04/13/2017 03:00 PM House HEALTH & SOCIAL SERVICES

         HB 176-GROUND EMER. MEDICAL TRANSPORT PAYMENTS                                                                     
                                                                                                                              
3:54:44 PM                                                                                                                    
                                                                                                                                
CHAIR SPOHNHOLZ announced that the  final order of business would                                                               
be HOUSE  BILL NO.  176, "An Act  relating to  medical assistance                                                               
reimbursement   for  ground   emergency  medical   transportation                                                               
services; and providing for an effective date."                                                                                 
                                                                                                                                
3:55:47 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  EDGMON  moved  to adopt  the  proposed  committee                                                               
substitute (CS) for HB 176,  labeled 30-LS0705\J, Glover, 4/7/17,                                                               
as the working draft.                                                                                                           
                                                                                                                                
3:56:08 PM                                                                                                                    
                                                                                                                                
CHAIR SPOHNHOLZ objected for discussion.                                                                                        
                                                                                                                                
3:56:17 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   ZACH   FANSLER,    Alaska   State   Legislature,                                                               
paraphrased  from the  Sponsor  Statement  [Included in  members'                                                               
packets], which read:                                                                                                           
                                                                                                                                
     "An  Act relating  to medical  assistance reimbursement                                                                    
     for  emergency  medical  transportation  services;  and                                                                    
     providing for an effective date."                                                                                          
                                                                                                                                
     Emergency   Medical   Transportation  Services   (EMTS)                                                                    
     relates  to the  emergency transportation  of patients.                                                                    
     For  what  is  traditionally  considered  an  ambulance                                                                    
     ride,  EMTS   reflects  Alaska's   unique  geographical                                                                    
     challenges to  include air,  water, and  other approved                                                                    
     medical  transport services.  As  it currently  stands,                                                                    
     Alaska's  emergency  medical  service  providers  incur                                                                    
     additional uncompensated costs  when providing services                                                                    
     to  Medicaid   beneficiaries,  by  as  much   as  sixty                                                                    
     percent.                                                                                                                   
                                                                                                                                
     Reimbursement    for     ground    emergency    medical                                                                    
     transportation  services  occurs   when  the  providers                                                                    
     submit  a billing  to the  department (specifically  to                                                                    
     the  Medicaid  fiscal   agent  Conduent)  for  eligible                                                                    
     services  provided;   the  department   reimburses  the                                                                    
     provider  using  the established  Medicaid  methodology                                                                    
     and   rate;   the  department   submits   documentation                                                                    
     supporting  the   payment  of  the   federal  financial                                                                    
     participation  (FFP)   to  Centers  for   Medicare  and                                                                    
     Medicaid Services  (CMS); and once it  is approved, the                                                                    
     department receives reimbursement for  the FFP from CMS                                                                    
     that  amounts  to  the appropriate  federal  assistance                                                                    
     percentage (FMAP).                                                                                                         
                                                                                                                                
     By enacting  this legislation  along with  an amendment                                                                    
     to the  state Medicaid  plan, public EMS  providers are                                                                    
     eligible  to   access  enhanced  federal   funding  for                                                                    
     emergency medical transportation  of Medicaid patients.                                                                    
     The use  of transfers is clearly  authorized in federal                                                                    
     statute  and is  both  legal and  useful. Further,  CMS                                                                    
     provides  reimbursement  for the  administrative  costs                                                                    
     associated  with  administrating  EMTS by  as  much  as                                                                    
     twenty percent.                                                                                                            
                                                                                                                                
     Anchorage,  Juneau,  Kenai,   and  Ketchikan,  combined                                                                    
     serve approximately forty-eight  percent of the state's                                                                    
     population.  In  2015  (for Kenai)  and  2016  for  the                                                                    
     others, these departments  provided 7,035 transports to                                                                    
     Medicaid  patients,   without  EMTS,   the  departments                                                                    
     received just  $2.1 million in reimbursements;  a total                                                                    
     collective under-compensation of  roughly $3.9 million.                                                                    
     Were they  EMTS eligible,  they could have  collected a                                                                    
     total of $6 million.                                                                                                       
                                                                                                                                
     HB 176  would allow EMS  providers around the  state to                                                                    
     collect  underfunded  costs  from the  effective  date,                                                                    
     providing a  financial boon to those  organizations and                                                                    
     communities.  Even smaller  communities such  as Bethel                                                                    
     can see  over a  quarter of a  million dollars  in EMTS                                                                    
     reimbursements per year.                                                                                                   
                                                                                                                                
     As you can see from  the attached bill packet, there is                                                                    
     widespread support  for HB 176 throughout  the state to                                                                    
     help   our  local   communities  receive   payments  to                                                                    
     actively cover the services they provide.                                                                                  
                                                                                                                                
                                                                                                                                
4:01:46 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KITO asked if the  entities that would be eligible                                                               
for  reimbursement  had to  meet  any  licensing or  registration                                                               
status.                                                                                                                         
                                                                                                                                
REPRESENTATIVE  FANSLER  replied  that  they  did  have  to  meet                                                               
certain requirements.                                                                                                           
                                                                                                                                
REPRESENTATIVE  KITO   offered  his  belief  that   there  was  a                                                               
significance   difference  between   ground  and   air  ambulance                                                               
transportation for how  the services were provided and  paid.  He                                                               
asked to better understand these cost and payment structures.                                                                   
                                                                                                                                
REPRESENTATIVE FANSLER  deferred to the Department  of Health and                                                               
Social  Services and  directed attention  to the  different codes                                                               
for transportation [Included in members' packets].                                                                              
                                                                                                                                
4:03:58 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SULLIVAN-LEONARD  asked how  many people  who used                                                               
the  ambulances paid  cash or  billed  insurance.   She asked  if                                                               
there  was  a large  number  of  patients  who used  Medicare  or                                                               
Medicaid, hence the need for this proposed bill.                                                                                
                                                                                                                                
REPRESENTATIVE  FANSLER  offered his  belief  that  there was  an                                                               
average of  15,000 transports  processed annually  throughout the                                                               
state.  He  opined that, in Bethel, there was  flexibility in the                                                               
municipal  code to  waive  the fee  for those  who  did not  have                                                               
insurance and  were not a  Medicaid recipient, rather  than leave                                                               
the patient behind.                                                                                                             
                                                                                                                                
4:06:32 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KITO  asked  how   the  transport  services  were                                                               
regulated  as  a  designated   carrier  for  emergency  services,                                                               
whether there  was any  licensing or  affiliation with  a medical                                                               
facility.                                                                                                                       
                                                                                                                                
4:07:14 PM                                                                                                                    
                                                                                                                                
MARGARET BRODIE, Director, Director's  Office, Division of Health                                                               
Care  Services,   Department  of  Health  and   Social  Services,                                                               
explained  that  the  proposed  bill  was  addressing  government                                                               
entities  which provide  these services.   These  providers would                                                               
have to be a government entity, as well as a Medicaid provider.                                                                 
                                                                                                                                
REPRESENTATIVE  KITO asked  how many  communities this  included,                                                               
noting  that  several communities  had  both  non-profit and  for                                                               
profit medical service providers.                                                                                               
                                                                                                                                
MS. BRODIE offered to research the exact number.                                                                                
                                                                                                                                
REPRESENTATIVE KITO asked about the air ambulances.                                                                             
                                                                                                                                
MS. BRODIE  said that she did  not know if any  rescue units were                                                               
run by municipalities or government entities.                                                                                   
                                                                                                                                
4:09:01 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SULLIVAN-LEONARD asked  how  many  of the  15,000                                                               
annual  transports  were  eligible for  insurance  reimbursement,                                                               
Medicaid or Medicare reimbursement, or were self-payment.                                                                       
                                                                                                                                
MS.  BRODIE replied  that she  could  only report  on the  annual                                                               
amount of Medicaid paid for  ground transportation, $50,362.  She                                                               
said  she did  not  have  the figures  for  private insurance  or                                                               
Medicare.                                                                                                                       
                                                                                                                                
4:10:22 PM                                                                                                                    
                                                                                                                                
CHAIR SPOHNHOLZ  removed her objection.   There being  no further                                                               
objection,  the proposed  committee substitute  (CS) for  HB 176,                                                               
labeled 30-LS0705\J,  Glover, 4/7/17, was adopted  as the working                                                               
draft.                                                                                                                          
                                                                                                                                
4:10:52 PM                                                                                                                    
                                                                                                                                
BILL HOWELL,  Fire Chief,  City of Bethel,  reported that  he had                                                               
been  with the  department for  25 years  and had  been the  fire                                                               
chief for the  past two years.  He shared  some of the challenges                                                               
for  providing  emergency  medical  care in  Bethel,  and  stated                                                               
support for  proposed HB 176.   He stated that the  proposed bill                                                               
would have  a positive, significant,  and long-lasting  impact on                                                               
the Emergency  Medical Service (EMS)  providers.  He  shared that                                                               
the Bethel  Fire Department EMS  call volume had increased  by 10                                                               
percent over the  past six years.  He reported  that the majority                                                               
of funding to  the City of Bethel was from  local sales, lodging,                                                               
and  alcohol  taxes,  with  the  balance  coming  from  community                                                               
support and fees  for services, including ambulance  service.  He                                                               
declared  that a  recent analysis  had shown  that the  ambulance                                                               
service was losing about $972,000  per year, noting that Medicaid                                                               
recipients were  the largest users  of the  service in 2016.   He                                                               
reported  that, as  Medicaid paid  an  average of  $455 per  call                                                               
toward an overall cost per transport  of $1287, there was a heavy                                                               
burden  on the  City of  Bethel.   He stated  that the  financial                                                               
needs of  the Bethel Fire  Department were  significant, pointing                                                               
out that additional  staff were necessary to  cover the increased                                                               
EMS  call volume  and that  about $1.5  million was  necessary to                                                               
replace  an aging  ambulance, a  1980 tanker,  and a  1980 ladder                                                               
truck.  He  added that the fleet would frequently  break down and                                                               
not  allow for  response, as  they did  not have  any back-up  or                                                               
mutual aid.   He shared that  there had been efforts  to increase                                                               
revenue, which included  an increase in ambulance  fees and close                                                               
work with  the third-party biller to  ensure proper documentation                                                               
for the services  and reception of the maximum allowed.   He said                                                               
that  funds were  raised  through the  volunteer  group and  from                                                               
grants for  staffing and equipment.   He  added that the  City of                                                               
Bethel  had  also  made  capital requests  to  the  Alaska  State                                                               
Legislature for  a new tanker and  ladder truck.  He  pointed out                                                               
that the  proposed bill would  reimburse local EMS  providers for                                                               
the   uncompensated  costs   of   providing   care  to   Medicaid                                                               
recipients.   He listed  support for the  proposed bill  from the                                                               
Bethel City Council, the Alaska  Fire Chiefs, and the Bethel Fire                                                               
Department.                                                                                                                     
                                                                                                                                
4:15:02 PM                                                                                                                    
                                                                                                                                
ALEX   BOYD,   Assistant   Chief,  Anchorage   Fire   Department,                                                               
emphasized that the scale of  the issue was growing exponentially                                                               
and  was impacting  the Anchorage  Fire Department  to an  almost                                                               
unmanageable  level.   He  reported  that  there  had been  a  74                                                               
percent increase in transport for  Medicaid recipients during the                                                               
past  year,  resulting  in  an  unrecovered  cost  of  nearly  $3                                                               
million.   He  stated  that  the proposed  bill  would provide  a                                                               
dramatic  impact on  the service  to the  municipality and  would                                                               
allow  the department  to  improve its  system  delivery and  its                                                               
impact  on the  city.   He noted  that this  current trend  would                                                               
result  in unrecovered  expenses of  $3.2 million  for more  than                                                               
7,000 transports  during the  calendar year 2017.   He  said that                                                               
Anchorage currently  collected about  $440 of the  $926 fee.   He                                                               
pointed out  that this significant  impact on the  budget brought                                                               
challenges for  the expansion of  staffing to meet  these growing                                                               
needs.                                                                                                                          
                                                                                                                                
4:18:12 PM                                                                                                                    
                                                                                                                                
RICHARD  ETHERIDGE,  Fire  Chief,  Juneau,  Alaska,  shared  that                                                               
Alaska had the  most complex, diverse EMS delivery  system in the                                                               
nation,  as  there  were  challenges  unlike  most  other  areas,                                                               
including the often high expenses  for even getting to a patient.                                                               
He reported  that there had  been an  increase in demand  for EMS                                                               
services,  which made  it  difficult for  fire  departments.   He                                                               
stated  that  the proposed  bill  provided  the authorization  to                                                               
develop  a program  where local  agencies could  recover some  of                                                               
their costs for  the provision of EMS.  He  acknowledged that the                                                               
Medicaid Expansion  had an impact  on emergency  services, noting                                                               
that in  Juneau the number  of Medicaid patients  transported had                                                               
more than  doubled.  He  added that  the call volumes  across the                                                               
state  were increasing,  in Juneau  there had  been a  13 percent                                                               
increase last year, an amount not  uncommon across the state.  He                                                               
pointed out  that Medicaid  did not  reimburse for  all expenses,                                                               
sharing that  the average  cost of  basic life  support transport                                                               
was $1,680, of  which Medicaid paid about $455.   The balance due                                                               
was absorbed  by the  fire department,  the local  community, and                                                               
the tax payers.  He reported  that the program utilized funds set                                                               
aside by the  federal Medicaid program just for  this purpose and                                                               
was not  tied to the  Patient Protection and Affordable  Care Act                                                               
or Medicaid  Expansion.   He reported that  the state  could also                                                               
collect administrative fees, up to  20 percent, an estimated $2.5                                                               
- $3  million back to  the state.   He estimated that  this could                                                               
put between $12  - $15 million into the local  economies for fire                                                               
departments.   He shared that  California was already  setting up                                                               
this program.   He stated that Alaska relied heavily  on the EMS,                                                               
and  that  the proposed  bill  provided  a foundation  for  first                                                               
responders  in   local  communities  to  recover   "some  of  the                                                               
desperately  needed financial  support and  stability across  the                                                               
state."                                                                                                                         
                                                                                                                                
4:22:36 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SULLIVAN-LEONARD   asked  if  the   borough  paid                                                               
reimbursement of transportation services  through local sales and                                                               
property tax.                                                                                                                   
                                                                                                                                
MR. ETHERIDGE  replied that fire  departments were funded  out of                                                               
general fund or fire service area funds.                                                                                        
                                                                                                                                
REPRESENTATIVE  SULLIVAN-LEONARD asked  if implementation  of the                                                               
proposed bill would free funds from local taxation.                                                                             
                                                                                                                                
MR.   ETHERIDGE  replied   that  this   would  be   up  to   each                                                               
municipality, although it  would provide money back  to the local                                                               
municipalities.                                                                                                                 
                                                                                                                                
REPRESENTATIVE SULLIVAN-LEONARD asked how much this would be.                                                                   
                                                                                                                                
MR.  ETHERIDGE said  that each  community was  different, stating                                                               
that  Anchorage could  receive up  to $4  million annually,  Nome                                                               
could receive  up to $16,000  annually, and Juneau  could receive                                                               
between $600,000 and $1 million.                                                                                                
                                                                                                                                
4:24:01 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KITO reflected on  the increase in calls statewide                                                               
and asked what was driving this increase.                                                                                       
                                                                                                                                
MR. ETHERIDGE said  that this was actively being  researched.  He                                                               
mused that more people were eligible  for health care and were no                                                               
longer self-payers, and that, as  it was more difficult to access                                                               
primary care providers,  more people came to  emergency rooms and                                                               
EMS for primary care.                                                                                                           
                                                                                                                                
4:24:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHNSTON shared that she  had read that the impact                                                               
of Medicaid  Expansion on  emergency rooms  had been  far greater                                                               
than  anticipated.   She acknowledged  that emergency  rooms were                                                               
now  being  reimbursed,  but  that the  desired  policy  was  not                                                               
happening.   She asked if  volunteer fire departments  could also                                                               
participate.                                                                                                                    
                                                                                                                                
MR. ETHERIDGE  said that any  fire department which  was eligible                                                               
to bill  and did bill for  EMS services could participate  in the                                                               
program.                                                                                                                        
                                                                                                                                
4:26:28 PM                                                                                                                    
                                                                                                                                
SCOTT CLOUGH,  AP Triton, Retired  Fire Chief, explained  that he                                                               
was a retired assistant fire chief  from Sacramento and was now a                                                               
consultant   with   fire   agencies  looking   to   pursue   this                                                               
legislation.   He  pointed  to his  initial  research in  Alaska,                                                               
which had identified  55 agencies eligible to  participate in the                                                               
program,  including  the  university  system and  a  health  care                                                               
district.    He clarified  that  some  public agencies  had  been                                                               
identified as  eligible to participate  in the  program, although                                                               
it did  not preclude  that private enterprise  also benefit.   He                                                               
said  that  municipalities  which  utilized  the  services  of  a                                                               
private provider,  as well as non-profit  and volunteer agencies,                                                               
could structure  to use  these revenues.   He  added that  it was                                                               
important  to  understand  that this  was  an  emergency  medical                                                               
transport bill  tied to  a federal  cost structure  for providing                                                               
these services.  He explained  that provider programs, if related                                                               
to the  EMS, could count  as a cost.   He offered an  example for                                                               
Juneau investing  in new extrication  equipment, and a  new squad                                                               
for  this  equipment.   Even  though  this  was not  a  transport                                                               
vehicle, it  was a  unit and equipment  utilized for  delivery of                                                               
emergency medical services and could  be rolled into the new cost                                                               
of service  for a draw  down of federal  funding.  He  said there                                                               
were  tremendous benefits  to the  communities  and the  Medicaid                                                               
beneficiaries  as it  allowed for  an opportunity  to expand  the                                                               
services and  recoup some of  that investment.  He  declared that                                                               
Alaska was unique, and it was  important to include both land and                                                               
air transport.                                                                                                                  
                                                                                                                                
4:32:25 PM                                                                                                                    
                                                                                                                                
CHAIR SPOHNHOLZ announced that HB 176 would be held over.