Legislature(2015 - 2016)CAPITOL 106
04/07/2015 03:00 PM House HEALTH & SOCIAL SERVICES
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| Audio | Topic |
|---|---|
| Start | |
| HCR9 | |
| HB161 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HCR 9 | TELECONFERENCED | |
| *+ | HB 161 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 161-MEDICAID: USED DURABLE MEDICAL EQUIPMENT
3:20:58 PM
CHAIR SEATON announced that the final order of business would be
HOUSE BILL NO. 161, "An Act relating to the purchase of durable
medical equipment under Medicaid; and providing for an effective
date."
3:21:08 PM
REPRESENTATIVE LYNN GATTIS, Alaska State Legislature, read from
the sponsor statement:
House Bill 161 is a cost saving bill for the state's
medical assistance programs. Currently the Department
of Health and Social Services only purchases new
Durable Medical Equipment, even though used Durable
Medical equipment is available and is able to
withstand repeated use.
House Bill 161 would require that, "When the
department authorizes the purchase of durable medical
equipment, the department shall require a recipient of
medical assistance services to purchase used or
refurbished durable medical equipment if used or
refurbished durable medical equipment is available, is
less expensive than new durable medical equipment of
the same type, is able to withstand at least three
years of use and meets the needs of the recipient."
REPRESENTATIVE GATTIS declared that the proposed bill was
"simply a cost savings bill," as when the state could use
cheaper, used equipment, it would. She stated that "it's
unfortunate, in my opinion, that we even have to have a bill to
do what I think is common sense."
REPRESENTATIVE STUTES asked whether there was a facility that
did the refurbishing and cleaning of these used items to prepare
them for re-use.
3:23:12 PM
ANDREW FORD, Staff, Representative Lynn Gattis, Alaska State
Legislature, replied that he did not have a list of providers
for refurbished or used durable medical equipment, but there
were a number of testifiers available.
REPRESENTATIVE STUTES asked whether there was a specialized
company to refurbish and certify this equipment.
REPRESENTATIVE TARR noted that there were support materials from
the Key Coalition of Alaska [included within members' packets].
She reflected on the suggestions for used equipment during an
earlier presentation by the Key Coalition, and she asked whether
the proposed bill was different from those suggestions.
REPRESENTATIVE GATTIS replied that the proposed bill was
introduced because of the Key Coalition, as it had been one of
their top priorities.
3:24:54 PM
CHAIR SEATON opened public testimony.
3:25:04 PM
JOHN CANNON, President, Key Coalition of Alaska, declared that
the proposed bill addressed one of the top priorities for the
Key Coalition. He said that apparently the state prohibited the
use of Medicaid funds for the purchase of used and refurbished
durable medical equipment (DME), even though the federal
government did allow these purchases. He reported that many
other states allowed it, including Kansas, Delaware, Idaho,
Oklahoma, and Vermont, which had resulted in cost savings. He
pointed out that the Kansas program reported a $3.15 return for
every $1 spent on this reused program. In 2012, the Kansas
equipment exchange program had 1,200 requests and re-assigned
806 items, with a value of nearly $1 million. In the four
months of 2013, the Kansas program had 397 equipment requests,
228 donations valued at $283,000, and reassigned 220 items. He
declared that the durable medical equipment reuse program made a
lot of sense for cost and users. He offered his belief that it
was wise to keep the language of the proposed bill simple and
straightforward in order to allow DHSS to set up the DME reuse
program. He reported that, currently in Alaska, the ownership
of the equipment went to the client, and consequently, when the
client no longer needed the equipment, it was disposed of in a
variety of ways. He suggested that this policy of ownership be
re-considered by DHSS. He pointed out that Kansas had the most
established re-use program, noting that Kansas had suggested to
be cautious of the impact on DME providers, as it was necessary
to maintain a healthy partnership with these vendors. He shared
that other states had recognized that there was plenty of
business, and that through collaboration, everyone would win.
He stated that this program would not need to put any of the
current DME providers at risk. He urged passing of the proposed
bill, adding that Access Alaska was currently refurbishing DME.
REPRESENTATIVE TARR questioned whether, although there appeared
to be about 50 different businesses involved with DME, there
were enough businesses in smaller communities for participation.
MR. CANNON said that, judging from the experience of other
states, no DME providers had been put out of business through a
similar program.
3:32:44 PM
PATRICK REINHART, Executive Director, Governor's Council on
Disabilities and Special Education, Division of Senior and
Disabilities Services, Department of Health and Social Services,
testified in support of proposed HB 161 regarding the reuse and
recycling of durable medical equipment, and allowing this under
Medicaid. He declared that the Governor's Council had brought
this concept to the legislature earlier this year, as had the
Key Coalition of Alaska. He spoke about his experience with the
Wisconsin mobility store, a program run by an independent living
center similar to Access Alaska. He said that this store had a
vast amount of used equipment and that, as almost everyone who
worked there had a disability, it had created opportunities for
employment. He reported that the wheelchairs in the store were
about one-third the original price, even though nothing looked
used. He said that damaged equipment was not offered. He
reported that Wisconsin used the correctional industries for a
lot of the cleaning and repair of the equipment, and that Kansas
and Oklahoma had similar programs. These programs would be
somewhat adaptable to Alaska, although Alaska would have bigger
challenges with shipping and collecting. He stated that it made
a lot of sense for Alaska in urban areas. He acknowledged that
the details would need to be worked out, as there was the
potential for unintended consequences if it was denying
appropriate DME. He declared that the concept was for when it
was appropriate and when equipment was useable by someone who
needed the equipment. He stated that there was potential for
schools, Medicaid, and other state programs, and that local
entities would also utilize the program. He directed attention
to page 1, line 6, and expressed his concern, suggesting that a
change from "shall" to "may" was necessary. He pointed out that
a companion bill in the Senate used "may" as there were some
instances where a used piece of equipment was not the right
thing at the right time, and an option was important.
REPRESENTATIVE GATTIS, in response to Representative Foster,
said that the original intent of the proposed bill was for
purchases anytime used equipment was available at a lower price;
however, she expressed an understanding for the substitution of
"may," as it was often necessary to include the additional costs
for shipping long distances. She declared her support for this
change.
CHAIR SEATON relayed that this would be considered when
amendments were discussed.
3:39:39 PM
LISA NOLAND, Chief Marketing Officer, Arc of Anchorage,
expressed support for HB 161. She said that there were typical
issues of need for DME, and in the remote areas of Alaska, it
took a lot of time just to acquire the appropriate equipment.
She said that many rural communities relied on loaner closets,
although often this equipment had not been maintained properly.
She pointed out that often there was not the ability by a user
to pay cash. She expressed support for proposed HB 161, as it
made common sense.
3:41:31 PM
JIM BECK, Executive Director, Access Alaska, said that Access
Alaska had the most mature experience with this type of program.
He reported that Access Alaska accepted donated equipment,
sanitized it, and then loaned it out. In Fiscal Year 2014, they
loaned out 2,399 pieces of DME, valued at more than $500,000,
which resulted in savings to private insurance, Medicare, and
Medicaid. He reported that grant funding from the Rasmussen and
the Murdoch charitable foundations had allowed Access Alaska to
buy a Hub Scrub, similar to a commercial dish washer for
cleaning wheelchairs and durable medical equipment. He declared
that proposed HB 161 was "generally a pretty good idea,"
although he expressed some concern with the regulatory process.
He asked to be involved with the regulatory process, as "the
devil is in the details" and they did not "want to wander into
the land of unintended consequences with this sort of
legislation." He pointed out that it would depend on the
regulatory framework for whether Access Alaska became a Medicaid
provider. He reiterated that currently Access Alaska was a loan
program which offered a lot of good for the local communities,
and he expressed his desire to continue this program.
3:44:31 PM
CHAIR SEATON asked if the proposed bill would give authority to
Department of Health and Social Services to write regulations.
CHAD HOPE, Pharmacy Program Manager, Medical Assistance
Administration, Division of Health Care Services, Department of
Health and Social Services, explained that regulations would
have to be written by DHSS establishing a coverage and fee
structure for used equipment. He shared that DHSS had been
approached in the last year by Mr. Reinhart, and they had begun
work on the process. He stated that regulations for the used
equipment rate would be required, regardless of whether the
proposed bill was passed.
CHAIR SEATON asked whether the statute needed to include the
authority to write regulations, or whether it would preclude any
changes from regulations to modify the program. He asked for
confirmation that DHSS had the authority to write regulations to
implement the statute as it was passed.
MR. HOPE expressed his agreement; however, he clarified that the
approach by DHSS for regulations had been to allow for the
purchase of used equipment but not to mandate it. He offered
his belief that a mandate could be a challenge, but if that was
amended, then there should not be any issue with the
regulations.
CHAIR SEATON stated that his intent was for clarification that
the statute allowed for the goal.
REPRESENTATIVE TARR referenced the Access Alaska apparatus for
sanitizing the DME, the industry standard, and she asked if
there were any concerns for enforcement of cleanliness by
additional providers.
MR. HOPE expressed his agreement that those were details that
would need to be worked out. He reported that the primary focus
until now had been to allow that used equipment be billed to the
department. He said that it was still an unknown for whether
Medicaid would write these details into the regulation or
whether it would be included with the provider's business
practices and policies.
CHAIR SEATON referenced the ownership of DME, as there was a
system whereby the client would own the equipment. He asked if
there would be a right of return included in the regulations, as
there was nothing in the proposed bill regarding who would own
the equipment.
MR. HOPE explained that currently the department purchased new
equipment and the ownership transferred to the recipient. He
said that the department had allowed for rental of various DME,
in which case ownership would remain with the provider, unless
it was rented to own. He noted that there had been discussion
of used equipment when the department investigated the
transition from a purchase model to a capped rental model for
reimbursement. He declared that this was a complicated topic,
as it would allow for the rental of equipment rather than an
outright purchase, but would then create a market for used
equipment. He said that the department would build in a
reimbursement model to allow providers to bill for used
equipment. He allowed that all of this was part of a larger
discussion for ways to reform the overall program.
CHAIR SEATON offered his belief that the statute would not
preclude these models.
REPRESENTATIVE GATTIS commented that the proposed bill had been
kept relatively simple to allow these opportunities.
3:52:04 PM
CHAIR SEATON closed public testimony after ascertaining that no
one further wished to testify.
REPRESENTATIVE STUTES offered her belief that this appeared to
be a win-win bill.
3:52:26 PM
REPRESENTATIVE FOSTER moved to adopt a conceptual amendment, on
page 1, line 6, to change the word "shall" to "may."
CHAIR SEATON stated that this would be labeled Conceptual
Amendment 1, and he objected for discussion.
REPRESENTATIVE GATTIS, in response to Chair Seaton, said that
Conceptual Amendment 1 was acceptable, as it aligned with the
senate version of the bill.
3:53:11 PM
CHAIR SEATON removed his objection. There being no further
objection, Conceptual Amendment 1 was adopted.
3:53:35 PM
CHAIR SEATON moved to adopt Amendment 2, labeled 29-LS0636\W.1,
Glover, 4/6/15, which read:
Page 1, line 10, following "expensive":
Insert ", including shipping,"
Page 1, line 13, following "(4)":
Insert "equally"
3:54:09 PM
REPRESENTATIVE TARR objected for discussion.
CHAIR SEATON explained that the proposed amendment would ensure
that shipping was included in the expense, as a piece of used
equipment could have a less expensive list price, but with
shipping it could be more expensive than a new piece of
equipment. He pointed out that there was a question for whether
a piece of durable equipment specifically, or equally, meets the
needs of an individual, offering examples of different types of
wheelchairs.
REPRESENTATIVE TARR asked whether all four of the standards had
to be met, and questioned whether there was any circumstance
when you would not want any limitation. She offered her belief
that being equally able to meet the needs of the recipient
prevented purchase of any less expensive piece that was not as
useful to the individual.
MR. HOPE explained that shipping costs would be factored in, as
it was an issue that was being reviewed holistically. He
reported that the current shipping regulations were very narrow,
and DHSS was exploring ways to refine these. He allowed that
any used equipment, inclusive of shipping, would need to be
cheaper than a new item, each of which would meet the needs of
the recipient.
3:57:45 PM
CHAIR SEATON directed attention to the proposed Amendment 2,
page 1, line 13, which inserted "equally" in front of meets, and
asked whether he was comfortable with that.
MR. HOPE said that he did not foresee any challenges to this.
REPRESENTATIVE GATTIS, in response to Chair Seaton, stated that
proposed Amendment 2 made this a better bill.
3:58:36 PM
REPRESENTATIVE TARR removed her objection. There being no
further objection, Amendment 2, labeled 29-LS0636\W.1, Glover,
4/6/15, was adopted.
3:58:58 PM
REPRESENTATIVE FOSTER moved to report HB 161, Version 29-
LS0636\W, as amended, out of committee with individual
recommendations and the accompanying zero fiscal notes. There
being no objection, CSHB 161(HSS) was moved from the House
Health and Social Services Standing Committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HCR9 Version A.PDF |
HHSS 4/7/2015 3:00:00 PM |
HCR 9 |
| HCR9 Supporting Documents-CDH Statistics.pdf |
HHSS 4/7/2015 3:00:00 PM |
HCR 9 |
| HCR9 Sponsor Statement.pdf |
HHSS 4/7/2015 3:00:00 PM |
HCR 9 |
| HCR9 Supporting Document - MOA Resolution.pdf |
HHSS 4/7/2015 3:00:00 PM |
HCR 9 |
| HB161 DHSS Summary and Recommendations.pdf |
HHSS 4/7/2015 3:00:00 PM |
HB 161 |
| HB161 Fiscal Note - DHSS - 04-05-2015.pdf |
HHSS 4/7/2015 3:00:00 PM |
HB 161 |
| HB161 Sectional Analysis Version W.pdf |
HHSS 4/7/2015 3:00:00 PM |
HB 161 |
| HB161 Sponsor Statement.pdf |
HHSS 4/7/2015 3:00:00 PM |
HB 161 |
| HB161 ver W.PDF |
HHSS 4/7/2015 3:00:00 PM |
HB 161 |
| HB161 Support Key Coalition.pdf |
HHSS 4/7/2015 3:00:00 PM |
HB 161 |
| HB161 Support Governor's Council on Disabilities.pdf |
HHSS 4/7/2015 3:00:00 PM |
HB 161 |
| HB161 letter from AK PT Association.pdf |
HHSS 4/7/2015 3:00:00 PM |
HB 161 |