Legislature(2015 - 2016)CAPITOL 106
02/11/2016 03:00 PM House HEALTH & SOCIAL SERVICES
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| Presentation: Medicaid Redesign and Expansion Technical Assistance Initiative | |
| Adjourn |
* first hearing in first committee of referral
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| + | TELECONFERENCED | ||
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ALASKA STATE LEGISLATURE
HOUSE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
February 11, 2016
3:04 p.m.
MEMBERS PRESENT
Representative Paul Seaton, Chair
Representative Liz Vazquez, Vice Chair
Representative Neal Foster
Representative Louise Stutes
Representative David Talerico
Representative Geran Tarr
Representative Adam Wool
MEMBERS ABSENT
All members present
OTHER LEGISLATORS PRESENT
Representative Dan Ortiz
COMMITTEE CALENDAR
PRESENTATION: MEDICAID REDESIGN AND EXPANSION TECHNICAL
ASSISTANCE INITIATIVE
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
THEA AGNEW BEMBEN, Managing Principal
Agnew::Beck Consulting
Anchorage, Alaska
POSITION STATEMENT: Presented a PowerPoint titled "Medicaid
Redesign and Expansion Technical Assistance Initiative."
NORA LEIBOWITZ, Principal
Health Management Associates (HMA)
Portland, Oregon
POSITION STATEMENT: Testified and answered questions during the
PowerPoint presentation.
SUSAN PANTELY
Milliman, Inc.
San Francisco, California
POSITION STATEMENT: Testified and answered questions during the
PowerPoint presentation.
ACTION NARRATIVE
3:04:43 PM
CHAIR PAUL SEATON called the House Health and Social Services
Standing Committee meeting to order at 3:04 p.m.
Representatives Seaton, Wool, Talerico, Stutes, Vazquez, Foster,
and Tarr were present at the call to order. Also in attendance
was Representatives Ortiz.
^Presentation: Medicaid Redesign and Expansion Technical
Assistance Initiative
Presentation: Medicaid Redesign and Expansion Technical
Assistance Initiative
3:05:37 PM
CHAIR SEATON announced that the first order of business would be
a presentation on the Medicaid Redesign and Expansion Technical
Assistance Initiative. He noted that this presentation was in
relationship to proposed HB 227 regarding Medicaid Reform, which
had substantial budget implications over the next several years.
3:06:37 PM
THEA AGNEW BEMBEN, Managing Principal, Agnew::Beck Consulting,
offered some background on her company and her consulting
history. She shared that that she grew up in the state and she
had been working as a consultant in Alaska for 20 years. She
said that her company had worked in conjunction with Health
Management Associates and Milliman, Inc. on this report.
NORA LEIBOWITZ, Principal, Health Management Associates (HMA),
reported that the HMA team were primarily the subject matter
experts, working closely in discussions with stake holders and
the state, in development for the recommendations.
SUSAN PANTELY, Milliman, Inc., shared that Milliman, Inc. was an
actuarial consulting firm, and they had provided actuarial
analysis for the report. She noted that Milliman, Inc. had
consulted with more than half the states on Medicaid and the
implications of the program.
MS. BEMBEN emphasized that the project timeline had been
intense, beginning in July, 2015, and the final reports were
published on the Department of Health and Social Services
website on January 22, 2016, slide 2. She noted that the
Agnew::Beck report included an analysis from Milliman, Inc.
although the Milliman report in full had been also published
separately.
3:09:56 PM
MS. BEMBEN directed attention to slide 3, "Project Overview,"
and reported that the project began with an environmental
assessment lead by HMA, which compared the experience of other
states with Medicaid Reform, as well as an analysis of the
various federal financing mechanisms available. She added that
it provided an overview of some of the ongoing reforms in
Alaska. She stated that the next step was the most intense part
of the process, beginning with a key partner and stakeholder
meeting at which the findings of the environmental assessment
were reviewed with subsequent discussion for the needs and focus
of Medicaid Reform in Alaska. She relayed that this was the
beginning of many such meetings for the iterative process which
analyzed potential reforms. She stated that the final report
included not only an analysis of Medicaid reform initiative
options, but also proposals for some alternative coverage models
for the expansion population. The final report included
recommendations from the various reform initiatives and the
action steps necessary for reforms. She shared that the final
piece of the contract was an evaluation plan, which would be a
set of measures as a companion to the ultimate reform package.
MS. BEMBEN moved on to slide 4, "Broad Stakeholder Engagement,"
noting that at least 500 people had participated on some level.
She stated that there were three key meetings, intended to be
joint work sessions, with partners from many different sectors
which interacted with the Medicaid program, as well as
leadership from the Department of Health and Social Services.
She added that some engagement meetings with specific sectors,
including hospital administrators, physicians, tribal health,
and community health centers, were also convened. She reported
that they gave more than 30 public presentations, as well as
webinars after each key partner meeting. She pointed to slide
5, "Key Partner Organizations" which listed some of the key
partner organizations engaged in the work sessions.
3:13:28 PM
MS. BEMBEN shared slide 6, "Final Report Outline," which
included an executive summary, and an introduction with a
roadmap for reform. She explained that the roadmap was an
attempt to lay out the recommended package with the necessary
sequencing, the groundwork for the reforms that would build over
time. She added that the background section was a summary of
the environmental assessment document, which she described as
similar to a primer for care models and federal financing
mechanisms around the U.S. She described the recommended
foundational reform initiatives, which included primary care
improvement, behavioral health access, and data analytics and IT
infrastructure, as necessary to be implemented first before
other more comprehensive reforms. She stated that the emergency
care initiatives and the accountable care organization pilot
initiative were the primary tests for value based payment
reform. She declared that other topics had been identified for
further discussion in work groups, while some topics were
explored but not recommended. She reported that the final
section provided information on the three options for coverage
of the Medicaid expansion population, as well as an appendix
containing the reference material.
MS. BEMBEN described slide 7, "Final Report: Roadmap for
Reform," and slide 8, "Goals for Medicaid Redesign + Expansion."
She stated that these were the initial goals introduced in the
Request for Proposal (RFP), considered the goals for Medicaid
redesign and expansion. She shared that the goals were to
improve outcomes for enrollees, optimize access to care, drive
increased value, and provide cost containment. She allowed that
although it was difficult to balance all of these goals, the
report had attempted to do just that and not focus on one over
another.
MS. BEMBEN addressed slide 9, "Alaska Medicaid Redesign: A
Phased Journey to Peak Performance," sharing that the graphic
was used throughout the report to communicate the journey and
its phased sequence for building capacity for further reform.
MS. BEMBEN described slide 11, "Final Report: Recommended
Package of Reforms," stating that its main sections included
Foundational System Reforms, Paying for Value, Pilot Projects,
and Recommendations around Work Group topics.
MS. PANTELY introduced slide 12, "Final Round of Analysis
Included Actuarial Analysis by Milliman, Inc." which was based
on claims data from 2014 for the Alaska program. She reported
that statistical models were used, and estimates were based on
already implemented national programs as well as their knowledge
of the health care system. She acknowledged that any
characteristics and known limitations of the Alaska marketplace
were taken into consideration and weighed against the national
programs. Moving on to slide 13, "Summary of Actuarial Results
for Reform Initiatives," she said that they would address the
savings or increased cost for each of the listed initiatives
over the next five fiscal years. She shared that the baseline
was the assumption for spending if none of these were
implemented; however, this was only for the medical expenses and
would not match the DHSS budget. She said that some populations
had been excluded, including Medicare Part B, as the target had
been on a broader population for ease of the projections. She
pointed out that, as each of the initiatives was reviewed
separately, the total would not reflect the cost for
implementation of all as there could be some overlaps.
MS. BEMBEN added that the actuarial analysis was specific to the
Medicaid budget, and did not include any savings that could
accrue to other parts of the state budget.
MS. PANTELY explained that behavioral health grants and state
taxes were all outside the scope of this analysis.
3:21:35 PM
MS. BEMBEN shared slide 14, "Analysis of Reform Initiatives,"
and explained that the RFP had included instructions for what
each of the initiatives needed to include. She listed:
description and key features of the initiative, considerations
for any special populations relevant to that reform, an
actuarial analysis of projected costs and savings, relevant
experience from other states, potential challenges for
implementation, and the proposed timeline and phases with action
steps for the department when implementing the reform. She
noted that those did not take into account whether it was
necessary to secure budgetary authority, add staff, or secure
other resources.
MS. BEMBEN described the first of the three foundational
initiatives, Primary Care Improvement, slide 15, "Recommended
Package of Reforms." Every Medicaid enrollee would be assigned
to a primary care provider whose role would be to monitor and
coordinate the care for that enrollee. Each enrollee should
have an annual health risk assessment, separate from an annual
exam, similar to a questionnaire to identify higher and lower
health needs and risks. She reported that care management could
be helpful for improving the health of those with high risk and
high health needs, although, as it was not a great return on
investment for people without complicated health needs, it was
important to identify those who would benefit. She stated that
health homes were a state plan option for a coordinated whole
person care, as well as coordination of home and community based
support. It was targeted for those with higher health needs,
chronic health conditions or severe and persistent mental
illness. She added that it was recommended that the department
contract with an Administrative Services Organization (ASO) to
provide the additional capacity for help with enrollee education
orientation, build a provider network, provide data analytics
and IT support, and administer the health risk assessments.
3:26:00 PM
REPRESENTATIVE TARR asked for the reason to contract outside the
department, as opposed to utilizing existing or new staff who
had the institutional knowledge from working for the state.
CHAIR SEATON asked that the immediate questions be for
clarifications only.
MS. PANTELY returned attention to slide 16, "Actuarial Results:
Primary Care Improvement Initiative," which reflected an
increased cost in the first few years, with a subsequent
decrease over the baseline. She shared that there was an
assumption that all medical costs, even in the first year, would
start to decrease. The savings would increase over time, as it
most often took time for the programs to get off the ground, and
that providers learned from experience and became more
efficient. She pointed out that the health home would start a
few years after the other programs, and, as it had a higher
federal match, it would also project for a greater savings.
MS. BEMBEN stated that the second initiative, Behavioral Health
Access, was a companion to the first initiative, slide 17,
"Recommended Package of Reforms." She suggested that DHSS apply
for a Section 1115 waiver, an application for a demonstration
project to propose an innovative use of Medicaid funding other
than that under the traditional program. She noted that this
waiver could be approved for a five year demonstration period,
with the potential for a three year extension. She reported
that this would allow DHSS to contract with an administrative
services organization to bring in national expertise for
behavioral health systems management. This would propose a
change from program and grant management into contract
management. She stated that the waiver would establish
standards of care to allow expansion of delivery for substance
use and mental health services. She proposed that DHSS remove
the requirement that providers be a grantee to bill Medicaid for
behavioral health services and the broader range of providers be
allowed to bill for Medicaid services, effectively broadening
and increasing the available work force for additional services.
In the second year of the demonstration period, they recommended
to amend the waiver application to include a federal waiver of
the exclusion for Medicaid funding of services within institutes
for mental disease containing more than 16 beds. She pointed
out that the other recommendations addressed gaps in the crisis
response system. She stated that the goal of this initiative
was to remove the barriers for accessing behavioral health
services to allow them to be provided in an integrated fashion,
early on in order to prevent the need for so much crisis
service.
3:31:58 PM
MS. PANTELY explained slide 18, "Actuarial Results: Behavioral
Health Access Initiative," which reflected an increase in cost
for the five years of the program with increased access to the
professional component and the associated prescription drugs,
although some in-patient care would be avoided by moving the
services to a more appropriate level of care.
MS. BEMBEN mentioned that development of the proposed health
homes would provide a hub for coordinated and managed care for
people with high needs, as a requirement would be for integrated
physical and behavioral health services within that home.
MS. BEMBEN moved on to the third initiative, Data Analytics and
IT infrastructure, stating that it was absolutely foundational
to implementing these and more comprehensive reforms later,
slide 19, "Recommended Package of Reforms." She explained that
the initiative proposed use of the current health information
exchange although it currently lacked the connectivity for full
utilization. She stated that the important part of the
initiative was to connect hospitals, emergency departments, and
providers to the health information exchange and to integrate
the prescription drug monitoring state program data base for
greater accessibility to providers. She shared that it was also
proposed to contract with a data analytics firm to support value
based care in order to extract information from the data
repository and provide analytics to the departments for better
management of utilization and costs of the program. The data
analytics firm would also offer support to the providers for
connection, as not all the providers had either a mandate or
resources to connect. This information sharing would lead to
greater opportunities for improving care and containing costs
outside the tribal system, where it was already utilized.
MS. BEMBEN discussed Initiative 4: Emergency Care, slide 20,
"Recommended Package of Reforms," which she called a pay for
value pilot project. She explained that this was a private-
public partnership which could be implemented fairly quickly.
She said that a lot of this was also imbedded in the
aforementioned Initiative 3, as it was about connection through
better IT infrastructures for better information sharing among
the different departments, in order to reduce preventable
emergency department use and better facilitate follow-up with
primary care and behavioral health providers. She stated that
this would link to Initiative 1 and the need for assignment of a
primary care provider. She reiterated that primary care and
behavioral health were the two most needed, most basic, and
least expensive forms of care offered. She added that this
initiative created the connections to previous initiatives. She
pointed out that this initiative also proposed a shared savings
model: when emergency room use was reduced, a portion of the
savings would be shared with the emergency rooms. She reported
that this had been done successfully in the states of Oregon and
Washington.
MS. LEIBOWITZ added that there was a reduction of $33 million in
emergency room costs in the first year of implementation in the
State of Washington. She pointed out that, although there was a
much bigger population, this was notable for the savings and the
use of the shared savings model.
MS. PANTELY directed attention to slide 21, "Actuarial Results:
Emergency Care Initiative," which depicted an increase in
savings for every year, including the first year of
implementation. She explained that the primary savings resulted
from a reduction in the facility outpatient, emergency room
visits, 50 percent of these emergency room visits were replaced
with an office visit to either primary care, outpatient
psychiatric, or a specialist. She noted that, although there
were professional charges associated with these office visits,
there were also professional charges with emergency room visits,
and therefore, there was still a savings. She addressed the
incentive to the emergency facilities to provide a shared
savings program.
3:41:11 PM
MS. LEIBOWITZ described Initiative 5: Accountable Care
Organizations Pilot, slide 22, "Recommended Package of Reforms."
She stated that the accountable care organizations were a
mechanism for providers within an area to come together and
agree to share responsibility for the cost and quality of health
care for a particular patient population. She said this was
different from the more traditional full risk managed care, as
what made it unique was less about payment mechanism and more
about being provider driven. The provider community were the
ones to make the changes in the way care was provided. She
explained that the proposal for payment was the establishment of
shared savings, with a target based on analysis of prior claims
for the relevant population and then, if services could be
provided and meet the targets for quality of care and access to
care for less than the target amount, then the providers and the
state would share in that savings. She suggested that, in a
later stage, there could be shared losses between the providers
and the state. She reported that this was different, from a
financing perspective, than the full risk model of a traditional
managed care organization.
MS. PANTELY described slide 23, "Actuarial Results: Accountable
Care Organizations Pilot Initiative," which reflected savings in
the first year of implementation after the providers formed the
organization. The savings were generated from efficient and
appropriate services, with an increase in preventative services.
She pointed out that, as Alaska had a smaller population, there
was not the critical population mass necessary for the larger
savings.
MS. BEMBEN addressed slide 24, "Recommended Package of Reforms,"
and identified some workgroup topics for DHSS to convene and
guide: expansion of telemedicine to include the non-tribal
health providers; Medicaid business process improvements to
bring together DHSS experts and providers to discuss the
administrative burden and identify other necessary process
improvements with suggested resolutions; and continued work with
providers and stakeholders for ongoing Medicaid redesign.
3:47:48 PM
MS. PANTELY shared slide 25, "Actuarial Results: Potential
Savings from a Telemedicine Initiative," and reported that,
although there was not a specific telemedicine initiative, the
analysis was based on the implementation of robust telemedicine
initiatives in other states. She said that this had reduced
office and emergency room visits, as well as some in-patient
visits, and replaced them with telemedicine visits. She
reported that there were immediate savings, which increased over
time as telemedicine use became more prevalent. She shared that
the initiative did not include any cost changes for non-
emergency transportation, as it varied from state to state.
MS. LEIBOWITZ discussed slide 26, "Reform Initiatives Considered
but Not Recommended." She spoke first about full risk managed
care as an option for the expansion population, reporting that
the big difference for accountable care organizations was on the
structural side, as more often with full risk managed care the
state was contracting with an existing insurance carrier who
accepted full risk. She compared factors in Alaska, large land
mass and small population with states such as Wyoming in the
lower 48 which ad also had discussions for implementing this
managed care, but had decided not to move forward with the full
risk program. She pointed out that it had not been determined
that it would never work in Alaska, but that Alaska, instead,
needed to have some key fundamental reforms and changes in order
to keep moving.
3:52:47 PM
MS. BEMBEN continued discussion on slide 26, and talked about a
dementia care access initiative that had been brought up by
stakeholders. She reported that DHSS currently had a robust
process looking at its 1915 I and K options, and that the
dementia access analysis should be run concurrent to these
options.
MS. LEIBOWITZ spoke about the three other initiatives included
on slide 26 as ways to pay for services which were not
prioritized for analysis. She described bundled payments,
taking a set of services and having a payment for the entire
package, and offered maternity care as an example; pre-paid
ambulatory and inpatient health plans as a type of managed care
for a set of services, but more limited than a full risk managed
care; health savings accounts, and how they worked in the
Medicaid realm, noting that, although savings were possible from
the use of pre-tax money, this was less meaningful for a lower
income population. She shared that this had not had a huge
impact to providing incentives relative to the overall goal of
getting people to use services to manage care. She reported
that often, currently, doctors did not even collect co-pays, as
the patients could not afford these.
3:57:23 PM
MS. LEIBOWITZ brought attention to "Alternative Coverage Models
for Expansion Population," slide 27. She addressed the options:
utilizing the current Medicaid benefit package with no changes;
establishing an alternative benefit package based on the
benefits provided in a qualified health plan, such as the
commercial coverage offered through the federal marketplace;
and, the states paying an insurer for private coverage, and
paying for the individuals' premiums and some co-payments.
After analysis, they decided it made the most sense for everyone
to have the same current Medicaid benefit package. She shared
that there was a lot of feedback from providers regarding the
complexity of multiple packages, as this would add more
administrative work. She relayed that the cost for the third
option did not make it viable.
MS. PANTELY continued with slide 28, "Actuarial Results for
Alternative Expansion Coverage Models," which compared the three
models. The first option, the current alternative benefit
program, relied on the Evergreen report and updates of more
recent claims data. The second option, based on a qualified
health plan, removed dental coverage with subsequent decreases
in cost, although estimates for emergency room use did increase.
The third option, the private option, looked at the individual
marketplace on the exchange which had been experiencing very
high increases, and, based on knowledge of the market, was
determined to be more expensive. She shared that the federal
government would pay the same amount in any option, but the
State of Alaska would be required to assume the rest of the
costs.
4:01:16 PM
MS. PANTELY discussed slide 29, "Actuarial Results: Expansion
Option 1 Current Alternative Benefit Package," reporting that
they started with the number of newly eligible adults multiplied
by the projected take up rate, and arrived at the number of new
enrollees. She acknowledged that, as the take up rate was very
hard to predict, it was left constant after the first year. The
cost per enrollee was determined from the current annual
Medicaid cost for members with the same demographic mix. Moving
on to slide 30, "Actuarial Results: Expansion Option 2 Qualified
Health Plan Package," she reported the use of a similar
analysis, although this option removed dental services and
increased the emergency room visits by a small amount. On slide
31, "Actuarial Results: Expansion Option 3 Private Coverage
Option," they reviewed the insurance premiums on the individual
market and the cost for adding these individuals. Using the
assumption for federal payment capped at Option 1, this option
reflected the cost to the State of Alaska.
MS. PANTELY relayed that the caveats on slides 32 and 33 stated
that these were estimates, and, if the specifics of the program
change, they should be reevaluated.
MS. BEMBEN concluded with slide 34, "Next Steps," and stated
that they had made presentations to the Medicaid Reform
subcommittee and House Health and Social Services Standing
Committee. They would next develop some evaluation measures for
the reform package.
4:04:55 PM
REPRESENTATIVE STUTES directed attention to slide 31, and asked
if there was a cost evaluation if the state did not include all
27 options currently provided.
MS. BEMBEN asked for clarification that this was for the
expansion population, and replied that they had not analyzed
that as an option, but instead had used the current Medicaid
package.
REPRESENTATIVE STUTES asked if the analysis on slide 26
considered all the infrastructure involved in telemedicine,
including broadband.
MS. PANTELY replied that the analysis just considered the
medical expenses and did not include any necessary investment.
CHAIR SEATON suggested starting with the beginning of the
presentation for questions.
4:08:00 PM
REPRESENTATIVE VAZQUEZ referenced slide 12, and asked if the
data analytics, mentioned in the Foundational System Reforms,
considered the data in the MMIS system.
MS. BEMBEN said that the purpose of this initiative was to
better capture and analyze data from providers, which was beyond
the claims data in the MMIS system. She explained that this was
seeking to analyze other types of data, not accessible through
claims data, to help better measure improvement in health
outcomes and manage the program.
MS. LEIBOWITZ added that part of the effort to improve access
and control costs involved utilizing data collection and
analysis to ensure that providers were providing the necessary
services in an efficient manner. She said that these quality
measures were not usually included in claims data, but required
an additional effort. She explained that the benefits in the
analysis included the federal requirement for the ten essential
health benefits to be included for Medicaid recipients of an
alternative benefit package. There was a limit as to what
services could be taken out of any model.
4:11:37 PM
CHAIR SEATON asked if these analytics included the e-health
network, and how it corresponded to either Medicaid or other
primary care in the health system.
MS. BEMBEN replied that there was not an actuarial analysis on
the data analytics initiative because there was not a clear
picture of the cost for the necessary improvements. She
expressed agreement that an increase for connectivity with the
health information exchange would benefit other payers, as well.
She stated that the third initiative on slide 11 would lay the
groundwork for an all-payers claim data base, as, in Alaska, no
provider had a huge market share.
4:13:30 PM
REPRESENTATIVE VAZQUEZ asked if the statewide prescription drug
monitoring program would be linked with the information
exchange.
MS. BEMBEN explained that the current state prescription drug
monitoring program data base was difficult to access, not used
by every provider, and not up to date.
CHAIR SEATON relayed that there would be a committee initiative
to fix that portion of the data base not serving its purpose.
REPRESENTATIVE VAZQUEZ questioned whether all the providers were
using the aforementioned prescription drug monitoring program
data base.
MS. BEMBEN opined that she did not believe so, but that she did
not have a precise number of users.
4:15:10 PM
REPRESENTATIVE TARR asked if the health information exchange was
the same as the e-health network.
MS. BEMBEN said that the health information exchange was the IT
infrastructure, and that DHSS currently contracted with the
Alaska e-health network to manage it and bring on providers and
vendors.
REPRESENTATIVE TARR asked if the public face of the health
information exchange was the e-health network.
MS. BEMBEN expressed her agreement that the e-health network was
the organization managing it, although the providers would most
often be accessing information from other provider platforms
through the information exchange.
4:17:39 PM
CHAIR SEATON opined that the e-health exchange was a voluntary
exchange of data, and asked if this would be required with
Medicaid.
MS. BEMBEN stated that they did recommend for DHSS to
investigate this as a requirement for Medicaid providers. She
opined that there needed to be some sort of incentive to join,
as it was not simple or cost free.
4:19:43 PM
REPRESENTATIVE TARR referred to slide 15, the idea of contract
versus increase of staffing.
MS. BEMBEN, in response to Representative Tarr, said that
contracting with an Administrative Services Organization (ASO)
offered greater capacity than currently existed. She pointed
out that the report discussed the possibility of contracting
with an ASO for specific program wide functions, such as data
analytics. She noted that tribal health organizations may want
to take on certain functions for their enrollees, as there had
been an expressed desire for more regional management of health
services. She suggested that an ASO could devolve some of these
functions to a regional entity. She expressed agreement with
the desire to first use local capacity, although there were
things for which national expertise was very useful.
MS. LEIBOWITZ stated that it could be difficult to change the
entire structure of a department immediately, so, while that was
happening or being considered, an ASO could provide those
functions.
CHAIR SEATON asked if a contract with an ASO was a recommended
reform, even though the benefits were only for those that were
at high risk and high cost. He questioned whether identifying
those people for primary care and continuity of care was where
the savings originated, and he asked for the projected outcome.
MS. BEMBEN referenced slide 15 and stated that the primary
reason, a fundamental assignment, was to connect every Medicaid
enrollee with a primary care provider, which she declared to be
a critical step. She explained that the health risk assessment
was also for every enrollee, but the value of this assessment
was for its identification of people with higher health needs or
risks. She said those enrollees could be referred to the higher
levels of care management, with the possibility for receiving
services from a health home, or, if they were identified as a
high utilizer of emergency room services, they could be enrolled
in the DHSS current care program. She shared that conversations
with stakeholders indicated that there were some pilot efforts
for this care management, although it was difficult to identify
those people who would most benefit. She explained that these
assessments would help DHSS identify the higher health needs and
risks, and prevent future high utilizers with better care
management early on.
4:25:40 PM
REPRESENTATIVE VAZQUEZ offered her belief that the savings from
this initiative would be even higher than projected on slide 16.
She declared that it was also a humanitarian measure as it
lessened suffering while offering support from providers. She
stated her support for the primary care initiative.
MS. BEMBEN replied that a difficulty of the health system was
for the attempts to create better linkages between clinical
settings and community base settings. She acknowledged that,
although there was a very robust network of available home and
community based services, the linkages to them were "tricky."
The primary care initiative included recommendation for better
use of those supportive services at a lower cost.
4:28:41 PM
CHAIR SEATON asked whether the cost savings depicted in FY17 -
19, slide 16, was the savings from individual care prevention
catching up to the initial implementation costs.
MS. BEMBEN directed attention to "Total Change in Medical Cost,"
slide 16, and noted that the medical costs started to decrease
in the first year because of assignments to the primary care
providers for care management. She said that the first year
expenses were for the ASO fees. By FY19, the health home
services would be ready, would receive a federal match for the
first two years, and would accelerate savings in medical costs
from the care management for those with higher health needs.
She pointed out that although the ASO services were being
purchased, they would help reduce the medical costs and produce
a better net savings to the state.
4:30:45 PM
REPRESENTATIVE TARR, referencing global payment schedules, asked
if that impact was evaluated in this analysis and whether it
could be used as a Medicaid reform tool for cost savings. She
offered her understanding that a global payment schedule was
value based instead of volume based.
MS. BEMBEN asked if this was a capitated payment, and, after
acknowledgement, she relayed that they did look at these,
especially when reviewing full risk managed care. In that
system, the managed care organization would receive a capitated
payment, one payment per member per month and would be required
to meet quality outcomes and provide the requisite services.
She opined that this was similar to "trying to climb Mt. Everest
right out of the gate" as it was assuming a lot of capacity and
infrastructure that may not yet exist in Alaska. She
recommended a sequence of reforms that will build that capacity.
She reminded that accountable care organizations were another
means for value based payments as they could be piloted in
Alaska. In this model, the providers would come together and
form an organization, estimate the total cost of care for the
population they would contract to serve, and then, if the care
was provided at a lower cost than the state, they would share in
the savings. From this model, there could be a shift to a share
in the losses if the cost was exceeded. She stated that
providers take on all the risk with capitated payments, and
offered her belief that this arrangement "would be best to build
up to, and not to jump to right away." She shared that the
discussions with stakeholders had not reflected a willingness
from providers to join this model right now. She reminded that
Medicaid was just a portion of their patient population, so
willingness to do this for Medicaid had to be balanced against
their efforts for the other payers. She pointed out that it was
not prevalent in rural states because the dispersed population
did not offer the economy of scale.
REPRESENTATIVE TARR asked if there were instances where
capitated payment and global payment schedules were different
and not used interchangeably.
MS. LEIBOWITZ replied that they were the same idea. Capitation
was the monthly payment per person, states like Oregon had moved
its managed care program into this, whereby there was
responsibility by the managed care entities for everything,
including physical health, behavioral health, and dental. The
annual payments were increased by a specified rate, regardless
of annual expenses. She added that, for states with coordinated
care organizations which utilized the global capitation payment,
it often seemed like the payment mechanism and the accountable
care were linked in a causal way. She stated that the important
thing for driving change was accountability, ensuring the
organizations and providers were changing the way they did
business, and not given incentives for providing more volume,
but only for quality.
4:38:06 PM
REPRESENTATIVE VAZQUEZ addressed slide 16, and asked for an
explanation to the acronym, PCCM.
MS. BEMBEN relayed that PCCM was the acronym for primary care
case management.
REPRESENTATIVE VAZQUEZ asked how the after share savings would
work.
MS. BEMBEN replied that the proposed initiative did not suggest
any shared savings, the line was included to allow a standard
format for all the initiatives.
CHAIR SEATON explained that there was some confusion about the
global payment model as an earlier proposal by the Central
Peninsula Hospital had referenced a global payment model. The
bills proposed by the House Health and Social Services Standing
Committee required the Department of Health and Social Services
negotiate for a model but there was not an exact specification
for construction. He allowed that he had also been confused by
the various definitions for the global payment model.
MS. BEMBEN noted that each initiative had to be specifically
designed to allow for an actuarial analysis. She offered an
example of the accountable care organization pilot, as part of
the recommendation was for a shared savings model. This
recommendation was for continuation of the fee for services, but
the accountable care organization is paid a bonus of the shared
savings payment if costs are reduced for the state. She shared
that part of the reasoning was for an easier lift out of the
gate, yet specific enough to do an analysis. She allowed that a
capitated payment was a viable option. She noted that the
recommendation had been as an incentive to accountability, while
sharing the risk for the cost, and that there were many ways to
do this.
4:41:52 PM
REPRESENTATIVE STUTES asked if there were enough providers in
Alaska for assignment to every enrollee or would Alaska need
more medical professionals.
MS. BEMBEN replied that they did not have a good number to
calculate a ratio. She noted that a broad definition for
primary care provider included advance nurse practitioners,
physician assistants, family practice and internal medicine
physicians, and behavioral health providers among others. The
behavioral health initiative recommended that DHSS recognize
additional behavioral health provider types who were not
currently recognized or able to bill Medicaid, in order to
create the necessary workforce. She acknowledged that the
analysis still needed to be done.
4:44:20 PM
REPRESENTATIVE STUTES commented that many seniors, Medicare
patients, were having a difficult time finding physicians, and
expressed her pleasure that the "spectrum is being widened on
the providers."
MS. BEMBEN said that an important part of the initiative was the
proposal that DHSS pay a per member per month incentive for the
case management to the primary care provider, as it takes quite
a bit of time to coordinate care.
4:45:38 PM
CHAIR SEATON directed attention to slide 17, and read: "In
second year, amend Section 1115 waiver to include a federal
waiver of the IMD exclusion for residential substance use
treatment." He asked if there was a history for these being
generally granted in the second year and if the modification of
the waiver was a normal process.
MS. BEMBEN offered her belief that the proposal to amend was
fairly new.
MS. LEIBOWITZ shared that the provision in Section 1115 of the
Social Security Act to ask for a waiver of a portion of federal
law was a "fairly well trod path, which is not to say that it's
a simple path." She reported that this took a lot of work and
documentation, but that the process was well understood and that
the letter from CMS indicating interest should give states the
sense that the federal government was interested in approving.
4:47:44 PM
REPRESENTATIVE TARR asked if Section 1115 had an eight year,
lifetime limit.
MS. BEMBEN replied that the purpose of the waiver was to test
innovative strategies, so, if during the demonstration period,
this was shown to be a good way to administer Medicaid services,
the state could continue.
MS. LEIBOWITZ expressed her agreement, sharing that it was a way
to test something for a period of time.
4:48:50 PM
REPRESENTATIVE VAZQUEZ asked for clarification that although
there was not a commitment beyond the requested demonstration
period, the ability to change during the demonstration period
was very limited.
MS. BEMBEN, in response to Chair Seaton, shared that they had
received guidance that Centers for Medicare & Medicaid Services
(CMS) had issued expressing desire to integrate substance use
disorder treatment with other mental health services.
MS. LEIBOWITZ, in response to Representative Vazquez, stated
that this was intended to be a five year period, and that there
were federal and state agreements to ensure that extra money was
not being spent than without the waiver. She stated that she
was not entirely sure how a smaller change would work as part of
a larger process.
REPRESENTATIVE VAZQUEZ asked about possibilities other than the
waiver for residential substance use treatment, pointing out
that Alaska did not have enough infrastructure.
MS. BEMBEN said that part of the reason for limited treatment
capacity was that the number of residential treatment beds were
limited in order to be allowed to bill Medicaid. She pointed
out that the cost of residential treatment was very difficult at
that scale and that Medicaid reimbursement was not available to
facilities larger than a specific number of beds. This waiver
asked that the bed limit be waived.
REPRESENTATIVE VAZQUEZ asked if this was a waiver for federal
regulation or was it a federal statutory limit.
MS. LEIBOWITZ replied that, although it was in statute, the
waiver would give permission "to ignore that piece of law."
REPRESENTATIVE TARR asked how the Medicaid payment rates were
estimated in out years, slide 18, noting that the payment was
often considered to be insufficient.
MS. PANTELY replied that the estimates used were from the
Department of Health and Social Services, with the exception of
pharmacy which used industry standards of 5 - 7 percent.
4:55:47 PM
REPRESENTATIVE VAZQUEZ noted that there may be an ultimate
savings as it was acknowledged that there was a mind body
connection.
MS. BEMBEN said that a lot of evidence confirmed this. She
stated that the medical costs for people with mental illness or
substance use were much higher, and if the behavioral health
conditions can be addressed, then the medical cost can be
lowered. She pointed out this did not include savings to other
parts of state government, reminding the committee of the
connection between behavioral health issues and corrections.
4:57:31 PM
REPRESENTATIVE VAZQUEZ expressed her concern that the initiative
analysis did not address the payment error rate of 16 percent,
slide 19.
CHAIR SEATON pointed to the fact that this was on the payment
side, and that the e-health initiative dealt with the exchange.
He asked to confine the questions, acknowledging that these were
the recommendations.
CHAIR SEATON asked if Initiative 4 was not considered or
recommended as it was outside the range of the RFP, slide 20.
MS. BEMBEN emphasized that they did recommend this initiative,
and, in response to Chair Seaton, stated that they did not do an
actuarial analysis on Initiative 3.
5:00:05 PM
REPRESENTATIVE VAZQUEZ asked about the Oregon study that showed
the expansion of Medicaid brought an increase in emergency room
visits.
MS. LEIBOWITZ asked if this was the study of expansion for the
program.
REPRESENTATIVE VAZQUEZ said that the study looked at the usage
of emergency rooms with Medicaid expansion in Oregon, with
findings that the use increased. She stated that there was also
some evidence of an increase in New York because of the shortage
of Medicaid providers.
CHAIR SEATON pointed out that this was a private public
partnership. He declared that Alaska currently had expanded
Medicaid and that this was a discussion on reform, not
expansion. He asked to confine the questions to this
recommended package of reforms.
5:01:38 PM
REPRESENTATIVE WOOL asked if dental was ever part of the package
or had it been opted out because of expense.
MS. BEMBEN replied that this was a reference to option 2 of the
coverage models for the expansion population. She said that the
difference was that option 1 would provide the current Medicaid
benefit package to the expansion population, whereas option 2
provided a benefit package modeled on the Alaska qualified
health plan which did not include dental benefits. In the
analysis, there was a decrease in cost because of the lack of
dental benefits, although they estimated an increase in
emergency care for dental emergencies. She stated that the
report offered quite a bit of evidence that supported the
advantages for providing dental care to Medicaid enrollees,
especially in low income populations, as it was an important
preventative care, and prevented the exacerbation of other
chronic conditions. She stated that the recommendation was to
go with option 1 and keep dental benefits, even though it was
slightly more expensive than option 2.
CHAIR SEATON asked that any further questions to be submitted.
5:04:42 PM
ADJOURNMENT
There being no further business before the committee, the House
Health and Social Services Standing Committee meeting was
adjourned at 5:04 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Milliman Report - AK Medicaid Expansion Population.pdf |
HHSS 2/11/2016 3:00:00 PM |
Medicaid Redesign |
| Estimated financial impact_redesign_Milliman actuarial Redesign.pdf |
HHSS 2/11/2016 3:00:00 PM |
Medicaid Redesign |
| Redesign_Final_Report_ Jan-22-2016.pdf |
HHSS 2/11/2016 3:00:00 PM |
Medicaid Redesign |
| Medicaid Redesign_AgnewBeck Presentation to House HSS_02112016.pdf |
HHSS 2/11/2016 3:00:00 PM |
Medicaid Redesign |