03/15/2010 09:00 AM Senate FINANCE

SENATE BILL NO. 238                                                                                                           
                                                                                                                                
     "An Act amending the  eligibility threshold for medical                                                                    
     assistance  for persons  in a  medical or  intermediate                                                                    
     care facility."                                                                                                            
                                                                                                                                
9:23:15 AM                                                                                                                    
                                                                                                                                
THOMAS OBERMEYER, STAFF TO SENATOR DAVIS delivered the                                                                          
sponsor statement.                                                                                                              
                                                                                                                              
     In 2003 the Legislature  changed Alaska Statute Section                                                                    
     47.07.020(b)(6),   the   Medicaid  long-term   services                                                                    
     income  eligibility limit  for  persons  in medical  or                                                                    
     intermediate  care  facilities from  300%  Supplemental                                                                    
     Security  Income (SSI)  to an  equivalent fixed  dollar                                                                    
     amount at  $1,656 per  month.   This change  created an                                                                    
     income  ceiling  for  waiver  eligibility,  effectively                                                                    
     freezing  the  eligibility  limit for  the  last  seven                                                                    
     years,  rather  than  allowing   the  limit  to  adjust                                                                    
     annually in tandem  with the SSI.  The  result was that                                                                    
     small Social  Security cost of living  adjustments have                                                                    
     disqualified  many  needy   disabled  people  from  the                                                                    
     program.                                                                                                                   
                                                                                                                                
     Near the  end of 2008  many individuals who  were aged,                                                                    
     blind,  or disabled  and  requiring institutional  care                                                                    
     received notices that they would  no longer be eligible                                                                    
     for  the  Home   and  Community-Based  Services  (HCBS)                                                                    
     waivers after  the 2009 Cost of  Living Adjustment went                                                                    
     into effect.  Because  the waiver eligibility limits no                                                                    
     longer increased with  the cost of living,  it placed a                                                                    
     number of  people over the  $1,656 per month  limit, or                                                                    
     300%  of the  2003 SSI  benefit rate.  The 2009  income                                                                    
     equivalent   at  300%   SSI  was   $2,022  per   month.                                                                    
     Alternatives  for preserving  eligibility, particularly                                                                    
     for  those   requiring  lifetime  or   long-term  care,                                                                    
     include  creation  of   a  Medicaid  qualifying  income                                                                    
     trust,  also known  as  a Miller  Trust.   Trusts  have                                                                    
     procedural      drawbacks,      including      numerous                                                                    
     responsibilities  and restrictions,  limited access  to                                                                    
     income,  assistance of  an attorney,  and a  trustee to                                                                    
     manage trust assets.                                                                                                       
                                                                                                                                
     The  Supplemental Security  Income (SSI)  program is  a                                                                    
     federal needs-based  disability program for  low income                                                                    
     adults over age 65, blind,  or disabled.  For an adult,                                                                    
     the SSI disability requirement is  based on the ability                                                                    
     to  work.   An  adult  is  considered disabled  if  the                                                                    
     person cannot do the work  that he/she performed before                                                                    
     the  disability occurred  or cannot  do alternate  work                                                                    
     because of a severe physical  or mental condition.  For                                                                    
     a  child  to  be  eligible,  he/she  must  suffer  from                                                                    
     serious  physical and/or  mental  problems.   For  both                                                                    
     adults and  children, the disability  must last,  or be                                                                    
     expected to last for at least a year.                                                                                      
                                                                                                                                
     Medicaid  services are  critical to  the well-being  of                                                                    
     Alaska's most  vulnerable citizens.  Supporting  SB 238                                                                    
     will  ensure that  eligible  Alaskans  can continue  to                                                                    
     receive  nursing home  care  and  in-home services.  It                                                                    
     also will  save the Legislature from  amending statutes                                                                    
     every  year  or  two  as   the  Federal  Poverty  Level                                                                    
     guidelines  and  Supplemental  Security  Income  levels                                                                    
     increase with the cost of living.                                                                                          
                                                                                                                                
9:25:58 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman mentioned  the one  zero fiscal  note from                                                                    
the Department of Health and Social Services (DHSS).                                                                            
                                                                                                                                
9:27:29 AM                                                                                                                    
                                                                                                                                
DENISE  DANIELLO, EXECUTIVE  DIRECTOR, ALASKA  COMMISSION ON                                                                    
AGING, testified in  support of SB 238. She  stated that the                                                                    
legislation was  important for elderly Alaskans  who receive                                                                    
small cost of living increases  to their social security and                                                                    
other benefit amounts. The impact  from the freeze is that a                                                                    
small  cost  of  living  adjustment  to  a  person's  social                                                                    
security  can move  the  senior over  the  $1,656 limit  and                                                                    
disqualify them  from receiving  Medicaid long  term support                                                                    
services.  These vulnerable  individuals  are  at risk  both                                                                    
financially and with regards to their health.                                                                                   
                                                                                                                                
9:31:53 AM                                                                                                                    
                                                                                                                                
JON   SHERWOOD,   DIRECTOR,   OFFICE  OF   PROGRAM   REVIEW,                                                                    
DEPARTMENT OF  HEALTH AND SOCIAL SERVICES  (DHSS), testified                                                                    
that  the   bill  would  raise   the  income   standard  for                                                                    
eligibility for  those people who  qualify for  nursing home                                                                    
or waiver  care under Medicaid. The  department's experience                                                                    
shows  that  individuals  who   exceed  the  current  income                                                                    
standard  use  a  qualifying income  trust  to  qualify.  He                                                                    
stated that the department  does not anticipate that raising                                                                    
the  limit would  increase the  number  of people  receiving                                                                    
Medicaid in these categories. He  pointed out that those who                                                                    
qualify  for Medicaid  under this  category  are subject  to                                                                    
make a cost of care  contribution toward their nursing home.                                                                    
The calculation is separate  and performed after determining                                                                    
eligibility.  Nothing   in  the   bill  would   effect  that                                                                    
calculation.  The department  does  not anticipate  changing                                                                    
the calculation if the bill  passes. Individual cost of care                                                                    
contributions will remain the same.                                                                                             
                                                                                                                                
9:33:58 AM                                                                                                                    
                                                                                                                                
SENATOR BETTYE DAVIS encouraged passing  the bill out of the                                                                    
Senate Finance Committee.                                                                                                       
                                                                                                                                
SB  238  was  HEARD  and   HELD  in  Committee  for  further                                                                    
consideration.