Legislature(1993 - 1994)
03/24/1993 01:30 PM Senate HES
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SENATE HEALTH, EDUCATION AND SOCIAL SERVICES COMMITTEE
March 24, 1993
1:30 p.m.
MEMBERS PRESENT
Senator Steve Rieger, Chairman
Senator Bert Sharp, Vice-Chairman
Senator Loren Leman
Senator Mike Miller
Senator Jim Duncan
Senator Johnny Ellis
Senator Judy Salo
MEMBERS ABSENT
All Members Present
COMMITTEE CALENDAR
SPONSOR SUBSTITUTE FOR SENATE BILL NO. 5
"An Act implementing an option available under federal law
to extend Medicaid eligibility to certain persons who are
eligible to be institutionalized but who are not in
institutions; relating to Medicaid waivers; reordering the
priorities assigned to groups of persons served under the
Medicaid program; and providing for an effective date."
PREVIOUS SENATE COMMITTEE ACTION
SSSB 5 - No previous action to record.
WITNESS REGISTER
Brenda Trumble
Klawock, Alaska 99925
POSITION STATEMENT: Testified in support of SSSB 5.
Laurel Putnam
908 West 5th
Anchorage, Alaska 99518
POSITION STATEMENT: Testified in support of SSSB 5.
Karol Libbey
14901 Wilden Drive
Anchorage, Alaska 99516
POSITION STATEMENT: Testified in support of SSSB 5.
Elaine Hurley
7771 Mayfair, #1
Anchorage, Alaska 99502
POSITION STATEMENT: Testified in support of SSSB 5.
Christine Culaton
Juneau, Alaska
POSITION STATEMENT: Testified in support of SSSB 5.
John Sherwood, Program Coordinator
Project Choice
Division of Medical Assistance
Department of Health and Social Services
P.O. Box 110660
Juneau, Alaska 99811-0660
POSITION STATEMENT: Answered questions on SSSB 5
Diana Rhoades, Legislative Staff
to Senator Ellis
Alaska State Legislature
State Capitol Building
Juneau, Alaska 99801-1182
POSITION STATEMENT: Answered questions on SSSB 5.
Elmer Lindstrom, Special Assistant
to Commissioner Mala
Department of Health and Social Services
P.O. Box 110601
Juneau, Alaska 99811-0601
POSITION STATEMENT: Answered questions on SSSB 5.
Terri Lauterbach, Attorney
Legislative Legal Counsel
Legislative Affairs Agency
130 Seward Street, Room 402
Juneau, Alaska 99801
POSITION STATEMENT: Answered questions on SSSB 5.
ACTION NARRATIVE
TAPE 93-30, SIDE A
Number 001
CHAIRMAN RIEGER called the Senate Health, Education and
Social Services (HESS) Committee to order at 1:30 p.m.
The only order of business to come before the committee was
SSSB 5 (MEDICAID FOR CERTAIN DISABLED CHILDREN). SENATOR
ELLIS, sponsor of the measure, said there's something wrong
with a system that pays for institutional care but won't
help a family that wants to care for its loved one at home.
This bill has become known by many of the parents and
advocates for Medicaid waivers and options as the Brianna
Hurley bill. Brianna is a two year old girl that was born
with cerebral palsy and her parents have tried very hard to
keep their daughter at home, not institutionalize her, and
keep the family together. Unfortunately, it has broken up a
marriage and financially devastated the family. Senator
Ellis said the fact is that the federal and state government
will pay to institutionalize a child costing up to over $100
thousand a year, but is unable or unwilling to provide
support in the home to keep the family together. Project
Choice offers a great deal of hope for a change in the
Medicaid law. He said there is money in the budget to
achieve that change and so the state is moving forward.
Senator Ellis said SSSB 5 is sort of a backup or safety net
to take care of those kids that don't need all the services
that a waiver would provide. He said a waiver may not take
care of all the people in the state that need it. Senator
Ellis said while waivers offer more services, they are
limited in the number of people who can receive them. We
can help people's lives and positively impact the budget by
having options kick in, after the department has experience
with the Medicaid waivers, for those families that aren't
able to be served by waivers. Options offer fewer services
but everyone who is categorically eligible can qualify for
an option, and not everybody needs all the services provided
under waivers. There is a very strong concern that not
everyone will be served with waivers and that not every
family is appropriately served by waivers.
Number 080
BRENDA TRUMBLE, Klawock, pointed out that during the last
legislative session the bill made it through the whole
committee structure, but didn't make it to the floor for a
vote. She said she has an eleven year old boy, Logan, who
has cerebral palsy which was a result of a DDT immunization
at five weeks old. He is developmentally disabled. Ms.
Trumble said her family feels very fortunate to receive care
such as respite care, etc. Ms. Trumble explained that three
years ago her husband left employment of fourteen years and
started his own business called "Wood Marine." He markets
Sitka spruce for musical instruments in the lower 48 and
Europe. Ms. Trumble said her family was covered by Blue
Cross before the child was born, but when her husband
changed employment, they were able to buy health insurance,
the COBRA option, for eighteen months. She explained that
in order to obtain Medicaid coverage for her son, they had
to totally devest themselves of all their resources and get
below the poverty level severely limiting their business
opportunities. She said they had to get rid of their life
insurance, they couldn't have anything in retirement, they
could't even have a burial plaque. Ms. Trumble said they
are currently trying to maintain health insurance for the
rest of the family which costs $478 per month and the price
is rising. The only way out of the situation is to put
their child in foster care or institutionalize him, which is
against everything she believes in. Passage of SSSB 5 would
guarantee that no Alaskan family would have to fall as hard
as her family has.
Number 140
LAUREL PUTNAM, mother of four children, testified from
Anchorage. She informed the committee that her fourth child
was born two years ago. He had complications at birth, he
was stillborn and it took approximately seventeen minutes to
resuscitate him. Because of brain damage, he suffers from
cerebral palsy and profound mental retardation. Ms. Putnam
said prior to the birth of her son, her husband was employed
and they had an insurance policy. He was laid off from his
job, but they were able to hold the COBRA plan for eighteen
months. She said her husband was able to find employment,
but because of their child's pre-existing condition, he was
not able to be insured under that policy. Since they no
longer had insurance, they had to place their child in a
foster home. She said there needs to be a safety net for
those children yet to be born. It is important to have a
program that is adequate for the child. A waiver will be
great for some children, but SSSB 5 will be better and more
cost effective for children. There are a number of families
in this situation and due to technology there will be more
families in the same situation in the future. Ms. Putnam
said if they placed their child in Our Lady of Compassion
Center, it would cost $7,000 per month. She said last year
her son was fairly healthy and he was able to avoid
hospitalization. By keeping him at home, the bill came to
under $60 thousand per year. It is much more cost effective
to have her son at home than in an institution. Ms. Putnam
urged passage of SSSB 5.
Number 200
KAROL LIBBEY, testifying from Anchorage, explained she works
with several families that have medically involved children.
Some of them are served by Medicaid. She said some of the
families are having to compromise their family economic
situation severely to receive the Medicaid coverage. This
can compound the issues of the medically fragile child by
imposing limitations whereby the family is unable to get
employment that would adequately support them and support
other children in the family. Ms. Libbey said it is not
unlikely to see depression in families where they feel such
a limitation in what they are able to do if they provide
what is needed for the medically fragile child. Ms. Libbey
urged support of the legislation.
Number 233
ELAINE HURLEY, Mother of Brianna Hurley, explained Brianna
has a terminal brain disease which causes a severe amount of
brain damage and disabilities. Brianna needs 24 hour care.
She said last year she lobbied very hard for HB 34, which is
the same bill as SSSB 5. It passed the House and two
committees in the Senate, but never made it to the floor for
a vote. Ms. Hurley said last year she was married and her
husband had a job but ended up quitting to provide Brianna
with Medicaid. She said it is cost effective to keep the
children in the home and not break up families. She urged
support for the bill and passage this year.
Number 270
CHRISTINE CULATON, from Juneau, was next to testify on the
measure. She informed the committee she has a daughter,
Cortney, who is eight years old and is a medically complex
child. Ms. Culaton said her daughter was forced into
institutionalized care and an out of state placement because
the State of Alaska could not meet her needs with Medicaid.
She said her insurance and income were too high to access
the Medicaid system and they weren't willing to impoverish
the entire family in order to meet Cortney's needs.
Currently, Cortney lives in a foster care placement in
Juneau. She was de-institutionalized under OBRA 89. The
State of Alaska had a very difficult time finding a foster
placement for her daughter. They searched for over a year
to find a family that was willing to help provide the
additional support that her family would have readily given
her had they been able to access Medicaid for her. It costs
the state more money to provide services or to find out of
state or institutionalized placements than it does to
provide the families with basic Medicaid services. Ms.
Culaton said the families that she deals with in Alaska
primarily do not place their children in foster care but, in
fact, impoverish the entire family and access every service
under AFDC. It is not cost effective to not implement
options for those families that will not be eligible for
waivers. She said due to preexisting condition clauses and
unaffordable insurance, these families cannot continue to be
forced to separate or to live at the poverty level and have
it be acceptable to the state. Ms. Culaton urged passage of
SSSB 5.
There being no further testimony, CHAIRMAN RIEGER closed the
public hearing. He indicated there is a proposed amendment
by Senator Ellis. He asked Senator Ellis to review the
ramifications between options and waivers. SENATOR ELLIS
said waivers which are applied for under Project Choice can
continue to be applied for if the department's operating
budget requests are approved. He said the state is asking
the federal government for waivers of which there will be a
limited number. Under waivers, the department can offer
families more services such as respite care, etc., but they
are limited in the number of people who can receive them.
Senator Ellis said the legislation is structured as sort of
a backup. It only kicks in, if necessary, 180 days after
the department has the waiver program going. Options offer
less services such as just a medical component but more
people can qualify. He said everyone can qualify who is
categorically eligible. Under the waivers, there will still
be families forced onto AFDC. Senator Ellis said the
department can give a more technical definition as to the
difference between waivers and options.
JOHN SHERWOOD, Program Coordinator, Project Choice, Division
of Medical Assistance, Department of Health and Social
Services, explained a waiver is a waiver from the federal
government for certain Medicaid restrictions. It allows the
department to offer services that they couldn't normally
offer under the Medicaid Program. The waivers allows the
department to offer certain home and community based
services for individuals who otherwise would qualify for
care in institutions. At the same time, the same
eligibility standards can be used for people who would be in
institutions. That is how waivers expand Medicaid
eligibility. What the option does for children is it allows
the department to apply that same income standard to
children without a waiver and without offering some
additional services. He said there are some small technical
difference between the two.
CHAIRMAN RIEGER questioned the meaning of page 3, lines 4
and 5, "...to be individuals with respect to whom a
supplemental security income is being paid." MR. SHERWOOD
said that wording means that the individuals would be
treated as if they qualified for supplemental security
income which is a federal program for the aged, the blind,
and the disabled. If you are eligible for supplemental
security income, you are eligible for Medicaid. That means
you would be treated as if you were in a class of persons
who are eligible for Medicaid. Most Medicaid eligibility is
tied to your eligibility to another program such as AFDC.
CHAIRMAN RIEGER questioned the meaning of the language on
page 3, lines 28 through 31, "Sec. 2 AS 47.07.030 is
amended by adding a new subsection to read: (c)
Notwithstanding (b) of this section, the department may
offer a service for which the department has received a
waiver from the federal government if the department was
authorized, directed, or requested to apply for the waiver
by law or by a concurrent or joint resolution of the
legislature." MR. SHERWOOD said that is language which
authorizes the department to offer services under a waiver
that isn't listed in section (b). He said he believes
section (b) is the statute that lists the services which are
covered and not covered.
SENATOR SHARP said there has been testimony that there are
children in institutions because the families are at the
poverty level. He said he assumes that the state is paying
50 percent of Medicaid for that. He asked Mr. Sherwood how
many people would be eligible to come back under the program
described in the bill. MR. SHERWOOD said there are children
in institutions, but it is difficult to say if they would be
released from institutions. He indicated that he would
check on the exact figures, but his recollection is that
there were 16 individuals in ICFMRs who where under the age
of 18. There are 9 individuals in nursing facilities and
there are many children in hospitals for a short length of
stay, but there were only 5 who were in for more than 100
days. SENATOR ELLIS indicated that there are also several
children in foster care who would go back to their parents
and families.
CHAIRMAN RIEGER indicated he still has concern with Sec. 2.
He said he would like to have a better explanation of why it
is in the bill and what it does.
Number 446
DIANA RHOADES, legislative staff to Senator Ellis, said the
drafter of the bill, Terri Lauterbach, informed her that the
department really didn't have the authority to officially
apply for the waivers but they went ahead and applied for
the waivers anyway. She said a law must be passed directing
the department to apply for any service that the legislature
hasn't approved. The legislature didn't pass a law but
passed a Project Choice Resolution. The wording is a
technical way to clear up that the department may offer this
service under a resolution rather than a law.
CHAIRMAN RIEGER said he understands the explanation for the
application of waivers that have occurred up to now. He
said he is concerned with how this fits in with the
prioritization of medical assistance. He said it seems that
the language could bypass the prioritization process that
the legislature goes through of saying what priority status
the services are in. He said he can see where the
legislature could pass a resolution, next year, asking the
department to look into a waiver for another thing.
Inadvertently, it could be put ahead of the service that is
in the bill.
SENATOR ELLIS said a question had been posed to him as to
why it was put at the bottom of the priority list where it
would be the first to go if funds are not appropriated for
the full range of Medicaid services. He said if you decide
to prioritize it and put it above other services, you would
make enemies. Senator Ellis said he does understand the
concern. He suggested maybe tightening up the language on
page 3 to make it more expansive.
Number 530
MS. PUTNAM informed the committee that in order for a waiver
to take effect, the Division of Medical Assistance has the
right to apply for a waiver without having an enactment of
law. In order for the option to occur, the legislature has
to enact a law. At that time the Division of Medical
Assistance can check the appropriate box that would allow an
option to go into effect. That is why Sec. 2 needs to be
included in the bill.
CHAIRMAN RIEGER suggested adding the wording "prior to
January 1, 1993" on page 3, line 31, after "legislature."
MR. SHERWOOD explained Sec. 2 refers to offering services.
The option that the committee currently is discussing is not
a service option. It is an eligibility option. Under the
option, people wouldn't be offered any additional services.
Therefore, the language shouldn't apply to the option in the
bill.
Number 560
ELMER LINDSTROM, Special Assistant to Commissioner Mala,
Department of Health and Social Services, said the position
of the department and the administration remains that there
isn't the need for specific statutory authority to enter
into waivers under the Medicaid Program. Four waivers have
already been approved by the federal government and will be
implemented beginning July 1, 1993. He said he isn't aware
of any problems that would arise by including the language
in the bill. He said he doesn't want the committee to think
that the administration would feel precluded from going
forward in the future with waiver applications and not
having the authority to do so in statute.
Number 571
SENATOR ELLIS indicated he had a proposed amendment on page
3, line 25, after "are" delete the rest of the sentence and
replace with "either not available to them or are
inappropriate for them under this chapter." The amendment
makes the point that waivers currently being applied for
under Project Choice would not be appropriate for all
families. It would be up to the department to decide as to
whether the option is appropriate. He moved Amendment #1.
CHAIRMAN RIEGER objected for the purpose of discussion. He
asked how the amendment would work and why it is necessary.
Senator Ellis referred to respite services, which is
available under a waiver but isn't available under an
option, and said there may be somebody that might be able to
give an experience of a service under a waiver that is
inappropriate for that family. He said you can serve a
family thorough an option which is potentially less
expensive than a waiver as it is a lessor range of services.
TAPE 93-30
Number 001
SENATOR SHARP asked if Amendment #1 is the amendment
referred to in the fiscal note. SENATOR ELLIS said he was
told that the fiscal note has changed and indicated he
wasn't sure of the answer.
MR. SHERWOOD referred to page 3, Sec. (D), and said the
federal government does not waive the requirement that the
department offers an option to someone. If the option is in
the books, they would receive that option regardless of
whether a waiver was available to them. The department does
not waive the client's right to be covered under an optional
group when they get a waiver. Mr. Sherwood said if the
option is enacted, people are entitled to it whether there
is a waiver space available or not if they qualify. The
option always comes first and they can make the choice of
whether they want the waiver.
Number 020
MS. CULATON explained that many families access services
through the public school system and do not need duplicated
services through Health and Human Services other than the
medical component. That is a good example of someone who
would just need an option. The school district provides
OTPT speech and other related support services under special
education. At age three the children go into the public
school system. So some families just need the medical
component and not the other services offered under a waiver.
An optional service would give them the Medicaid coverage
for the medical condition. Ms. Culaton said many school
districts contribute a good portion of support services
through the district program.
MR. SHERWOOD said he doesn't believe the fiscal note would
change if Amendment #1 is adopted. The client would still
have the right to the optional coverage whether or not the
additional language is added or not.
Number 040
CHAIRMAN RIEGER asked if there was an objection to adopting
Amendment #1. Hearing no objection, the motion carried.
At 2:20 p.m. a recess was taken while the committee awaited
the arrival of Terri Lauterbach. At 2:30 p.m. Chairman
Rieger called the meeting back to order.
CHAIRMAN RIEGER referred to language on page 3, line 28
through 31 and asked why the language has been included in
the bill. He also asked what the effect will be on future
legislative requests for the department to investigate
waivers or options. He asked if the language would allow
such a waiver or option to take a precedence ahead of other
things on the optional services list. TERRI LAUTERBACH,
Attorney
Legislative Legal Counsel, Legislative Affairs Agency,
explained that Sec. 2 of SSSB 5 ratifies a past practice
that the department has already been doing. They have been
applying for waivers from the federal government to offer
services allowed under federal waivers, and they offer
those services even though they haven't been authorized by
the legislature. Ms. Lauterbach said the statute that is
amended by Sec. 2 says that the department has to offer
things that are mandatory under federal law. The bill says
"the department may offer only the following optional
services," and the legislature has laid out what those
optional services are. Ms. Lauterbach said the new
subsection (c) would ratify what the department has already
been doing and would let them continue to do it in the
future. She noted that it wouldn't do anything to the
priority listing. In order to offer something that the
federal government allows under waiver, it would seem that
there needs to be a statute to authorize the department to
do that. That is why Sec. 2 is in the bill.
CHAIRMAN RIEGER said if next year the legislature authorizes
the department to pursue another waiver for a service and
they would commence offering that service and if money is
tight and not all the services can be provided that are
listed on the optional list of priority medical assistance
list, would the law require the department to follow AS
47.07.035 about how they would reduce those services so that
the waivered service that the department has started in
effect would be the last to go because the statute says that
the others have to go first in the following order. MS.
LAUTERBACH said she believes so. Sec. 2 could be amended to
achieve a different result so that a waivered service could
be the first to go.
CHAIRMAN RIEGER asked what difference there would be if the
words "prior to January 1, 1993" were added to Sec. 2. MS.
LAUTERBACH said if there wasn't a strict understanding with
the department that they couldn't do it in the future, she
would expect them to keep doing what they have done in the
past. Chairman Rieger said his concern is that anything
that is offered as a waivered service under Sec. 2 ends up
being automatically top priority. Ms. Lauterbach said the
bill is ratifying something that is already occurring. It
is not giving the department new authority.
Chairman Rieger asked Ms. Lauterbach if in Sec. 3 a
reference could be made to waivered services. Ms.
Lauterbach said a general reference could be made to any
service offered by the department under a waiver from the
federal government that they were not directed to get by the
legislature. It could be added as "(1)."
Number 167
Chairman Rieger asked Mr. Lindstrom if he had a comment.
MR. LINDSTROM said he believes that the Project Choice
waivers are the only waivers that the department has ever
sought or contemplates seeking at this point. He said he
doesn't think it would be possible or conceivable for the
current administration or for any future administrations to
go forward with a waiver without being in close contact with
the legislature and seeking their advice.
Number 200
CHAIRMAN RIEGER said he had a proposed amendment. In Sec. 2
after "legislature" add a sentence which would say "The
department shall annually submit to the legislature its
recommendations about where a service offered under this
subsection should be placed on the priority list in
AS 47.07.035." He asked Ms. Lauterbach if it would address
the problem. MS. LAUTERBACH said if you don't put a time
deadline on the department to do that, it would address the
problem. Chairman Rieger moved Amendment #2. He asked if
there was an objection to the motion. Hearing no objection,
Amendment #2 was adopted.
Number 255
There being no further discussion on the legislation,
SENATOR MILLER moved to pass SSSB 5, with amendments and
accompanying fiscal notes, out of the Senate HESS Committee
with individual recommendations. Hearing no objection, the
motion carried.
There being no further business to come before the Senate
HESS Committee, CHAIRMAN RIEGER adjourned the meeting at
2:55 p.m.
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