Legislature(2003 - 2004)
02/09/2004 01:39 PM Senate HES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 285-MEDICAL ASSISTANCE COVERAGE
The committee took up SB 285.
MS. JACQUELINE TUPOU, staff to Senator Lyda Green, presented SB
285 on behalf of the sponsor and testified that this bill allows
the state to extend targeted case management to various user
groups that aren't currently included in its authority. By
doing so, it allows for refinancing of general fund expenditures
by reimbursing the schools for the targeted case management
services. Secondly, it changes the state's rehabilitative
services to match the federal definition of rehabilitative
services. Doing this ensures reimbursement for the school-based
Medicaid rehabilitative services. It's estimated that this
legislation will potentially save approximately $270 [thousand]
in FY 05.
SENATOR WILKEN asked, "How does this roll into what we did a
couple years ago about -- we asked someone to start billing the
feds for something. Where are we on that project?"
SENATOR LYDA GREEN responded that this bill was directly related
to that legislation and she deferred to Commissioner Gilbertson.
MR. JOEL GILBERTSON, Commissioner, Department of Health and
Social Services (DHSS), said that SB 285 accomplishes two
purposes, and testified as follows:
One purpose does deal with school-based Medicaid ...
to improve and increase the flexibility for school
districts ... being able to bill for Medicaid services
and to assist them in the documentation of those
services. Also, to address a deficiency found in the
current authority of the department to move forward
[on what] was found by the Department of Law.
The first of these two deals with the ability of the
schools to adequately document for services so that
they can bill. For this reason, the legislation
itself now directly cites the code of federal
regulations in the definition of rehabilitative
services. The unambiguous linkage of the state and
federal definition will permit services recommended by
the physician or provider - normally included in the
student's IEP [Individual Education Plan] - those
services normally recommended, not prescribed, can be
billed under Medicaid. We have an approved state plan
for therapies, normally OT, PT, speech, some assisted
devices for hearing, some transportation services,
nursing services, and it is the department's intent,
after passage of this legislation, to submit another
state plan amendment of the Medicaid program, to
broaden the scope, and to include psychological
evaluation and counseling services. However, absent
this change, and this inclusiveness of the federal
language, under the CFR, we are now working under a
paradigm in which the doctor has to prescribe services
as opposed to services recommended in the IEP, to
allow those services to be billed under Medicaid.
Also, the amendment is needed because when the
department began to implement school-based services
legislation, SB 345, which was passed in 2002, the
Department of Law noted that while the bill had added
school-based rehabilitative services to the list of
covered Medicaid services, in AS 47.07.030, the
statutory definition of rehabilitative services in AS
47.07.900 was left unchanged. So the scope was
changed but not the definition. That restricts
rehabilitative services only to those adult
individuals who are substance abusers or who are
chronically medically ill. As a result, the
department cannot issue regulations allowing the
school districts to bill for rehabilitative services.
SB 285 fixes this problem by including a separate
definition for rehabilitative services for school
districts in AS 47.07.063, which supersedes the
previous definition that was in AS 47.07.900.
The second point of this legislation addresses
targeted case management [TCM] services. Currently,
those services are optional services under federal
Medicaid law. This change, being put forward in this
legislation, coincides with the department's general
effort to replace the general fund in the provision of
health care services across the state. Current law
restricts the provision of targeted case management
services to substance abusers, chronically mentally
ill adults, and SED (severely emotionally disturbed)
children. TCM for these groups is funded at the
Medicaid program match rate of 58 percent federal, 42
percent state. This is a change from the current
funding of these services, which is at 100 percent
general fund dollars. The amendment will permit DHSS
to identify additional groups that are currently
receiving case management services that are funded by
the general funds, and replace that with the Medicaid
match rate of 58 percent federal funds.
Some examples of services that can be provided through
TCM services include: Children under the care/custody
of the Office of Children's Services or Department of
Juvenile Justice [DJJ] who are not currently in
detention beds; children in the Infant Learning
Program, some public health nursing services; children
within the educational system who have an IEP; and
targeted tribal groups. The fiscal note notes only
minimal general fund savings for FY 05. It is a zero
fiscal note because the governor's budget already
includes a $270 thousand savings assuming the
implementation of this legislation and the successful
implementation of TCM services in FY 05. Much work
has to be done to begin the services. Obtaining
federal approval of the state plan amendment to draw
down the necessary funds has recently become a more
prolonged process than previously. State plan
amendments are becoming more difficult to receive
approval on, but we do ultimately receive approval.
This is an approvable state plan amendment, so we do
anticipate implementation at some point during FY 05,
and will realize these savings. In addition, billing,
accounting, and case management systems will need
modification in order to submit and support this new
claiming activity. These are some of the reasons for
there being minimal savings for FY 05, but we believe
that future savings will be much larger for the state.
CHAIR DYSON acknowledged that Senator Guess was participating in
the meeting via teleconference.
SENATOR GREEN said she wanted to respond to inquiries she has
received from school districts on this issue and asked when this
process would be in place.
COMMISSIONER GILBERTSON responded there is a two-pronged effort
to implement this legislation, recalling a previous discussion
with Senator Green to get this fast-tracked. He said the
regulations were developed and a state plan amendment was
submitted which was the federal side of this to get approval to
provide these services. The state plan amendment was approved
for some services, largely therapies; the deficiency in the
regulations was noted by the Department of Law. He said as soon
as this legislation is passed and the legislative authority
exists to engage in the services, regulations would be put out
again, there would be a comment period, and finalization of the
regulations. An additional state plan amendment will be
submitted to expand the scope of services to include counseling
and psychological evaluation. Those services would be subject
to the time process of getting the state plan amendment
approved. Historically this hasn't taken long, but as of late
it has taken quite a bit of time to get approval by the federal
government, he said.
SENATOR GREEN asked, "Possibly next fall?"
COMMISSIONER GILBERTSON replied this would be the goal.
SENATOR WILKEN commented on the fiscal note, saying that this
had been about a $4 million savings, which was an additional
amount of money that could be spent in the schools.
SENATOR GREEN said she didn't remember the amount.
COMMISSIONER GILBERTSON responded that a sizable amount of
federal money will be gathered through school-based Medicaid
claiming. That money goes to the school districts, and the
districts provide towards the general fund maximum, with 42
percent drawing down 58 percent of federal monies. The $270
thousand is the savings the state anticipates in FY 05. As a
result of the second part of this legislation, TCM services that
allow for claiming some federal match dollars on services
currently being paid for with general fund dollars, that scope
of business and amount of claiming is expected to increase over
the long-term. Acknowledging the start-up time, "we don't
anticipate a large savings in FY 05."
SENATOR WILKEN questioned what this would mean to the 53 school
districts and asked, "What will be freed up?"
MR. JON SHERWOOD, DHSS, responded that Senator Wilken "was in
the ballpark" regarding the total amount of funds, saying that
this would bring into the school district the mechanism the
school district provides to general funds [indisc. due to
coughing] and the state process through the federal funds. Mr.
Sherwood said he was not aware if estimates had been revised
regarding how fast the money would come in or if the amount was
still the same. Some of that depends on seeing what the federal
government actually approves.
SENATOR WILKEN said the bill would go on to Finance, and asked
Mr. Sherwood if there was a way to profile one district, such as
Anchorage, and give a range (low/high) of what it may mean five
years from now.
MR. SHERWOOD responded that the department could come up with an
estimate.
CHAIR DYSON said, "We would enjoy seeing that when it gets to
Finance." He asked Senator Guess if she had any questions and
then asked her if she was somewhere where she could receive a
fax.
SENATOR GRETCHEN GUESS replied that unfortunately she was not
near a fax, however, she understood the changes that Ms. Barrans
had discussed regarding the proposed CS to SB 277. [SB 277 was
previously heard during today's meeting.]
CHAIR DYSON then asked if there were any additional questions on
SB 285. Hearing none, he said he would entertain a motion.
SENATOR GREEN moved SB 285 from committee with individual
recommendations and accompanying fiscal notes.
CHAIR DYSON asked if there were any objections. Seeing and
hearing none, it was so ordered.
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