Legislature(2009 - 2010)SENATE FINANCE 532
03/11/2009 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB116 | |
| SB13 | |
| SB32 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 13 | TELECONFERENCED | |
| + | SB 32 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| = | SB 116 | ||
SENATE BILL NO. 32
"An Act relating to medical assistance payments for
home and community-based services."
9:50:14 AM
Senator Ellis presented SB 32.
Senate Bill 32 creates a mechanism for regular Medicaid
rate review for providers of home- and community-based
services to Alaska's elderly and developmentally
disabled citizens. Institutional service providers
receive regular reviews in order to bring rates in line
with costs.
However, home and community-based services (HCBS) have
been conclusively proven to lower overall long-term
Medicaid costs. One recent study in the academic
journal Health Affairs found that states with long-
established high proportions of HCBS spending saw a 3%
overall decrease in long-term care spending between
1995 and 2005 as opposed to a 14.5% increase in low-
HCBS states. The study concluded:
"Justifications based on financial
constraints can no longer be credibly
offered as reasons for forcing such people
[seniors and persons with developmental
disabilities] into nursing homes and other
institutions. HCBS programs may be one
instance in which offering people greater
1
choice also helps reduce costs."
Over the last few years, however, rates for home- and
community-based services have been frozen. During that
time, not only have costs increased, the medical
environment - including regulations, technology, and
client expectations - has shifted dramatically. These
shifts threaten the continued viability of the hundreds
of HCBS providers, primarily private businesses that
employ thousands of Alaskans in every region of the
state.
Home and community based services are the key to
helping our seniors and those living with developmental
disabilities live their lives as productive members of
our communities while controlling the growth of health
care costs. Without the regular review process in
Senate Bill 32, many providers will be forced out of
1
Health Affairs 28, no. 1 (2009): 262-272.
business and HCBS services will be taken away from
thousands of Alaskans across the state.
9:58:25 AM
Senator Ellis noted that most providers have not seen
increases in ten years. He pointed to problems with
contractor's assessments precluding testimony from smaller
providers. He explained that SB 32 gives the Department of
Health and Social Services (DHSS) the flexibility to devise
a cost based system, while repairing the disparity between
home and community based services and institutional care
rates. Hospitals and nursing homes require regular rate
reviews. Home and community based services deserve the same
treatment from the state.
10:00:19 AM
Co-Chair Hoffman asked for a list of home and community
based providers. He asked how the fiscal notes would affect
their earnings.
Senator Ellis noted that new and possibly reduced fiscal
notes would be provided to the committee. He emphasized that
the legislation is not a rate increase, but a mechanism for
rate review. He believed that work in the finance committee
could further reduce the cost. He informed that DHSS could
provide the requested provider information.
10:01:55 AM
Co-Chair Stedman observed that the fiscal notes are $4.4
million for FY10 and $8 million for FY11. A committee
substitute (CS) bill is in the works, but information for
committee members is today's goal. Senator Ellis stressed
that the fiscal impact could be reduced.
Senator Olson asked how non-Medicaid eligible individuals
would be impacted by the mandatory rate review. Senator
Ellis explained that SB 32 addresses providers that are
reimbursed through Medicaid. Senator Olson stated that he
had not witnessed a component of the fiscal note for
providers ineligible for Medicaid.
10:03:32 AM
MAX HENSLEY, STAFF, SENATOR ELLIS, responded to questions.
He informed that there are approximately 350 home and
community based providers, who receive approximately $140
million in Medicaid funding per year.
Mr. Hensley informed that Section 1 of SB 32 creates a rate
review process for home and community based services as well
as assisted living homes, which are outside of the Medicaid
arena. Section 1 adds personal care services and assisted
living homes for needy and vulnerable adults to the services
receiving the rate review process. As drafted, the bill only
covered home and community based services provided though a
Medicaid waiver.
Mr. Hensley reviewed Sections 2 and 3, which are conforming
language for the assisted living homes for needy and
vulnerable adults. Section 4 creates an annual report to the
legislature detailing trends in rates based on the review
process in the bill, and sunset that reports in 2014. He
stressed that the legislation is designed as a management
tool.
10:06:15 AM
Mr. Hensley explained that Section 6 delays the
implementation of the program for two years to allow DHSS to
create the methodology to set the rates.
10:07:25 AM
JON SHERWOOD, DIRECTOR, OFFICE OF PROGRAM REVIEW, DEPARTMENT
OF HEALTH AND SOCIAL SERVICES (DHSS), observed that the
process has been collaborative. The department hired a
consultant to review the program. The department is
committed to moving forward with a rate setting system, but
is still seeking compromise, including adequate direction
without restriction in the rate setting process of larger
hospitals and nursing homes. The department supports the
process of accountability.
10:09:21 AM
Senator Olson questioned how the legislation would affect
residents of the Mary Conrad center in Anchorage. Mr.
Sherwood observed that they would not be affected by SB 32.
Senator Olson asked if semi-private home services providers
were affected. Mr. Sherwood answered that the legislation
requires the department to change rates reflecting costs
incurred by providers. Senator Olson asked if the
legislation would affect health care corporations in rural
Alaska.
10:10:51 AM
Senator Ellis acknowledged that there are home and community
based providers, especially in rural Alaska, who would
benefit from the legislation. The intent of the legislation
is to find the proper balance. Rural providers are
struggling and the state is in danger of losing a cross
section of service providers.
10:12:19 AM
Senator Huggins requested clarification regarding the two
year delay in the implementation of SB 32. Mr. Sherwood
agreed that the department requested the two year delay.
Senator Huggins asked if the department has concerns for
home and community service organizations that might not
survive two years. He felt concern about the attrition of
these services.
Mr. Sherwood answered that two years was an ambitious goal
for implementing a cost based rate system. He explained the
difficulty in creating the system.
Senator Huggins asked when the five year repealer would
begin. Mr. Hensley explained that the repealer addresses the
report from the department and takes effect June 30, 2014,
meaning that the report would occur during the first three
years of the program.
10:14:27 AM
DENISE DANIELLO, DIRECTOR, ALASKA COMMISSION ON AGING
testified in favor of SB 32.
Good Morning. My name is Denise Daniello and I am the
executive director of the Alaska Commission on Aging. I
am here to testify in support of CSSB 32, a bill to
allow for regular rate reviews of home- and community-
based services for Medicaid-eligible persons similar to
the process used by hospitals and nursing homes. We
believe that this proposed legislation addresses the
need for a fair and consistent process to maintain the
systems of care for vulnerable Alaskans and promotes
sounds fiscal planning for providers and the State.
The Governor's Council on Disabilities and Special
Education, the Alaska Mental Health Board, Advisory
Board on Alcoholism and Drug Abuse along with the
Alaska Mental Health Trust Authority, the Suicide
Prevention Council, the Alaska Brain Injury Network and
the Alaska Commission on Aging have jointly identified
the establishment of a regular and periodic schedule of
rate reviews for home and community based services as
one of our four legislative priorities for 2009. The
provisions that address our legislative priority are
included in SB 32 sponsored by Senator Ellis.
Alaska's most vulnerable populations depend heavily on
a network of community nonprofit provider agencies.
Before last year's rebasing for FY09, many home and
community-based service providers had been over a
decade without a rate review receiving the same level
of reimbursement while their costs continued to climb
along with demand for more services.
Home- and community-based services are an effective and
efficient means of providing care for nearly 57,000
Alaskans who would otherwise need to be served by more
costly institutions. Investment in the foundation of
home- and community-based services is prudent to assure
that services meet the needs of all vulnerable Alaskans
to maintain their quality of life and to hold down the
costs of higher level health care.
According to 2006 estimates provided by Senior and
Disabilities Services, the average annual cost of a
semi-private room in a nursing facility was $172,685
compared to $21,436 for the Medicaid waiver.
It should also be kept in mind that as more individuals
are able to receive home- and community-based services,
fewer of them will need to enter much more costly
institutions such as nursing homes. Thus, it is quite
possible that by adequately funding these critical
pieces of the continuum of care may result in an
ultimate cost savings for the State.
Older Alaskans depend on home- and community-based
services which help them to continue living in their
home communities for as long as possible close to
family, friends, and cultural tradition. For seniors,
these services may include home-delivered meals,
transportation, chore services, care coordination,
assisted living homes, and other services. Thirty-six
percent of the 3,498 individuals served by Medicaid
waivers are older Alaskans - the majority of whom are
elders in their 80's on the Older Alaskans waiver.
This bill has broad support from a coalition of
providers who have also signed on to our joint Trust
and Advisory Boards' position paper. They include
· Alaska Association on Developmental Disabilities,
serving 2,636 Alaskans
· AgeNet, serving 18,953 Alaskans
· Personal Care Attendant Providers' Association,
serving 3,807 Alaskans
· Assisted Living Association of Alaska, serving
1,500 Alaskans
· Alaska Behavioral Health Association, serving
26,285 Alaskans
10:19:24 AM
TIM SCHUERCH, POLICY ANALYST, ALASKA NATIVE HEALTH BOARD
represented the state's Native Health Organizations. He
stressed that providing basic services in outlying areas has
grown expensive. The medical inflation index and employer's
health insurance increase every year. The rates for home and
community based services have been frozen for nine years. A
rate freeze for cost effective services does save money
overall by preventing and intervening up front. The Alaska
Native Health Board supports SB 32. Concerns include
gathering the necessary data. He stated that the two year
delay was crucial to work with the department to create a
rate establishing methodology.
10:22:16 AM
PAT LUBY, ADVOCACY DIRECTOR, ALASKA ASSOCIATION OF RETIRED
PERSONS (AARP), ANCHORAGE (testified via teleconference), in
favor of the legislation. The goal of home and community
based services is to avoid premature institutionalization
for individuals. Rates must undergo review ensuring that
providers are accurately reimbursed. Older citizens have
fewer options without the help of home and community based
services.
MARITA KAPLAN, SENIOR CITIZENS OF KODIAK (testified via
teleconference). She urged the committee to allow the annual
rate review. The Senior Citizens are challenged with keeping
services alive and having trained staff available. Home
based services are essential for families striving to keep
elders at home.
JACK NIELSON, DEPARTMENT OF HEALTH AND SOCIAL SERVICES
(testified via teleconference). He stated that he works in
the office of rate review, which works directly with cost
reporting and rate setting proposed under SB 32.
Co-Chair Hoffman asked if the department believes that the
rate review must occur annually or is a less frequent review
prudent.
10:27:26 AM
Mr. Nielson replied that his work was involved with statutes
and regulations. Requirements outlined in federal statutes
outline the requirements for rate setting in the Medicaid
program. The department must provide access to services for
clients with rates that are consistent with economy and
efficiency, which has an element of cost. The current laws
do not require a cost review each year.
STEVE LESKO, PRESIDENT OF KEY COALITION OF ALASKA (testified
via teleconference) in favor of the legislation. He asked
that the impact on families be considered. This governs
rebasing, which accounts for mandatory pass through costs on
a periodic basis. Community and home based programs do not
have access to such a process. This fiscal year marks the
fifth year of the rate freeze. These factors have
devastating consequences on the community. He mentioned a
few of the ways impacts are perceived. Families receive
fewer and fewer services. Care for so many is not an option
it is a matter of life and death.
10:33:37 AM
CONNIE SIPE, EXECUTIVE DIRECTOR FOR CENTER FOR COMMUNITIES,
SITKA (testified via teleconference) representing a non-
profit based in Sitka. She spoke in favor of the
legislation. She explained that the budget is made up of 50
percent Medicaid reimbursements. She stated that the center
does not receive grants. She spoke of the areas served in
Southeast Alaska. She stated that the center had 113 clients
in Sitka, Kake, and Ketchikan. Medicaid pays for the
services. She felt that her organization had been unfairly
treated in the Medicaid arena for home and community based
services leading to many position cuts. SB 32 is necessary
to keep home and community based services stable.
10:38:38 AM
EMILY ENNIS, EXECUTIVE DIRECTOR, FAIRBANKS RESOURCE AGENCY
(testified via teleconference), in support of SB 32.
Medicaid supported home and community services enable the
care of people who are not able to independently care for
themselves. She believed that the Medicaid community
services along with hospitals and nursing homes represent
Alaska's long term healthcare system in the community.
10:42:32 AM
DON CLINE, THERAPIST, BRISTOL BAY BEHAVIORAL HEALTH
COORPORATION, DILLINGHAM (testified via teleconference),
spoke in support of SB32. He mentioned the recent
termination of the crisis center, "Our House," which served
as respite for the chronically mentally ill. The center was
closed and the service is missed by both the families and
the mentally ill individuals.
10:46:05 AM
RACHEL GREEN, REPRESENTATIVE FROM THE PALMER SENIOR CENTER
(testified via teleconference), in support of SB 32. She
supported the bill due to the regular rate review of state
services. The senior citizen population is increasing, and
senior citizen services have been underfunded for many
years. This bill allows the necessary tools to provide
educated funding decisions for home and community based
services now and in the future.
10:48:19 AM
EMMA HUNTSMAN, SELF, BARROW (testified via teleconference),
in support of SB 32. She spoke in support of the North Slope
area. She spoke in support of Medicaid and annual rate
reviews. She relayed appreciation for the benefits of
Medicaid utilized by her disabled son.
10:51:14 AM
| Document Name | Date/Time | Subjects |
|---|---|---|
| 2009-02-25 Denali KidCare, CHIP.PDF |
SFIN 2/25/2009 9:00:00 AM SFIN 3/11/2009 9:00:00 AM |
SB 13 |
| Alaska Heating Assistance Programs.ppt |
SFIN 3/11/2009 9:00:00 AM |
SB 116 |
| sectional.pdf |
SFIN 2/25/2009 9:00:00 AM SFIN 3/11/2009 9:00:00 AM |
SB 13 |
| Repercussions.pdf |
SFIN 2/25/2009 9:00:00 AM SFIN 3/11/2009 9:00:00 AM |
SB 13 |
| Poverty Guidelines.pdf |
SFIN 2/25/2009 9:00:00 AM SFIN 3/11/2009 9:00:00 AM |
SB 13 |
| Background of SCHIP.pdf |
SFIN 2/25/2009 9:00:00 AM SFIN 3/11/2009 9:00:00 AM |
SB 13 |
| ANHB Support Letter.pdf |
SFIN 3/11/2009 9:00:00 AM |
SB 116 |
| AVERAGE MONTHLY TEMPERATURES FOR BETHEL ALASKA.doc |
SFIN 3/11/2009 9:00:00 AM |
SB 116 |
| SB 116 - gallons by comunity.xls |
SFIN 3/11/2009 9:00:00 AM |
SB 116 |
| SFIN letters of support addendum.pdf |
SFIN 3/11/2009 9:00:00 AM |
SB 32 |
| SFIN explanation of changes.pdf |
SFIN 3/11/2009 9:00:00 AM |
SB 32 |
| sb13_2009 summary 3-9-09.pdf |
SFIN 3/11/2009 9:00:00 AM |
SB 13 |
| SFIN letters of support.pdf |
SFIN 3/11/2009 9:00:00 AM |
SB 32 |
| SFIN sponsor statement.pdf |
SFIN 3/11/2009 9:00:00 AM |
SB 32 |
| SFIN supporting information.pdf |
SFIN 3/11/2009 9:00:00 AM |
SB 32 |
| sponsor statement.pdf |
SFIN 2/25/2009 9:00:00 AM SFIN 3/11/2009 9:00:00 AM |
SB 13 |
| Work Draft CS for SB116(Fin) 031109.pdf |
SFIN 3/11/2009 9:00:00 AM |
SB 116 |