SENATE BILL NO. 212 "An Act relating to eligibility requirements for medical assistance for certain children and pregnant women; and providing for an effective date." 9:49:16 AM TOM OBERMEYER, STAFF, SENATOR DAVIS, presented an overview of the bill by reading the Sponsor Statement: SB 212 reinstates the qualifying income standards for children and pregnant women receiving Medicaid benefits under the Denali KidCare (DKC) program to poverty guidelines used when the program was established in 1997 at 200% Federal Poverty Guideline (FPG) for Alaska. Reduced and frozen at 175% FPG by the Legislature in 2003, the equivalent income limits were reduced in the following four years to 154% by the time SB27 was implemented to reinstate current levels of the FPG at 175% in 2007. Children and pregnant women with household incomes between 176% and 200% FPG still have not regained eligibility. SB212 also increases allowable premiums or cost-sharing by families whose incomes are between 150%-200% FPG. The fiscal notes anticipate 2% enrollment growth after 2009 and an annual cost increase of 8.6%, allowing for 5% medical inflation in Alaska. The $249,600 appropriation required for 2009 does not reflect the indirect savings by fewer emergency room visits and many avoided long-term illnesses for SCHIP children. The addition of one employee and office expense at $73,800 provides for the anticipated increase in enrollment of 218 pregnant women and 1277 children. DHSS has requested additional support for Denali KidCare in the Governor's FY09 budget. Forty one-states allow participation by families at or above 200% FPG with many over 300%. The reason for higher SCHIP eligibility coverage in other states is that the federal government reimburses SCHIP at an enhanced rate, and higher SCHIP eligibility has proven to be an efficient use of health care dollars. While most patients enrolled in Medicaid are children, children utilize only a fraction of the resources. Early intervention and preventative care greatly reduce visits to emergency rooms and costly long-term illnesses. Hospitals regularly write-off the cost of emergency room visits by non-emergency low-income, indigent, or uninsured patients whom they must serve when patients cannot pay. The costs of these non- emergency visits to hospitals for SCHIP children and other low-income and uninsured, who have no other way of obtaining health care, are passed along in increased costs to patients who do pay and/or are insured under private or state health benefit plans. There is no effect on eligibility for Denali KidCare if the SCHIP allotment is fully expended. If costs exceed available SCHIP funds, claims are simply reimbursed at the lower, regular Medicaid rate, resulting in reduced federal revenues. 9:52:16 AM Senator Dyson asked what would be the financial difference for a family of four. Mr. Obermeyer explained that the amount is predicated on income but he did not have the dollar amount. He referred to a Medicaid expert online. 9:53:07 AM STEVE HORN, EXECUTIVE DIRECTOR, ALASKA BEHAVIORAL HEALTH ASSOCIATION testified via teleconference and spoke in support of the bill. He reported that Alaska has the fourth most stringent eligibility level for children's health insurance in the country resulting in many children not receiving needed basic health care. He believed Denali KidCare will save Alaska money in the long run. Children without health care receive less preventative care resulting in higher health risks and greater use of expensive emergency rooms. 9:54:38 AM JERRY FULLER, MEDICARE DIRECTOR, DEPARTMENT OF HEALTH AND SOCIAL SERVICES testified via teleconference and noted he did not have the income chart with him to answer Senator Dyson's question to describe the income level for a family of four at the 200% level. He acknowledged that the Governor has not taken a position on this bill. 9:55:37 AM BRENDA MOORE, MEMBER, MEDICAL HEALTH BOARD AND COUNSELOR, SUICIDE PREVENTION testified via teleconference in support this bill and encouraged the bill being moved from Committee. 9:56:55 AM NAOMI TIGNER, ALASKA ASSOCIATION FOR HOMES FOR CHILDREN AND PRESBYTERIAN HOSPITALITY HOUSE testified via teleconference in support of this bill. She believed in the necessity of raising the eligibility level to 200% to enable children to receive basic needed health care. AT EASE: 9:58:09 AM RECONVENED: 9:58:50 AM 9:59:05 AM ROD BETIT, PRESIDENT, ALASKA STATE HOSPITAL NURSING HOME ASSOCIATION testified via teleconference and supported the bill. As a member of the Governor's Health Care Strategy Council, the Association listed this as one of their key recommendations to bring coverage to the 200 percent level. 10:00:24 AM LAWRENCE WEISS, EXECUTIVE DIRECTOR, ALASKA CENTER FOR PUBLIC POLICY testified via teleconference in support of this bill. He presented the economic issues for the 1,200 Alaska children with no access to health care. For every thirty cents the state spends, the federal governor would contribute seventy cents. Children without health care are at highest risk to use expensive emergency rooms where they do not receive preventive health measures. This program will save the state money in the future. 10:03:15 AM ANGELA LISTAN spoke in support of the bill. She noted that the cost of health care has risen faster than almost any other living expense. She noted that forty-six states use the 200 percent federal poverty level rate. She remarked that the federal poverty level for a family of four is $53,000 which is not enough to cover all expenses with the additional expense for health insurance. 10:05:24 AM GERAN TARR, ALLIANCE FOR REPRODUCTIVE JUSTICE testified via teleconference in support of the bill. She agreed with the previous comments from the others testifiers. 10:06:45 AM GUS MARX, GRANTS MANAGER, JUNEAU YOUTH SERVICES supported the bill. His family has used Denali KidCare in the past and he applauded the state for helping families in need. 10:08:11 AM JEFF JESSEE, CHIEF EXECUTIVE OFFICER, ALASKA MENTAL HEALTH TRUST AUTHORITY spoke in support of the bill. He declared that Medicaid is a crucial part of funding for children in need and this bill will assist in financing future projects. 10:08:55 AM Co-Chair Stedman reviewed the three Department of Health and Social Services fiscal notes attached to this bill. 10:09:50 AM Senator Thomas appreciated those who brought forth this bill. He mentioned that other people were covered by this bill, such as the aged, blind and mentally retarded. 10:10:42 AM Co-Chair Hoffman MOVED to REPORT SB 212 out of Committee with individual recommendations and the attached fiscal notes. Senator Dyson OBJECTED for discussion. Senator Dyson warned of putting into Statute programs that the Legislature may not be able to sustain in the long run. He suggested the bill have a provision that in three or four years the percentage reverts back to the 175 percent unless the Legislature takes action. The state may run into a deficient problem in the future. He reminded the Committee of another state program that allows people with significant health issues to get state financing. Senator Dyson WITHDREW his OBJECTION. Senator Elton OBJECTED for discussion. Senator Elton reported his enthusiastic support for this bill. He remarked that one of the biggest debates this year was whether to provide energy assistance, across the board, regardless of need or income level. In his opinion, the beauty of SB 212 is the it provides medical assistance to Alaskans in need and this is one of the preeminent concerns and rights of all citizens. This program would receive $2 from the federal government for every $1 spent by the state. Senator Elton WITHDREW his OBJECTION. There being NO OBJECTION, it was so ordered. SB 212 was REPORTED out of Committee with no recommendations and three accompanying previously published fiscal notes from the Department of Health and Social Services. 10:15:19 AM