Legislature(2013 - 2014)CAPITOL 106
03/20/2014 03:00 PM House HEALTH & SOCIAL SERVICES
| Audio | Topic |
|---|---|
| Start | |
| HB324 | |
| HB319 | |
| HB356 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 319 | TELECONFERENCED | |
| *+ | HB 356 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 324 | TELECONFERENCED | |
HB 356-ADVISORY COMMITTEE ON WELLNESS
4:12:33 PM
VICE CHAIR KELLER announced that the final order of business
would be HOUSE BILL NO. 356, "An Act establishing the Advisory
Committee on Wellness; and relating to the administration of
state group health insurance policies."
4:13:09 PM
REPRESENTATIVE SEATON, as sponsor of proposed HB 356,
paraphrased from the sponsor statement:
HB 356 requires the Commissioner of the Department of
Administration to implement procedures for decreasing
the incidence of disease in Alaska in order to hold
the inflation of healthcare costs of active and
retired Alaska state employees to 2% per year.
According to the Institute of Social and Economic
Research, total health care spending in Alaska topped
$7.5 billion in Alaska in 2010, with state government
employers paying over $400 million. A major component
of our $12 billion unfunded pension liability is
retiree healthcare costs. HB 356 requires the
Commissioner of Administration to put in place
programs that will decrease the incidence of disease
in State of Alaska employees, both current and
retired, in order to hold the inflation of costs to 2%
per year.
This bill focuses on preventing the incidence of
disease as opposed to treatment of disease.
Prevention of disease is the policy approach
unanimously requested of the Governor by the
legislature through HCR 5 in 2011. This is an area of
healthcare where the most economic impact can be
achieved. For instance, recent studies show that an
action as simple as taking a daily supplement of 5,000
IU of vitamin D can dramatically reduce the risk of
heart disease, diabetes, cancer, autism, gingivitis,
and many other conditions.
HB 356 creates an Advisory Committee on Wellness which
is charged with making recommendations to the
Commissioner of Administration on ways to decrease the
incidence of disease in Alaska. HB 356 will enforce a
paradigm shift for the Department of Administration
and the Department of Health and Social Services. It
will require the agencies to implement policies to
keep Alaska state employees healthy by preventing
disease, rather than the common, reactive policy of
waiting until people get sick and then treating them.
REPRESENTATIVE SEATON directed attention to a PowerPoint
presentation entitled, "HB 356 Prevention of Disease Decreasing
the Alaska Healthcare Liability," and the unfunded liability in
the PERS and TRS accounts. He addressed slide 1, "$3.8
Billion," which he declared to be the current amount of unfunded
liability for health care costs, with an annual increase of more
than 2 percent. Directing attention to slide 2, "Why are we
here?" he noted that the state was spending more than $100
million annually for active employees, and almost $500 million
for retirees. He pointed out that the state also paid health
care costs for inmates, state employees under union health
trust, Medicaid, and workers compensation, slide 3. He
explained that the current discussion would be about DOA
policies for workers and retirees for Alaska, and noted that
almost 60 percent of the $7.5 billion of the state cost for
health care was spent on hospital care, doctors, and clinical
services.
REPRESENTATIVE SEATON moved on to slide 5, "This is the way we
currently contain costs:" and pointed out that the state
insurance focused on limitations of coverage for certain
conditions or limitations on compensation for procedures. He
stated that the Department of Labor & Workforce Development
tried to prevent accidents by limiting time on the job and
requiring safe job conditions. He said that Department of
Health and Social Services had some prevention programs,
including voluntary childhood vaccinations, prescription drug
safety, and voluntary lifestyle changes, which he deemed to be
tough accomplishments. He pointed out that Department of
Environmental Conservation and Department of Natural Resources
worked on food safety requirements, including shellfish testing,
pasteurized milk requirements, and restaurant and food processor
inspections. He stated that the Department of Public Safety
enforced the laws. He pointed out that the aforementioned $3.8
billion expense was created by the institution of these current
programs.
REPRESENTATIVE SEATON asked "How can we avoid diseases and
prevent illness instead of just reacting to and paying for
Sickcare," slide 6. Moving on to slide 7, "Active Plan," he
noted that these were the aggregate risk profiles and risk
drivers of the plan, with a contribution percentage for the
direct relation of each to Vitamin D levels. He stated that the
total of diseases directly related to Vitamin D levels was 66
percent. Moving to slide 8, "Retiree Plan," the risk factors
related to low vitamin D levels was 61 percent. He spoke about
slide 9, "Meta-analysis of breast cancer risk," a group of
studies that combined data and then segregated these into five
groups by blood serum Vitamin D. The national average was 21
ng/ml, yet the rate for blood cancer was decreased by half when
Vitamin D rates moved up to 52 ng/ml.
REPRESENTATIVE SEATON reported on slide 10, stating that, with
Vitamin D use, there was a 50 percent reduction to the costs
resulting from breast cancer.
REPRESENTATIVE SEATON projected slide 11, "Meta-analysis," and
noted the 50 percent reduction in incidence of colon cancer with
Vitamin D use, an almost $2 million savings for the state, slide
12. He discussed slide 13, "Diabetes Incidence:" which
reflected a clinical trial for Type 2 Diabetes and the 90
percent reduction of incidences with the increase of Vitamin D
to 48 ng/ml, slide 14, "Type 2 Diabetes." Slide 15, reflected a
$4 million per year savings with this Vitamin D use. He
stressed the importance of raising Vitamin D levels to the 40-60
ng/ml.
4:26:28 PM
REPRESENTATIVE SEATON pointed to slide 16, "march of dimes,"
which reflected the reduction of preterm births in Alaska with
an increase of Vitamin D. The savings to the state was $1.3
million, slide 17. He spoke about slide 18, "Upper Respiratory
Tract Infections," and compared levels of Vitamin D above 30
ng/ml with the relative risk of upper respiratory tract
infections. He reviewed slide 19, "Inflammatory gum disease,"
and spoke about tooth loss and infection, and that relationship
to other illnesses in the body. He pointed to the 80 percent
reduction in inflammation in 90 days with an increase in Vitamin
D levels to 50 ng/ml.
REPRESENTATIVE SEATON stated that individual Alaskans and the
State shared a burden for the increasing health care costs. He
declared that the state had not adequately focused on a policy
of avoiding disease and maintaining health, slide 20. He read
from the proposed bill, slide 21, "to the greatest extent
legally and reasonably practicable, the Department of
Administration shall work to hold down the escalation of health
care costs to less than 2 percent annually by administering
policies of the group health insurance obtained under this
subsection in a manner that is likely to reduce the incidence of
disease in the state's population and facilitates implementation
of the recommendations of the Advisory Committee on Wellness
established under this bill." He emphasized that this
represented a "total change in the direction in which we view
health care." He stressed that it was necessary for a new tack
if we were going to address the unfunded liability and the
impending big budget deficits. He said that the aforementioned
Advisory Committee on Wellness was modeled on the Citizens
Review Panel for the Office of Children's Services [Department
of Health and Social Services]. It would comprise of a minimum
of seven appointed members, with at least one health care
provider. Similar to the Citizens Review Panel, the
administration would be required to address the issues brought
forward by the panel. He declared that this could change the
course of escalating health care costs and the large unfunded
liability.
REPRESENTATIVE TARR asked whether there were expansions for
preventative care and additional covered services under the
Affordable Care and Patient Protection Act, and were these a
complement for long term cost savings to the proposed bill.
REPRESENTATIVE SEATON replied that this proposal was a paradigm
shift, whereas the Affordable Care and Patient Protection Act
was directed more toward affordable insurance and paying for
sick care. He relayed that its only prevention means were early
detection screenings.
REPRESENTATIVE SEATON read a list of the study titles which
included Senior Health Issues, Vitamin D Supplementation
programs, and Low Serum Vitamin D concentration in Alzheimer's
disease.
REPRESENTATIVE SEATON, in response to Vice Chair Keller,
explained that the proposed bill requested that Department of
Administration (DOA) focus on disease prevention in its health
coverage policy. He suggested an incentive of a lower co-pay if
people agree to increase their Vitamin D level to between 40-60
ng/ml. He suggested that DOA construct an incentive system
during negotiation with the union health care contracts. He
pointed to the potential health care tradeoffs with health care
accounts. He noted that this could spread to include not only
the health insurance programs in the state, but also include
Medicaid. He declared that many chronic diseases could be
avoided at a fraction of cost, noting the huge cost/benefit
ratio. He reminded the committee that, in 2011, House
Concurrent Resolution 5 was passed, which called on the governor
to declare prevention of disease as the primary model for health
care, and that this resolution had not been implemented. The
current proposed bill, HB 356, would be another reminder for the
administration to implement the policy, and, as it would be in
statute, it was a priority. He declared that the crux of the
proposed bill was to prioritize this paradigm shift to lower
health care cost by avoiding disease. He allowed that there had
been a voluntary wellness committee in Department of Health and
Social Services, although it had never been set in statute or
required the DOA to respond. He offered his belief that the
focus had always been to pay for the sick care, and not to focus
on keeping people well. Lifestyle changes were hard and had to
be voluntary. He declared that the intention of the proposed
bill was for the Alaska State Legislature to set a policy for a
healthy Alaskan workforce and retiree base, and lower the health
care cost. He opined that this would help alleviate the
upcoming fiscal constraints.
VICE CHAIR KELLER summarized that the proposed bill was a change
in the DOA mission statement, and that performance would be
measured on the successful implementation of the
recommendations.
REPRESENTATIVE SEATON replied that the language of the proposed
bill allowed a lot of latitude. He said that the millions saved
would make a huge difference.
REPRESENTATIVE TARR said that she supported the idea and any
efforts at prevention. She suggested a need for clarifications
of the criteria for the seven volunteer committee memberships.
REPRESENTATIVE SEATON explained that the proposed bill suggested
at least seven committee members, though there could be more to
even better create a geographical representation. He emphasized
the necessity for a clear intent from the legislature.
4:47:37 PM
MIKE BARNHILL, Deputy Commissioner, Office of the Commissioner,
Department of Administration (DOA), expressed his appreciation
to the sponsor, and stated that DOA shared the enthusiasm for
wellness initiatives and the idea to trend medical costs down to
2 percent. He questioned whether this was achievable, however.
He offered to share past DOA programs, which included a wellness
committee for the 2012 state employee health plan. There were
over 90 applications for the 12 positions on the wellness
committee. He explained the "first dollar preventive care" in
the state employee health plan, which meant that certain
preventive care services were not subject to the deductible. He
opined that it was too early to measure the efficacy of any of
these measures; although some of these initiatives were popular
with certain constituencies, there was also an equally prominent
constituency that was skeptical of government telling them what
to do and how to live their lives. He offered his belief that
this was the larger segment, and he questioned how to engage
with this population for an effective wellness campaign.
MR. BARNHILL said that a variety of issues drive health care
costs. He stated that end-of-life care was very expensive, and
there were many expensive behavioral issues, as well. He stated
that many people will not change the way they live their lives.
He opined that, although the benefits of Vitamin D was an
interesting proposal, there were health costs driven by issues
not addressed by Vitamin D, noting especially the high cost of
orthopedic fractures. He reported that AETNA was developing "a
more robust network particularly for specialists," as
controlling these costs was very important.
4:54:37 PM
REPRESENTATIVE TARR asked about the suggested wellness committee
approach in the proposed bill.
MR. BARNHILL replied that there were discounts for State of
Alaska employees at gyms, recreation clubs, etc. and that there
were intermittent programs, competitions, and initiatives. He
expressed his understanding that this would only appeal to a
certain percentage of the workforce.
MR. BARNHILL, in response to Representative Tarr, said that
there was a strategic health initiatives coordinator who
coordinated these program discounts.
VICE CHAIR KELLER asked for details about the current wellness
committee.
MR. BARNHILL replied that the 12 members met monthly.
VICE CHAIR KELLER asked if the committee had considered the use
of Vitamin D.
MR. BARNHILL replied that he did not know.
REPRESENTATIVE SEATON said that the wellness committee had not
met "since AETNA came on-line." He referred to the New Zealand
report which advocated for Vitamin D, noting that usage had
jumped from 15 percent to 74 percent, with a 32 percent
reduction in aged residential care in the emergency department
from falls and fractures. He expressed the need to reach out to
residential senior facilities across Alaska, and his desire to
give the administration a tool for use in contract negotiation
for prevention programs. He suggested that the legislature
adopt a policy for healthy Alaskans.
5:00:10 PM
VICE CHAIR KELLER asked that the DOA discuss its support and
report back to the committee. [HB 356 was held over.]