Legislature(1993 - 1994)
02/23/1994 03:00 PM House HES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 451 - COMPREHENSIVE HEALTH INSURANCE ACT CHAIR TOOHEY stated that Dr. Nighswander would join the meeting via offnet from Anchorage, and Nancy Cornwell would be available for technical questions in Juneau. She indicated that the meeting was being teleconferenced for observers only. Number 902 DR. NIGHSWANDER, Chairman, Health System Reform Work Group, testified on HB 451. He gave a history of the process behind HB 451 that lead up to the committee meeting. He said the primary concern of the work group was to keep Alaskan's healthy and to direct people in need of services of quality care at a reasonable cost. He said the fundamental issue was whether to take action now or wait to see what happens at the federal level. He felt the question should be what is right for Alaskans and listed some major points of concern. Dr. Nighswander stated that the issues of long term care and access of services to rural communities continue to be of keen interest to everyone. He said there are 76,000 Alaskans that are completely uninsured. DR. NIGHSWANDER said a total of six very public meetings had taken place prior to the day's meeting. He said there was a large cross-section of the public and of professionals in attendance at those meetings. He felt it was a very healthy exchange. DR. NIGHSWANDER stated that the bill does not define a benefit package, therefore there is no "sticker price" for the plan. He said the legislation does suggest some financing options, but it does not specify those options. He explained that the bill is a phased approach in considering health reform. It proscribes a very public concept that provides universal coverage of a standard benefit package to all residents of the state. He stated that there is a well defined public health initiative within the bill that focuses on wellness and prevention. He further stated that the bill would allow persons to choose their own physician. DR. NIGHSWANDER stated that a voluntary cost control mechanism is provided for in the legislation. Also, he said a peer group would be established to monitor quality and utilization of health care. He said the bill would not prohibit an individual from buying services that would not be covered by the state plan. DR. NIGHSWANDER asserted that the bill would establish the Alaska Health Corporation, which would be separated from the federal government as much as possible. He said the board would have public representation and would act independently of government concerns. TAPE 94-27, SIDE B Number 000 DR. NIGHSWANDER said the corporation would collect data from all health care providers regarding the services being rendered and relative costs. The proposal requires state waivers to obtain that information from the federal government. He further stated that the corporation would be charged with developing a benefit package and reviewing any options for financing, and subsequently the findings would be presented to the legislature. He said there are incentives within the bill for rural providers. DR. NIGHSWANDER addressed the issues of cost control concepts. He felt that Alaska could accomplish many things in this area that no other state could. For example, he maintained that all orthopedic surgeons or ophthalmologists could be gathered around one table to discuss cost, quality, and utilization of services. DR. NIGHSWANDER explained the term market-based single-payer system. He said the single-payer system is straight forward. He said money for health care that includes deductibles and co-payments that is provided by the individual would be funnelled through a single payer. The market base would allow for providers to publish price lists of their services and descriptions of the services they provide. He said this would enable a person to cost shop. He said a statewide health expenditure target is provided for in the proposal. The target would be based upon the data that would be collected early on by the corporation, focusing on cost and utilization of services. He said from the data an accurate assessment could be made as to how much is being spent on health care. He asserted that the target could be adjusted based on various factors; i.e., the consumer price index (CPI). He further stated that the plan provides for voluntary compliance to the expenditure target. Number 250 CHAIR TOOHEY asked if there were comments or questions for Dr. Nighswander. DR. NIGHSWANDER said the question remains as to when the action would be taken on health care. Number 296 REP. BRICE asked how the proposal would dovetail with the federal providers. DR. NIGHSWANDER stated that Senator Ted Stevens perceives the potential of a "seamless system" in the future whereby both federal care and private care would be amalgamated into a single (seamless) system. Number 362 CHAIR TOOHEY said the Oregon plan, which went into effect in January in the state of Oregon, has become three times larger than the state had anticipated. She said that caution must be used before a plan is implemented in Alaska. DR. NIGHSWANDER said that was an appropriate concern and needed to be addressed as soon as possible. Number 413 REP. NICHOLIA asked what type of impact HB 451 would have on Indian Health Services. DR. NIGHSWANDER said there might be a change in financing, but relatively there would be little impact. He felt there would be more of an impact in urban areas. He indicated that problems with corporations in the rural areas are addressed by President Clinton's health care plan. REP. NICHOLIA asked what the problem was that Dr. Nighswander referred to regarding corporations in the rural areas. DR. NIGHSWANDER explained that in some rural areas there are no hospitals or providers. Number 534 REP. G. DAVIS suggested that perhaps those people who are not insured choose not to be insured. DR. NIGHSWANDER deferred to Nancy Cornwell to answer the question. Number 545 NANCY CORNWELL, Member, Health System Reform Work Group, answered questions on HB 451. She acknowledged that there are some individuals who make the judgement that health care is not a priority. She asserted that a great concern was for the low income individuals that are faced with the problem of not being able to afford health care. She indicated that the percentage of a family's income that is devoted to health care had increased from 9% to 12%, and it is projected to be closer to 16% in the year 2000. She felt there was little research to indicate the number of Alaskans who go without health care coverage for long periods of time. Ms. Cornwell said there is an overall decline in the United States of those who have health care coverage. Number 632 DR. NIGHSWANDER asked where the 76,000 figure came from regarding the number of Alaskans with no coverage. MS. CORNWELL said the number was derived from the current population survey. The number was derived by combining three years of data obtained from the Bureau of the Census. CHAIR TOOHEY asked what time of year the population survey was taken, indicating that there is a larger population at work in the summer. MS. CORNWELL said the population survey is ongoing. She said the survey referred to as the March Supplement is where the statistics originate from and the survey is taken in the month of March. CHAIR TOOHEY said one half of those people would be employed in June. She then asked what the percentage was of people who do not want to purchase coverage. MS. CORNWELL said she did not know, and said it is very difficult information to obtain. She further stated that only 9% of the 76,000 are unemployed. She also said that people who work in small businesses have a difficult time receiving health care coverage through their employer. Number 708 DR. NIGHSWANDER agreed with Ms. Cornwell. He related to the committee the scenario of a youth who is uninsured and is involved in a serious car accident. He said the result of situations like that is cost shifting. REP. G. DAVIS asked about volume control as opposed to cost control from the standpoint of prevention. Number 750 DR. NIGHSWANDER stated that utilization could be controlled by the process of co-payments. He also said the bill allows for less expensive options; i.e., nurse practitioners and physicians' assistants (PAs). Number 791 MS. CORNWELL referred to page 18, line 2, and said that the peer review process would review the utilization, quality, and prices of health care services, after the fact. Through the peer review process, there would be self-regulation. She said the process was modeled after the Maine Medical Assessment Foundation. She explained that the process would cut down on much unwarranted medical procedures. REP. G. DAVIS agreed. DR. NIGHSWANDER indicated there would be a claims clearing house. REP. G. DAVIS said that Indian Health Services (IHS) was making strides in that area. DR. NIGHSWANDER said that information is shared with other states. Number 877 MS. CORNWELL asserted that the proposal would enable all claims to be brought into a single clearing house in the state, which would provide a tremendous amount of information not only for the corporation but everyone in the state. She felt certain that the information would be a significant part of the information highway. CHAIR TOOHEY asked who would be responsible for the fiscal note. No one had an answer to that question. Number 920 REP. G. DAVIS referred to the presentation made by the trial lawyers, and asked Dr. Nighswander what the focal points were. DR. NIGHSWANDER stated that the main focus was tort reform and malpractice reform. CHAIR TOOHEY said that the trial lawyers would be presenting two bills to the HESS Committee the following week. She urged Dr. Nighswander to observe and stay abreast of the issues. She asked for further questions. REP. G. DAVIS said that it was his hope that much of the proposed legislation within HB 451 would be retained and implemented if a "final product" should come about. He thanked Dr. Nighswander for his efforts. DR. NIGHSWANDER thanked the committee. CHAIR TOOHEY expressed her appreciation to both Dr. Nighswander and Nancy Cornwell for their efforts. DR. NIGHSWANDER said he was inspired by the whole process. CHAIR TOOHEY stated that now they both know how much educating needs to be done so that people can make informed choices pertaining to health care. Seeing no further business before the committee, CHAIR TOOHEY ADJOURNED the meeting at 4:22 p.m.
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