Legislature(2015 - 2016)SENATE FINANCE 532
02/10/2015 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB28 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 28 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
February 10, 2015
9:02 a.m.
9:02:48 AM
CALL TO ORDER
Co-Chair Kelly called the Senate Finance Committee meeting
to order at 9:02 a.m.
MEMBERS PRESENT
Senator Pete Kelly, Co-Chair
Senator Peter Micciche, Vice-Chair
Senator Click Bishop
Senator Mike Dunleavy
Senator Lyman Hoffman
Senator Donny Olson
MEMBERS ABSENT
Senator Anna MacKinnon, Co-Chair
ALSO PRESENT
Jeff Jessee, Chief Executive Officer, Alaska Mental Health
Trust Authority; Pat Pitney, Director, Office of Management
and Budget, Office of the Governor.
SUMMARY
SB 28 APPROP: MENTAL HEALTH BUDGET
SB 28 was HEARD and HELD in committee for further
consideration.
SENATE BILL NO. 28
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date."
9:03:07 AM
Co-Chair Kelly wanted to get a deeper examination of the
budget, but wanted a greater understanding of the mental
health budget. He wanted a new approach to the mental
health budget. He queried the history of the Alaska Mental
Health Trust Authority (AHMTA).
JEFF JESSEE, CHIEF EXECUTIVE OFFICER, ALASKA MENTAL HEALTH
TRUST AUTHORITY, discussed the history of the AHMTA. In
territorial days, individuals with a mental disability were
sent to Morningside Hospital in Oregon, and, in many cases,
served a life sentence. At the point of statehood, the
issue of a mental health was part of the conversation. The
federal government paid for Morningside, but the
formulation of the state would require the state to pay for
the rehabilitation. The issue halted statehood, during the
debate over the mental health issues. There was cash
appropriated to the first wing of the Alaska Psychiatric
Institute (API) and to purchase a motel in Valdez to place
individuals with mental health issues. He stated that the
mental health management in the state evolved over time.
For example, senior issues were assigned to the Department
of Administration (DOA). He shared that, at the time of
statehood, a holistic approach to mental health program was
discussed. He remarked that mental health issues were not
solely the purview of Department of Health and Social
Services (DHSS), but also held within Department of
Corrections (DOC). He stated that there were many other
departments in state government that "touch" the
beneficiaries, and should be examined as part of a holistic
picture of the state's mental health program, including the
capital budget.
Mr. Jessee presented the PowerPoint, "Mental Health Budget
Bill Overview," (copy on file), and referred to slide 1,
"The Budget Process - Why separate Appropriation Bill":
Settlement mandated an integrated, comprehensive
mental health program
Separate bill enables a holistic approach of all
mental health programs rather than in silos/per
department
Mr. Jessee highlighted slide 2, "The Budget Process - A
Separate Appropriation Bill":
Trustees recommend to governor annual operating and
capital budgets by September 15 (required by statute)
Recommendations include not only MHTAAR but what
trustees think the state should spend (GF/MH) in order
to have an adequate MH program
If governor or Legislature does not follow trustee
recommendations they have to explain why
9:10:21 AM
Senator Dunleavy asked if the governor or legislature had
ever not followed the recommendations of the trustees. Mr.
Jessee replied that almost every year, the governor or
legislature did not follow the trustee recommendations.
Senator Dunleavy asked him to elaborate. Mr. Jessee
responded that the trustees recommended increments, and the
legislature does not fund them or according to the
recommendations. Every year the AMHTA receives a letter
from both the governor and legislature, outlining the
contrasting decisions.
Mr. Jessee moved to slide 3, "Types of Funds in the Mental
Health Budget Bill":
GF/MH - general fund/mental health
MHTAAR - Mental Health Trust Authority Authorized
Receipts
MHT Admin - funds to operate the Trust
Alaska Housing Finance Corporation dividends
Alcohol tax receipts
Mr. Jessee moved to slide 4, "Examples of Holistic
Approach":
Therapeutic Courts
Bridge Home
9:13:00 AM
Mr. Jessee moved to slide 5, "Therapeutic Courts":
Prevent inappropriate use of Correctional Centers and
reduce criminal recidivism for targeted populations
-Anchorage Mental Health Court (est. 1998)
•Total of Trust funds ~$1,000.0 (1st in
Alaska, 3rd in the nation) over 5 years to
develop, implement and evaluate
•Combined savings of nearly 2½ times program
annual operating cost ($293,000)
•2005 transitioned to GF/MH and used
available Trust funds to expand to Palmer
-Palmer Mental Health Court (est. 2005)
•Total of Trust funds ~$600.0 to develop,
implement and evaluate
•Participants were less likely to engage in
new criminal conduct after exiting the
program (17 percent) than an equivalent
group (40 percent)
•2007 transitioned to GF/MH and used
available Trust funds to expand to other
locations
-Current Trust funded mental health courts
•Fairbanks Juvenile Mental Health Court
(est. 2008); FY14 $245.6 MHTAAR
•Juneau Mental Health Court (est. 2008);
FY14 $204.4 MHTAAR
9:22:26 AM
Mr. Jessee moved to slide 6, "Bridge Home":
Targeting people exiting Alaska Psychiatric Institute
or Dept. of Corrections through intensive community
outreach project
•Bridge Home Program: FY14 $750.0 MHTAAR
•Total investment since FY06: $6,250,000 MHTAAR
•Medicaid supportive services utilized in the
program
Senator Dunleavy asked what the asterisks on the slide
meant. Mr. Jessee replied that he did not know.
Senator Dunleavy asked if all trust beneficiaries actively
participate in one or more of AMHTA outreach services. Mr.
Jessee postulated that he thought the answer was no, and
went on to clarify that there were beneficiaries that had
family support, so they may not need outside services;
there were those that chose not to participate in services;
and so on. The trust did not operate outreach services.
Mr. Jessee moved to slide 7, "FY15 - FY16 Budget." The
slide depicted a $15,000 level view of the mental health
budget. He stressed that the numbers were a work in
progress, because the governor had not submitted the final
numbers. He stressed that there was approximately $200
million in GF. The other funds were mostly alcohol tax
money. He remarked that the capital budget numbers showed a
remarkable difference between FY 15 and FY 16.
Mr. Jessee presented slide 8, "FY15 Budget (operating)."
The slide divided that budget by departments. He noted that
DHSS was most of the mental health budget. He stated that
the budget also included the DOA, DOC, Department of Labor
and Workforce Development (DOLWF), Department of Law,
Department of Education and Early Development (DEED),
Department of Natural Resources (DNR), Department of
Revenue (DOR), the University of Alaska (UA), and the Court
System.
Mr. Jessee presented slide 9, "FY15 Budget (DHSS
Operating)," and explained that the mental health bill was
far reaching in just DHSS. He shared that within DHSS the
budget affected Behavioral Health; Medicaid Services;
Senior and Disability Services; Pioneer Homes; Children's
Services; Juvenile Justice; and Public Assistance, Health
Care Services, Public Health, and Departmental Support.
9:26:41 AM
Co-Chair Kelly queried the successes in the programs. Mr.
Jessee stated that Housing First, as a concept, occurred in
the Lower 48 when jurisdictions discovered that many
homeless people had severe addiction problems, and
homelessness was extremely expensive. Up until that point,
the government required homeless people to get sober before
they were granted housing. After some time, homelessness
was deemed extremely expensive. Therefore, providing
housing to those individuals resulted in a positive, and
less expensive outcome. The housed individuals saw improved
health care; the utilization of health care costs were
reduced; they were not contacted by police; and the alcohol
abuse was reduced. He remarked that it was a myth to assume
that homeless people enjoy being homeless, because they
consider it like camping. He furthered that it was also a
myth to assume that homeless people "enjoy" drinking. The
Housing First project in Seattle proved that the people in
the project went through treatment an average of 15 times
before they were sober. He felt that participation in
treatment proved the desire to stop abusing alcohol. He
stated that a Housing First project in Anchorage was
established, and had positive outcomes. He stated that the
individuals and neighborhood had showed a positive outcome.
He announced that UA was going to conduct an in-depth
evaluation of the program. He furthered that the Tanana
Chiefs Conference was interested in a tribal-operated
Housing First project in Fairbanks. He stressed that the
issues must be examined holistically.
9:35:10 AM
Mr. Jessee stated that family support for senior programs
was also an issue in the mental health budget. He stated
that supporting the families before the senior was a ward
of the state, was a preventive and cost-saving measure.
Senator Hoffman queried the estimated homeless population
in Alaska. Mr. Jessee replied that in Anchorage alone there
are 200-250 chronically homeless individuals.
Senator Hoffman queried the number of homeless individuals
in Fairbanks. Mr. Jessee estimated that the number was
roughly similar to that of Anchorage. He furthered that
Juneau also had a similar number to Anchorage.
Senator Hoffman asked if there were homeless people in
rural Alaska. Mr. Jessee replied that there were homeless
people and "housing burdened" people in rural Alaska. He
explained that "housing burdened" meant that there were
many family members living in a very small space.
Senator Hoffman queried the impact of Housing First on the
larger population in receiving employment. Mr. Jessee
looked at the Anchorage Housing First project. He shared
that a number of the residents also worked for Rural Alaska
Community Action Program (Rural CAP), and some were then
able to get a job outside of the program. He stressed that
the population in that project was often health impaired,
in addition to substance abuse. Therefore, employment was a
problem, because of the prevalence of chronic disease and
other health problems.
Co-Chair Kelly queried the management of the unsuccessful
programs. Mr. Jessee noted a program called Healthy
Families, which identified high-risk families at the moment
a child was born and provided outreach. It was the hope
that there would be better outcomes in the family, in terms
of child protection and other problems. He shared that the
trust spent approximately $250,000 to have Johns Hopkins
explore the actually outcomes of the programs. It was
determined that the program did not have positive outcomes.
There were issues with the fidelity with the model and
program implementation.
Co-Chair Kelly remarked that the program was enacted at a
time where there was similar fiscal challenges as the
current budget year. He appreciated the high level of
program scrutiny from the AMHTA.
9:41:08 AM
Senator Dunleavy wondered if the Healthy Families program
was a problem, or if the implementation was the problem.
Mr. Jessee replied that the program was an evidence-based
successful concept. The program in Alaska did not have
fidelity with the successful model.
Senator Dunleavy asked if the management of the program was
the problem. Mr. Jessee replied in the affirmative.
Senator Dunleavy wondered if there was a "failure to
perform clause" in the management and administration of the
program. Mr. Jessee noted he was not aware of any
performance-based employment contracts for executive
directors, but felt that it may not be a bad idea. He noted
that the business model of behavior health was complicated,
because of reimbursement rates and other issues. He
stressed that supporting the administrators with the proper
assistance was important in providing adequate support.
Co-Chair Kelly asked to move on, and noted that it was
important to examine successful outcomes. He referred to
slide 10, "FY16 GF/MH Recommendations." He wondered why
MHTAAR money was not used for the programs. Mr. Jessee
responded that the trust had approximately $25 million per
year for spending. He felt that money would only support
the base programs, and the result would have a negative
impact on the legislature's willingness to provide funding
for the effective programs.
9:46:33 AM
Co-Chair Kelly asked how frequently the AMHTA closely
examined its programs, and adjusted its enthusiasm for
unsuccessful programs. Mr. Jessee replied that the trust
measured the program effectiveness on a daily basis. He
stated that every grant had a set of trackable performance
measures. He stated that there was not a similar level of
scrutiny for the every single grantee program, however the
outcomes were examined. He shared that sending children out
of the state was not resulting in a positive outcome. He
remarked that the trust was able to sustain programs across
changes in administration. He stated that the program
recommendations were the result of a rigorous data-driven
agenda.
9:51:46 AM
Co-Chair Kelly asked if the trust has had a discussion
about the current fiscal environment and its position in
deficit situation. Mr. Jessee replied in the affirmative.
He shared that the budget had the lowest GF/MH
recommendations in his memory.
Mr. Jessee moved to slide 15, "Current Priorities":
Restore Homeless Assistance Program Funding
Medicaid Expansion and Reform
Recidivism
Substance Abuse Prevention and Treatment
9:54:02 AM
Co-Chair Kelly queried the trust's investment in the
priorities. Mr. Jessee replied that the trust put $850,000
into the Homeless Assistance Program; the trustees
authorized almost $2 million to Medicaid Expansion; the
trust paid for hiring Carmen Gutierrez for the Recidivism
plan; and a couple million dollars would be put toward
substance abuse prevention and treatment in the current
year.
Co-Chair Kelly remarked that the administration wanted to
expand Medicaid before Medicaid reform, and the legislature
wanted, at least, reform first. He wondered if the trust
had conducted any research on Medicaid reform and its
recommendations. Mr. Jessee responded that they have
already been collaborating with the DHSS. He used patient-
centered medical homes as an example of collaboration. He
stated that Alaskans were heavy utilizers of behavior
health services and basic health services. He stated that
intensive case management had proved to be a cost saver. He
stated that the trust had committed $300,000 to DHSS to
hire some technical assistance, to research the other
states' effective reform and expansion strategies.
Co-Chair Kelly noted that the committee needs to know the
Trust's recommendation, and they need hard evidence to
support Medicaid expansion. Mr. Jessee urged caution in
considering the Medicaid program as a stand-alone budget
element. He noted the correlation between individuals
coming out of corrections and high Medicaid costs.
Co-Chair Kelly reiterated the need for evidence. He noted
that the most common scenario was that spending does not
create savings. Mr. Jessee replied that the Trust
understood that Medicaid expansion was a high stakes issue.
10:00:49 AM
Senator Dunleavy wondered if the budget had any earmarks to
underwrite Medicaid expansion. Mr. Jessee noted that it
was not in this budget, but it would be reflected in the
budget detail of the Governor's budget.
Senator Dunleavy asked how the recommendations on slide 10,
were formed. Mr. replied noted that the recommendations
were formed based on what the trust thought was most
critical for an ongoing sustainable budget.
Senator Dunleavy asked about the Licensed Marriage and
Family Therapist item. Mr. Jessee replied that it was a
small increment that would help establish the credential
process to provide an ability to access federal resources
for the services.
Senator Dunleavy hoped to be convinced of the effectiveness
of Medicaid expansion.
Co-Chair Kelly wondered how behavioral health programs had
thrived without adequate case management within the current
Medicaid system. Mr. Jessee replied that a case manager
would be helpful in ensuring that beneficiaries were
treated. He stressed that the case manager must be paid. He
felt that paying case managers was a wise financial choice.
He announced that the division had established an
"Assertive Community Treatment" which was a mobile case
management system.
10:07:21 AM
Co-Chair Kelly noted that in his personal experience he
observed a staggering cost to the state resulting from an
individual who did not show up to appointments or take the
full regimen of antibiotics. He noted that lack of an
effective case management practice. Mr. Jessee agreed that
there were problems.
Co-Chair Kelly asked Mr. Jessee to postulate an effective
case management. Mr. Jessee guessed $5 to $10 million.
Co-Chair Kelly wondered if the Trust had designed a case
management system. Mr. Jessee replied in the negative.
Co-Chair Kelly asked if the Trust would support a case
management system. Mr. Jessee noted the trust was
supporting the division, in community treatment.
Co-Chair Kelly asked if the current behavioral grants
contained funds for case management. Mr. Jessee replied
that case management would be unnecessary, if there was
continued cutting of programs.
Co-Chair Kelly noted that he would like to have a different
relationship with the AMHTA and wanted to speak about the
mental health budget. Mr. Jessee stated he embraces
accountability and the trust is committed to reform and
using Medicaid expansion as a catalyst.
10:13:03 AM
Vice-Chair Micciche referred to individuals who abuse
services, and asked what systems currently function to
ensure the services were provided for the right
individuals. Mr. Jessee noted that any system will have
under-performing and well performing aspects. He noted
that no matter the system, there will always be individuals
which will take advantage, and the trust is well aware of
the fiscal issues with those who take advantage of the
system.
Co-Chair Kelly asked Mr. Jessee to address Area Health
Education Centers (slide 10). Mr. Jessee explained that the
centers provided care management, so individuals could
navigate their health care system to better access the
specific services.
Co-Chair Kelly asked about the difference between the
current Medicaid waiver and personal care attendants (PCA)
care in the Senior In-home Services request. Mr. Jessee
explained that that PCA services had paid individuals to
provide care to a specific person. The Caregiver Grant
Program was designed to support the caregivers. The Senior
In-home Services provided other types of services for those
trying to care for loved ones may need to access, and were
not necessarily Medicaid or Medicare billable services.
Mr. Jessee referred to back to slide 7, and referred to the
underlined capital portions of the mental health bill. He
noted the substantial difference between the FY 15 Enacted
Capital, and the WIP in the governor's initial budget. He
explained the Homeless Assistance Program (HAP) funding. He
referred to the handout "Impact of the Loss of AHFC Basic
Homeless Assistance Program (BHAP) Funding."
Mr. Jessee referred to slide 13, explaining that there are
two agencies that receive homeless assistance funding: BHAP
and SNHG. He stressed that SNHG was essential in
establishing the Housing First program.
10:20:34 AM
Senator Bishop wondered what would occur if the SNHG was
zeroed out. He surmised that the $547,000 would not go to
Fairbanks. Mr. Jessee replied in the affirmative.
Senator Bishop asked if those people that currently receive
services would then become homeless again. Mr. Jessee did
not know what would occur, if the funding was eliminated.
Senator Bishop asked if he had done a cost-benefit
analysis, and what strain it would put on other services in
the state. He wondered if Medicaid expansion may "backfill
that number." Mr. Jessee noted that the trust had not
examined the downstream costs, if the services were
eliminated. He furthered that Medicaid expansion may help
to fill the numbers. He remarked that Medicaid would not
directly fund the housing, but it did fund the treatment
services that individuals need in order to maintain their
housing.
Co-Chair Kelly clarified that on the BHAP handout, the
items listed were on the capital list. Mr. Jessee noted the
BHAP handout listed the agencies that received the BHAP and
special needs housing grants in the past.
Co-Chair Kelly wondered if those items were part of the
capital budget piece. Mr. Jessee replied that those items
were included in the missing mental health capital budget
bill. He stated that one body took all of the projects,
except for one, and the other body did the opposite. The
result of that process made all items conferenceable.
10:24:43 AM
Mr. Jessee concluded his slides and encouraged the
committee to look broader than subcommittee budgets. He
noted that a lot of state costs are driven by behavioral
health issues, and the state should get a better handle on
those issues.
Vice-Chair Micciche hypothesized that if we expanded
Medicaid, could Mr. Jessee provide offsets that would
reflect some benefit to the beneficiaries. Mr. Jessee
responded the affirmative. He stated that there would be
some opportunities for offsets in the behavioral health
grants. He stressed that the Medicaid expansion would
provide federal reimbursement, so there would be GF savings
in the grants. He stressed that the offsets were intended
to expand capacity to better serve the beneficiaries.
Vice-Chair Micciche requested a document to further explain
the benefit of Medicaid expansion. Mr. Jessee agreed to
provide that information.
Senator Hoffman wondered if the document could be
delineated with a timeframe. Mr. Jessee agreed to that
format.
Senator Olson surmised that Mr. Jessee was in favor of
Medicaid expansion, as long as guidelines were in place to
further continue to the current programs. Mr. Jessee
replied in the affirmative.
10:29:45 AM
Senator Dunleavy asked how the committee would hold the
trust accountable. Mr. Jessee replied that future requests
for project funding innately have accountability measures
when the results are examined.
Senator Dunleavy asked if Mr. Jessee had the same vision of
Medicaid as "everyone else." Mr. Jessee responded that he
did not consider Medicaid expansion as a panacea, but
considered it as a way to help more individuals. He felt
that Medicaid expansion would develop a more sustainable
state budget over time.
Senator Dunleavy asked if the trust reported unsuccessful
programs to the legislature. Mr. Jessee replied that the
trust worked to identify the problematic programs, and then
attempt to assist the programs.
Co-Chair Kelly commented that it would be of interest to
the committee to have a list of discontinued programs Mr.
Jessee agreed to provide that information.
Co-Chair Kelly noted that the trust had been very
responsible, even though the legislature had provided very
little oversight. He felt that there should be a higher
level of scrutiny on the mental health budget.
10:35:06 AM
Vice-Chair Micciche agreed with Co-Chair Kelly and stated
that the AMHTA was an important asset and expressed his
appreciation for Mr. Jessee's tenacity.
Senator Hoffman asked Mr. Jessee to give a brief
description of the success of the AMHTA, and to
characterize how the investments were made. Mr. Jessee
noted that a venture capital fund such as the trust is a
unique and wonderful way to serve. He noted that the trust
invested over $16 million dollars. He stressed that the
trust had many separate interest, because of the
investments in innovations and systems to better serve
Alaskans.
Senator Hoffman queried the number of acres managed by the
trust. Mr. Jessee replied that the trust managed
approximately 950,000 acres. He stated that the Trust Land
Office had contributed nearly $100 million to the
endowment, and continued to produce $4 million to $5
million per year on top of the generated principal.
Co-Chair Kelly asked how many acres were owned by UA.
PAT PITNEY, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET,
OFFICE OF THE GOVERNOR, replied that UA owned 250,000
acres.
Senator Olson wondered if the mental health budget took
recommendations from other departments when formulating its
budget. Mr. Jessee referred to slide 7, and stated that the
trust money MHTAAR is a zero-based budget. He noted that
they complete a two year budget, which the trustees will
modify.
Senator Olson asked if Mr. Jessee was in favor of the
budget process. Mr. Jessee replied in the affirmative,
because it was helpful to have a long-term budget
perspective.
SB 28 was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
10:42:36 AM
The meeting was adjourned at 10:42 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 021015 SFC SB 28 Mental Health Budget Overview.pdf |
SFIN 2/10/2015 9:00:00 AM |
SB 28 |
| 021015 AHFC BHAP Funding.pdf |
SFIN 2/10/2015 9:00:00 AM |
SB 28 |