Legislature(2015 - 2016)CAPITOL 106
03/24/2016 03:00 PM House HEALTH & SOCIAL SERVICES
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| Presentation on Telehealth | |
| HB344 | |
| HB315 | |
| HB328 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | HB 315 | TELECONFERENCED | |
| += | HB 334 | TELECONFERENCED | |
| += | HB 328 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 344 | TELECONFERENCED | |
HB 315-ELECTRONIC VISIT VERIFICATION: MEDICAID
4:31:24 PM
CHAIR SEATON announced that the next order of business would be
HOUSE BILL NO. 315, "An Act relating to an electronic visit
verification system for providers of certain medical assistance
services."
4:31:43 PM
REPRESENTATIVE VAZQUEZ moved to adopt CSHB 315, Version 29-
LS1287\E, Glover, 3/21/16, as the working document.
REPRESENTATIVE STUTES objected
4:32:18 PM
ANITA HALTERMAN, Staff, Representative Liz Vazquez, Alaska State
Legislature, read from prepared testimony as follows:
The most salient points of this bill is that the bill
protects the most vulnerable of our population. It
does so by allowing an alert to be triggered for the
home and community based provider agency who then can
remediate this matter with a beneficiary. The goal of
HB 315 is to ensure that the state only pays providers
for the approved services that are rendered by the
appropriate home health agency personnel while within
that recipient's home or other authorized setting.
Alaska's population is aging and the demand for PCA
and home care services will increase. Accordingly it
will continue to become increasingly more important to
ensure that the home care is delivered properly and
that publically funded resources are being managed and
spent appropriately. It is anticipated that Alaska
has the potential to realize savings of between $15
million and $35 million with this bill.
CHAIR SEATON asked how the anticipated savings are to be
realized.
4:34:01 PM
MS. HALTERMAN answered that she would like to get a little bit
more background on the bill, there's been a lot of questions
about the bill that have been raised by the public and the
Department of Health and Social Services. She asked that she be
allowed to read notes written for the record, as follows:
House Bill 315 is the electronic visit verification
Medicaid bill. A 2012, the Government Accountability
Office (GAO) report has indicated that 40 percent of
all national fraud convictions initiated by the
Medicaid Fraud Control Units (MFCUs) are related to
services that are rendered in the home and community
based settings. According to the institutes of
Medicaid ... medicine fraud ... medical fraud and
abuse in health care costs $75 billion annually, and
the cost to unattended patients can be immeasurable.
It has been reported that the adoption of use of
technology is not only about compliance, it is about
survival. Even FedEx deliveries of a $4 item requires
an electronic signature proving the delivery. Why
shouldn't something as valuable as patient care be
electronically documented and verified? Perspective
approaches to combatting fraud, waste, and abuse, are
far more effective than reactive or retrospective
approaches such as audits and imposing new mandates.
To give a little bit of history, the State of Alaska
has previously considered using electronic visit
electronic verification systems. On July 28, 2014, it
was reported by the Anchorage or the ... the ADN that
the state was considering a pilot for EVV. The
Assistant Attorney General at that time reported that
Medicaid fraud was costing Alaska Medicaid a
conservative estimate of $45 million per year. EVV
systems are easy to use, they don't require any
installation of software or hardware. They ensure
that beneficiaries receive the services that are
authorized for the support that has been approved and
for which the state is being billed. A person who can
use EVV, typically can use the telephone. EVV is used
for compliance and for quality assurance purposes
throughout the nation. Beneficiaries are identified
by either a landline or a GPS location and caregivers
are identified by a unique identifier, and a biometric
match that allows the system to verify that the calls
were made from the proper caregiver for the
beneficiary. EVV systems authenticate the presence of
service providers, they may rely on telephony, which
is the most commonly used form of EVV, GPS tracking,
biometrics, computers for the provider agencies,
mobile tablets, tokens, or other applications - those
names of devices vary by vendor, and then smart
phones. An individual without landline or systems
used to authenticate services can be provided a device
by a vendor, kind of like a pager. This generates a
client ID with a ... that provides a digital readout
that can be given to the caregiver who can call in and
then enter that code into a system about that client.
Our research indicates that it appears the average
cost of ... of that verification is approximately
$0.15 per visit. Biometrics are critical component
for successful EVV implementation. They ensure
further reduction of fraud, waste, and abuse by
identifying that caregiver's identify. Statewide
independent approaches involve vendor solutions and
are considered funded mandates. These are cloud-based
platforms that allow for remote patient monitoring.
The states that have chosen the statewide approaches
have done so because they want to maintain oversight
over their EVV systems. Statewide vendor solutions do
the following: it allows the state to access federal
assistance matching percentages of up to 90 percent
for frontend system development; they gain 75 percent
for recurring costs when the systems are plugged into
the claims system; it removes fraud liability from the
consumer directed home care provider agency and it
places it directly on the consumer directed PCA or
caregiver under her consumer directed clients. This
morning I confirmed with the department that only
approximately 1.5 percent of the clients are served
under an agency based model, so this would limit
liability from any of our consumer directed
beneficiaries and their agencies.
4:39:13 PM
CHAIR SEATON asked for more explanation.
MS. HALTERMAN explained there are two different models, such as
an agency based model that typically requires that the agency
staff the beneficiary's care in that home, and sends someone,
typically a CNA, to the home to provide that care. The agency
has some direct responsibility over directing the care when it
is an agency based caregiver. When it is a consumer directed
PCA model, the consumer directly hires, supervises, and fires
their caregivers, they provide the training, and they are
responsible for the oversight of their care. These systems
place that responsibility more directly on the consumer and its
caregivers, rather than the agency, she said.
4:40:16 PM
MS. HALTERMAN continued reading her written testimony as
follows:
Statewide vendor solutions can also be set to trigger
an alert so that they can be sent to the provider
agency in order for that agency to investigate a gap
in care. These can be set to set an alert to an
administrator within the state agency, but only if the
state chooses that option. EVV systems can monitor to
ensure visits are happening as expected and/or alert
that provider agency when a gap in care is occurring.
The reports and these alerts are optional for the
Department of Health and Social Services. Provider
agencies maintain all control over scheduling and
resolving any gaps in care with that direct caregiver.
Generally, vendors provide training and the use of the
EVV systems to administrative staff within those
agencies, who then provide training to the direct
caregiver. EVV systems statewide allow for con ...
configuration of new software so EVV systems can
incorporate programs specific business rules for each
of our agencies. They ensure for comprehensive
training to be consistently provided, which may
include providing a training kit, visual aids, videos,
or documentation on best practices. EVV systems can
generate reports that alert agencies when the
caregiver fails to show up. EVV systems can be
integrated, again with the existing provider systems,
to minimize the impact on those provider agencies.
A standards based approach, which we've heard some
folks testify and some ... we've seen some written
testimony in support of. Um, I want to kind of define
the standards based approach. It is an approach where
the department sets the minimum set of requirements
that the provider must meet with the use of an EVV
system. The provider then needs to ensure that those
requirements ... um, occur with the solution that they
provide ... or they procure on their own. Standards
based approaches are unfunded mandates. States have
chosen those options but those that have done so have
experienced that they have little control and
oversight over their data. The standards approach may
lead to increased reimbursement due to the cost and
complications of implementing new systems for each
provider. For instance, the State of Washington we
have learned has increased reimbursement to providers
due to the implementation of a standards based
recordkeeping system or timekeeping system. It's not
technically a fully ... fully functioning EVV system.
It has no oversight or management of claims
integration.
4:43:15 PM
MS. HALTERMAN continued reading her written testimony as
follows:
Standards based EVV systems do not necessarily lead to
the savings that are found in the vendor based
solutions because the provider still maintains control
and check the validity of all of the data that is sent
to the state. There is no data sent to the state
independently and; therefore, no independence of any
EVV data. Standards based solutions may become too
costly for some of our smaller providers. They may
become far too complicated for smaller providers to
implement. Even our PCA Association has pointed this
fact out. Our fear is that if we implement a
standards based solution this could cause some of our
small providers in Alaska to close their doors and
impede competition due to an unfunded mandate of the
development of new systems. Standards based EVV
systems can significantly slow implementation because
if the state allows for integration of standards based
EVV solutions into existing business practices it may
take a lot longer to finish full implementation.
Standards based EVV approaches can be challenging for
some of our providers, it can be complicated for those
providers. They may delay the full implementation or
cause non-compliance for provider agencies that can't
fully implement. They may reduce the savings
generated, again due to the lack of oversight and
control. This is still essentially a (indisc.) model
with no upfront fraud prevention. Standards based
solutions place the burden of verifying or certifying
systems within the State of Alaska on the department
in order to assure that strong technical controls are
placed and maintained. Requiring the state to make
exceptions to address the needs of remote or small
providers as has been suggested by some, may force a
vendor solution in part to be considered along with a
standards based solution because otherwise small
providers may be forced to close their doors.
4:45:34 PM
MS. HALTERMAN continued reading her written testimony as
follows:
So, I want to talk a little bit about what EVV systems
do. EVV systems can do the following: they can reduce
inappropriate billing for home health and personal
care attendant services; they can improve
efficiencies; reduce paid work for both the agencies
and the State of Alaska's Medicaid Agency. They can
improve quality by ensuring services are provided for
the most vulnerable of our populations. They may
assist agencies and providers in helping to identify
unmet needs or missed or late appointments when
caregivers don't show. They may improve the ability
to make adjustments to care quickly by triggering an
alert to an agency who then knows the caregiver didn't
show up, they can initiate a backup plan. They can
improve policy decisions and improve strategies due to
the ... having access to the encounter data that the
state has never had before. It can improve data
collection, evaluation, and also provide a unified
view of each home and community based and PCA service
that will allow care to be examined across multiple
agencies and possibly multiple provider types. This
will improve the quality of services for those
beneficiaries. EVV systems can afford a more
effective invoice, billing, scheduling, and
documentation of the service delivery process and they
can lead to enhanced administrative processes for
those agencies. EVV systems capture and
electronically submit claims data with accurate dates
from visits that are verified which allows the state
to validate that the data is coming from an
independent source. EVV systems can ease reporting by
providing a central location that identifies the
support and services that those providers are
rendering. EVV systems can generate exception reports
that can be run ad hoc ... um, and they can reduce
adult protective service issues and the need for
investigations. These reports may help DHSS identify
concerns earlier than they have been able to do so in
the past. So, the benefits of EVV include the
potential to eliminate the padding of timesheets by
caregivers, it allows for a flag to the supervisors,
the agencies ... um, to alert to suspected abuse or
neglect. It can reduce errors, it can save money for
agencies and for the State of Alaska. If plugged into
the claims system it can speed up payments if
implemented with that claims system. It can ensure
compliance with state and federal regulations. It can
improve quality assurance and streamline processes
including payroll for many of our agencies. They can
improve efficiencies and effectiveness. And, lastly
save money on audits because the proof of care will be
automated.
I have in our research, Rep. Vazquez and I have
discovered...
4:49:10 PM
REPRESENTATIVE VAZQUEZ interjected that she wanted to place
certain relative experiences on the record and offered her
extensive Medicaid fraud background. She related that many
states have been using electronic visit verification (EVV)
systems for years, if not decades. As a prosecutor she attended
numerous national conferences on Medicaid fraud and has seen
demonstrations on how these systems work. Currently, there is
evidence that these systems can save states money by reducing
fraud, waste, and abuse, and add to the quality of care that the
most vulnerable of Alaska's population needs. Recent research
indicates that Congress has gotten onto this idea, and in 2015,
Representative Steven Guthrie introduced HR 2446, which would
require these types of systems for every state offering
Medicaid, which is now all 50 states, and stipulates that states
that do not implement the system will be subject a decrease of
Federal Medical Assistance Percentage (FMAP), the federal share.
The most recent action on this bill was November 4, 2015, when
the bill was forwarded to the subcommittee on Health to the full
Energy and Commerce Committee. In 2015, on the House of
Representatives side of Congress, Senator Charles "Chuck"
Grassley introduced SB 2416, which also would require EVV
systems in Medicaid and in addition Medicare. The bill
stipulates that states that do not implement will be subject to
a decreased federal share in Medicaid, or FMAP. She explained
that it's always difficult, as a prosecutor who also dealt with
civil cases, to chase after Medicaid providers after the fact
because it very difficult once the horse has left the barn to
recover money. In 2015, there was a PCA agency owner and it was
alleged that $1.2 million were billed inappropriately to the
Medicaid program. Restitution was ordered by the judge at
judgement but recovering $1.2 million posed a difficult
challenge for the state. This bill in essence would try to
catch the fraud, waste, and abuse, upfront before the horse
leaves the barn and it also adds to the quality of care for
individuals, she explained.
4:53:32 PM
MS. HALTERMAN added that their research identified a number of
vendors that provide this service. Sandata is the vendor the
sponsor's office has been working with to crunch numbers that
used some data from Kaiser Family Foundation from 2012. She
pointed out that Sandata would like to analyze more current data
and the department has been speaking with this vendor and they
had a meeting to share insights about these systems, and answer
questions. There are a number of vendors such as, First Data,
Vilify Health, Access, Technology Solutions, and Care Watch are
all EVV vendors. She explained that it has been made clear to
Sandata that no guarantee were offered to Sandata in the RFP
process. She said that unfortunately, of the 130 fraud cases
that have been investigated by Alaska's Medicaid Fraud Control
Unit, 120 of them are directly related to the populations that
would be targeted with this bill.
MS. HALTERMAN referred to Sandata's Brian Lawson's previous
testimony and said he is willing to make himself available for
anyone with further questions to explain the benefits of
analyzing real data and the return on investment found from an
effective implementation of an EVV system. Although, Sandata
was not their only research tool, it helped develop the pricing
and return on investment forecast is collected from the Kaiser
Family Foundation, its 2012 data. It has been noted that the
enrollment in populations in the Medicaid expenditures are down,
but only PCA data was presented. Ms. Halterman continued
reading her written testimony as follows:
While the return on investment that was generated by
Sandata includes not just PCA, it identifies potential
savings for home and community based waiver. Now, in
the targets that they presented on that return and
investment because it was not using actual Medicaid
data. They would need to have access to true data,
real data, from the department, enrollments numbers
and spending outcomes in order to present a more valid
forecast of what these savings could be. So now the
current data does show that the beneficiaries and
spending are down slightly for these populations that
would be targeted with this bill. It is clear that
the proper implementation of an EVV system would
provide a significant return on investment regardless
of what the numbers are, regardless of how much is
spent. The 5 percent return on investment was based
on the PCA and home and community based population
savings that use an EVV system. And the total of
those expenditures was approximately $305 million, the
numbers again used for the analysis was sample data
and it used fail information that the vendor
identified from a source that was valid but wasn't a
reliable ... necessarily a 100 percent reliable
source. If the department is willing to provide more
reliable data, the vendor is willing to analyze
current real data to come up with a realistic return
on investment. It should be noted that while Sandata
did present a return on investment that used 5
percent, 8 percent, and 12 percent returns, Medicaid
Fraud Control unit has alerted us that those are
conservative estimates because they have presented
that fraud has conservatively reached approximately 20
percent with those populations. So sadly, in light of
the testimony last year in Senate Finance and House
Finance it is clear that Alaska has a fraud problem.
Several documents...
4:59:54 PM
REPRESENTATIVE SEATON interrupted and pointed out that the
committee actually wanted a summary of changes. Before each
member is HB 315, with a proposal to take up a committee
substitute which is different, he said. The committee wanted a
summary of those changes which he opined that one requires that
a standards based model be used, and Version E is that the
department shall contract with the vendor to implement an
electronic visit verification (EVV) system. Also, he said it
required real time reporting, to the extent feasible. He asked
whether the committee has questions on considering the vendor
model versus the standard based model in the original bill.
5:01:25 PM
REPRESENTATIVE TARR advised she does not have Version E.
The committee took an at-ease from 5:01 p.m. to 5:05 p.m.
5:05:23 PM
REPRESENTATIVE WOOL noted that the committee heard from the
vendors during the last committee meeting and asked whether the
committee has heard from the department.
5:06:29 PM
DEB ETHERIDGE, Deputy Director, Division of Senior and
Disabilities Services, Department of Health and Social Services,
said she is available.
REPRESENTATIVE SEATON asked Ms. Etheridge to discuss fiscal note
wherein it lists $224,000 each year for the next five years;
however, in the analysis, he paraphrased the following: "Three
states passed legislation to implement an EVV program and two
are fully implemented but that they reported there was high cost
of however reported initial cost for implementation of $13
million." He remarked that he is trying to relate that although
they have a larger population, but it reads that "a timeline for
implementation be 24 months." He pointed out that this fiscal
note relates to Version A.
5:07:47 PM
REPRESENTATIVE VAZQUEZ offered a correction that the fiscal note
before the committee, OMB Component Number 2663, states that the
total cost is $224,200, and it would be 50 percent federal match
so the general fund match would be $112,100.
REPRESENTATIVE SEATON offered that it is a recurring cost and he
is trying to determine how that corresponds to the narrative,
and he paraphrased the following, "that said in several places
that the impacts were substantial.
5:08:55 PM
MS. ETHERIDGE responded that the fiscal note before the
committee is a fiscal note to the administrative component, and
it captures the department's personnel costs for implementation
and ongoing compliance and oversight of the electronic visit
verification (EVV) system. The fiscal note was developed on the
original version and not on Version E. The other estimated cost
that the department struggled to develop would have impacted the
Senior and Disability Services Medicaid component and at this
time there is not an indeterminate Medicaid component note.
However, the division did note in the narrative on its
administrative fiscal note that there would be expenditures
impacting its Medicaid budget, and it gave some logic about what
the division anticipates or why it had difficulty anticipating
the cost associated with how it would impact Medicaid.
REPRESENTATIVE SEATON surmised that was looking at one GGU
Health Program Manager II positions in Anchorage, and it is the
main portion of the fiscal note.
MS. ETHERIDGE agreed that it is the main portion of the
administrative fiscal note.
REPRESENTATIVE SEATON asked whether Ms. Etheridge had had a
chance to look at the vendor portion and generate a fiscal note.
MS. ETHERIDGE stated that she had an opportunity today to learn
more about the intention of the implementation of the EVV system
and she has a better understanding of what the obligations may
be and she is preparing a fiscal note.
REPRESENTATIVE SEATON added that he just wanted to clarify that
because there is a single fiscal note there, but that's if the
department would do it and not through the vendor model which is
Version E.
5:11:38 PM
REPRESENTATIVE TARR offered that due to the recent changes to
the PCA program, and also the major Medicaid reform package that
is moving through the legislature, her concern is that this is
potentially too many things at once.
MS. ETHERIDGE related that the department does, and the Division
of Senior and Disability Services has a number of initiatives in
which it is working on currently through Medicaid reform,
through its CMS compliance necessary for the home community
based services. Which includes the initiatives the department
has taken to streamline and have more oversight over its
personal care program. She noted that is part of the reason the
department would require additional staff to implement this
program, and the department anticipates it will take 24 months,
at least.
REPRESENTATIVE TARR surmised that the changes that affected the
amount of time each recipient is receiving, in part to address
the issue of potential fraud or misuse of the time. She opined
that in this particular instance, some of the potential problems
may have been addressed through that process.
MS. ETHERIDGE answered that the division has made some changes
to account for time for task, and it allocates time and then the
recipient receives a time that is authorized weekly. The
division feels like it has oversight and a more clear
understanding of the services it has been authorizing; however,
it understands the benefits of an EVV system as it has explored
implementing that system. There are some examples of rounding
that may happen that it may capture if it was to be directly
tied into the division's enterprise system so that claims were
tied into the system so there could be some efficiencies in that
way. She advised that it is difficult for the division to say
what percent of fraud would be realized at this time, but she
has talked to other states and is trying to get a handle on it.
5:14:24 PM
REPRESENTATIVE SEATON reminded the committee that the motion to
adopt Version E, a vendor system, is still on the table.
5:14:33 PM
REPRESENTATIVE STUTES removed her objection to adopt CSHB 315,
Version 29-LS1287\E, Glover, 3/21/16, as the working document.
There being no objection, Version E was before the committee.
CHAIR SEATON asked Ms. Etheridge to round out some numbers for
Version E.
MS. ETHERIDGE agreed.
[HB 315 was held over.]