resources  and still                                                               
took care  of its elders. He  said he is testifying  to appeal to                                                               
the humanity of the committee. He  urged members to not just talk                                                               
about  finances when  talking about  people's lives.  He said  he                                                               
understands why  legislators are  talking about finances,  but he                                                               
asked them to  think past that. The Pioneer  Homes' population is                                                               
500 of  800,000 Alaskans.  Many elders  helped build  this state,                                                               
including his  parents. The state must  rise up and take  care of                                                               
elders,  not force  them to  leave,  and not  bankrupt them.  His                                                               
mother  is self-pay  but  is assessed  $14,000  every month.  The                                                               
state can do better.                                                                                                            
                                                                                                                                
2:59:33 PM                                                                                                                    
KEVIN  HENDERSON, representing  self,  Juneau,  Alaska, spoke  in                                                               
support of  HB 96.  He said  he was testifying  on behalf  of his                                                               
wife's mother,  Beatrice Long, 93,  who is at the  Juneau Pioneer                                                               
Home receiving  Level II services  and is self-pay.  Beatrice and                                                               
her  husband moved  to Alaska  in 1964  and raised  four children                                                               
here.  Her  husband  was  a  contractor  and  a  state  inspector                                                               
overseeing  various  projects,  including   the  Auke  Bay  ferry                                                               
terminal. He  expressed support for  HB 96 on behalf  of Beatrice                                                               
and her  family. HB 96 recognizes  that it was never  going to be                                                               
possible  for the  state to  sustain for-profit,  assisted living                                                               
homes. It  was understood that  a subsidized Pioneer  Home system                                                               
was needed  to support  seniors. Last  year the  governor ignored                                                               
the  original intent  of the  Pioneer Home  and decided  that the                                                               
homes  should  be  completely  self-funded.   As  a  result,  the                                                               
exorbitant rate increases began last  fall, which created lots of                                                               
panic.  HB 96  will place  the  payment rate  and the  additional                                                               
charges   in  state   statute.   The  bill   will  prohibit   the                                                               
administration from  raising Pioneer Homes rates  based solely on                                                               
fiscal  philosophy. If  this bill  passes,  the legislature  will                                                               
decide  future rate  increases. The  bill recognizes  the state's                                                               
fiscal  responsibilities. This  bill  would create  a 15  percent                                                               
increase, which  is more  reasonable than the  40 to  140 percent                                                               
increases. Rates must  be fair, reasonable, and humane.  HB 96 is                                                               
good government. It  recognizes fiscal reality and  it honors the                                                               
state's seniors.                                                                                                                
                                                                                                                                
3:03:40 PM                                                                                                                    
CHAIR WILSON  said he would hold  HB 96 in committee  with public                                                               
testimony open.                                                                                                                 
                                                                                                                                
3:04:12 PM                                                                                                                    
SENATOR GIESSEL  disclosed that  she has  a conflict  of interest                                                               
because her  92-year-old mother, who  has lived in Alaska  for 71                                                               
years, lives  in the  Anchorage Pioneer  Home, is  categorized at                                                               
Level V and is private pay.                                                                                                     
                                                                                                                                
3:04:34 PM                                                                                                                    
At ease                                                                                                                         
                                                                                                                                
3:04:44 PM                                                                                                                    
CHAIR WILSON reconvened the meeting.                                                                                            
                                                                                                                                
There being  no further  business to  come before  the committee,                                                               
Chair  Wilson adjourned  the Senate  Health  and Social  Services                                                               
Standing Committee at 3:04 p.m.                                                                                                 

Document Name Date/Time Subjects
1 CSHB 96 Sponsor Statement 5.12.19.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
2 CSHB 96 House Finance Committee Substitute Version S 5.12.19.PDF SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
3 CSHB 96 Supporting Document Sectional Analysis Version S 5.12.19.pdf SFIN 3/9/2020 9:00:00 AM
SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
4 CSHB96 Version S Payment Assistance Allocation Fiscal Note 5.12.19.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
5 CSHB96 Version S Pioneer Homes Allocation Fiscal Note 5.12.19.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
6 CSHB 96 Summary of Changes Version M to Version S 5.12.19.pdf SFIN 3/9/2020 9:00:00 AM
SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
7 HB 96 Supporting Document Combined Letters of Support 4.18.19.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
8 CSHB 96 Supporting Doc Petition of Support 5.12.19.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
9 CSHB 96 Supporting Document-Agnew Beck Study 5.12.19.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
10 CSHB 96 Supporting Document-Pioneer Home Advisory Board Report 5.12.19.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
12 HB 96 Supporting Doc DHSS PH costs 5.12.19.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
CSHB96 Supporting Document-2019 AFN Resolution 1.23.2020.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
HB 96 FN DHSS AK Pioneer Home.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96
HB96 FN DHSS APH Payment Assistance.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
CSHB96
HB 96
CSHB 96 Supporting Document PPT Presentation 1.27.2020.pdf SHSS 1/27/2020 1:30:00 PM
SHSS 2/12/2020 1:30:00 PM
HB 96