Legislature(2003 - 2004)
03/18/2003 03:02 PM House HES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 167-ALCOHOLISM AND DRUG ABUSE GRANTS CHAIR WILSON announced that the next order of business would be HOUSE BILL NO. 167, "An Act relating to grants for alcoholism and drug abuse programs; and providing for an effective date." Number 1103 ELMER LINDSTROM, Special Assistant, Office of the Commissioner, Department of Health and Social Services, testified in support of HB 167. He explained that the bill is very straightforward in that it requires that the alcohol and drug abuse grantees increase their local match to 25 percent from 10 percent. MR. LINDSTROM pointed out that the fiscal note reflects the reduction in state support for these programs, with a savings of approximately $1.6 million. It is assumed that local communities will be successful in providing for an additional match and therefore [the department] would not expect there to be a reduction in services at the community level. He offered the belief that the grantees would be able to increase their local contribution to the program. He said this proposal came from the Division of Alcohol and Drug Abuse as a result of [the department's] budget exercise earlier in the session. He said the 25 percent local match requirement is the same as the standard for the mental health grant program. Number 1050 MR. LINDSTROM said the Division of Behavioral Health will be constituted from the existing Division of Alcohol and Drug Abuse and the existing Mental Health Program portion of the Division of Mental Health and Developmental Disabilities. It is reasonable that the substance-abuse grant program and the mental health grant program would require the same 25 percent match from grantees. He said he overstated the case in a previous hearing on this bill in the other body. He told the committee he did suggest that 25 percent was the standard across all of the department's grant programs, and that is not the case. There is wide variation in what the local match requirement is from various programs funded through the department. The 25 percent is the standard for the mental health grant program, which [the department] believes is the best comparison. Number 0952 CHAIR WILSON commented that there is a spreadsheet in the bill packet that shows the amount of reductions for each area in the state. She said it is very difficult decision for all the members in these days when there are limited funds and so many needs. Number 0908 REPRESENTATIVE CISSNA referred to the sponsor statement from [U.S.] Senator Lisa Murkowski, who was then a state Representative, for the alcohol tax bill that was put in last year. In that statement, [then-Representative Murkowski] said that she "introduced the bill to help offset the soaring costs of alcohol-related expenses." Representative Cissna went on to say Representative Murkowski ended her sponsor statement by saying, "This legislation is an important part of the effort to address the problem of alcohol and alcohol abuse in Alaska and would help provide revenue needed for the expanded treatment, therapeutic courts, diversion programs, and other initiatives now under consideration in the legislature." Representative Cissna commented that although that is not dedicated funding, this is one of the few revenue-enhancement measures that came about last year, and the purpose was to provide funds for programs that would curb one of the most expensive habits in this state. CHAIR WILSON agreed with Representative Cissna on that point, but noted that in the original bill, the tax was actually much higher than the one that passed the legislature. Number 0779 REPRESENTATIVE CISSNA commented that may be true, but the problem has not decreased; if anything, it has increased. CHAIR WILSON responded that unfortunately [the legislature] cannot designate where the funds go. She commented that maybe the legislature would have been able to prevent these reductions if the higher tax had passed. REPRESENTATIVE CISSNA said the tax is in place. She told the committee she has an amendment she would like to introduce at the appropriate time. CHAIR WILSON told the committee she wants to be advised ahead of time when a member has an amendment. Number 0711 MR. LINDSTROM told the committee passing this bill is the appropriate thing to do. It is the only statutory local match requirement that exists. He said there is another area in the governor's budget for FY 04 that he believes will address some of Representative Cissna's concerns. There is approximately $3.5 million in alcohol tax receipts for new programmatic efforts, and there is an expectation that the program, under [the administration's] emphasis on maximizing federal receipts, ought to be able to generate a significant amount of additional federal dollars for the Medicaid program by leveraging that $3.5 million. Mr. Lindstrom offered to get that information on additional substance abuse treatment proposed in the governor's budget. Number 0599 CHAIR WILSON referred to page 1, lines 8-11, which says, "The department may waive all or part of the requirement that state money be matched by community money if the department finds that community money is unavailable and waiver of the requirement is in the best interests of the state." She asked Mr. Lindstrom to explain that language. Number 0544 MR. LINDSTROM referred to a spreadsheet in the bill packet that was labeled "SB 124/HB 167 Increase in Local Match Requirements for Substance Abuse Grants (Revised 3/12)." He told the committee that exempted from community grant match are the community-based suicide-prevention projects and those projects that are less than $30,000. He said in these cases either the communities do not have a local match at all or other programs that are services for families would remain at the 10 percent match. Community prevention services under $30,000 would also remain at the 10 percent match. Mr. Lindstrom told the committee the language provides for the department to waive match requirements in full or in part under a hardship. Number 0425 REPRESENTATIVE WOLF asked if the grantees are normally nonprofit corporations. MR. LINDSTROM answered in the affirmative. REPRESENTATIVE WOLF pointed out that these organizations have the ability to seek corporate or federal grants outside the [state] government sector. CHAIR WILSON asked Representative Wolf to expand on grants obtained from sources other than state government. Number 0381 REPRESENTATIVE WOLF referred to 501(c)(3) nonprofit funding, which he said is virtually untapped nationwide. Representative Wolf told the committee there was over $160 million in grant funding that was not applied for last year. If the nonprofit organizations in the state of Alaska were more enthusiastic about trying to build partners, he said, it would be a lot easier to accommodate these programs. REPRESENTATIVE CISSNA asked if groups that this legislation affects are existing nonprofits and if the new programs being suggested by the governor's legislation are also nonprofits or are government programs. Number 0273 MR. LINDSTROM replied that virtually all support for the substance abuse treatment programs are for "our grant in aid" program to nonprofits. He said he believes the priorities for the additional funding are for women and children's services, particularly for families that may be involved in the child-in- need-of-aid system. He said there is also emphasis on adolescent treatment in rural areas. Number 0221 REPRESENTATIVE KAPSNER asked why a 25 percent match was chosen. MR. LINDSTROM replied that the suggestion at the first budget meeting was that 25 percent was the standard in all of the department's grant programs. However, he said he subsequently learned that really is not true. It is the standard for the most analogous grant program, which is for mental health grants. He told the committee there is a wide variety of match rates. Mr. Lindstrom said it was stated by the former director that this is relatively low; in looking for budget savings, it was something that rose to the top of the list as one of the most feasible and least harmful things to propose. REPRESENTATIVE KAPSNER asked Mr. Lindstrom if he has rates of alcohol consumption versus crime. She asked if he could think about that with respect to cost to the state. MR. LINDSTROM replied that there is a wealth of information about that subject and a recently published report by the criminal justice assessment commission, which compiles a lot of alcohol-related statistics. He said he has found in his conversations with law enforcement and corrections staff that there is a very high percentage of criminal behavior where there is substance abuse involved. Number 0003 REPRESENTATIVE KAPSNER asked if the department considered using a sliding scale for the communities that could least afford to pay for the services. For instance, municipal assistance and revenue sharing is going to go down this year, and there have been huge decreases in that program over the last ten years. Many communities are not faring well with timber, mineral, tourism, and oil markets such as they are. Would the department consider a sliding scale for communities that can afford to pay more? TAPE 03-26A, SIDE A Number 0013 MR. LINDSTROM said he did not believe that there was any expectation that local governments would be stepping forward to make up the shortfall. It was much more of an expectation that through various types of fundraising, grants, and other sources of funds, the nonprofits would generate the additional match. Mr. Lindstrom said that there is an expectation that all of the treatment providers in the system offer a sliding-fee scale for the clients who come in to be served. This is the public treatment system, so the patients tend to be very low-income individuals. REPRESENTATIVE KAPSNER replied that her understanding is that communities would be asked to pay, and asked if she is misreading the bill. MR. LINDSTROM replied that the word "community" is in the broad sense of the word, and not referring to local government. He pointed out the exemptions for very small communities, particularly those communities that only receive the suicide prevention grant, which is approximately $12,000 to $17,000. There is not the expectation of a match from those communities. Number 0166 REPRESENTATIVE KAPSNER asked what the waitlist is for some of these treatments programs. Number 0177 MR. LINDSTROM responded that there is an updated waitlist report that he has not yet seen. It was due in January or early February. He said he would get a copy of that report to the committee. Mr. Lindstrom said he heard discussions about the report and believes the number is similar to the previous waitlist, which is very significant in many areas of the state at any given time. The waitlist report from a year ago was about 300 individuals waiting for treatment. REPRESENTATIVE WOLF said for the record that many state and federal governments recognize nonprofit organizations as community organizations. The 25 percent match for nonprofits is a comparatively low number. Most government grants for nonprofit, community-based organizations start at 33 percent and go up from there. He told the committee he has seen a two-to- one match, so a 25 percent match is a low number. By bringing in the community, the organization has an opportunity to expand understanding and knowledge of the care that organization provides. He told the committee bonding and stewardship are very tough to regulate, and a lot easier to educate [people about]. Number 0340 REPRESENTATIVE GATTO said the state spends a lot of money on substance abuse treatment and he is curious if the state is getting anything out of it. Do [these programs] cure people, and if they do, is it a percent or a serious number? He asked Mr. Lindstrom what the success rate is over one, five, and ten years, having people be drug-free for 24 and 48 hours before they come back. Does [the state] have numbers to indicate success in all the money the state spends? MR. LINDSTROM pointed to the "New Standards Report of 1998," where a firm came in under contract and did a study on the success rates of alcohol and substance abuse programs. The conclusion was that programs are effective. He said the most compelling discussion he has heard on this issue was from a previous director of the division, Ernie Turner, who changed the way Mr. Lindstrom thought about alcohol abuse. Mr. Lindstrom said he and most of the folks in the health care community believe that defining what success means is important because alcoholism is a disease that is chronic, progressive, and if not treated the outcome is death. In thinking about any other chronic disease, one would not ask this kind of question. If a person has diabetes or chronic diseases and is treated, gets better, and then subsequently is required to be hospitalized again, there would not be the suggestion that the first treatment was a failure in some sense, Mr. Lindstrom commented. Number 0511 MR. LINDSTROM went on to say that there is recognition that with some chronic diseases there are some people who will be able to go on and not have a relapse; however, it is not uncommon for there to be a relapse. The short answer is that there is success, but not 100 percent success, the first time; for the rest of their lives, that answer is no. Number 0603 REPRESENTATIVE GATTO told Mr. Lindstrom he understands what he is saying, but diabetics are told that unless they take insulin every day for the rest of their lives, they will get sick and die. If a person does not take it and gets sick, that is a problem with a person who is abusing himself or herself. He said he is more concerned about a person who is a diabetic who does the right thing, watches his/her diet, and occasionally comes back. That is quite a different story. Representative Gatto said he is not expecting 100 percent of anything, but he said he is expecting a number that says this is not a waste of state money. He said the legislature is spending a great deal of money and that he gets a lot of input from the community concerning repeat offenders. REPRESENTATIVE GATTO shared that after 25 years on the streets of Anchorage as a paramedic, he can tell the first names, second names, and family names of people who come back over and over again. He offered his belief that these individuals have no interest in any kind of a cure. Their main interest is living on the dole. That is their primary goal in life. He questioned whether the state wants to support people whose primary goal is to live on the dole. Number 0661 MR. LINDSTROM apologize for overstating the case for alcohol treatment, and he said he would get a copy of the report to the committee. He said treatment does have good value and he is well aware of the situations Representative Gatto described and does not dispute for one second that they [exist]. Number 0709 PAM WATTS, Executive Director, Governor's Advisory Board on Alcoholism and Drug Abuse, Office of the Commissioner, Department of Health and Social Services, testified on HB 167. She said that while she did not hear all of the previous testimony, what she heard was very important. She told the committee when looking at legislation that changes the match rate from 10 percent to 25 percent, the committee needs to acknowledge that the Division of Alcoholism and Drug Abuse funding has been flat for approximately 10 years. There have been a lot of discussions about inflation-proofing funding, and that has not been done with this program. She said the grantees have had cuts over the past 10 years, and this will increase the burden on them. MS. WATTS pointed out that the client population served by this program is either very low-income or indigent, so while there is a sliding-fee scale, the ability to collect from this population is extremely limited. The Veterans' Administration used to pay for some of this treatment; however, that is now impossible. Providers used to be able to collect permanent fund dividends from some of these folks, but child support enforcement and a lot of other important entities are first on the list in that regard. If current legislation being proposed to take the permanent fund dividend away from individuals who are arrested for driving under the influence [passes], providers will not have that any longer either. Many of these people are not employed. Ms. Watts said she understands what the committee members have said, that there should be accountability for treatment, and many times down the road once they have received treatment, become productive, and can pay for treatment, "we do receive it." Number 0919 CHAIR WILSON asked Ms. Watts how often individuals who have been through treatment come back and pay for that treatment. MS. WATTS said when she worked as a treatment provider for eight and a half years [both residential services and outpatient prevention services], the big-ticket item was the residential services. Unfortunately, those are the people who are most severely impaired. That is why residential treatment sometimes is not as successful as outpatient treatment, because these are really late-stage people. Many of them were provided treatment on a sliding-fee scale, and some of them were right out of corrections; some of them had no cash. They were on a treatment plan, and it would not be very much a month, but they were paying something. If the individual did not pay anything, it was turned over to collections. MS. WATTS told of a provider in Seward that says if its match rate goes up, it will be very difficult because it gets its [matching funds] from clients. Number 0930 MS. WATTS responded to Representative Gatto's question and Mr. Lindstrom's comment on the New Standards Study, which does show that Alaska is not only comparable in successful treatment outcomes compared to the rest of the country, but showed that Alaska was slightly above the national average. Right now the Mental Health Trust Authority and the legislature are funding a study through the University of Alaska to give more current information about treatment outcomes. As soon as it is available, she said, she will make it available to the committee. Number 1042 MS. WATTS strongly encouraged the committee to keep the language intact that refers to the department's ability to waive the match if the department determines that community money is unavailable and a waiver is in the best interest of the state. Number 1068 MATT FELIX, National Council on Alcoholism, testified in opposition to HB 167. He gave a brief description of his long career in the alcoholism treatment field. He told the committee he believes this bill is not needed because the 25 percent match is a goal that most community nonprofits cannot reach in public programs. He pointed out that with this population, by the time they need treatment, most of their resources are gone. The grant-in-aid regulations under Governor Hickel found that this is a very efficient way of providing services and that it is probably done at a third of the cost of providing services by state employees. The grant-in-aid regulations by the state require a nonprofit to charge for those services. The provider is required to use the federal regulations for poverty guidelines on a sliding-fee scale. Some of these people can pay and some do. He said when he was running the hospital in Juneau, city government provided some of the funding. In Anchorage, the city would receive the same grant and match funding for programs or nonprofits, but it was difficult to match because the funds were substantial. Since the late 1980s, Anchorage has decided not to match funding, and since the late 1990s, the city of Juneau has decided not to either. MR. FELIX said in rural Alaska there has been a hard time reaching the 10 percent match. The people out there do not have the ability to pay at all. He said he recalls that some individuals paid in fish and handmade products. Number 1313 CHAIR WILSON announced that she would end testimony at this time. [HB 167 was held over.]
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