Legislature(2021 - 2022)GRUENBERG 120
05/07/2021 08:00 AM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| SB40 | |
| HB44 | |
| HB176 | |
| HB58 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 44 | TELECONFERENCED | |
| += | HB 176 | TELECONFERENCED | |
| + | HB 58 | TELECONFERENCED | |
| += | SB 40 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HB 176-DIRECT HEALTH AGREEMENT: NOT INSURANCE
8:58:00 AM
CO-CHAIR FIELDS announced that the next order of business would
be HOUSE BILL NO. 176, "An Act relating to insurance; relating
to direct health care agreements; and relating to unfair trade
practices."
8:58:21 AM
CRYSTAL KOENEMAN, Staff, Representative Sara Rasmussen, Alaska
State Legislature, on behalf of prime sponsor Representative
Rasmussen, told committee members that direct primary care (DPC)
agreements would encompass all of the healthcare profession
licenses under Title 8, including doctor's visits, mental health
counseling, or marriage and family counseling. She clarified
that the agreements would not include emergency services or
urgent care.
9:00:18 AM
JAY KEESE, Executive Director, Direct Primary Care Coalition,
presented a PowerPoint on HB 176 [hard copy included in the
committee packet]. He said the Direct Primary Care Coalition
represents approximately 1,500 direct primary care practices
nationwide, and he noted that 35 states have passed legislation
relating to direct primary care agreements. He began his
presentation with slide 2, "Status of Direct Primary Care in
2021," which displayed a map of the U.S. with green, red, and
blue points in various jurisdictions and which read as follows
[original punctuation provided]:
? Capitated Monthly Fee Payment model
? Personal relationship with primary care physician
Care delivered in any setting virtual, telehealth,
at home, in-person
? Innovative, affordable, value-based monthly payment
model ? Over 1,400 practices nationwide
? Bipartisan Legislative History:
? Defined in ACA Section 1301 (a) (3)
? 30 + Bipartisan State Laws and Regulations
? CMS Innovation Center to demo Direct
Contracting in Medicare
? Presidential Executive Order 13877
? IRS Proposed Rule 2020 12213
? Primary Care Enhancement Act: S. 2999 Cassidy
HR 3707 Blumenauer passed House in 2018,
Included in original CARES Act
MR. KEESE presented slide 3, "DPC Laws/Regs Passed in 34
States," which displayed a map of the U.S. showing states with
DPC laws in place or proposed, along with a list of the
governing legislation in each state. He then presented slide 4,
"DPC Reduced Overall Cost of Care," which read as follows
[original punctuation provided]:
25.4% reduction in total claims costs**
4.7% reduction in risk scores
ER Visits down 53%***
Advanced Radiology down 66%
Surgeries down 77%
Hospital admission down 33%*
Specialist visits down 43%
Non-MD Specialists down 39%
Primary care visits up 133%
12% reduction from baseline HBA1C
Up to 41% reduction in cost of care for chronically
ill patients Increased compliance for preventive
screenings
Why?
? More primary care utilization
? Reduction in specialty care /hospitalization
? Reduced overall health costs
? Reduced out of pocket costs for consumers
? Predictable fixed costs for employers/payers
? Significantly reduced administrative costs no
claims, no disputes, no appeals
Data Sources:
* Iora Dartmouth Health Connect Study June 2016
** Nextera/Digital Globe Case Study June 1 Dec. 31,
2015
*** Journal American Board of Family Medicine , Nov.
2015 Qliance employer claims data set 2011-13
MR. KEESE presented slide 5, which read as follows [original
punctuation provided]:
DPC is associated with a reduction in overall member
demand for health care services outside primary care:
? 19.90% lower claim costs for employers 40% fewer ER
visits that those in traditional plans.53.6% reduction
in ER claims cost.
? 25.54% lower hospital admissions on an unadjusted
basis.
Virtual Care and Telehealth are at the core of DPC
service offerings:
? 99% of all DPC practices surveyed were doing virtual
consults via text/phone as a part of the membership
fee (two years prior to COVID-19).
? 88% said they provided "telemedicine" benefits
(meaning expanded video or additional digital
communications assets).
DPC is Affordable Primary Care
? The average adult monthly DPC Fee is $73.92.
? Median age for DPC patient was 31.8 years old
? Concierge patients in MDVIP membership $1,650 -
$2,200 annual membership fee MDVIP also bills third-
party payers for all services provided to members.
9:06:47 AM
REPRESENTATIVE SNYDER referred to the map on slide 2 and asked
what the colored circles represent.
MR. KEESE explained that green indicates providers that offer
only DPC agreements, red represents practices that offer DPC,
and the blue and yellow represent practices that offer some
combination of DPC and fee-for-service arrangements.
REPRESENTATIVE SNYDER referred to slide 3 and asked about the
color legend.
MR. KEESE noted that the map is out of date. He said the states
in blue - Alaska, Minnesota, Wisconsin, Maryland, and the
District of Columbia - all have pending DPC legislation. He
said that the states in blue and green stripes - Colorado,
Oklahoma, Missouri, Iowa, Indiana, and Tennessee - are amending
existing legislation. He said the states in gray do not have a
law in place, either because there already exist statutes which
would render DPC-specific legislation redundant, or because the
states just haven't proposed the legislation.
9:10:00 AM
REPRESENTATIVE SCHRAGE acknowledged that offering a subscription
model makes sense from a business standpoint. He then asked
whether capacity has been an issue, and whether there is a
remedy for patients who are not able to book an appointment for
care due to capacity.
MR. KEESE replied that DPC providers usually have a smaller
patient panel compared to fee-for-service providers. He said
that he doesn't know of any capacity issues.
9:12:41 AM
CLINT FLANAGAN, MD, Chief Executive Officer, Nextera Healthcare,
expressed his agreement with Mr. Keese's statement that capacity
has not been a problem. He described the problems inherent with
the fee-for-service model, such as having to wait up to a month
for an appointment, that don't exist with the DPC model. He
said that fee-for-service practices often have a patient roster
of several thousand, while DPC practices have a patient roster
of between 500 and 1,000. He said, "Access and time are
definite pillars of direct primary care ... as a movement that
was created by physicians that solve problems in a fee-for-
service insurance model, we want to make sure our patients have
that access." He pointed out that DPC agreements are month-to-
month, and that if a patient is dissatisfied with the agreement,
it can be terminated.
9:14:45 AM
REPRESENTATIVE SCHRAGE asked whether the monthly agreement is
required, or whether there could be a longer minimum commitment.
MS. KOENEMAN responded that the proposed legislation has been
written so that providers could determine their own parameters,
and consumers could shop for the DPC agreement that best fits
their needs.
CO-CHAIR FIELDS asked who stands to benefit from a DPC
agreement, and what types of consumer protections should be
considered. He said, "If you have a direct primary care
agreement, and you still have to pay for health insurance for
your higher costs, how is that going to work in Alaska with the
plans that are out there?"
9:17:05 AM
LORI WING-HEIER, Director, Division of Insurance, Department of
Commerce, Community, and Economic Development, answered that
it's the opinion of the Division of Insurance that there is a
benefit to DPC agreements. For example, she said, a young
couple that has a health care plan with a deductible of $20,000
might still want regular primary care checkups. She said that
they could pay $100 per month for a DPC agreement and receive
primary care for non-serious ailments without having to use
their insurance. She pointed out the possibility of insurance
companies canceling someone's insurance due to the existence of
a DPC agreement, and she said that consumers deserve a way to
have complaints heard.
CO-CHAIR FIELDS asked whether the view is that DPC agreements
would primarily benefit those with high-deductible insurance
plans or people who "choose" not to have health insurance.
MS. WING-HEIER replied, "That's correct." She said many young
people have high-deductible plans, some people utilize health
sharing ministries, and it's possible that people who are on
Medicare may still be able to remain under the care of their
long-term providers.
CO-CHAIR FIELDS asked whether a DPC agreement would work for a
family physician in Anchorage.
MS. WING-HEIER responded that there has been interest over the
years from clinics in Anchorage and Fairbanks.
CO-CHAIR FIELDS asked whether there exists evidence from other
states that suggest that establishing such legislation tends to
have an impact on the availability of family physicians.
MS. WING-HEIER replied that there has been concern about what
would happen to Medicaid or lower-income patients if every
physician used a fee-for-service model.
9:21:16 AM
CO-CHAIR SPOHNHOLZ asked how DPC agreements could relate to
Affordable Care Act (ACA) provisions.
MS. WING-HEIER said, "In some ways, they complement them." She
said that an insurance company cannot credit an individual for
buying a DPC agreement, and that insurance would still be
required to provide the 10 essential health benefits under ACA.
She said that someone cannot negotiate a different health
insurance plan simply due to the existence of a DPC agreement.
CO-CHAIR SPOHNHOLZ asked what some possible side boards would
be.
MS. WING-HEIER expressed that discrimination due to health
status needs to be addressed, and that providers should be able
to cap the number of patients they have. She said that
consumers would need to be clear that a DPC agreement doesn't
take the place of insurance.
CO-CHAIR SPOHNHOLZ noted the importance of transparency.
9:24:35 AM
CO-CHAIR SPOHNHOLZ pointed out that the proposed legislation
doesn't limit what types of health care may use DPC agreements.
She asked Dr. Flanagan whether his practice limits DPC
agreements to primary care.
DR. FLANAGAN responded that the focus was originally to form a
model for patient care that was better than the fee-for-service
model. He said that nationwide, Nextera has family medicine,
internal medicine, and pediatric doctors, as well as other
specialties; in Colorado, clinics include specialists in
orthopedics, cardiology, endocrinology, and rheumatology.
9:27:22 AM
REPRESENTATIVE KAUFMAN referred to slide 4 of Mr. Keese's
PowerPoint, and he asked for an explanation of "risk scores."
MR. KEESE explained that the numerous benefits that come from
utilization of DPC agreements result in lower levels of risk to
involved organizations such as employers and insurance
companies. He said liability insurance providers has looked at
the benefits of DPC agreements, and that insurance companies see
the agreements as "insurance against using your insurance."
REPRESENTATIVE KAUFMAN asked whether there exist metrics on the
difference between the time spent with patients versus time
spent on administrative tasks.
MR. KEESE said that there is "virtually no administration" for
practices with DPC agreements, versus an average of 40 percent
for fee-for-service providers. He said that the process of
working with insurance companies in filing the claim, then
trying to get paid, then appealing a denied claim, doesn't exist
in the DPC model.
9:32:11 AM
REPRESENTATIVE SNYDER asked about the attributes of fee-for-
service users versus DPC users, and whether those attributes
change after a DPC model is in place.
DR. FLANAGAN said that change is observable. He said that in a
fee-for-service model, a doctor sees one patient every 10 to 15
minutes; the appointment is often for the single, annual
checkup; and care is limited by what the insurance plan will
cover, so a patient with a chronic illness such as diabetes
won't return to the office for a follow-up because of the cost
concern. In contrast, he said, DPC patients can be seen six to
seven times per year, either in the office or through
telemedicine, and a deeper relationship develops between the
patient and providers. He shared that his clinic happens to
currently be doing a high number of sports physicals for
children, and one child was also having some issues with anxiety
and depression. The clinic is doing follow-up visits with the
child through video chat, at no additional cost to the parents.
In a fee-for-service model, he said, those visits may never have
happened, because his parents have a high-deductible health
plan. He would have gotten his sports physical through the
school instead of through his own doctor, and because the
financial barrier is removed, his other health issues are being
addressed.
9:36:43 AM
CO-CHAIR FIELDS opened public testimony on HB 176.
9:37:09 AM
CLINT FLANAGAN, MD, Chief Executive Officer, Nextera Healthcare,
stated his support for HB 176 and commented that doctors in DPC
practices call themselves "happy doctors," because the
challenges inherent to the fee-for-service world are removed.
He said that happy doctors have happy patients and, because 87
percent of Nextera Healthcare's clientele are employers, the
employers are happy. He commented that his fee-for-service
colleagues are "burned out."
9:38:14 AM
WADE ERICKSON, MD, Owner and Founder, Capstone Clinic, stated
his support for HB 176. He shared that there is a standard in
the American Academy of Family Practice called "quadruple aim,"
which is to increase access, reduce costs, improve quality of
care, and improve physician quality of life. He said that DPC
agreements would help accomplish that aim. He said that his
practice, which has been in business for 20 years, currently
sees administration taking up 50 percent of its time, which
would be greatly improved through the use of DPC agreements.
Regarding the concerns mentioned earlier in the meeting
regarding access and capacity, he said that access is an issue
with fee-for-service providers, and that the market would
determine access.
9:40:41 AM
BETHANY MARCUM, Chief Executive Officer, Alaska Policy Forum,
stated the Alaska Policy Forum's support for HB 176 and said
that she can personally attest to the benefits of the DPC model.
She said that her access to her provider is unlimited, she pays
$75 per month, and that he does not bill insurance for her care.
She pointed to studies that found that, when county employees
were offered a DPC benefit option, there was a 99 percent
satisfaction rate with a 26 percent decrease in monthly costs
compared to employees covered by regular insurance. She said
that members reported spending almost twice the amount of time
with their physician, and 79 percent of patients reported that
their health improved. A 2020 case study, she said, found that
emergency room visits by DPC patients were 40 percent lower than
those with a standard model of insurance. She said that the DPC
model has the ability to transform the healthcare landscape in
Alaska.
9:42:57 AM
ROSE LARSON stated her support for HB 176. She said that she is
an independent contractor and business developer, and often
works with businesses that experience difficulty in insuring
their employees.
9:44:17 AM
CO-CHAIR FIELDS asked how Ms. Larson found out about the DPC
model.
MS. LARSON replied through the Young Republican Party.
9:44:26 AM
OAKLEY JACKSON testified in support of HB 176. She said that
it's difficult to find health insurance that is both affordable
and worth the cost, so being able to access primary care would
be good for the younger community.
CO-CHAIR FIELDS asked whether she would buy a DPC plan or health
insurance.
MS. JACKSON said she would pursue a DPC plan over regular health
insurance because of the flat rate and the level of support
afforded by DPC agreements. She said many people don't go to a
doctor unless they're dying, due to the excessive costs.
CO-CHAIR FIELDS asked whether she thinks $1,200 per year is
affordable.
MS. JACKSON said, "Overall, absolutely."
9:46:59 AM
CO-CHAIR SPOHNHOLZ asked whether she has tried to get health
insurance.
MS. JACKSON replied yes.
CO-CHAIR SPOHNHOLZ asked whether she looked on the ACA
marketplace.
MS. JACKSON replied that plans on the marketplace ranged from
$450 to $600 per month. She said that she can't afford health
insurance, so she deals with any health issues on her own.
CO-CHAIR SPOHNHOLZ asked whether she is eligible for any
subsidies on the ACA marketplace, and she said that the average
Alaskan pays $80 per month, due to subsidies.
MS. JACKSON replied that she hasn't had that option.
9:48:13 AM
PORTIA NOBLE testified in support of HB 176. She shared her
personal experience with DPC in another state and said that she
received consistent care that focused on health, supplemental
nutrition, exercise, and long-term wellness. She said that she
never had any anxiety regarding the cost of the service. "Lower
cost, more access, gave me more choice and control of health
care for my daughter and I," she said. She said that she valued
the sense of privacy within the DPC agreement, having vetted her
own provider instead of having to select from in-network
providers and have a third party involved in her health care.
9:51:00 AM
SARAH HETEMI testified in support of HB 176. She said that as a
young professional, she knows how hard it can be to find good
insurance, and that self-employed Alaskans would love to have
affordable medical care for themselves and their families. She
said DPC agreements would expand access to services while
increasing the quality and lowering the cost of health care.
9:53:38 AM
REPRESENTATIVE MCCARTY asked whether Ms. Hetemi was saying that
certain insurance companies require a patient to visit a doctor
in their preferred network.
MS. HETEMI expressed confusion at the suggestion that she made
that claim.
9:54:24 AM
CRYSTAL NYGARD, Deputy Administrator, City of Wasilla, testified
in support of HB 176. She said that she has years of experience
helping small business navigate health insurance and finding
health care for herself and her family. She said that she has
experienced "drastic" savings by simply asking how much a
service costs, and that she has worked directly with providers
and insurers on payments, navigating the red tape inherent in
the system. She said that she has been a purchaser of health
care plans for 25 years, and that health care is one of the top
four expenses of small businesses.
9:58:41 AM
CO-CHAIR FIELDS, after ascertaining that no one else wished to
testify, closed public testimony on HB 176.
[HB 176 was held over.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 58 v. B 4.22.2021.PDF |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM |
HB 58 |
| HB 58 Sponsor Statement v. B 4.22.2021.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM HL&C 5/17/2021 3:15:00 PM |
HB 58 |
| HB 58 Sectional Analysis v. B 4.22.2021.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM HL&C 5/17/2021 3:15:00 PM |
HB 58 |
| HB 58 Supporting Document - Guttmacher Alaska Statistics 2016 3.30.2021.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM |
HB 58 |
| HB 58 Supporting Document - Guttmacher Public Costs from Unintended Pregnancies February 2015 3.30.2021.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM |
HB 58 |
| HB 58 Supporting Document - UCSF Study Newspaper Article 2.11.2011.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM |
HB 58 |
| HB 58 Supporting Document - Unintended Pregnancies Study March 2011 3.30.2021.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM |
HB 58 |
| HB 58 Additional Document - HRSA Women’s Preventive Services Guidelines.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM |
HB 58 |
| HB 58 Additional Document - Insurance Coverage of Contraceptives 4.1.2021.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM |
HB 58 |
| HB 58 Fiscal Note DHSS-MS 4.9.2021.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM HL&C 5/17/2021 3:15:00 PM |
HB 58 |
| HB 58 Fiscal Note DCCED-DOI 4.9.2021.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM HL&C 5/17/2021 3:15:00 PM |
HB 58 |
| HB 58 Fiscal Note DOA-DRB 4.12.2021.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM HL&C 5/17/2021 3:15:00 PM |
HB 58 |
| HB 58 Letters of Support as of 5.6.21.pdf |
HL&C 5/7/2021 8:00:00 AM HL&C 5/12/2021 3:15:00 PM HL&C 5/17/2021 3:15:00 PM |
HB 58 |
| SB 40 ver A 3.12.21.pdf |
HL&C 5/7/2021 8:00:00 AM |
SB 40 |
| SB 40 Sponsor Statement 2.23.21.pdf |
HL&C 5/7/2021 8:00:00 AM |
SB 40 |
| SB 40 Supporting Document - VSO duties 10.22.20.pdf |
HL&C 5/7/2021 8:00:00 AM |
SB 40 |
| SB 40 Testimony Received 4.25.2021.pdf |
HL&C 5/7/2021 8:00:00 AM |
SB 40 |
| SB 40 Fiscal Note - MVA 3.2.21.pdf |
HL&C 5/7/2021 8:00:00 AM |
SB 40 |
| SB 40 Letter of Support - Challenge Alaska 3.8.21.pdf |
HL&C 5/7/2021 8:00:00 AM |
SB 40 |
| SB 40 Letter of Support 3.3.21.pdf |
HL&C 5/7/2021 8:00:00 AM |
SB 40 |
| HB 176 Presentation - Direct Primary Care Coaltion 5.6.21.pdf |
HL&C 5/7/2021 8:00:00 AM |
HB 176 |
| HB 176 Letter of Support - AK Policy Forum, 5.7.21.pdf |
HL&C 5/7/2021 8:00:00 AM |
HB 176 |