Legislature(2023 - 2024)BUTROVICH 205

03/19/2024 03:30 PM Senate HEALTH & SOCIAL SERVICES

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ SB 233 CHILD CARE PROVIDER EDUCATION REQUIREMENT TELECONFERENCED
Heard & Held
+= SB 241 MEDICAL ASSIST. DEMONSTRATION PROJECTS TELECONFERENCED
Heard & Held
*+ HB 344 MEDICAL ASSIST. DEMONSTRATION PROJECTS TELECONFERENCED
<Pending Referral>
Scheduled but Not Heard
+ Bills Previously Heard/Scheduled TELECONFERENCED
           SB 241-MEDICAL ASSIST. DEMONSTRATION PROJECTS                                                                    
                                                                                                                                
 4:06:01 PM                                                                                                                   
 CHAIR  WILSON   reconvened   the   meeting  and   announced   the                                                              
 consideration of SENATE BILL NO. 241 "An Act relating  to medical                                                              
 assistance demonstration projects  established by the  Department                                                              
 of Health."                                                                                                                    
                                                                                                                                
CHAIR WILSON stated SB 241 the companion bill to HB 344.                                                                        
                                                                                                                                
4:06:59 PM                                                                                                                    
HEIDI  HEDBERG, Commissioner,  Department  of Health,  Anchorage,                                                               
Alaska,  introduced SB  241 on  behalf of  the administration  by                                                               
explaining  that it  will grant  the Department  of Health  (DOH)                                                               
permission  to apply  for a  Medicaid  demonstration waiver.  The                                                               
waiver is intended  to improve the health of  Alaskans and reduce                                                               
healthcare costs.                                                                                                               
                                                                                                                                
4:07:36 PM                                                                                                                    
ANNE  ZINK,  MD, Chief  Medical  Officer,  Department of  Health,                                                               
Anchorage, Alaska, introduced herself.                                                                                          
                                                                                                                                
4:07:43 PM                                                                                                                    
EMILY  RICCI, Deputy  Commissioner, Department  of Health  (DOH),                                                               
Juneau, Alaska,  moved to  slide 2,  a map  of the  United Stated                                                               
showing total health  care expenditures per capita  for 2020. She                                                               
emphasized  that Medicaid  is a  critical  component of  Alaska's                                                               
healthcare  delivery   system,  covering  about  38   percent  of                                                               
Alaskans. She  highlighted its  importance as  an insurer  in the                                                               
state and  noted that  it shapes  the healthcare  delivery system                                                               
which  responds  to what  is  being  paid  for and  the  services                                                               
provided. She pointed out that  healthcare expenditures in Alaska                                                               
and the U.S. are very high,  prompting the need to assess whether                                                               
the outcomes match  the investments being made at  both the state                                                               
and national levels.                                                                                                            
                                                                                                                                
MS. RICCI  explained that if  the outcomes are not  aligning with                                                               
the investments,  it's important to  examine the system  and find                                                               
ways  to leverage  those investments  to  improve results.  Given                                                               
Medicaid's role  in Alaska,  she stressed that  the state  has an                                                               
opportunity to address unmet needs  and identify gaps where there                                                               
is a disconnection between investment and outcomes.                                                                             
                                                                                                                                
4:09:18 PM                                                                                                                    
MS.  RICCI  moved  to  slide   3,  a  chart  of  Alaska  Medicaid                                                               
utilization,  illustrating a  key  concept  in health  insurance,                                                               
showing how a small percentage  of Medicaid beneficiaries account                                                               
for a large  portion of the spending. She explained  that about 5                                                               
percent  of  beneficiaries  represent   50  percent  of  Medicaid                                                               
spending,  which  totaled  approximately $1.3  billion  in  state                                                               
fiscal  year  2023.  Additionally, 10  percent  of  beneficiaries                                                               
account for 67 percent of the spending, or about $1.7 billion.                                                                  
                                                                                                                                
MS. RICCI noted  that as the state looks to  create a sustainable                                                               
Medicaid  program,  it  is  essential to  focus  on  areas  where                                                               
 individuals with high acute needs are consistently  engaging with                                                              
 the system. The  goal is to  find ways  to improve both  outcomes                                                              
 and  the  program's  fiscal  sustainability.  She  said   today's                                                              
 presentation would focus on those unmet needs  disproportionately                                                              
 affecting this high-cost portion  of the Medicaid population  and                                                              
 explore alternatives to address them.                                                                                          
                                                                                                                                
 4:10:35 PM                                                                                                                   
 MS. RICCI moved to slide  4 a graph depicting the utilization  of                                                              
 Alaska's emergency  department.  She  explained  that  the  graph                                                              
 provides another perspective on individuals with acute  needs who                                                              
 are   using    the    healthcare    system    inefficiently    or                                                              
 inappropriately. The graph outlines  the number of patients  with                                                              
 more than 10  emergency department  visits per year,  as well  as                                                              
 the  median  number   of  visits   for  those  individuals.   She                                                              
 highlighted that, once again,  a small portion of the  population                                                              
 with very acute needs is  utilizing the system at highly  intense                                                              
 levels.                                                                                                                        
                                                                                                                                
 4:11:10 PM                                                                                                                   
 CHAIR WILSON asked  whether the  data had been  broken down  into                                                              
 the types  of visits, specifically  whether the  visits were  for                                                              
 medical or behavioral health issues.                                                                                           
                                                                                                                                
 MS. RICCI  explained  that when  the  data  was broken  down  and                                                              
 examined in more detail, it  was found that a high percentage  of                                                              
 these cases involved a behavioral health diagnosis.                                                                            
                                                                                                                                
 4:11:43 PM                                                                                                                   
 DR. ZINK  on  slide  4,  explained that  the  data  highlights  a                                                              
 critical issue, particularly with patients who cycle  through the                                                              
 emergency department repeatedly  without receiving the  necessary                                                              
 care. She shared  that this experience  initially drove her  into                                                              
 policy work, as she observed both the significant time  and money                                                              
 spent on patients,  yet without addressing  their real needs  due                                                              
 to systemic shortcomings.  She noted that  systems, which can  be                                                              
 controlled and changed, are often failing patients.  Referring to                                                              
 the highest  utilizersthose   with over  75 visits  per  yearshe                                                               
 stated that all  had a behavioral  health diagnosis coded  within                                                              
 the  last   six   months.  She   explained  the   complexity   of                                                              
 distinguishing the root  cause, as  physical ailments like  heart                                                              
 failure  or autoimmune  diseases  can  lead  to  conditions  like                                                              
 degenerative bone disease, which may require opioids,  and result                                                              
 in  depression.  She  emphasized  the  close  connection  between                                                              
 physical and  mental  health,  adding  that  although  healthcare                                                              
 payment  systems   often   separate   them,   both   are   deeply                                                              
intertwined.  In  the  case  of the  highest  utilizers,  a  high                                                               
percentage had behavioral health diagnoses.                                                                                     
                                                                                                                                
4:13:13 PM                                                                                                                    
CHAIR TOBIN sked about the  intersection of dental health and its                                                               
impact on  high utilizers, specifically how  plaque buildup might                                                               
lead to further health consequences.  She also inquired about the                                                               
age breakdown  of the high utilizers,  asking if they tend  to be                                                               
older, younger, or middle-aged individuals.                                                                                     
                                                                                                                                
4:13:51 PM                                                                                                                    
DR. ZINK said  the department would provide the  committee with a                                                               
broader  age  breakdown.  She  noted  that  Alaska  data  can  be                                                               
challenging due  to small sample  sizes, highlighting  that there                                                               
were seven  patients with  over 100  visits, with  one individual                                                               
having over 200  visits per year. Some high utilizers,  such as a                                                               
patient with over  300 visits annually for almost  a decade, have                                                               
since  passed away,  making  generalizations  difficult in  small                                                               
numbers. Regarding  dental health, she explained  that the waiver                                                               
primarily  focuses   on  health-related   needs  such   as  food,                                                               
transportation, and  housing, and  while they will  discuss diet-                                                               
sensitive conditions, dental care  wasn't specifically broken out                                                               
in the data. She added that,  as a physician, it can be difficult                                                               
to  directly   attribute  dental  conditions   like  inflammation                                                               
leading  to cardiovascular  disease because  emergency department                                                               
visits  might focus  on  the  immediate issue,  such  as a  heart                                                               
attack. Although dental  care can be a  contributing factor, it's                                                               
hard to account for on an individual level.                                                                                     
                                                                                                                                
4:15:20 PM                                                                                                                    
CHAIR   WILSON  humorously   commented  that   at  a   healthcare                                                               
conference, teeth were  referred to as "luxury  bones" since many                                                               
insurance  companies   don't  cover  dental  care,   even  though                                                               
neglecting dental health can lead to major chronic conditions.                                                                  
                                                                                                                                
4:15:47 PM                                                                                                                    
DR. ZINK moved to slide 5,  pointed out that taking care of these                                                               
issues  is important,  as they  have broader  impacts on  overall                                                               
health.  She   explained  that  the  department   is  focused  on                                                               
addressing  the  whole  personbehavioral,  mental,  and  physical                                                               
healthwhile  recognizing that aspects  like dental care also play                                                               
a role  in overall health.  She then noted that  individuals with                                                               
multiple chronic  conditions tend to  be much more  expensive for                                                               
the system,  with costs significantly  increasing for  those with                                                               
eight or  more chronic  conditions, up  to $81,000  annually. She                                                               
highlighted  that  some  conditions are  modifiable,  like  those                                                               
influenced  by diet  and  lifestyle, while  others  are not.  She                                                               
 pointed out that  over two-thirds  of Alaskans have  one or  more                                                              
 chronic  conditions   and   discussed   modifiable   diet-related                                                              
 conditions  such  as  obesity  (68  percent),  hypertension   (31                                                              
 percent), high  cholesterol (27 percent),  diabetes (8  percent),                                                              
 and heart  disease (5  percent). These  conditions contribute  to                                                              
 high  healthcare   costs  and  mortality.   She  emphasized   the                                                              
 importance of  addressing  these issues  early,  as the  cost  of                                                              
 treating just  one chronic  condition  adds approximately  $7,500                                                              
 per individual. She  also referenced the  Fresh Start program,  a                                                              
 public health  initiative that  provides free  resources to  help                                                              
 Alaskans address  chronic  conditions.  The department  has  been                                                              
 listening to Alaskans across regions to better understand  what's                                                              
 working and what's not in addressing chronic conditions.                                                                       
                                                                                                                                
 4:18:11 PM                                                                                                                   
 DR.  ZINK  then  moved  to  slide  6,  discussing   two  specific                                                              
 programs. The Produce  Prescriptions program,  run by the  Yukon-                                                              
 Kuskokwim Health Corporation (YKHC) since 2018,  targets diabetes                                                              
 by  providing   healthier  food   options  through   grant-funded                                                              
 efforts. The program supports patients like elders  with diabetes                                                              
 and pregnant  women with gestational  diabetes. Another  program,                                                              
 the  Multi-Visit  Person  (MVP)  program  at  Bartlett   Regional                                                              
 Hospital in  Juneau,  coordinates  care for  patients  frequently                                                              
 cycling through  the  emergency  department,  focusing  on  food,                                                              
 housing,  and  transportation.  She   also  mentioned  the   High                                                              
 Utilizer Mat-Su (HUMS) program, which has saved  approximately $5                                                              
 million  through   emergency   department   and   hospitalization                                                              
 avoidance for  its  120  participants by  addressing  non-medical                                                              
 needs like  lodging,  food, and  transportation. She  noted  that                                                              
 these programs  illustrate  how addressing  health-related  needs                                                              
 can keep patients healthier and reduce hospital visits.                                                                        
                                                                                                                                
 4:20:01 PM                                                                                                                   
 DR. ZINK moved  to slide  7, showing a  pyramid that  illustrates                                                              
 the relationship  between  health-related  needs  services,  with                                                              
 prevention at the base and  treatment at the peak. She  clarified                                                              
 that the  1115 waiver  is  not meant  to replace  existing  food,                                                              
 housing,  or  transportation  programs,  but  to  provide   time-                                                              
 limited,  medically  necessary  support   for  those  with   high                                                              
 healthcare needs. She emphasized that the Centers for  Medicare &                                                              
 Medicaid   Services   (CMS)   requires   that   these    services                                                              
 specifically target patients with high healthcare costs,  such as                                                              
 those  recently   hospitalized  for   heart  failure   or   acute                                                              
 psychiatric  conditions,  to  prevent  costly  readmissions   and                                                              
 emergency department visits.                                                                                                   
                                                                                                                                
 4:21:27 PM                                                                                                                   
DR. ZINK  moved to slide  8, providing an example  from nutrition                                                               
services. She  said there is  a considerable amount of  data from                                                               
multiple  states using  waivers to  provide targeted  support for                                                               
medical conditions. One  example of target support  is a pregnant                                                               
woman  with   gestational  diabetes,   who  would   benefit  from                                                               
additional  nutritional support  to  manage her  blood sugar  for                                                               
both  her health  and  her  baby's. Another  example  is a  heart                                                               
attack patient  managing heart failure,  who would need  a strict                                                               
low-sodium diet  to avoid returning to  the emergency department.                                                               
She explained that nutritional  services might include education,                                                               
grocery delivery,  or meal delivery,  depending on  the patient's                                                               
specific needs.  For example, someone reliant  on microwave meals                                                               
might  benefit  from  medically  tailored  meals,  while  another                                                               
person  with the  ability  to cook  might  need just  nutritional                                                               
education. Studies,  such as those from  Massachusetts, show that                                                               
providing medically  tailored meals resulted in  significant cost                                                               
savingsaround    16  percent   overallwith    70  percent   fewer                                                               
inpatient admissions  and 72  percent fewer  emergency department                                                               
transports.                                                                                                                     
                                                                                                                                
4:23:31 PM                                                                                                                    
SENATOR TOBIN expressed curiosity  about whether the waiver could                                                               
potentially  cover   allergy  testing  or  efforts   to  identify                                                               
autoimmune  responses,  such as  in  a  patient with  undiagnosed                                                               
Crohn's disease. She asked if  this type of diagnostic work falls                                                               
under the waiver or if it is a different process.                                                                               
                                                                                                                                
4:23:57 PM                                                                                                                    
DR. ZINK explained that allergy  testing can currently be covered                                                               
by  Medicaid, depending  on the  patient's  needs. She  clarified                                                               
that the waiver  being discussed focuses on  services outside the                                                               
traditional healthcare  system. CMS has approved  various waivers                                                               
in the past,  and the scope of Alaska's  waiver application could                                                               
be broad or narrow. However,  the application process has not yet                                                               
started, as legislative  approval is needed to  move forward. She                                                               
noted that  the department  would discuss  the steps  involved in                                                               
the process later on in the presentation.                                                                                       
                                                                                                                                
SENATOR TOBIN  clarified her  question, asking  if a  patient who                                                               
repeatedly presents at the  hospital with inflammation, undergoes                                                               
allergy  testing, and  is diagnosed  with  Crohn's disease  could                                                               
receive meal services under the waiver.                                                                                         
                                                                                                                                
4:25:11 PM                                                                                                                    
MS. RICCI  responded that  the department is  hesitant to  give a                                                               
definitive answer  because the types  of support  offered through                                                               
the waiver  are not necessarily traditional  healthcare services.                                                               
 What  medical   conditions  will   qualify  for   non-traditional                                                              
 services are defined by the state through the waiver  process and                                                              
 its own program  design. The state decided  in its analysis  that                                                              
 time-limited  prescription  support  is  valuable  for  Alaskans.                                                              
 While time-limited support for a patient with Crohn's  disease is                                                              
 something the department could consider, most states'  frameworks                                                              
 focus narrowly on conditions with very frequent  readmissions and                                                              
 high-cost utilization.  Alaska can  define its  own framework  in                                                              
 this process.                                                                                                                  
                                                                                                                                
 4:26:18 PM                                                                                                                   
 SENATOR TOBIN  highlighted  concerns  about  Alaska's  Indigenous                                                              
 populations, using  dairy  as  an  example. She  noted  that  the                                                              
 Western food  system  may not  suit  all Alaskans  and  suggested                                                              
 considering these  unique factors when  addressing health  issues                                                              
 in the state.                                                                                                                  
                                                                                                                                
 4:26:45 PM                                                                                                                   
 MS. RICCI  stated that the  department has  met extensively  with                                                              
 stakeholders and  will continue to  do so  throughout the  waiver                                                              
 process. This  includes  tribal  health organizations  and  other                                                              
 groups across the state. As ideas arise, they will  be evaluated.                                                              
 She noted  that stakeholders have  expressed a  desire for  clear                                                              
 guidelines on  what  the  waiver  will and  will  not  cover  but                                                              
 emphasized that they are still  in the early stages of  exploring                                                              
 options. The department will need contractual and  actuarial work                                                              
 to determine  the best  fit for  Alaska's  Medicaid program,  and                                                              
 they remain open to input.                                                                                                     
                                                                                                                                
 4:27:40 PM                                                                                                                   
 CHAIR WILSON  noted  that the  discussion  seems to  involve  two                                                              
 different waivers, referencing Medicaid's social determinants  of                                                              
 health and  social  drivers  of  health waivers,  as  well  as  a                                                              
 medicine waiver. With  transportation now  being added, he  asked                                                              
 whether the  department  is combining  these waivers  to  address                                                              
 health-related needs in  one omnibus waiver, or  if they plan  to                                                              
 apply for multiple individual waivers.                                                                                         
                                                                                                                                
 4:28:11 PM                                                                                                                   
 MS. RICCI explained that the 1115 waivers are a federal  tool for                                                              
 states to  cover  different  types of  services.  Whether  Alaska                                                              
 modifies its existing 1115 waiver  or applies for a new one  will                                                              
 depend on further analysis  with consultants and the Centers  for                                                              
 Medicare  and Medicaid  Services  (CMS)  to  determine  the  most                                                              
 effective approach.  She said  she does  not  envision the  state                                                              
 applying for multiple 1115 waivers for each service;  instead, it                                                              
would  likely  combine them  into  one  or two  waivers  covering                                                               
related topics, as other states have done.                                                                                      
                                                                                                                                
4:29:04 PM                                                                                                                    
MS. RICCI  also noted  that this area  is evolving  rapidly, with                                                               
CMS updating  its approval processes  every 120 to 180  days. The                                                               
proposed legislation  seeks authorization  to apply for  a waiver                                                               
that addresses  broad categories of services  states are focusing                                                               
on,  as outlined  by CMS's  streamlined 1115  process. While  the                                                               
final product is still uncertain,  legislative approval is needed                                                               
before  the  state  can  proceed with  the  time-  and  resource-                                                               
intensive application process.                                                                                                  
                                                                                                                                
4:30:00 PM                                                                                                                    
CHAIR WILSON  expressed concern about granting  blanket authority                                                               
to  apply for  waivers without  the department  returning to  the                                                               
legislature to review costs and  other specifics. He acknowledged                                                               
the  goals  and   supported  them  but  is   cautious  about  the                                                               
legislative  authority over  waivers,  pointing out  that once  a                                                               
waiver  is approved,  the department  could modify  or cancel  it                                                               
without legislative  input. He  mentioned that  this has  been an                                                               
ongoing  conversation  with   the  administration  regarding  how                                                               
waiver authority  is being used  in the state. He  clarified that                                                               
the department  doesn't need  to address  this concern  and could                                                               
continue its presentation.                                                                                                      
                                                                                                                                
4:31:15 PM                                                                                                                    
DR. ZINK explained that many  states have 1115 waivers, with some                                                               
maintaining  a single,  continuously  updated  waiver and  others                                                               
handling  multiple  waivers.  CMS  has  emphasized  that  health-                                                               
related social  needs are major  drivers of healthcare  costs and                                                               
has  encouraged  states  to address  them.  SB  241  specifically                                                               
targets  those health-related  social needs  as outlined  by CMS.                                                               
She  clarified  that,  while  Alaska   has  an  1115  waiver  for                                                               
behavioral  health, this  issue  is distinct,  which  is why  the                                                               
department consulted  with legal  counsel and  chose to  bring it                                                               
separately  to   the  legislature.  Although   behavioral  health                                                               
diagnoses can be linked to  health-related social needs, this new                                                               
proposal  focuses  on  improving Alaskans'  health  and  reducing                                                               
costs,  particularly  in  avoiding repeat  hospitalizations.  She                                                               
emphasized  the  department's  intent  to  collaborate  with  the                                                               
legislature.                                                                                                                    
                                                                                                                                
4:32:25 PM                                                                                                                    
MS.  RICCI  acknowledged  that  the committee  is  aware  of  the                                                               
budgetary process  and noted  that the  budget authority  for the                                                               
Medicaid program  is ultimately appropriated by  the legislature.                                                               
 Any  budgetary   impact   related   to  Medicaid   will   require                                                              
 legislative review and approval.  She also pointed out that  1115                                                              
 waivers have  guardrails  regarding  federal  budget  neutrality,                                                              
 meaning there will likely be a financial component to consider.                                                                
 She  explained  that  many  states  have  leveraged   anticipated                                                              
 federal  savings early  in  the  process  to  reinvest  in  their                                                              
 systems, and Alaska could pursue  a similar approach if it  makes                                                              
 sense. However,  the  department  would  need to  return  to  the                                                              
 legislature for  budgetary approval  before moving  forward.  She                                                              
 emphasized that  there  will  be  checks and  balances  with  the                                                              
 legislature before any changes are implemented.                                                                                
                                                                                                                                
 4:33:36 PM                                                                                                                   
 CHAIR WILSON  expressed concern about  the reapplication  process                                                              
 for an  approved  1115 waiver,  noting  that the  state  recently                                                              
 reapplied  for  the  current  1115  waiver  without   legislative                                                              
 approval,  oversight,   or  modifications,   despite  not   fully                                                              
 implementing the first waiver. He highlighted reports  indicating                                                              
 issues during the  implementation period  of the existing  waiver                                                              
 and raised concerns about the lack of legislative  involvement in                                                              
 the waiver process. While  he acknowledged the value of  waivers,                                                              
 he  questioned  how  they  are  implemented  without   sufficient                                                              
 legislative  oversight.   He   also  suggested   considering   an                                                              
 amendment to the current waiver to include additional  authority,                                                              
 such as  exploring  the Department  of Corrections  (DOC)  waiver                                                              
 process to  allow soon  to  be released  inmates to  qualify  for                                                              
 Medicaid. He  noted  that  other  states have  pursued  this  and                                                              
 suggested it could be an opportunity for future consideration.                                                                 
                                                                                                                                
 4:34:59 PM                                                                                                                   
 MS.  RICCI   added   that  the   department  is   exploring   new                                                              
 opportunities to  support incarcerated  individuals  pre-release,                                                              
 particularly under the  existing work  authorized by Senate  Bill                                                              
 74 and  the 1115  behavioral health  waiver. She  noted that  the                                                              
 activities available through the Centers for Medicare  & Medicaid                                                              
 Services (CMS) reentry  waiver align  with the behavioral  health                                                              
 and  substance  use  services  already  covered  under   Alaska's                                                              
 current statutory  authority.  Therefore,  while  not  explicitly                                                              
 included in  this bill, the  department believes  it already  has                                                              
 the statutory authority to pursue those services.  She emphasized                                                              
 that the department is  aware of this  and is considering how  it                                                              
 could be applied in Alaska.                                                                                                    
                                                                                                                                
 4:35:52 PM                                                                                                                   
 CHAIR WILSON  acknowledged that  these conversations  have  taken                                                              
 place off the record but expressed his desire to have  them noted                                                              
 on the record.                                                                                                                 
                                                                                                                                
4:35:56 PM                                                                                                                    
DR. ZINK highlighted  that for nutrition services  to be approved                                                               
by CMS,  both a medical and  a social component must  be present.                                                               
In  response to  Senator  Tobin's earlier  comment about  Crohn's                                                               
disease, she  explained that a  person would need both  a medical                                                               
condition and an unmet social  need, such as homelessness or lack                                                               
of access  to food. She emphasized  that cultural appropriateness                                                               
is  also  considered,  referencing  the  success  of  the  Yukon-                                                               
Kuskokwim Health  Corporation (YKHC) program, which  tailors food                                                               
options  to  reduce  diabetes risk  by  addressing  local  needs,                                                               
transportation, and genetic factors.                                                                                            
                                                                                                                                
4:37:01 PM                                                                                                                    
DR. ZINK API  moved to slide 9 and said  the waiver could address                                                               
housing   for  patients   discharged   from  Alaska   Psychiatric                                                               
Institute  (API),  noting that  around  60  percent of  them  are                                                               
either  underhoused  or homeless.  For  example,  a patient  with                                                               
schizophrenia who  has lost  their job and  housing may  be doing                                                               
well after treatment at API  but struggles to reintegrate without                                                               
stable housing or  transportation. Temporary, medically necessary                                                               
housing could provide the support  needed to help patients regain                                                               
stability,  such  as  securing  a  job  or  renewing  a  driver's                                                               
license.  She emphasized  that  transitioning  from inpatient  to                                                               
outpatient  care  can  be challenging,  particularly  when  acute                                                               
mental health  issues disrupt social support  networks, jobs, and                                                               
housing.                                                                                                                        
                                                                                                                                
4:38:32 PM                                                                                                                    
CHAIR WILSON  asked for clarification  on what type  of temporary                                                               
housing  is  being  proposed.  He  inquired  whether  this  would                                                               
involve something  like an  assisted living  facility with  a day                                                               
rate  or  if  the  department  is  referring  to  paying  for  an                                                               
apartment or housing with caregivers.                                                                                           
                                                                                                                                
DR. ZINK explained  that the type of housing  support will depend                                                               
on  how  the  waiver  is  scoped and  the  results  of  actuarial                                                               
analysis to determine where the  greatest impact can be made. She                                                               
noted that  other states are  paying for temporary  housing, such                                                               
as  an apartment,  often  with a  caseworker  nearby. This  would                                                               
apply  to individuals  who  do not  qualify  for other  medically                                                               
covered  needs,   such  as  a  skilled   nursing  facility  after                                                               
discharge  from  a hospital.  She  gave  an example  from  Yukon-                                                               
Kuskokwim  Health Corporation  (YKHC), where  a patient  could be                                                               
discharged  to temporary  housing in  Bethel, receive  behavioral                                                               
health  services,  and  stabilize  on  their  medications  before                                                               
 returning to  their community or  village, instead  of making  an                                                              
 immediate leap from discharge back home.                                                                                       
                                                                                                                                
 4:39:47 PM                                                                                                                   
 MS.  RICCI moved  to  slide  10  explained  that  the  waiver  is                                                              
 designed to  tailor Medicaid to  address some  of Alaska's  unmet                                                              
 needs,  which   contribute   to   increasing,   yet   potentially                                                              
 avoidable, healthcare  utilization. Medicaid  is a  state-federal                                                              
 partnership, and  new federal  support encourages  innovation  in                                                              
 Medicaid, particularly  to address  these unmet  needs. The  1115                                                              
 waivers are  demonstration  waivers that  allow states  to  cover                                                              
 services typically not included under Medicaid for a  set period,                                                              
 usually five  years,  with renewal  possible  if the  waiver  can                                                              
 demonstrate that it does not  cost more than what Medicaid  would                                                              
 have paid without the waiver. Additionally, the waiver  must show                                                              
 positive impacts on health outcomes.                                                                                           
                                                                                                                                
 4:40:53 PM                                                                                                                   
 MS. RICCI moved to slide 11 and emphasized that  when considering                                                              
 changes to the Medicaid  program, it's important to identify  the                                                              
 population being  served, particularly focusing  on the  5 to  10                                                              
 percent of Medicaid users  driving $1.7 billion in annual  costs.                                                              
 She stressed  that the  department's goal  is  to shift  Medicaid                                                              
 spending from  acute  services  to preventive  care  or  reducing                                                              
 acute  care  needs,  ultimately  supporting  the  Department   of                                                              
 Health's mission  to promote  the health,  well-being, and  self-                                                              
 sufficiency of all Alaskans.                                                                                                   
                                                                                                                                
 4:41:46 PM                                                                                                                   
 DR. ZINK moved to side 12 and stated that the overall  goal is to                                                              
 improve  health  outcomes  and   reduce  downstream  costs.   She                                                              
 emphasized that  healthier  people  are less  expensive  for  the                                                              
 healthcare system and that a healthy population is  essential for                                                              
 economic growth  and sustainability in  Alaska. The  focus is  on                                                              
 shifting resources  away  from high-risk  Medicaid  beneficiaries                                                              
 and toward  prevention,  wellness,  and  addressing  unmet  needs                                                              
 across the system.                                                                                                             
                                                                                                                                
 4:42:11 PM                                                                                                                   
 MS. RICCI moved to side 13  explained that the purpose of SB  241                                                              
 is to  provide  the  department with  specific  authorization  to                                                              
 apply for an 1115 waiver. She noted that Senate Bill 74  laid the                                                              
 groundwork  for   the   department   to   explore   such   waiver                                                              
 opportunities, and recent options  from the Centers for  Medicare                                                              
 & Medicaid  Services  (CMS) have  led  states to  reassess  their                                                              
 Medicaid coverage.  SB 241  is essential  for  Alaska to  proceed                                                              
with its  waiver application as  the department  determines which                                                               
services best address the state's needs.                                                                                        
                                                                                                                                
4:42:54 PM                                                                                                                    
SENATOR TOBIN  asked about the  potential impact of  the upcoming                                                               
election  cycle on  the waiver  approval process,  noting that  a                                                               
change in  administration could affect federal  partnerships. She                                                               
inquired whether  the department  anticipates any  disruptions to                                                               
the process if there is a  shift in administration at the federal                                                               
level.                                                                                                                          
                                                                                                                                
4:43:26 PM                                                                                                                    
MS. RICCI responded  that she couldn't speculate on  how a change                                                               
in administration  might affect  the process. However,  she noted                                                               
that  over  16 states,  including  Florida,  Arkansas, Utah,  and                                                               
Arizona, have already implemented,  or negotiated similar waivers                                                               
with   CMS.  While   each  administration   may  have   different                                                               
priorities,  she  believes  that  with so  many  states  actively                                                               
pursuing  these   waivers,  it  would  be   difficult  to  change                                                               
direction quickly.                                                                                                              
                                                                                                                                
4:44:15 PM                                                                                                                    
DR. ZINK  added that  the department had  asked this  question to                                                               
their  technical  assistance  (TA) partners.  Historically,  even                                                               
with changes in administrations, waivers  that have been approved                                                               
tend to  remain in  place. These waivers  become embedded  in how                                                               
states operate,  making it difficult to  reverse specific changes                                                               
at CMS once they are implemented.                                                                                               
                                                                                                                                
4:44:41 PM                                                                                                                    
MS.  RICCI  moved to  side  14  and  discussed  some of  the  new                                                               
opportunities  identified  by CMS  for  1115  waivers to  address                                                               
health-related needs, including  food security, transportation to                                                               
medical  appointments, temporary  housing,  and case  management.                                                               
She  also mentioned  workforce  development,  which was  recently                                                               
approved  in New  York and  is something  Alaska is  considering.                                                               
Moving to  the financial  considerations, she  highlighted budget                                                               
neutrality and  the possibility of  pulling down  federal savings                                                               
in  advance to  reinvest  in the  system,  noting that  providers                                                               
would  need to  adapt  to these  changes  within Medicaid,  which                                                               
could be challenging.                                                                                                           
                                                                                                                                
4:45:23 PM                                                                                                                    
MS.   RICCI   moved  to   slide   15   and  discussed   financial                                                               
considerations.  She   highlighted  budget  neutrality   and  the                                                               
possibility  of  pulling  down  federal  savings  in  advance  to                                                               
reinvest  in the  system,  noting that  providers  would need  to                                                               
 adapt  to  these   changes  within   Medicaid,  which  could   be                                                              
 challenging:                                                                                                                   
                                                                                                                                
 [Original punctuation provided.]                                                                                               
                                                                                                                              
      Financial Considerations                                                                                                
       Budget Neutrality: Centers for Medicare and Medicaid                                                                     
      Services  requires  budget  neutrality  for  all   1115                                                                   
      waivers.                                                                                                                  
   • Alaska Medicaid Spending: The legislature authorizes                                                                     
      Medicaid spending annually.                                                                                               
   • Efficiencies in Care: There is strong evidence that                                                                      
      addressing   health-related   needs   improves   health                                                                   
      outcomes and reduces costs.                                                                                               
                                                                                                                                
                                                                                                                                
4:46:21 PM                                                                                                                    
 MS. RICCI moved to slide  16 and said the sectional analysis  for                                                              
 SB 241 authorizes  the department to  apply for  a 115 waiver  to                                                              
 establish  one  or   more  demonstration   projects  focused   on                                                              
 addressing  health-related  social  needs  for  Alaska   Medicaid                                                              
 recipients in  one or  more specific  geographic  areas. It  also                                                              
 defines "health-related needs" as  social or economic  conditions                                                              
 that contribute to an individual's poor health outcomes:                                                                       
                                                                                                                                
 [Original punctuation provided.]                                                                                               
                                                                                                                                
                       SECTIONAL ANALYSIS                                                                                       
       Senate Bill 241: Medical Assistance Demonstration                                                                        
                            Projects                                                                                            
      Section 1.  Adds  a new  section  (h) to  AS  47.07.036                                                                 
      authorizing the department to apply for an 1115  waiver                                                                   
      to  establish  one   or  more  demonstration   projects                                                                   
      focused on addressing  health-related needs for  Alaska                                                                   
      Medicaid recipients in one or more specific  geographic                                                                   
      areas.                                                                                                                    
                                                                                                                                
      Defines "health-related  needs" as  social or  economic                                                                   
      conditions that  contribute  to  an  individual's  poor                                                                   
      health  outcomes.  Examples  of  health-related   needs                                                                   
      include  nutrition   and   food   security,   workforce                                                                   
      development,  transportation,  temporary  housing,   or                                                                   
      case management.                                                                                                          
                                                                                                                                
 4:46:47 PM                                                                                                                   
DR. ZINK  moved to  slide 17, which  displayed a  chart outlining                                                               
Alaska's  waiver process  with a  photograph  of a  river in  the                                                               
background.  She  emphasized  that  SB 241  is  not  intended  to                                                               
replace  any grant-based  services.  Instead, it  allows for  the                                                               
possibility   of   implementing   services  in   phases   through                                                               
demonstration projects over time.                                                                                               
                                                                                                                                
[Original punctuation provided.]                                                                                                
                                                                                                                                
     Department of Health                                                                                                     
                                                                                                                                
     Preparation                                                                                                              
     Partner Engagement                                                                                                         
     Tribal Engagement                                                                                                          
     Technical Assistance                                                                                                       
     Legislative Input and Authority - WE ARE HERE                                                                              
                                                                                                                                
     Development                                                                                                              
     Actuarial Analysis                                                                                                         
     Partner Engagement                                                                                                         
     Tribal Consultation                                                                                                        
     Waiver Proposal Drafting                                                                                                   
                                                                                                                              
     Consultation                                                                                                             
     Tribal Consultation                                                                                                        
     CMS Negotiation                                                                                                            
     Public Comment                                                                                                             
                                                                                                                                
     Approval                                                                                                                 
     CMS Approval                                                                                                               
     Annual Budget Process                                                                                                      
                                                                                                                                
     Implementation                                                                                                           
     Infrastructure and Capacity Building                                                                                       
     Services Available to Eligible Alaskans                                                                                    
                                                                                                                                
     Review                                                                                                                   
     Required Annual Reporting to CMS                                                                                           
     Annual Budget Process                                                                                                      
     Renewal Opportunities                                                                                                      
                                                                                                                                
4:49:12 PM                                                                                                                    
CHAIR WILSON asked if there is  a timeframe for each block of the                                                               
waiver process, assuming all conditions  are ideal, and variables                                                               
are controlled.                                                                                                                 
                                                                                                                                
4:49:32 PM                                                                                                                    
 MS. RICCI replied that although  she was not with the  department                                                              
 during the creation  of the behavioral  health and substance  use                                                              
 disorder 1115 waiver,  she estimated the  process could take  one                                                              
 to two years. The timeline depends on how quickly  the department                                                              
 can  move internally,  bring  on  contractors,  and  address  key                                                              
 questions. She  added  that  the implementation  timeframe  would                                                              
 also  depend   on  the   readiness  of   different  regions   and                                                              
 communities within the state, but she did not have a  clear sense                                                              
 of that readiness at this time.                                                                                                
                                                                                                                                
 4:50:20 PM                                                                                                                   
 DR. ZINK noted  that states have  found the implementation  phase                                                              
 challenging, as providers need  to rethink their service  models.                                                              
 However, she emphasized that  the process of discussion has  been                                                              
 extremely  valuable.   It  has   fostered  collaboration   across                                                              
 different  groups  in  the   state,  which  is  influencing   and                                                              
 inspiring various divisions  within the  Department of Health  to                                                              
 explore  new approaches,  even  without  needing  a  waiver.  She                                                              
 highlighted that these conversations have already led  to changes                                                              
 by encouraging a more holistic approach to care. The  river slide                                                              
 was chosen  because  it  represents the  gathering  of  different                                                              
 ideas and  information, flowing  together to  become a  long-term                                                              
 waiver.                                                                                                                        
                                                                                                                                
 4:51:07 PM                                                                                                                   
 CHAIR WILSON  expressed  concern,  similar  to  Senator  Tobin's,                                                              
 about potential changes in  the federal administration  affecting                                                              
 the waiver  process.  He  mentioned a  conversation  with  Daniel                                                              
 Tsai, Deputy Administrator at CMS, noting that waivers  are often                                                              
 aligned with  an  administration's  priorities, which  can  shift                                                              
 with a change in  leadership. This could potentially disrupt  the                                                              
 process  if  there   is  a  mid-change   in  administration.   He                                                              
 encouraged the  department  to ask  for additional  resources  if                                                              
 needed, especially since the legislature is in session  and could                                                              
 help  expedite the  process.  He  emphasized  the  importance  of                                                              
 moving quickly and offered  support to ensure the department  has                                                              
 the  resources   necessary  to   complete  the   waiver   process                                                              
 efficiently.                                                                                                                   
                                                                                                                                
 4:52:21 PM                                                                                                                   
 DR. ZINK  moved  to slide  18  and  expressed gratitude  for  the                                                              
 support and explained  that the  department's main limitation  is                                                              
 obtaining legislative  approval.  She  mentioned that  they  have                                                              
 technical assistance (TA)  support ready, along  with a team  and                                                              
 extensive partner and stakeholder engagement. The department  has                                                              
 been gathering input  from community members  to ensure that  the                                                              
 proposal aligns with their needs and interests and  that partners                                                              
are ready to implement it.  She highlighted the strong letters of                                                               
support  the department  has received  and acknowledged  the need                                                               
for  ongoing education  about what  the waiver  does and  doesn't                                                               
cover. She  also mentioned the  need to do actuarial  work before                                                               
moving forward. She  concluded by thanking the  committee for the                                                               
opportunity to discuss the SB 241.                                                                                              
                                                                                                                                
CHAIR WILSON thanked  the Department of Health  (DOH) for sharing                                                               
where it is in the waiver process.                                                                                              
                                                                                                                                
4:54:00 PM                                                                                                                    
MS.  RICCI thanked  the committee  for offering  DOH the  support                                                               
needed to move forward in the waiver process by hearing SB 241.                                                                 
                                                                                                                                
4:54:30 PM                                                                                                                    
CHAIR WILSON  opened public  testimony on  241; finding  none, he                                                               
closed public testimony.                                                                                                        
                                                                                                                                
CHAIR WILSON [held SB 241 in committee.]                                                                                        

Document Name Date/Time Subjects
SB 233 Version A.pdf SHSS 3/19/2024 3:30:00 PM
SB 233
SB 233 Sponsor Statement 2.22.2024.pdf SHSS 3/19/2024 3:30:00 PM
SB 233
SB 233 Sectional Analysis Version A 2.22.2024.pdf SHSS 3/19/2024 3:30:00 PM
SB 233
SB 233 FN DOH.pdf SHSS 3/19/2024 3:30:00 PM
SB 233
SB 233 Testimony.pdf SHSS 3/19/2024 3:30:00 PM
SB 233
SB 241 Version A.pdf SHSS 3/19/2024 3:30:00 PM
SB 241
SB 241 Sponsor Statement Version A.pdf SHSS 3/19/2024 3:30:00 PM
SB 241
SB241 Sectional Analysis.pdf SHSS 3/19/2024 3:30:00 PM
SB 241
SB 241 FN DOH Medicaid.pdf SHSS 3/19/2024 3:30:00 PM
SB 241
SB 241 DOH Presentation.pdf SHSS 3/19/2024 3:30:00 PM
SB 241
SB241 LOS 3.18.24.pdf SHSS 3/19/2024 3:30:00 PM
SB 241
SB 241 Support SFC.pdf SHSS 3/19/2024 3:30:00 PM
SB 241