2003-03-06                     Senate Journal                      Page 0394
SB 109                                                                                            
SENATE BILL NO. 109 BY THE SENATE RULES COMMITTEE                                                   
BY REQUEST OF THE GOVERNOR, entitled:                                                               
                                                                                                    
          "An Act repealing the statute that sets priorities for                                    
          the Department of Health and Social Services to                                           
          apply to administration of the medical assistance                                         
          program when there are insufficient funds allocated                                       
          in the state budget for that program; authorizing the                                     
          department to make cost containment decisions that                                        
          may include decisions about eligibility of persons and                                    
          availability of services under the medical assistance                                     
          program; and providing for an effective date."                                            
                                                                                                    
was read the first time and referred to the Health, Education and Social                            
Services and Finance Committees.                                                                    
                                                                                                    

2003-03-06                     Senate Journal                      Page 0395
The following fiscal information was published today:                                               
                                                                                                    
 Fiscal Note No. 1, zero, Department of Health and Social Services                                  
                                                                                                    
Governor's transmittal letter dated March 5:                                                        
                                                                                                    
Dear President Therriault:                                                                          
                                                                                                    
Under the authority of article III, section 18, of the Alaska                                       
Constitution, I am transmitting a bill to provide greater flexibility to                            
the Department of Health and Social Services to implement cost                                      
containment strategies for the Medicaid program.                                                    
                                                                                                    
Under current law, if funds appropriated to the Medicaid program are                                
insufficient for a given fiscal year, the department is directed to                                 
eliminate optional Medicaid services based on a priority list that is                               
woefully out-of-date. The existing list is not an effective management                              
tool and if used, would needlessly result in the denial of necessary and                            
cost-effective services to Alaskans in need of health care.                                         
                                                                                                    
The proposed bill would replace this obsolescent language with                                      
authority for the department to undertake cost containment based on                                 
three key principles.                                                                               
                                                                                                    
First, the department must pursue all other reasonable cost                                         
containment measures before eliminating any eligibility groups or                                   
services.                                                                                           
                                                                                                    
Second, the department should aggressively pursue strategies to                                     
maximize federal financial participation in the Medicaid program.                                   
                                                                                                    
Third, cost containment decisions should be made in a manner that                                   
best reflect the needs and interests of eligible Medicaid recipients.                               
                                                                                                    
The imperative of slowing the growth of state funding for Medicaid                                  
while at the same time maintaining health care coverage for needy                                   
Alaskans is an issue that can no longer be avoided. Passage of this                                 
legislation will give the department additional tools to meet this                                  
challenge.                                                                                          
                                                                                                    
I urge your prompt and favorable action on this measure.                                            
                                                                                                    

2003-03-06                     Senate Journal                      Page 0396
Sincerely,                                                                                          
/s/                                                                                                 
Frank H. Murkowski                                                                                  
Governor