Legislature(2001 - 2002)

02/12/2002 03:05 PM House HES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 367-MEDICAL ASSISTANCE PROGRAM COVERAGE                                                                                    
                                                                                                                                
CHAIR DYSON announced the next  order of business, HOUSE BILL NO.                                                               
367, "An Act relating to  coverage of children and pregnant women                                                               
under  the  medical  assistance program;  and  providing  for  an                                                               
effective date."                                                                                                                
                                                                                                                                
Number 1880                                                                                                                     
                                                                                                                                
REPRESENTATIVE COGHILL, sponsor, explained  that HB 367 addresses                                                               
the  [income eligibility  level] of  the Denali  KidCare program.                                                               
Right  now, the  program's level  is 200  percent of  the poverty                                                               
level; HB 367 seeks to bring this  down to 150 percent.  The bill                                                               
also contains  "housekeeping" measures addressing such  issues as                                                               
removing the  hyphen from  "child-care".   He explained  that the                                                               
drafter had taken this opportunity to clean up some language.                                                                   
                                                                                                                                
REPRESENTATIVE COGHILL  pointed out that  the real [intent  of HB
367] is on  page 4, lines 5 and 9,  wherein the [household income                                                               
threshold]  is changed  from 200  percent to  150 percent  of the                                                               
federal poverty guideline.   He posed questions:   What does this                                                               
translate into  for a  family of  three to five?   How  does this                                                               
relate to  child health  care?  He  explained that  he'd broached                                                               
this issue  two years ago, proposing  a change to 100  percent of                                                               
the  [federal poverty  guideline].   "I  barely got  out of  here                                                               
alive," he said.  Representative Coghill continued:                                                                             
                                                                                                                                
     It  was just  asking the  question, was  that expansion                                                                    
     really  what  we wanted  to  do?   And  the  resounding                                                                    
     answer was yes,  that is something that  they wanted to                                                                    
     do.   And  it was  under the  Smart Start  program that                                                                    
     passed  some  years ago.    But  once again,  I'm  here                                                                    
     asking us the  question:  Is this  really the direction                                                                    
     we want to go?                                                                                                             
                                                                                                                                
     There [are] two  sides to it - there's  the dollar side                                                                    
     and there's a  policy side.  To me, the  policy side of                                                                    
     an  expanding   subsidy  level   for  health   care  is                                                                    
     something that ... I'm not  willing to go for.  There's                                                                    
     a  dollar  side  that  right   now,  under  the  fiscal                                                                    
     condition we're  in, can  we really  afford to  go down                                                                    
     this road further?                                                                                                         
                                                                                                                                
     But what I'm  not saying, and I want  everybody to hear                                                                    
     this real clear ..., is there  is not a need out there.                                                                    
     The need for  child health care is there,  just as sure                                                                    
     as we're  sitting here.   So,  I understand  that there                                                                    
     are going to  be some people who are going  to say, "We                                                                    
     can't afford  to do  that anymore."   But I  think that                                                                    
     has to  be part of  the legitimate discussion  of "what                                                                    
     are we  going to do  to fill  the $800 million  hole in                                                                    
     Alaska."                                                                                                                   
                                                                                                                                
Number 1763                                                                                                                     
                                                                                                                                
REPRESENTATIVE COGHILL said this  does affect policy, although he                                                               
doesn't  expect [savings  in HB  367]  to fill  the $800  million                                                               
[fiscal gap].   He  remarked, "The  argument that  the investment                                                               
into children's  health care is going  to be cheaper at  this end                                                               
than  at the  other end,  I agree  with."   He offered  that this                                                               
argument is  an important part of  the discussion.  On  the other                                                               
hand, he  added his  belief that there  are families  between the                                                               
150  percent  and 200  percent  levels  that can  afford  [health                                                               
care].   He  said,  "Before  I'm willing  to  take  money out  of                                                               
somebody  else's pocket  to pay  for  this, I'm  willing to  say,                                                               
'You've  got to  be a  part of  that discussion  too.'"   He told                                                               
members  that his  aide would  explain the  family income  levels                                                               
associated  with   the  aforementioned  percentages.     He  drew                                                               
members' attention  to a  chart in  the committee  packet showing                                                               
income  levels  and  the   different,  adjusted  federal  poverty                                                               
levels.                                                                                                                         
                                                                                                                                
Number 1694                                                                                                                     
                                                                                                                                
RYNNIEVA  MOSS,  Staff  to Representative  John  Coghill,  Alaska                                                               
State  Legislature, explained  that Alaska's  [poverty level]  is                                                               
set at 125 percent of the federal poverty level.                                                                                
                                                                                                                                
CHAIR DYSON asked for clarification.                                                                                            
                                                                                                                                
MS. MOSS replied  that the federal poverty level for  a family of                                                               
four is  a monthly income of  $1,472.  Alaska's poverty  level is                                                               
set  25  percent higher  by  the  federal government;  therefore,                                                               
Alaska's  poverty level  is set  at a  monthly income  of $1,840.                                                               
Exemptions   such  as   the  permanent   fund  dividend,   Native                                                               
corporation  dividends  up  to  $200  per  recipient,  income  of                                                               
nonbiological  or  nonadoptive parents,  and  income  of a  step-                                                               
parent are not considered as  income for eligibility purposes for                                                               
Denali KidCare.                                                                                                                 
                                                                                                                                
MS. MOSS explained  that a family of four, under  the 200 percent                                                               
of the federal poverty level -  which is based on the 125 percent                                                               
initial  adjustment  - can  have  an  annual income  of  $44,160.                                                               
Adding  [last  year's  amount] of  the  permanent  fund  dividend                                                               
[times four]  to this income, the  result is $51,561.   This is a                                                               
monthly  income for  a  family  of four  of  $3,680, without  the                                                               
dividend.   By contrast, the  150 percent  level to which  HB 367                                                               
proposes to lower  the 200-percent figure would  change the [pre-                                                               
dividend] monthly income to $2,760;  this translates to an annual                                                               
income  of $33,120.   A  family of  four would  add approximately                                                               
$5,400 [of permanent fund dividends]  to that figure to arrive at                                                               
nearly $40,000, Ms. Moss explained.                                                                                             
                                                                                                                                
Number 1568                                                                                                                     
                                                                                                                                
REPRESENTATIVE  WILSON  commented   that  [the  foregoing  income                                                               
levels] would include teachers who  are single parents; she noted                                                               
that  many  teachers earn  less  than  that, although  they  have                                                               
insurance.                                                                                                                      
                                                                                                                                
MS. MOSS  clarified that  the Denali KidCare  program is  not for                                                               
people who already have insurance through their employer.                                                                       
                                                                                                                                
Number 1543                                                                                                                     
                                                                                                                                
REPRESENTATIVE  WILSON recounted  that an  upset mother  recently                                                               
had informed Representative Wilson  that the mother's health care                                                               
provider had  told her to drop  her health insurance and  sign up                                                               
for Denali  KidCare; this switch  would result in  less paperwork                                                               
and  more  ease for  the  provider,  the  mother had  been  told.                                                               
Representative Wilson  explained that this provider  was one that                                                               
receives state  funds.  Representative Wilson  reported that more                                                               
than one parent  had told her this.   She noted that  she did not                                                               
know  how prevalent  this  problem actually  was,  but said  this                                                               
parent was aggravated by the incident.                                                                                          
                                                                                                                                
Number 1475                                                                                                                     
                                                                                                                                
REPRESENTATIVE   COGHILL  explained   that   a  discrepancy   was                                                               
discovered in some  of the numbers; he noted that  he'd asked the                                                               
[Department of  Health and  Social Services]  to present  some of                                                               
the  monthly  costs  [for clarification  purposes].    He  added,                                                               
however,  that  he  was  "content to  let  the  people  [testify]                                                               
because it  really is a policy  call, no matter what  the numbers                                                               
shake out at."                                                                                                                  
                                                                                                                                
Number 1448                                                                                                                     
                                                                                                                                
CHAIR DYSON expressed interest in  hearing a brief statement from                                                               
the department.                                                                                                                 
                                                                                                                                
REPRESENTATIVE JOULE  asked whether Chair Dyson  intended to move                                                               
HB 367 out of committee at this hearing.                                                                                        
                                                                                                                                
CHAIR DYSON replied  that he did not believe  the committee would                                                               
hear  all  the testimony  at  this  hearing.   He  confirmed  for                                                               
Representative Joule  that the  bill would not  be moved  at this                                                               
hearing.                                                                                                                        
                                                                                                                                
Number 1425                                                                                                                     
                                                                                                                                
JAY  LIVEY,   Commissioner,  Department  of  Health   and  Social                                                               
Services, spoke  in opposition to HB  367.  He noted  that should                                                               
this  bill  be  enacted,  approximately 3,800  children  and  722                                                               
pregnant women would lose coverage.   He concurred that this bill                                                               
reduces [income]  eligibility levels from  200 to 150  percent of                                                               
[the federal] poverty level.                                                                                                    
                                                                                                                                
COMMISSIONER  LIVEY pointed  out that  the fiscal  note indicates                                                               
the proposed  reduction would  save about  $5 million  in general                                                               
funds; however, it  means the state would  lose approximately $12                                                               
million in  federal funds.   Denali KidCare funding is  such that                                                               
for every  dollar spent,  about 71 cents  comes from  the federal                                                               
government, he explained.   In addition to  providing health care                                                               
for children and pregnant women,  Denali KidCare allows the state                                                               
to leverage federal funds into the state's health care system.                                                                  
                                                                                                                                
COMMISSIONER LIVEY  turned attention  to savings  associated with                                                               
[the diminution of coverage].   He pointed out that these savings                                                               
will be shifted  to other payers because these  children who lose                                                               
coverage will  go somewhere  to receive care  - most  likely, the                                                               
emergency room.   Unpaid emergency  room bills will  generally be                                                               
paid by  the state; other payers  in the system will  pay some of                                                               
that bill.   When that  happens, that  bill will probably  not be                                                               
paid  at the  70/30  federal-share rate;  he  suggested that  the                                                               
state will pay a larger share [than 30 percent].                                                                                
                                                                                                                                
Number 1334                                                                                                                     
                                                                                                                                
COMMISSIONER  LIVEY  turned  to Representative  Wilson's  concern                                                               
about  people being  told  to sign  up for  Denali  KidCare.   He                                                               
explained  that   there  is  a   12-month  waiting   period  [for                                                               
coverage].   When a person  applies for Denali  KidCare coverage,                                                               
he/she is  asked about  other insurance coverage.   A  person who                                                               
has  insurance  is not  eligible  to  sign  up for  the  program.                                                               
Consequently, the aforementioned parent who  was told to drop her                                                               
coverage and  sign up for Denali  KidCare would be unable  to get                                                               
coverage in that manner.  He  noted that there would be a waiting                                                               
period;  the children  would have  to go  without coverage  for a                                                               
period of time.                                                                                                                 
                                                                                                                                
Number 1303                                                                                                                     
                                                                                                                                
REPRESENTATIVE  WILSON asked  how  this issue  of an  applicant's                                                               
insurance coverage is policed.                                                                                                  
                                                                                                                                
COMMISSIONER  LIVEY  replied  that  quality checks  are  done  on                                                               
applications.                                                                                                                   
                                                                                                                                
Number 1276                                                                                                                     
                                                                                                                                
BOB LABBE,  Director, Division of Medical  Assistance, Department                                                               
of  Health  and  Social  Services,  explained  that  through  the                                                               
Division  of Public  Assistance, quality  control reviewers  have                                                               
found  this  is not  occurring  to  the  extent one  might  think                                                               
because  of anecdotes.   He  reported that  some applicants  have                                                               
dropped insurance  and applied for  coverage; he  indicated there                                                               
was good cause to do so in some  cases.  "For the most part, it's                                                               
not occurring to that extent," he added.                                                                                        
                                                                                                                                
MR. LABBE said [the division]  has advised grantees not to advise                                                               
people   in   that  manner;   some   were   not  aware   of   the                                                               
disqualification  and the  fact that  some people  would be  left                                                               
[without coverage].   He  added, "I can't  say there  aren't some                                                               
instances where  things happen or  get by,  but ... we've  done a                                                               
quality  review on  that, and  it  was not  ... going  on to  any                                                               
extent."  He offered to obtain the related report for members.                                                                  
                                                                                                                                
Number 1216                                                                                                                     
                                                                                                                                
MR. LABBE, in response to  a question from Chair Dyson, explained                                                               
that a "spot  check" is done on people who  have applied and been                                                               
approved,  to view  the  circumstances [present  at  the time  of                                                               
application]; he noted that this is an intensive review.                                                                        
                                                                                                                                
CHAIR DYSON  asked whether an  individual's personal  records can                                                               
be "invaded" to find out whether he/she has insurance elsewhere.                                                                
                                                                                                                                
Number 1175                                                                                                                     
                                                                                                                                
MR. LABBE  replied, "I'm  not sure  that we  can, the  way you're                                                               
saying it.   We  do have,  though, if a  person has  applied, ...                                                               
access to  information that comes  through ... them and  from the                                                               
providers that submit claims, as  well as from other 'data-match'                                                               
sources."  He indicated most  of the information is gathered when                                                               
asking  the applicant  questions such  as:   Where  do you  work?                                                               
Does that employer offer health  insurance coverage?  He said the                                                               
application  process is  fairly simple,  but the  quality-control                                                               
review process is much more detailed.                                                                                           
                                                                                                                                
CHAIR  DYSON  said,  "My  question  is, do  you  have  access  to                                                               
peoples'  records,  whether  or  not they  have  entered  into  a                                                               
private relationship with an insurance carrier?"                                                                                
                                                                                                                                
Number 1131                                                                                                                     
                                                                                                                                
MR.  LABBE  answered,  "Not  generally."   He  stated  that  [the                                                               
division]  has access  to the  applicant's employer  to determine                                                               
whether the employer  provides coverage.  He  explained that this                                                               
is generally where this is addressed.                                                                                           
                                                                                                                                
REPRESENTATIVE COGHILL  inquired what it  takes to waive  the 12-                                                               
month [waiting period].                                                                                                         
                                                                                                                                
Number 1112                                                                                                                     
                                                                                                                                
MR. LABBE  replied that the  division has [created] a  formula to                                                               
look at household circumstances.  He  stated that he did not know                                                               
the numbers exactly,  but offered that the  division has approved                                                               
about  half-a-dozen  requests  for  waivers.   He  indicated  the                                                               
waivers   have  been   granted   based  on   income  and   family                                                               
circumstances;  this [waiver-request  review] is  handled in  his                                                               
office in  Juneau.   He stated that  approximately 95  percent of                                                               
the waiver requests  have been denied.  He added  that the number                                                               
of waivers was not large.                                                                                                       
                                                                                                                                
COMMISSIONER LIVEY, in  response to a question  from Chair Dyson,                                                               
clarified that  the qualifying  threshold is  200 percent  of the                                                               
Alaska income level, which is  the federal poverty level adjusted                                                               
[upward] 25 percent to account for Alaska's cost of living.                                                                     
                                                                                                                                
CHAIR DYSON surmised  that it is close to the  250 percent level,                                                               
as compared to the Lower 48 [poverty] level.                                                                                    
                                                                                                                                
COMMISSIONER LIVEY replied,  "I don't think that's  the math, but                                                               
I'd have to think about it for a minute."                                                                                       
                                                                                                                                
CHAIR DYSON queried about the  process the department had used to                                                               
decide that a multiplier of two  was the correct threshold to set                                                               
for Alaskans.                                                                                                                   
                                                                                                                                
Number 1005                                                                                                                     
                                                                                                                                
COMMISSIONER  LIVEY explained  that this  decision was  made when                                                               
the federal CHIP [Children's Health  Insurance Plan] proposal was                                                               
first made.   He noted that  Alaska had several choices  to make,                                                               
such  as whether  to have  a  Medicaid program  or a  stand-alone                                                               
program.  He offered that the  state chose a Medicaid program for                                                               
several  reasons.   For one,  a stand-alone  program, by  federal                                                               
law, must cover individuals who  are also eligible for the Indian                                                               
Health Service (IHS).   In a stand-alone  program, Alaska's costs                                                               
for covering IHS-eligible Alaska  Natives would not be reimbursed                                                               
at 100 percent.  On the other  hand, if the state covers the cost                                                               
of IHS-eligible individuals through  Medicaid, the state receives                                                               
100  percent  of the  cost  of  that  care, reimbursed  from  the                                                               
federal government.   He  explained that  Alaska has  the highest                                                               
percentage of  IHS beneficiaries  anywhere in  the country.   For                                                               
that reason alone, it made sense to [choose a Medicaid system].                                                                 
                                                                                                                                
COMMISSIONER LIVEY recalled that  when the [department] looked at                                                               
the income threshold, it had  a policy discussion similar to what                                                               
Representative Coghill is  suggesting:  At what  point should the                                                               
state  stop subsidizing  health  care and  a  private citizen  be                                                               
[responsible] for his/her own coverage?   He said the 200 percent                                                               
level was chosen  because it appeared to be a  level of income at                                                               
which individuals  and families had trouble  purchasing their own                                                               
insurance.   The insurance market was  not sufficiently developed                                                               
for a parent to purchase a policy for a child, he offered.                                                                      
                                                                                                                                
COMMISSIONER  LIVEY  indicated  these   types  of  policies  were                                                               
difficult  to obtain  and expensive.   This  issue was  discussed                                                               
with  executives  from  some of  the  state's  largest  insurance                                                               
companies;  these  executives  told [the  department]  that  low-                                                               
income insurance is  not necessarily one of  the companies' prime                                                               
focus  markets.   Commissioner  Livey  explained  that this  low-                                                               
income-insurance  market has  high  administrative costs  because                                                               
people enter and  leave this coverage frequently.   He concluded,                                                               
"It seemed to us that 200  percent ... was a reasonable cutoff in                                                               
terms of  what a  family could  afford or  what was  available to                                                               
them out in the market."                                                                                                        
                                                                                                                                
Number 0878                                                                                                                     
                                                                                                                                
CHAIR  DYSON   asked  if  Representative  Coghill   was  "in  the                                                               
ballpark"  when  saying that  a  family  of  four has  an  income                                                               
eligibility  of  about $44,000  plus  whatever  is added  by  the                                                               
dividend.                                                                                                                       
                                                                                                                                
COMMISSIONER LIVEY replied, "Correct."                                                                                          
                                                                                                                                
CHAIR DYSON  added, "And it  would be reduced down  to [$]33,000-                                                               
and-change, plus the dividend?"                                                                                                 
                                                                                                                                
COMMISSIONER  LIVEY  answered  that  he had  not  done  the  math                                                               
himself, but presumed that number was correct.                                                                                  
                                                                                                                                
Number 0843                                                                                                                     
                                                                                                                                
REPRESENTATIVE WILSON stated that when  a woman visits the doctor                                                               
and finds  out she is  pregnant, right  away [she is  advised] to                                                               
sign  up  for WIC  [Special  Supplemental  Nutrition Program  for                                                               
Women,  Infants,  and  Children]  because it  is  retroactive  to                                                               
before  she became  pregnant.   Representative  Wilson asked  how                                                               
much  overlap [of  benefits]  there is  between  WIC and  [Denali                                                               
KidCare].                                                                                                                       
                                                                                                                                
COMMISSIONER LIVEY  pointed out  that these programs  provide two                                                               
different  services.   Whereas WIC  provides services  related to                                                               
nutrition,  Medicaid is  more medically  oriented.   The services                                                               
would not necessarily overlap.                                                                                                  
                                                                                                                                
REPRESENTATIVE WILSON asked what  other [coverage] pregnant women                                                               
apply for.  She also asked [which entity] pays for doctor bills.                                                                
                                                                                                                                
MR. LABBE  offered his assumption  that it  would have to  be the                                                               
Medicaid program.   Noting his belief  that WIC does not  pay for                                                               
any kind of  medical services, he offered to check  on this for a                                                               
certainty.   He said there  are "linkages," however;  when people                                                               
apply for WIC,  they can pick up applications  for Denali KidCare                                                               
at those offices.                                                                                                               
                                                                                                                                
REPRESENTATIVE  WILSON  indicated  this   is  the  focus  of  her                                                               
question -  what program  "kicks in"  - because  she has  been to                                                               
clinics  that [offer  multiple applications  for programs].   She                                                               
said, "That  makes sure that the  clinic or the doctor  gets paid                                                               
for  maternity care  throughout that  pregnancy."   She expressed                                                               
interest in  knowing whether  the 722  pregnant women  alluded to                                                               
earlier  who  wouldn't  receive  Denali  KidCare  coverage  might                                                               
qualify under some other program.                                                                                               
                                                                                                                                
Number 0726                                                                                                                     
                                                                                                                                
COMMISSIONER LIVEY  offered his belief  that there is  no overlap                                                               
of coverage for prenatal care; he  said he'd make certain that is                                                               
the case.                                                                                                                       
                                                                                                                                
CHAIR  DYSON indicated  his desire  to ensure  that witnesses  be                                                               
able to testify who would be unable to testify on February 14.                                                                  
                                                                                                                                
REPRESENTATIVE  STEVENS   expressed  concern  about   the  salary                                                               
levels; he  indicated this can  be misleading.  Many  teachers do                                                               
not earn  $44,000; when benefits  are added, however,  the result                                                               
far  exceeds $44,000.    He asked  whether  many professional  or                                                               
fully employed people use [Denali KidCare].                                                                                     
                                                                                                                                
Number 0676                                                                                                                     
                                                                                                                                
COMMISSIONER  LIVEY  observed  that many  families  with  incomes                                                               
between  the  150 percent  and  200  percent poverty  levels  are                                                               
working families.  Generally, these  are families who do not have                                                               
an option to purchase health care through their employer.                                                                       
                                                                                                                                
REPRESENTATIVE STEVENS noted that  he was specifically interested                                                               
in  discovering  whether  families with  insurance  were  seeking                                                               
coverage.   "Are there  a lot  of teachers  in your  program?" he                                                               
queried.                                                                                                                        
                                                                                                                                
MR. LABBE stated  that he wouldn't necessarily know.   He offered                                                               
his impression  that most  of the  people [using  Denali KidCare]                                                               
are self-employed, such  as people in the building  trades.  Some                                                               
may  qualify  on  the  income  level,  but  they  typically  have                                                               
coverage through the district, the state, or some other entity.                                                                 
                                                                                                                                
Number 0520                                                                                                                     
                                                                                                                                
KATHLEEN  FITZGERALD,  Key  Coalition of  Alaska,  testified  via                                                               
teleconference in opposition  to HB 367.  She  stated that Denali                                                               
KidCare  is  an  important  piece  of  health  care  for  Alaskan                                                               
families.  She stated that  the coalition believes Denali KidCare                                                               
promotes the best  outcomes for children; when  they are healthy,                                                               
they can  learn.   Pregnant women who  receive prenatal  care are                                                               
less  likely to  deliver children  with health  care problems  or                                                               
disabilities.    She  added  that  the  coalition  believes  that                                                               
families  with  children  with   disabilities  [between  the  150                                                               
percent  and] 200  percent range  have  a difficult  time due  to                                                               
increased   costs   associated   with  raising   a   child   with                                                               
disabilities.  The  coalition supports the 200  percent level for                                                               
this reason, she indicated.                                                                                                     
                                                                                                                                
Number 0412                                                                                                                     
                                                                                                                                
MS.  FITZGERALD  added,  "We  also  think  that  it's  just  good                                                               
business  to provide  that coverage;  even though  it costs  us 5                                                               
million  in Medicaid  dollars, what  it saves  us in  the federal                                                               
dollars and  provides for the  medical community and  for healthy                                                               
families is really important to  us."  She concluded, saying that                                                               
the  Key Coalition  is strongly  opposed to  reducing the  income                                                               
level for Denali KidCare.                                                                                                       
                                                                                                                                
Number 0348                                                                                                                     
                                                                                                                                
MS. FITZGERALD  read a letter  from someone unable to  attend the                                                               
hearing, as follows:                                                                                                            
                                                                                                                                
     I am  a single parent  with four children,  three still                                                                    
     at home.   I work  full-time and attend  the University                                                                    
     of Alaska half-time in order  to secure a future for my                                                                    
     children and  myself.  Even with  full-time employment,                                                                    
     I still  struggle financially  and need  some temporary                                                                    
     support until I have completed my education.                                                                               
                                                                                                                                
     Denali  KidCare ...  has been  a wonderful  benefit for                                                                    
     our family.   I no  longer have  to decide if  they can                                                                    
     make it  until Monday  because I  can't afford  to take                                                                    
     them  to  the doctor,  gambling  on  their health  over                                                                    
     money.   It  has made  access to  medical treatment  by                                                                    
     reducing  the  financial  burden   that  is  ...  often                                                                    
     expected  at the  time of  treatment.   My children  no                                                                    
     longer  have   to  ask,  "Can  we   afford  glasses  or                                                                    
     medicine?"   Denali  KidCare has  decreased the  stress                                                                    
     level  in  our  home  by  affording  access  to  needed                                                                    
     medical care for my children.                                                                                              
                                                                                                                                
CHAIR DYSON announced that witnesses  may send written testimony,                                                               
which would be distributed to members.                                                                                          
                                                                                                                                
Number 0250                                                                                                                     
                                                                                                                                
THOMAS  CONLEY,   Pediatrician;  Member,  Sitka   Borough  School                                                               
District School  Board, testified via teleconference  and thanked                                                               
members for the  opportunity to testify.  He offered  that he has                                                               
been  in practice  in  Alaska  for 27  years.   He  characterized                                                               
patients  as  falling   into  three  [medical-coverage]  classes:                                                               
patients who are poor and  covered by Medicaid; patients who have                                                               
considerable  resources or  insurance and  can afford  self-care;                                                               
and  patients  such  as fishermen,  small  business  owners,  and                                                               
entrepreneurs  who  do not  have  access  to insurance  and  must                                                               
obtain care on  a "self-pay" basis.  Dr. Conley  stated that this                                                               
latter group  of people is  the group  "left behind" in  terms of                                                               
medical  care.   These  patients would  frequently  wait until  a                                                               
[health  concern]  was  severe  before  seeking  treatment;  they                                                               
skimped on prenatal  care and child [health] care.   He suggested                                                               
that the price  to this population to secure  care was frequently                                                               
quite high; this was often eventually paid by the state.                                                                        
                                                                                                                                
Number 0148                                                                                                                     
                                                                                                                                
DR.  CONLEY offered  that  should these  people  be dropped  from                                                               
coverage, the state  would wind up paying  considerably more down                                                               
the road.  He added that he  serves on the school board in Sitka;                                                               
as a  member, he  observes that problems  not addressed  early in                                                               
life  frequently  become problems  for  the  school system.    He                                                               
concluded  by  expressing his  opinion  that  the program  should                                                               
continue as  it is;  it is  covering something  that needs  to be                                                               
covered.                                                                                                                        
                                                                                                                                
CHAIR DYSON reminded participants that  there has been no talk of                                                               
discontinuing the program.                                                                                                      
                                                                                                                                
TAPE 02-9, SIDE A                                                                                                               
Number 0043                                                                                                                     
                                                                                                                                
MEG  MITCHELL   testified  via   teleconference  in   support  of                                                               
retaining  Denali KidCare  [eligibility]  at  the current  level.                                                               
She clarified that she is not  a parent; therefore, this is not a                                                               
program from  which she  can benefit.   She  stated that  she has                                                               
worked  with   families  administering   a  child-care-assistance                                                               
program in  Homer; in  this role,  she was  able to  tell parents                                                               
about  this "incredible  program" that  the state  offered.   She                                                               
indicated  the  best impact  of  the  program  is that  it  helps                                                               
working families.   She mentioned  that the Denali  KidCare motto                                                               
is insuring Alaska's  children and our future;  she urged members                                                               
to pay attention  to the need for providing  children with health                                                               
care insurance.                                                                                                                 
                                                                                                                                
Number 0127                                                                                                                     
                                                                                                                                
MS. MITCHELL  offered her  belief, based  on the  state's current                                                               
economy, that there is no  reasonable option for obtaining health                                                               
care  coverage for  one's children.   Alaska  does not  have many                                                               
jobs that offer  such coverage, she said.  There  is nothing else                                                               
for parents to do if they are  not fortunate enough to have a job                                                               
that  does so.    "This is  the program  that  is benefiting  our                                                               
working  families, and  I  would  really like  to  see the  state                                                               
continue to  support ...  the working families,"  she said.   She                                                               
noted that the  economy is "not looking good," and  that it isn't                                                               
easy  for  families  to  meet  all its  needs  in  Alaska.    She                                                               
indicated Alaska's [poverty rate] is  set higher than the rest of                                                               
the nation due to the high cost  of living.  She urged members to                                                               
not change the current Denali KidCare program.                                                                                  
                                                                                                                                
Number 0200                                                                                                                     
                                                                                                                                
DANA LEE  HALL, R.Ph.,  Village Operations  Administrator, Yukon-                                                               
Kuskokwim    Health    Corporation    (YKHC),    testified    via                                                               
teleconference,  noting  that   the  village  operations  program                                                               
includes the health  aide program, home care  worker program, and                                                               
an advanced-training  program.   She explained that  [YKHC] began                                                               
its  well-child  program  in  the  Yukon-Kuskokwim  (Y-K)  Delta;                                                               
health  aides were  trained  to provide  services  such as  EPSDT                                                               
[Early and Periodic Screening, Diagnosis, and Treatment] well-                                                                  
child exams in  villages.  The mission at YKHC  is to ensure that                                                               
health care is delivered as  close as possible to people's homes,                                                               
she said;  Denali KidCare has allowed  them to do so.   She noted                                                               
that another priority of YKHC is  to enroll all pregnant women in                                                               
Medicaid in order for them to receive appropriate care.                                                                         
                                                                                                                                
Number 0328                                                                                                                     
                                                                                                                                
MS.  HALL  offered  that  many   village  residents  qualify  for                                                               
Medicaid, but  many other residents have  low-paying jobs without                                                               
insurance.  These low-paid residents  are not teachers.  They may                                                               
work  for the  village corporations  or the  tribal councils,  or                                                               
they may work as ancillary staff  in the school.  She pointed out                                                               
that  [YKHC] is  witnessing increased  Medicaid enrollment  under                                                               
the  Denali  KidCare  program; this  includes  a  4-to-5  percent                                                               
increase over the past year.                                                                                                    
                                                                                                                                
MS.  HALL said  the lack  of adequate  prenatal care  is [YKHC's]                                                               
most serious  concern, however.   She offered that  prenatal care                                                               
is  the single  most cost-effective  health care  expenditure and                                                               
ensures  the  best  outcomes  for babies.    Denali  KidCare  was                                                               
created  to meet  the needs  of uninsured  children and  pregnant                                                               
women   with  incomes   too   great   for  traditional   Medicaid                                                               
eligibility and too  low to obtain insurance or  pay directly for                                                               
health care,  she reported.  The  cost of delivering care  in the                                                               
Bush is "astronomical", she noted.   A trip from Kotlik to Bethel                                                               
to  obtain care  is  $400 a  person.   Although  she offered  her                                                               
understanding  of  the  state's  financial  situation,  she  said                                                               
providing preventative  services for children and  pregnant women                                                               
is  money well  spent.    She urged  that  Denali KidCare  income                                                               
requirements remain unchanged.                                                                                                  
                                                                                                                                
Number 0453                                                                                                                     
                                                                                                                                
REPRESENTATIVE  STEVENS asked  for  clarification  about the  100                                                               
percent federal  health care  coverage for  Native children.   He                                                               
also  asked whether  this proposed  reduction  would affect  only                                                               
non-Native children.                                                                                                            
                                                                                                                                
Number 0486                                                                                                                     
                                                                                                                                
COMMISSIONER  LIVEY  replied  that   IHS  beneficiaries  who  are                                                               
Medicaid-eligible can sign  up for Medicaid.  The  state pays the                                                               
Medicaid bill and is fully reimbursed by the federal government.                                                                
                                                                                                                                
REPRESENTATIVE  STEVENS  expressed  his  understanding  that  all                                                               
[Native]  children would  continue  to be  fully  covered by  the                                                               
federal  government; only  non-Native children  would fall  under                                                               
the provision [in HB 367], should it pass.                                                                                      
                                                                                                                                
COMMISSIONER LIVEY  replied that  this is true  in 98  percent of                                                               
the cases.                                                                                                                      
                                                                                                                                
Number 0550                                                                                                                     
                                                                                                                                
JIM  KOHLER,  Tanana  Chiefs   Conference  (TCC),  testified  via                                                               
teleconference  in  opposition  to  the proposed  change  to  the                                                               
Denali  KidCare program.    He  said, "We  believe  that the  200                                                               
percent of  poverty is an  accurate level of poverty  of patients                                                               
who can  afford insurance."   He noted  that should this  go into                                                               
effect, 20  to 30 percent of  TCC beneficiaries would be  cut off                                                               
of Denali  KidCare.  In  addition, he  said, "We would  also lose                                                               
the  federal  funding  for  this   program,  [because]  it's  our                                                               
understanding that if  [an] Alaska Native is  served under Denali                                                               
KidCare,  100  percent  of  the  money  comes  from  the  federal                                                               
government  and not  the state.   We  believe this  to be  a good                                                               
investment of the federal funds for Alaska Natives."                                                                            
                                                                                                                                
CHAIR DYSON queried, "Would you say  that you're serving a lot of                                                               
folks who don't qualify as Natives?"                                                                                            
                                                                                                                                
MR.  KOHLER  replied,  "No.    Tanana  Chiefs  just  sees  Alaska                                                               
Natives."                                                                                                                       
                                                                                                                                
CHAIR DYSON  expressed his understanding that  all Alaska Natives                                                               
would be fully qualified [under IHS].                                                                                           
                                                                                                                                
Number 0624                                                                                                                     
                                                                                                                                
DIANE CLARK,  Group Home  Daycare, testified  via teleconference,                                                               
noting that  she is  representing herself,  a single  parent with                                                               
two children,  as well as  Group Home  Daycare.  She  stated that                                                               
she does  not support HB  367, and that  she is thankful  she has                                                               
Denali  KidCare for  her  children for  preventative  care.   She                                                               
offered that  the program  has been  beneficial to  her children.                                                               
As a  daycare provider, she  is witness  to the needs  of parents                                                               
for health  care [for their children].   The cost of  health care                                                               
is  rising, she  explained;  it has  doubled in  her  area.   She                                                               
indicated  that  if HB  367  passes,  health care  expenses  that                                                               
parents are  unable to  pay will  be borne by  the state;  if the                                                               
state  is  unable to  pay,  the  federal  government pays.    She                                                               
characterized this as a vicious cycle.                                                                                          
                                                                                                                                
MS. CLARK  added that lower  self-esteem and a higher  crime rate                                                               
would result  from the bill's  passage.  Denali  KidCare coverage                                                               
now provides a greater chance  for families to receive well-child                                                               
care and  to detect health problems  early on.  She  noted that a                                                               
higher self-esteem  is the result of  greater stability [provided                                                               
by Denali KidCare coverage].   She thanked members for their time                                                               
and expressed her hope that this bill would not pass.                                                                           
                                                                                                                                
Number 0760                                                                                                                     
                                                                                                                                
TRUDY ANDERSON, Consumer Awareness  Manager, Alaska Native Health                                                               
Board,  testified via  teleconference.   She  explained that  the                                                               
Alaska Native  Health Board is a  statewide nonprofit corporation                                                               
established  more  than  30  years   ago  to  promote  spiritual,                                                               
physical, mental,  social, and cultural  well-being and  pride of                                                               
Alaska  Native  people.    The   board  of  directors  represents                                                               
regional and village health providers  from across the state.  In                                                               
most cases,  she noted, these  organizations are the  only health                                                               
care providers  for their  region, serving  both Native  and non-                                                               
Native patients who  would otherwise have virtually  no access to                                                               
health care  services.   She emphasized that  the CHIP  funds are                                                               
100  percent  reimbursed by  the  federal  government for  Alaska                                                               
Natives  and  IHS  beneficiaries   who  use  Denali  KidCare  and                                                               
Medicaid.   She  said,  "We  are opposing  HB  367  and urge  the                                                               
legislature not to pass this bill."                                                                                             
                                                                                                                                
Number 0859                                                                                                                     
                                                                                                                                
GAY  WELLMAN,  Copper  River Native  Association,  testified  via                                                               
teleconference and explained  that she wished to  speak on behalf                                                               
of  the association  as well  as herself.   She  stated that  the                                                               
Copper River Native Association  provides services to both Native                                                               
and  non-Native  residents.    One service  it  provides  is  for                                                               
treatment for Fetal Alcohol Syndrome  (FAS); Denali KidCare is an                                                               
integral part  of enabling  the association  to provide  that FAS                                                               
service.    Denali KidCare  assists  in  paying the  out-of-state                                                               
doctor for diagnosis and services.   She stated that this service                                                               
would be difficult to provide, were HB 367 to pass.                                                                             
                                                                                                                                
MS.  WELLMAN  explained  that  several years  ago,  she  and  her                                                               
husband were  earning more than the  $44,000 [eligibility] limit;                                                               
her husband was  working in the private [sector] and  she for the                                                               
federal  government.    She reported  that  they  had  difficulty                                                               
finding coverage  for their  children; she  was unable  to afford                                                               
coverage through  her job for  more than herself.   Although they                                                               
found a policy  that was initially affordable,  rates were raised                                                               
within several months'  time and continued to  rise.  Eventually,                                                               
her family was unable to afford this policy, she said.                                                                          
                                                                                                                                
Number 0945                                                                                                                     
                                                                                                                                
MS.  WELLMAN summarized  by stating  that the  insurance that  is                                                               
available for  families is  really not  affordable.   Often these                                                               
companies do not pay what they  should when a claim is filed, she                                                               
said.   She indicated that her  family was reimbursed $200  for a                                                               
$3,000 medical  bill for  one of  their children.   She  said, "I                                                               
hope that  you will  keep it  the way it  is; it  would certainly                                                               
help us out here greatly."                                                                                                      
                                                                                                                                
Number 0978                                                                                                                     
                                                                                                                                
COMMISSIONER LIVEY  asked department  personnel to assist  him in                                                               
responding.                                                                                                                     
                                                                                                                                
NANCY   WELLER;  Unit   Manager;  State,   Federal,  and   Tribal                                                               
Relations; Division  of Medical Assistance; Department  of Health                                                               
and  Social Services,  clarified that  if the  income level  [for                                                               
program eligibility] is lowered, it  would affect all children of                                                               
all races.  She said, "Medicaid  would not be getting the hundred                                                               
percent  pass-through  funds  for Native  children  because  they                                                               
would no longer be covered at that income level."                                                                               
                                                                                                                                
CHAIR  DYSON  queried whether  there  wasn't  other medical  care                                                               
available for Native Alaskan children.                                                                                          
                                                                                                                                
MS.  WELLER  replied  that  Native   health  coverage  is  funded                                                               
directly through Indian Health Service  funds at approximately 60                                                               
percent of  the need.  This  funding level is documented  in many                                                               
studies, Ms. Weller said.  She  stated that the U.S. Congress had                                                               
allowed [IHS]  to bill Medicaid  for services to assist  [IHS] in                                                               
covering the cost of health care for beneficiaries.                                                                             
                                                                                                                                
CHAIR DYSON asked for further  clarification [in the future].  He                                                               
expressed his  understanding that children who  would not qualify                                                               
under Denali  KidCare would still  qualify to have 60  percent of                                                               
their medical bills paid by IHS.                                                                                                
                                                                                                                                
MS.  WELLER  responded that  the  IHS  system  is funded  for  60                                                               
percent of the need of Alaska Native people.                                                                                    
                                                                                                                                
CHAIR DYSON  queried, "Does 60 percent  of the need ...  not mean                                                               
paying 60 percent of the bills?"                                                                                                
                                                                                                                              
COMMISSIONER LIVEY noted  that it probably means  that the health                                                               
corporations  do not  have enough  money to  pay for  all of  the                                                               
medical  services  for  their   beneficiaries.    Therefore,  the                                                               
corporations  have to  choose what  is  covered and  what is  not                                                               
covered.  He explained that 60  percent of the need is covered by                                                               
the federal  government; 40 percent  is not covered.   Whether or                                                               
not  a  corporation  would  choose  to  cover  prenatal  care  or                                                               
children is up to the corporation.                                                                                              
                                                                                                                                
Number 1102                                                                                                                     
                                                                                                                                
CHAIR  DYSON said,  "So we're  talking  about 60  percent of  the                                                               
aggregate need,  not of a  particular individual."   [He received                                                               
confirmation  from both  Commissioner Livey  and Ms.  Weller that                                                               
this is correct.]                                                                                                               
                                                                                                                                
REPRESENTATIVE COGHILL referenced a  study indicating $63 million                                                               
comes directly  to Alaska  through IHS.   He  said, "So  there is                                                               
money going  to health care  in Alaska."   He indicated  [HB 367]                                                               
would  not  destroy  that;  it  still allows  60  percent  to  be                                                               
[covered].  He expressed his  opinion that this should be debated                                                               
in the House Finance Standing Committee.                                                                                        
                                                                                                                                
CHAIR DYSON announced that HB 367 would again be heard by the                                                                   
committee on February 14.  [HB 367 was held over.]                                                                              

Document Name Date/Time Subjects