Legislature(2021 - 2022)BUTROVICH 205
02/10/2022 01:30 PM Senate HEALTH & SOCIAL SERVICES
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| Audio | Topic |
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| Start | |
| Presentation(s): Eo 121, Bifurcation of the Department of Health and Social Services | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
SENATE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
February 10, 2022
1:32 p.m.
MEMBERS PRESENT
Senator David Wilson, Chair
Senator Shelley Hughes, Vice Chair
Senator Lora Reinbold
Senator Tom Begich
MEMBERS ABSENT
Senator Mia Costello
COMMITTEE CALENDAR
PRESENTATION(S): BIFURCATION OF THE DEPARTMENT OF HEALTH AND
SOCIAL SERVICES
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
STACIE KRALY, Director
Civil Division
Department of Law
Juneau, Alaska
POSITION STATEMENT: Provided a brief overview of EO 121.
ANDREW DUNMIRE, Attorney
Legislative Legal Services
Legislative Affairs Agency
Juneau, Alaska
POSITION STATEMENT: Answered questions on EO 121.
ADAM CRUM, Commissioner
Department of Health and Social Services (DHSS)
Anchorage, Alaska
POSITION STATEMENT: Offered a presentation on Executive Order
121, DHSS Reorganization.
SYLVAN ROBB, Assistant Commissioner
Department of Health and Social Services (DHSS)
Juneau, Alaska
POSITION STATEMENT: Answered questions on EO 121.
BRENDA SHELDEN, Board Member
Alaska Pioneer Homes Advisory Board
Wasilla, Alaska
POSITION STATEMENT: Testified in support of EO 121.
ACTION NARRATIVE
1:32:24 PM
CHAIR DAVID WILSON called the Senate Health and Social Services
Standing Committee meeting to order at 1:32 p.m. Present at the
call to order were Senators Begich, Reinbold, Hughes and Chair
Wilson.
^PRESENTATION(S): EO 121, Bifurcation of the Department of
Health and Social Services
PRESENTATION(S): EO 121, BIFURCATION OF THE DEPARTMENT OF HEALTH
AND SOCIAL SERVICES
1:32:53 PM
CHAIR WILSON announced the consideration of a presentation on EO
121, the bifurcation of the Department of Health and Social
Services.
1:34:58 PM
STACIE KRALY, Director, Civil Division, Department of Law,
Juneau, Alaska, stated that she would present a broad overview
of EO 121 in place of a sectional analysis. The bulk of EO 121
consists of three components. The first is to separate the
Department of Health and Social Services (DHSS) into the
Department of Health (DOH) and the Department of Family and
Community Services (DFCS). Existing statutes must be separated
to create the two departments. Title 44.29 would pertain to the
Department of Health and Title 44.30 to Family and Community
Services. Organizational changes to DOH and DFCS would be found
in Title 47.05 and Title 47.06, respectively.
Boards and commissions' statutory relocation is the second
principal component of EO 121. Boards and commissions that were
not substantive to the department were moved from the statutory
provisions of Title 47. These boards and commissions have unique
roles, responsibilities, and advocacies, making placement under
Title 47 confusing. For example, the Mental Health Trust
Authority and the Long-term Care Ombudsman were moved from DHSS
to the Department of Revenue (DOR) more than a decade ago but
remained under Title 47.
1:38:25 PM
SENATOR BEGICH asked if the Senate Health and Social Services
Standing Committee would no longer have the jurisdiction to
review the Mental Health Trust Authority appointees.
MS. KRALY opined that moving the Mental Health Trust Authority
provisions into Title 44 would not affect the committee's
jurisdiction since the trust has been affiliated with the
Department of Revenue for some time.
SENATOR BEGICH stated that moving the provision from DHSS could
effect change. He found it concerning and requested a definitive
answer.
CHAIR WILSON interjected that the decision rests with the
presiding officer, who generally follows statute. Title 18 and
47 are usually assigned to the Senate Health and Social Services
Standing Committee.
SENATOR BEGICH replied that the Mental Health Trust Authority
Board would be under Title 44, not 47, which would remove it
from the committee's jurisdiction.
1:39:32 PM
MS. KRALY asserted that jurisdiction would not change because
the Mental Health Trust Authority has been under DOR for at
least a decade. Nothing was changed but the statutory reference
to DOR.
SENATOR BEGICH stated he supports the bifurcation of DHSS but
would like an opinion from Legislative Legal Services.
CHAIR WILSON asked Legislative Legal Services to answer whether
changing the statutory reference location to DOR would remove
jurisdiction from the committee.
1:40:29 PM
ANDREW DUNMIRE, Attorney, Legislative Legal Services,
Legislative Affairs Agency, Juneau, Alaska, replied that Uniform
Rule 20 states that the Health and Social Services Standing
Committee has jurisdiction over the programs and activities of
the Department of Health and Social Services.
1:41:07 PM
SENATOR BEGICH clarified that the jurisdiction of the Mental
Health Trust would no longer be with the Senate Health and
Social Services Standing Committee because its statute would no
longer be under the purview of the Department of Health and
Social Services.
CHAIR WILSON replied that would be correct.
SENATOR BEGICH concluded that the change was concerning.
MS. KRALY stated that other boards and commissions with
provision relocations to DOH Title 44 include the Governor's
Council on Disability and Special Education, the Commission on
Aging, the Alaska Mental Health Board, and the Statewide
Independent Living Council.
The Advisory Board on Alcohol and Drug Abuse, and the Suicide
Prevention Council already in Title 44 will be listed under DOH.
The Pioneer Advisory, also in Title 44, will be listed under
DFCS.
1:42:42 PM
SENATOR REINBOLD asked her to reference the bill sections as
part of the overview.
MS. KRALY stated that a document mapping out changes and
locations would be created since EO 121 is an extensive bill.
Section 35 addresses all boards moving to DOH, except for the
Pioneer Home Advisory Board, which moves to DFCS under Section
36. Changes to the Mental Health Trust Authority and long-term
care ombudsman could be found under Section 27.
1:44:03 PM
The third component of EO 121 entails all the conforming
technical edits and instructions to the revisors. It ensures
that all the previous references to DHSS are aligned correctly
to DOH or DFCS.
1:44:43 PM
At ease.
1:46:26 PM
CHAIR WILSON reconvened the meeting.
1:46:36 PM
ADAM CRUM, Commissioner, Department of Health and Social
Services (DHSS), Anchorage, Alaska, offered a slide presentation
on EO 121, the bifurcation of the Department of Health and
Social Services (DHSS) into the Department of Health (DOH) and
the Department of Family and Community Services (DFCS), reading
his prepared script as follows:
[Original punctuation provided.]
Thank you committee members for having us here today
to discuss Executive Order 121 to restructure the
Department of Health and Social Services into two
departments. For the record, I am Adam Crum,
Commissioner for the Department of Health and Social
services.
At Health and Social Services, or DHSS, we really do
serve and touch all Alaskans at some point in their
life: from birth and death certificates, marriage
licenses, public health, Emergency Medical Services
(EMS) to behavioral health and more. Because of the
breadth and depth of services we provide, at some
point you WILL interact with DHSS
1:47:11 PM
COMMISSIONER CRUM advanced to slide 3 and continued reading:
You'll see on this slide a 100,000 foot view of Health
and Social Services. We are what our federal partners
refer to as a "mega agency." In fact, the work we do
at the single agency of DHSS is performed by multiple
departments in other states: South Dakota, one of our
peer states for example, spreads this work and these
programs across four state departments.
And Wyoming with a smaller population than Alaska
performs this work in two departments.
Seeing the $3.5 billion dollar budget and over 3,000
employees, it's clear that DHSS is a very large,
single department. But it's the number of programs
delivered, the multifaceted services, and the
vulnerability of our primary beneficiaries that really
tell the story of just how complex DHSS is, and why
the structure needs to be evaluated.
Throughout this presentation we will further define
the challenges at DHSS due to the number of programs,
staff and budget size. Then we will discuss what the
proposed solution is, it's benefits, the work that has
been ongoing and the stakeholder engagement over the
past year, as well as why an Executive Order is the
proper vehicle to make these changes.
1:48:24 PM
SENATOR REINBOLD commented that slide 3 stated, "Does not
include COVID funds." She asked what the fund amount was for
COVID.
COMMISSIONER CRUM deferred the question.
SYLVAN ROBB, Assistant Commissioner, Department of Health and
Social Services (DHSS), Juneau, Alaska, stated that DHSS had
received approximately $900 million in COVID relief since the
pandemic started.
1:49:07 PM
SENATOR HUGHES asked if DHSS knows how many programs South
Dakota and Wyoming provide to citizens compared to the 100
programs Alaska provides its citizens.
COMMISSIONER CRUM replied that he does not know the total
program counts for South Dakota and Wyoming. The comparison was
made on the similar services of child welfare, childcare
assistance, Medicaid funding, juvenile justice, psychiatric and
senior care.
SENATOR HUGHES stated she realized her previous question was not
related to the bifurcation of the department. However, she would
like to assess whether Alaska offers more assistance programs
than other states and if people relocate for that reason.
1:50:37 PM
COMMISSIONER CRUM returned to his presentation on slide 4
concerning the programs within DHSS:
Let's start with DHSS programs? And this is only SOME
of the programs we offer. This helps illustrate the
truly complex nature and size of DHSS, and why it is
so difficult, nigh impossible, to get all aspects of
the department running efficiently and well at the
same time. Just look at this incomplete list, and tell
me what the commissioner's office and policy staff
should make the priority for the hour. Is it senior
veteran's care? Strengthening families? What about
chronic disease and health promotion? Suicide
prevention or healthy eating? I don't make these
remarks to be dismissive, but to truly highlight that
the programs we offer and the people we serve are ALL
high priority but they can't be addressed as such
within the current structure.
1:51:14 PM
COMMISSIONER CRUM advanced to slide 5:
As the structure of DHSS currently exists, there are
119 different federal funding sources that flow into
the department. 119. That's a lot of overseers. That's
a lot of different rules, guidance, program
limitations?you name it, that's a lot of it. With so
many and so varied funding sources there are limits to
what and how much can be delegated. A great many
programs and funding requests require commissioner or
assistant commissioner signature. Because of these
federal funding sources and rules, it means that the
Commissioner cannot simply delegate down, and this
will be the same problem for anyone who follows me in
this position. To manage this responsibility requires
due diligence, meetings with federal partners, audits,
corrective actions addressed, compliance concerns, etc
creating a natural bottleneck in the organizational
design one that can't be corrected with just more
deputies, it requires new legal lines of authority and
focus. On top of this there are state statutes that
clearly outline commissioner authorities, further
limiting the ability to delegate.
This is a problem. It was a problem for my
predecessors and will continue to be a problem for any
administrations that follow if this current structure
persists.
1:52:24 PM
COMMISSIONER CRUM continued reading, slide 5.
And when you look at the diverse array of agencies
that we work with and receive funding from, which
items should we make the most important right now? Do
I take the phone call from Administration of Children
and Families about helping to repatriate American
citizens on a flight from Wuhan, or do I continue to
focus on Medicaid innovations and negotiations with
CMS? What about new federal funding sources that ask
states to redefine how childcare assistance is
delivered and managed in their states? Does that
warrant more time and energy than recovering from a
cyberattack that delays grant payments to behavioral
health providers? These are painful decisions, and
while leadership roles are naturally encumbered with
difficult decisions and time management concerns, it
still hurts when you know that Alaskans in need are
asking for help and the structure you work in is a
natural barrier towards rapid and appropriate
response.
1:53:12 PM
COMMISSIONER CRUM advanced to slide 6, speaking to the
number of employees at DHSS, and continued to read:
We've talked about programs and funding sources, so
let's talk about the number of employees at DHSS. It's
one thing for large organizations to exist and be
geographically spread out, but they typically will
have just a handful of key services they provide,
keeping the focus narrow. But it is quite the
managerial and administrative task to juggle all
aspects of providing the wide array of services we do
across a state the size of Alaska and with more
employees than residents of Kotzebue or Petersburg
DHSS has as many employees as 5 other state
departments, the legislature and the Governor's office
combined. There are multiple DHSS divisions that have
more employees than other departments and all these
large divisions answer back to a single commissioner's
office.
1:54:05 PM
SENATOR REINBOLD asked if the 3,259 positions represent the
number of filled positions within DHSS or the allotted quantity
of position control numbers (PCNs). She further asked how many
PCNs are unfilled.
MS. ROBB replied that 3,259 represents the number of PCNs in the
department and that because of its size DHSS always has some
vacancies.
1:54:40 PM
SENATOR REINBOLD asked approximately how many positions are
unfilled.
MS. ROBB guesstimated that 200 positions were unfilled.
1:55:24 PM
COMMISSIONER CRUM resumed his presentation on slide 8 and stated
that at 30 percent of the statewide budget in FY23, DHSS's
budget is more than the legislature, the governor's office and
judiciary combined. DHSS's size and diversity of duties means
DHSS interacts with all other state departments. Improving
DHSS service delivery would assist other departments in
providing better service to Alaskans. For example, DHSS works
with the Department of Corrections on reentry and behavioral
health. DHSS shares a background check unit with the Department
of Public Safety and together they work on crisis stabilization.
Whereas Medicaid, public health, and behavioral health are areas
easily associated with DHSS, other areas, such as the use of the
Supplemental Nutrition Assistance Program (SNAP) to purchase
fishing and hunting licenses, and WIC and SNAP benefits use at
farmer's markets are less noticeable. The Kids Don't Float
program run by Department of Natural Resources started in
collaboration with DHSS.
1:56:38 PM
CHAIR WILSON asked if a department should focus on the scope of
revision that solely pertains to it. He stated that DOC
requested a behavioral health unit. He asked if that should
happen or should DOC's behavioral healthcare continue to receive
assistance from DHSS.
1:57:49 PM
COMMISSIONER CRUM continued reading at slide 11:
All of the above mentioned programs and massive budget
are performed under this current structure of DHSS.
So what can be done to reduce span of control, narrow
the focus of management and staff, as well as be more
responsive overtime to stakeholders and employees?
This is the solution. To reorganize DHSS into two
separate departments that reduce span of control and
align functionality, because in the simplest terms and
100,000 foot view, there are really two key function
areas. Providing direct care to patients or clients,
24/7 in facility or in the community. That's DFCS
Managing of Payment, process, and programs that's
DOH
Aligning these functions allows the commissioner's
office and policy staff to focus on supporting staff
through improved work processes, improving services
delivered to Alaskans and creating the bandwidth
necessary for further engagement with stakeholders and
federal partners to lead towards innovation.
1:58:56 PM
COMMISSIONER CRUM said that the left side of slide 13 shows the
current structure of DHSS with its nine public-facing divisions.
The divisions interact with the community by providing care and
services. The nine divisions were kept whole, and assignment to
a department was based on a division's key function. This was
done to ensure services would not be disrupted. On the right
side of the slide, DOH consists of the Medicaid divisions of
Health Care Services, Behavioral Health, and Senior &
Disabilities Services. He continued reading:
This will align our payments, processes and programs
and allow future innovations such as moving towards
value-based care, further enhancing the Shared Vision
of the DD community, and focusing on chronic health
prevention efforts.
DFCS will consist of the facility-based divisions such
as API, DJJ and Pioneer Homes, along with the round
the clock community services of OCS. This aligns the
divisions that provide direct care and makes time for
specific attention on issues such as OCS recruitment
and retention, and time to lead community discussions
on future investment at Pioneer Homes, not to mention
that issues that come from facility-based entities,
such as deferred maintenance and licensing concerns.
2:00:37 PM
SENATOR REINBOLD asked what Finance and Management Services
does.
COMMISSIONER CRUM stated that Finance and Management Services is
sometimes referred to in budgets as Department Support Services
(DSS). He said Finance and Management Services (FMS) includes
administrative services, human resources, funding, finance,
grants, and information technology. FMS is the engine that keeps
the DHSS machine functioning.
2:01:40 PM
CHAIR WILSON asked if this is the section that currently handles
outside grants and contracts for DHSS.
COMMISSIONER CRUM replied yes. FMS handles the primary grants
and contracts for the department, with some managed in other
divisions. FMS is the group that processed COVID funds.
2:02:14 PM
COMMISSIONER CRUM returned to his presentation at slide 14:
This reorg was designed in such a way to minimize any
disruption in services to beneficiaries or payments to
providers. This was achieved by keeping the public
facing divisions intact, no leadership changes and no
change in footprint. It should be noted that to keep
services aligned, Designated Evaluation and Treatment
Services or DET services will be moved from DBH to
DFCS in order to stay closely aligned with API and
help coordinate title 47 involuntary commitment
patient movement between facilities. This aligns with
pointing those statutes to the oversight of DFCS.
The primary changes in the reorg will occur to the
internal division of Finance and Management Services
(FMS) which will divide staff to cover each
department. These involve sections like IT, Grants and
Contracts, and finance and budget. We are asking for
some new positions and reclassified positions to fill
out FMS staff and Commissioner's office Staff.
2:03:15 PM
SENATOR REINBOLD asked what involuntary confinement is and
whether it is related to SB 124.
COMMISSIONER CRUM stated that SB 124 and HB 172 involve crisis
stabilization language and subacute patient care services that
Alaska is looking to provide. The bills are not tied to EO 121.
2:03:54 PM
SENATOR REINBOLD proclaimed she was shocked that DHSS's size was
being bragged about and that expansion was desired. She
expressed concern about the issue of involuntary confinement in
SB 124. She asked for an explanation of DHSS's current
involvement with involuntary confinement.
2:04:17 PM
COMMISSIONER CRUM replied that the crisis stabilization bills
would help expand available services so individuals could get
crisis care. SB 124 and HB 172 are not tied to EO 121. DHSS
would help facilitate payment for services to providers, but the
providers would be the ones to expand services within their
communities. Individuals a judge determines to be in need of in-
patient psychiatric care can be sent to a Designated Evaluation
Treatment (DET) facility under Title 47. DETs in Alaska include
the Alaska Psychiatric Institute, Fairbanks Memorial, Mat - Su
Regional, and Bartlett Regional hospitals.
2:05:09 PM
SENATOR REINBOLD asked what the service would cost the state.
MS. ROBB replied that the Designated Evaluation and Treatment
(DET) services allocation is approximately $13 million.
2:05:28 PM
COMMISSIONER CRUM resumed reading:
DOH, again, was designed to not disrupt service or
payment delivery. You'll see no change in leadership
or footprint [of the public facing divisions]. The
highlighted groups of FMS and Commissioner's office
are the ones feeling the brunt of the reorganization.
With the current structure of DHSS, and its
innumerable layers, issues that work their way up to
the Commissioner's office aren't little embers that
can quickly be extinguished, but roaring fires that
require all hands on deck to make sure the entire
thing doesn't burn down.
With an additional Commissioner's Office and a focused
span of control, then leadership will be able to more
effectively work with stakeholders and employees to
address concerns before they turn to infernos.
Speaking of infernos. We have had plenty. This
administration has worked on crisis after crisis, and
has shown that focused leadership and support can lead
to improved outcomes for Alaskans?but only in specific
areas, and only if less time and attention is paid to
other divisions. Some examples are:
DPA had a backlog of 15,000 applications and multiple
letters of correction from federal partners, but with
new leadership, capital support and willingness to
embrace innovation, the backlog was eliminated and
administrative efficiencies and savings were gained.
Then COVID hit, and hundreds of millions of dollars
for new assistance programs have flowed through DPA,
and while this has required developing new processes
and eligibility criteria, they were able to respond
and move additional assistance checks out the door to
Alaskans?all while doing their normal course of
business this wouldn't have been possible with the
DPA tools and setup from a couple years ago.
2:07:16 PM
SENATOR REINBOLD said she is not able to keep up with the
presentation. She could not find a fiscal note for the new PCNs.
COMMISSIONER CRUM replied that a slide at the end of the
presentation provides the dollar amounts and positions.
2:07:46 PM
SENATOR HUGHES asked if Commissioner Crum's name on slide 15
indicates that the governor decided he would be the commissioner
of DOH.
COMMISSIONER CRUM replied that he requested to be the
commissioner for DOH. However, the commissioners would need to
be appointed by the governor since the two departments would be
legally separate entities.
2:08:33 PM
SENATOR HUGHES asked why he preferred to be the commissioner of
DOH. She also asked how DHSS's $3.5 billion budget would be
split.
COMMISSIONER CRUM said a slide at the end of the presentation
provides the costs, budgets, and PCN counts for each department.
He stated that he would like to be commissioner of DOH because
he worked predominantly with public health and Medicaid during
his tenure as commissioner of DHSS.
2:09:16 PM
SENATOR HUGHES asked if he feels comfortable managing the
workload of the DOH commissioner since it would still entail
more than he expressed having time for as the DHSS commissioner.
2:09:45 PM
COMMISSIONER CRUM said breaking up the department will make it
easier for the commissioners and policy staff because the
divisions will be aligned. DFCS has programs with significant
burning issues that need addressing. Its programs have a lot of
independent and individual funding sources. They also have many
rules that go through different boards and community meetings.
Splitting DHSS into two departments with five and four public-
facing divisions frees the capacity and mental energy of the
commissioner and policy staff.
SENATOR BEGICH stated he thought it made sense that Commissioner
Crum would seek to be commissioner of DOH. He asked if the
commissioners of the new departments would be subject to
legislative confirmation.
COMMISSIONER CRUM stated his belief that it would require
legislative confirmation.
2:11:08 PM
SENATOR REINBOLD asked if the commissioner's responsibilities
are just in the highlighted blue box on slide 15.
COMMISSIONER CRUM said the DOH commissioner would preside over
public health, behavioral health, healthcare services, senior
disabilities services, and public assistance. The changes would
be to the commissioner's office and finance management.
SENATOR REINBOLD asked if Dr. Zink's responsibilities would
remain the same under DOH.
COMMISSIONER CRUM replied yes, her responsibilities in public
health would remain the same.
2:11:53 PM
SENATOR REINBOLD asked if Dr. Zink would remain over
epidemiology, public health nursing, women's clinics, family
health, and state laboratories.
2:12:08 PM
COMMISSIONER CRUM replied yes.
2:12:10 PM
SENATOR REINBOLD stated she agreed with Senator Wilson's bill
that addresses certificate of need. On DOH's organizational
chart, she noted that Health Facilities Licensing and
Certification was listed under Health Care Services. She asked
if there was any change to medical services or the licensing of
medical providers and if medical licensing would be moved from
the Department of Commerce.
COMMISSIONER CRUM stated that professional licensing would
remain with the Department of Commerce. He explained that Health
Facilities Licensing and Certification perform surveys and
quality control checks. The certificate of need process will be
under the Office of Rate Review, which is part of the
commissioner's staff as noted on slide 15.
2:14:13 PM
COMMISSIONER CRUM said he spent a great deal of time working
through API licensing issues, the backlog at DPA, and pandemic
problems. He stated these were three examples of burning issues
that caused other areas to receive less attention.
2:14:42 PM
COMMISSIONER CRUM continued sharing the merits of DHSS's
bifurcation and advanced to slide 18, reading:
The sticky notes are a reminder that there is never a
dull moment at DHSS. 24/7, 365, there are issues and
crises. There will never be a so to speak "good" time
to make a move like this. But there is always a time
and place for decisive action
The only certainties are that with the current
structure we can do nothing but keep running from
crisis to crisis, we have no idea what is around the
corneranother earthquake? Another outbreak? All the
ideas for reorganization are not new and most of it
came from division leaders who have had many years in
the system and understand that Medicaid and high
priority public health issues take all the air out of
the room. As a state we are not putting in enough
energy into innovating for the futurefacilities,
programs, quality of care etc. since we are stuck in
crisis mode all the time. All change is stressful. And
All change is difficult, even good change. This isn't
change for change's sake, down the road this will mean
more bandwidth for everyone.
More bandwidth for each Commissioner's Office and
Policy staff means more meaningful stakeholder
engagement. Meaningful engagement takes time. Time to
really listen to constituents and advocacy groups to
address their concerns. Time to seriously engage with
federal partners to seek Alaska specific
flexibilities. And time to do follow-up reach outs to
those stakeholders who don't respond to the first try.
There is not enough time in the day for a single
commissioner's office and policy staff to do
meaningful engagement with that vast and diverse array
of stakeholders that DHSS oversees. This includes one
of our biggest groups of stakeholders, our employees.
2:16:17 PM
COMMISSIONER CRUM moved to slide 19 of his presentation and
addressed improved employee experience, reading:
There are over 3,000 Alaskans at DHSS who care deeply
about what they do. But the important work performed
by staff is rarely visible, systems improvements are
slow and cumbersome, and this all leads to
frustration, creating a feedback cycle of negative
emotions and concerns.
More time and bandwidth to address employee concerns
and improve their experience will facilitate improved
recruitment and retention. Currently, DHSS is like an
aircraft carrier, a massive, self-contained eco system
that is everything to everybody, with a single
captain.
With so many facilities, so many staff and so many
programs, it's impossible for the Commissioner's
office to see and interact with all of them, and to
see and hear their concerns. This has been an issue in
the past and will continue to be an issue for anyone
who succeeds me if we do not take action. Our
employees deserve better.
And their department should be able to more readily
respond to and address their concerns. But, to be
frank, aircraft carriers are easier to turn than
bureaucracies.
2:17:18 PM
COMMISSIONER CRUM moved to slide 20:
The proposed structure of two smaller departments
allows for a more nimble leadership response to fewer
divisions we are making the ships smaller and adding
another captain.
Fewer divisions in each department means less
jockeying for position on the priority list, and a
much more intentional approach to interacting with
leadership
This will provide a direct benefit to our FMS Staff
this usually unseen support division has to have
expertise to serve all 9 public facing divisions and
fund sources that go with it. With a smaller span of
control, we will be able to recruit and retain
positions better such as our Finance officer and
Grants and Contracts staff instead of training them up
to take a lateral transfer at a much smaller dept for
the same level of position. Because of the critical
nature of their work, when FMS is running full steam
ahead it makes life easier for the other divisions.
2:18:12 PM
COMMISSIONER CRUM stated the advantage of using an executive
order over a legislative bill beginning at slide 21, reading:
Executive orders are a useful tool that were
specifically contemplated by Alaska's Constitutional
Convention. Article 3, Section 23 says the Governor
may make changes in the organization of the executive
branch or in the assignment of functions among its
units which he considers necessary for efficient
administration.
So why not a bill? Because Executive Orders are well
defined and the process is prescribed. EO's can not
have substantive law change, this means programs and
services won't be changed by the EO. This provides
certainty to stakeholders and beneficiaries that their
programs will continue on unaltered throughout the EO
process. The definitive timeline as laid out in
Article 3 Section 23 of the state constitution is
another touchstone of certainty, as opposed to
legislative process where timelines can vary greatly
and services can be altered via amendments.
2:19:16 PM
COMMISSIONER CRUM moved to slide 23 discussing executive orders
and continued reading his presentation:
Executive Orders have been used many times to realign
state agencies for better service to the public.
In 2003 the Pioneer Homes were in the Dep of Admin,
and EO 108 was used to move them to DHSS. Corrections
was historically a part of DHSS, and they didn't
become their own department until 1984 via an EO. In
fact, EO 54 to split out corrections was put forward
in 1983 but was disproved. It was worked on and then
reintroduced the following year as EO 55 which became
law. This really highlights that the process works
the legislature provided input, and then ultimately
the correct change was made.
2:20:02 PM
COMMISSIONER CRUM continued at slide 23:
Furthermore, we know that there could be bumps and
future legislation may be needed to fill some gaps, an
example of that would be a bill making the
Commissioner of DFCS a statutory advisor to the Mental
Health Trust. We appreciate our legislative partners
and look forward to working together to set the two
departments up for success. That brings us to the
timeline of all this.
Governor Dunleavy introduced Executive Order 121 on
the first day of session, and as you know the
legislature has 60 days to take action, by coming
together in a joint session to disapprove the EO. If
no action in 60 days, then in it becomes law, with an
effective date of July 1, 2022. So how does this
differ from what was brought forward last year?
2:20:49 PM
COMMISSIONER CRUM advanced to slide 25 to explain what is
different in EO 121.
Time. Time is the difference. The plan put forward of
which divisions go to each department is the same as
EO 119 that was introduced in 2021, but then pulled
when Legislative Legal noted some technical concerns
in it's drafting. These items have been corrected by
the department of law and specific areas of concern
have been addressed with Leg Legal. Prior to its
official introduction, a draft was sent to Leg Legal
to make sure that issues from the previous session
were addressed in the current version before you all.
You, as committee members, rightly brought up that
stakeholders needed to be engaged more. So we spent
the past year doing robust stakeholder engagement on a
weekly basis. We have done employee townhalls, public
town halls, met with tribes, tribal groups, tribal
health consortia's, child welfare partners, child care
providers and advocates, juvenile justice groups,
senior groups, disability groups, healthcare
providers?we truly worked hard to meet with groups
that represented services that DHSS provides.
2:21:53 PM
COMMISSIONER CRUM continued reading his presentation at
slide 25, regarding outreach and feedback on EO 121.
This engagement has been in formal meetings both
during and after work hours, but also incorporated
into our daily interactions with outside groups, with
myself, deputy commissioners, policy staff and
directors almost always weaving the prospective
reorganization into the discussion to find out their
concerns. It even became a running joke amongst some
groups, that no matter the topic, I would bring up the
reorganization. And I would say that these consistent,
informal interactions were very beneficial because
they occurred in smaller groups, with much more
spontaneous and insightful feedback.
2:22:27 PM
COMMISSIONER CRUM slide 25 continued:
Throughout the process we would respond to many
different groups' concerns and questions in writing
and then follow up again to ensure no lingering
questions remained. From all of this constant
engagement, we listened and incorporated feedback as
necessary into our implementation plans. And as we've
demonstrated throughout this presentation, the sheer
size of DHSS means its impossible for us to meet with
every provider, advocate or beneficiary about the
reorganization. But I can say that we finished all of
our meetings with links to the reorg website and an
email address where questions, concerns or meeting
requests could be sent. Any groups that have reached
out or asked for meetings we have met with, and we are
still continuing these outreach meetings now. Our
efforts in stakeholder engagement have been sincere,
and absolutely necessary.
2:23:10 PM
COMMISSIONER CRUM moved to slide 26, Stakeholder Engagement:
The word cloud is a nice tool to demonstrate just some
of the groups we were honored to meet with. And from
these efforts we engaged with and listened to the
concerns of groups that initially spoke up about the
reorganization. And we also gained letters of support
from key groups representing a diverse array of
beneficiaries, advocates and providers. Support
letters include:
Alaska State Hospital and Nursing Home
Association
Alaska Commission on Aging
AK Pioneer Homes Advisory Board
Governor's Council on Disabilities and Special
Education
Alaska Geriatric Exchange Network, or AgeNet
2:23:45 PM
COMMISSIONER CRUM continued his presentation at slide 27:
From this engagement we definitely learned things,
such as our Tribal Partners suggesting a role of
Tribal Liaison in each commissioner's office. While
each division has a tribal liaison, they suggested,
and we agreed, that having a liaison in the
commissioner's office can only help maintain the open
lines of communication that we have been committed to
having between the state and our tribal partners.
From the stakeholder engagement, it also became clear
that more regular and intentional interaction between
departmental leadership and outside groups needs to
happen, something that will only be possible with
smaller departments and a second commissioner's
office.
The Alaska Children's Trust had a great suggestion
that we adopted, of having a role in each
commissioner's office of Reorganization Transition
Liaison. The purpose of which is to have a single POC
[point of contact] in each department that
stakeholders can share feedback on the implementation
of the reorg, and they can in turn get that info to
appropriate people within the department. These
transition liaisons will also help convene post-
implementation meetings or townhalls where all have a
chance to bring areas of concern to department
leadership.
2:24:54 PM
COMMISSIONER CRUM advanced to slide 29 and continued reading. He
shared what is needed to bring about EO 121:
So what will it take to make this proposed solution a
reality? A strategic investment of $2 million in total
funds, 11 new positions and 10 reclassified positions.
As we've told stakeholders over the past year, this is
not cost cutting or job cutting initiative, this is an
appropriate size government initiative. For less than
0.06% percent of DHSS' total budget we can fund this
reorganization. This is a smart investment in
prioritizing how services are delivered to vulnerable
Alaskans, and for allowing time and bandwidth for each
department to meaningfully engage with stakeholders
and partners on current initiatives and future
innovations.
2:25:41 PM
SENATOR REINBOLD stated that Commissioner Crum and Governor
Dunleavy campaigned in support of reducing DHSS's budget. Yet,
$2 million in additional funding and 21 additional PCNs are
requested to make DHSS more efficient. She stated her philosophy
that a person who cannot do well with a little should not be
given more. She opined that DHSS was given an extra $900 million
in addition to its $3.5 billion budget. Despite the increases,
nothing was done to address chronic disease, the use of Vitamin
D, an emergency room for Eagle River, preventative healthcare,
or substance misuse. Focus should have been on immunizations,
fraudulent COVID claims, and the effects of isolation on the
elderly. She stated that Dr. Zink and Commissioner Crum are at
the helm of these failing and she would not support rewarding a
failing department.
2:29:42 PM
CHAIR WILSON stated the committee is working with DHSS and would
be presenting an address on the state of Alaska's Health.
SENATOR REINBOLD quipped that she hoped it would be more honest
than the State of the State address.
CHAIR WILSON commented that while the committee would address
some of the issues mentioned, others have been addressed but not
recognized.
2:30:27 PM
COMMISSIONER CRUM clarified that the $900 million was not liquid
capital for the department to use at its discretion. Rather, it
was federal money for defined programs, which came out in funds
approved through the legislative process. DHSS was tasked with
distributing the assistance funds to community groups and
foundations.
COMMISSIONER CRUM said that focused improvements and
administrative efficiencies lead to budgetary savings that
exceed DHSS's request for $2 million and 21 PCNs to implement
the department's bifurcation. For example, changes made to the
Department of Public Assistance (DPA) cleared a backlog of
15,000 applications, created a budget savings of $9 million, and
reduced 121 positions. He said a series of matrices would be
used to evaluate the reorganization of DHSS.
2:31:32 PM
SENATOR REINBOLD opined that DHSS did not spend its $3.4 billion
budget on items of most importance. OCS is in crisis, and
families are weaker than ever due to COVID vaccinations and mask
wearing requirements. She stated her belief that Alaska is in
crisis because DHSS is in crisis.
SENATOR BEGICH said legislators do not always share the same
opinions. He has confidence in DHSS employees. He stated his
belief that they did a superb job in handling COVID-related
issues. Regarding DHSS's reorganization, he expressed certainty
that the department would answer questions, there would be some
debate, and the committee would seek to find common ground.
2:34:25 PM
SENATOR HUGHES said splitting DHSS into two departments
effectually follows Senator Reinbold's philosophy. The
commissioner of DOH will have a smaller assignment than is
currently held by the commissioner of DHSS. She acknowledged
that recruitment and retention of employees is expensive and
asked what the state's expected cost savings would be because of
DHSS's bifurcation.
2:36:22 PM
COMMISSIONER CRUM responded that OCS has a vacancy rate of 60
percent. According to a conservative estimate by the Casey
Family Foundation, this vacancy rate costs the state between $13
- 15 million per year. By focusing on and addressing the issues
of just one division within the department, the savings more
than covers the reorganization costs. Furthermore, trauma to
children and families is reduced because the problems that were
in one division do not go on to affect other divisions. Grants
and contract staff at Finance Management Services will benefit
from the split because managing four or five divisions is less
difficult than managing nine.
2:37:56 PM
SENATOR HUGHES stated that presenting the cost savings from the
bifurcation of DHSS by division would be helpful.
COMMISSIONER CRUM replied that 12 and 24-month projections would
be given to the committee.
2:38:59 PM
COMMISSIONER CRUM stated that implementing the reorganization of
DHSS began even before Executive Order 119. The reorganization
required working with other departments to determine how
programs and facilities would operate. Items necessary to carry
out the reorganization were categorized into ongoing, during the
legislative session, and post 60-day consideration. Slide 31
provides examples of items to be done in each category. The goal
was for the public to not notice any change in service from June
30 to July 1. Beneficiaries and providers will still receive
services and payments. Internally the departments need a
transition time to complete the split and ferret out issues.
This transition phase occurs from April to July 1, 2022. After
July 1, the two departments must work together to close the
fiscal year. The Alaska Constitution articulates that executive
orders must be dropped on the first day of session. Therefore,
behind-the-scenes work was ongoing.
2:40:52 PM
SENATOR HUGHES asked if tracking would be done so the state
could know the extent to which the bifurcation of DHSS was
beneficial.
COMMISSIONER CRUM replied that DHSS would submit a list of
matrices to the committee that will be used to evaluate both the
short and long-term impacts of the bifurcation.
2:41:52 PM
COMMISSIONER CRUM returned to reading the presentation at slide
33:
Where do we go from here? When there is more capacity
for those that drive and lead organizations, there is
more fuel in the tank to travel further than we have
ever been able to go before. The items on this slide
are not new. A lot of you have been involved with
these issues for years, yet we haven't seen the level
of improvements or innovations that we want and need
to see.
Despite the efforts of OCS, the governor and the
legislature, we haven't yet moved the needle on child
welfare. The increasing vacancy rate of our case
carrying workers puts pressure on our entire system,
families and communities. To truly improve our child
welfare system and to support community prevention,
improve family reunification, it will require focused
attention and support from a commissioner's office
that isn't pulled away by Medicaid or public health.
For the Alaska Pioneer Homes we need to start having a
long series of community driven conversations about
how deferred maintenance is addressed and what future
investment should we be planning for. This requires a
commissioner's office with a smaller span of control.
Currently, Alaska is one of the last Medicaid states
that is fee-for-service and doesn't have value based
care. Also, one third of Alaskans are Medicaid
eligible, this greatly affects all healthcare and
insurance costs in Alaska shouldn't these be
addressed and worked on by a commissioner's office
removed from API and OCS concerns?
2:43:18 PM
COMMISSIONER CRUM continued:
Prior experience clearly shows us that the existing
structure of a single department will not allow for
forward progress on all these serious items
simultaneously. Nor can they be solved without active,
consistent engagement with community partners and
granted flexibilities from federal partners.
The time and space created by having Two departments
and two commissioner's offices allows these critical
conversations to take place in earnest. Yes, crises
will occur, but dealing with half as many divisions
and issues allows the commissioner's offices and
policy staff to facilitate the meetings with all
parties, so we can design our systems of care,
together.
2:43:58 PM
COMMISSIONER CRUM stated that suggestions and questions could be
emailed to DHSS and there is also a reorganization website at:
reorg.dhss.alaska.gov
2:44:12 PM
SENATOR REINBOLD asked what happened to last year's bill that
addressed the bifurcation of DHSS.
COMMISSIONER CRUM said that was Executive Order 119. It was
introduced, Legislative Legal Services identified technical
errors, and it was rescinded. It has been reintroduced as EO 121
with drafting errors corrected.
2:44:45 PM
SENATOR REINBOLD asked if technical errors were the only issues
with EO 119.
COMMISSIONER CRUM replied yes.
SENATOR REINBOLD asked if he considered the changes to be
legislative.
2:44:56 PM
COMMISSIONER CRUM answered that the bill is an Executive Order
as specifically contemplated in the constitution.
SENATOR REINBOLD stated that the response did not answer her
question. She said her question was, "Does this make legislative
changes."
COMMISSIONER CRUM replied, "This makes conforming changes to
statute."
SENATOR REINBOLD retorted that, "To me, it's clear as day. It's
statute changes."
2:45:18 PM
CHAIR WILSON stated that it is statutory changes, through the
power of the executive branch, executive order.
SENATOR REINBOLD stated her belief that EO 121 encroaches on the
duties of the Legislative Branch. She ran for office to protect
legislative supremacy over budgets and legislative change. She
said she would get a legal opinion.
SENATOR HUGHES asked if EO 121 would require making or revising
any regulations.
2:46:54 PM
MS KRALY stated that regulatory conforming changes would be
made. It is her understanding that this would be done through
the revisor of regulations, and entails placing regulations
under the appropriate department.
She added that an Executive Order could not make substantive
changes to statutes under the constitution. She stated she
worked with Legislative Legal Services, and no substantive
changes to laws clearly within the purview of legislative
authority were made. EO 121 would be inappropriate and void if
the changes made were found to be substantive.
SENATOR HUGHES asked for a summary of what the constitution says
regarding the governor's ability to reorganize and its
reference.
2:48:34 PM
COMMISSIONER CRUM stated the reference is Article 3 Section 23.
2:48:52 PM
SENATOR BEGICH read Article 3 Section 23 of the Alaska State
Constitution:
The governor may make changes in the organization of
the executive branch or in the assignment of functions
among its units which he considers necessary for
efficient administration. Where these changes require
the force of law, they shall be set forth in executive
orders. The legislature shall have sixty days of a
regular session, or a full session if of shorter
duration, to disapprove these executive orders. Unless
disapproved by resolution concurred in by a majority
of the members in joint session, these orders become
effective at a date thereafter to be designated by the
governor.
2:49:44 PM
SENATOR BEGICH asked what would happen to the bifurcation of
DHSS if the legislature chose not to appropriate funds for the
new positions, including a commissioner or deputy commissioner
position.
COMMISSIONER CRUM replied that he did not know and would have to
defer to a lawyer.
2:50:21 PM
CHAIR WILSON opined that the positions would be created when the
legislature authorizes a power appropriation. There would be
three allocations through the appropriation, and the department
can move within those allocations to technically fund the
positions unless a statute says otherwise.
2:50:44 PM
SENATOR BEGICH asked if that could be vetoed or ignored as a
letter of intent.
CHAIR WILSON replied that intent is like a gentleman's
handshake.
2:51:09 PM
SENATOR REINBOLD opined that the changes in EO 121 are not
technical and expand government. She stated her belief that the
bifurcation of DHSS is a substantial undertaking and should be
done under the authority of the Legislative Branch. She desires
to preserve the duties and authority of the legislature.
2:52:40 PM
At ease.
2:53:03 PM
CHAIR WILSON reconvened the meeting.
2:53:11 PM
SENATOR BEGICH recalled the merging of Community and Regional
Affairs and Commerce and Economic Development several years ago.
He asked if the merging was done by legislation or executive
order.
MS. KRALY replied that she did not know but would get back to
the committee.
2:53:41 PM
CHAIR WILSON opened public testimony.
2:54:06 PM
BRENDA SHELDEN, Alaska Pioneer Homes Advisory Board, Wasilla,
Alaska, stated that the Department of Family and Community
Services (DFCS) would be better able to focus on the Alaska
pioneer homes' residents and facilities. Splitting DHSS would
increase communication and allow for the specific needs of 24/7
patient care facilities to be addressed. Divisions within (DFCS)
would also have budgets, making it possible to champion needs
without competing against the breadth of divisions found in
DHSS.
2:56:45 PM
At ease.
2:57:20 PM
CHAIR WILSON reconvened the meeting and closed public testimony
on EO 121.
2:57:32 PM
SENATOR BEGICH asked if there was any opposition from the mental
health trust authority user groups, such as the mental health or
alcohol boards, or any of the associated committees.
COMMISSIONER CRUM replied no.
2:58:01 PM
SENATOR BEGICH asked that explicit letters of support from the
various committees and commissions associated with DHSS be
submitted to the committee.
2:58:08 PM
COMMISSIONER CRUM replied that he does not have letters at this
time.
SENATOR BEGICH asked if there were letters of support from
outside organizations besides the Medical Association.
COMMISSIONER CRUM replied that an outside organization is
working on a write-up. Alaska Native Health Board and Alaska
Native Health Consortium have expressed that they will remain
neutral.
2:59:19 PM
SENATOR BEGICH asked whether employee labor organizations
support the reorganization.
COMMISSIONER CRUM stated that employee organizations have not
disposed of or supported the reorganization. All organizations
and staff are being apprised of the changes, and townhalls have
been held to hear concerns and keep the public informed.
2:59:41 PM
SENATOR REINBOLD asked if there was any opposition to EO 121.
COMMISSIONER CRUM stated that groups that previously opposed EO
121 are now neutral.
3:00:18 PM
SENATOR REINBOLD asked if he said that no group opposes EO 121.
COMMISSIONER CRUM replied that is correct; no group opposes EO
121.
3:01:31 PM
There being no further business to come before the committee,
Senator Wilson adjourned the Senate Health and Social Services
Standing Committee meeting at 3:01 p.m.