Legislature(2025 - 2026)BUTROVICH 205
01/23/2025 03:30 PM Senate HEALTH & SOCIAL SERVICES
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| Presentation: Department of Health Overview | |
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* first hearing in first committee of referral
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+ teleconferenced
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ALASKA STATE LEGISLATURE
SENATE HEALTH AND SOCIAL SERVICES STANDING COMMITTEE
January 23, 2025
3:31 p.m.
MEMBERS PRESENT
Senator Forrest Dunbar, Chair
Senator Cathy Giessel, Vice Chair
Senator Matt Claman
Senator Löki Tobin
Senator Shelley Hughes
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
PRESENTATION: DEPARTMENT OF HEALTH OVERVIEW
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
HEIDI HEDBERG, Commissioner
Department of Health
Anchorage, Alaska
POSITION STATEMENT: Co-presented a Department of Health
Overview.
EMILY RICCI, Deputy Commissioner
Department of Health (DOH)
Juneau, Alaska
POSITION STATEMENT: Co-presented a Department of Health
Overview.
BOB LAWRENCE, M.D., Chief Medical Officer
Commissioner's Office
Department of Health (DOH)
Anchorage, Alaska
POSITION STATEMENT: Co-presented a Department of Health
Overview.
ACTION NARRATIVE
3:31:05 PM
CHAIR DUNBAR called the Senate Health and Social Services
Standing Committee meeting to order at 3:31 p.m. Present at the
call to order were Senators Hughes, Claman, Giessel and Chair
Dunbar. Senator Tobin arrived immediately thereafter.
^PRESENTATION: DEPARTMENT OF HEALTH OVERVIEW
PRESENTATION:
DEPARTMENT OF HEALTH OVERVIEW
3:32:29 PM
CHAIR DUNBAR announced an overview by the Department of Health
(DOH).
Senator Tobin joined the meeting.
3:33:16 PM
HEIDI HEDBERG, Commissioner, Department of Health, Anchorage,
Alaska, introduced herself, staff, and advisors. She stated that
July 1, marked the one-year anniversary of the Department of
Health (DOH).
COMMISSIONER HEDBERG moved to slide 2 and presented the mission
of DOH.
[Original punctuation provided.]
MISSION
Promoting the health, well-being & self-sufficiency of
Alaskans
Divisions
Division of Behavioral Health
Division of Health Care Services
Division of Public Assistance
Division of Senior and Disabilities Services
Division of Public Health
Strategic Approach
Modernize Systems
Increase Capacity
Stabilize Workforce
3:33:58 PM
COMMISSIONER HEDBERG said each division has done a tremendous
amount of work and will provide an update on modernizing
systems, increasing capacity and stabilizing the workforce. She
stated that a new department website will launch this winter and
described the change as transformational. The redesign will
focus on user journeys tailored to specific needs. As examples,
a pregnant woman searching for Women, Infants, and Children
program (WIC) will also be guided to Supplemental Nutrition
Assistance Program (SNAP) and related services; seniors will be
directed to programs for older adults; and healthcare providers
will find Medicaid enrollment information. She explained that
Phase Two includes launching language translation for the top
five non-English languages spokenSpanish, Tagalog, Korean,
Russian, and Hmongalong with a chatbot to assist users in
navigating the site. She added that ongoing improvements will
follow based on user feedback. Also noted was the plan by the
communications team to launch an internal employee hub to
centralize communication, policies, procedures, and key dates
for staff.
3:36:13 PM
SENATOR HUGHES asked whether any Alaska Native languages would
eventually be included in the website's language translation
offerings.
3:36:26 PM
COMMISSIONER HEDBERG replied that while the Division of Public
Assistance currently offers Yupik translation services, the
department has not found a contractor capable of translating all
website content. She welcomed suggestions and stated the
department would be happy to collaborate with any available
resource.
SENATOR HUGHES suggested the use of artificial intelligence
(AI).
3:37:03 PM
COMMISSIONER HEDBERG moved to slide 3, Arcs of Effort. She
emphasized the importance of community engagement for the new
department, particularly listening to Alaska providers and
clients. She noted that over the past two years, intentional
listening efforts helped identify what is working and what
challenges exist. These insights informed the development of
strategies under the governor's Healthy Families initiative. She
explained that slide three reflects the outcome of those
conversations, highlighting four key areasreferred to as "arcs
of effort":
-Transformation of care
-Child care
-Prevention of deaths from overdoses, suicide, and other -
injuries
-Strengthening the behavioral health system.
She stated that the presentation will include updates on these
efforts along with divisional updates.
3:38:15 PM
EMILY RICCI, Deputy Commissioner, Department of Health (DOH),
Juneau, Alaska, co-presented a Department of Health Overview.
She moved to slide 4, Office of Health Savings, Innovative Ways
to Improve Systems and discussed the creation of the Office of
Health Savings within the commissioner's office, describing it
as a small team of three focused on achieving Medicaid savings
through innovation and transformation. She explained that the
office functions as an "ideas engine" for the Medicaid program
by identifying and leveraging federal and state opportunities to
implement changes aligned with departmental goals.
MS. RICCI emphasized that the office plays a key role in
supporting the department's objective of responding nimbly to
new opportunities through pilot and demonstration projects. She
noted that the team, fully staffed for under a year, has already
helped secure nearly $4 million in federal grants for technical
assistance and planning. She added that the office is essential
to several key initiatives, including the first arc of effort,
transformation of care.
3:39:46 PM
MS. RICCI moved to slide 5, Transformation of Care, she
explained that the transformation of care arc of effort focuses
on evaluating whether Medicaid benefits and payment structures
align with desired health outcomes for Alaskans and support the
development of an effective healthcare delivery system. She
outlined five main focus areas within this arc:
-Medicaid Rate Review
-Medicaid Demonstration Projects
-School-Based Services
-Justice Involved Youth
-Re-Entry Supports
MS. RICCI stated that the Medicaid rate methodology review
project began in spring and launched publicly in the fall,
supported by funding from the Division of Insurance. The
Department of Health contracted a firm to assess how Medicaid
services are paid, with the goal of determining if current
methodologies support intended outcomes. She noted that due to
the complexity of Medicaid's multiple methodologies, the review
has been split into two phases. Phase one, currently underway
and due in July 2025, focuses on behavioral health, long-term
care and support services, home and community-based waivers,
federally qualified health centers, and medical transportation.
MS. RICCI described three areas of analysis for the study: rate
structure, including components such as overhead and wages; rate
level, to assess whether payments sufficiently cover service
delivery costs; and rate policy, which examines the rules
governing billing, such as the use of 15-minute increments
versus alternative models like monthly or capitated payments.
She emphasized that the department is collaborating closely with
providers and stakeholder groups throughout the process.
3:42:02 PM
SENATOR CLAMAN stated that discussions about Medicaid and
Medicare rates are of strong interest to him and highlighted
ongoing concerns in Alaska regarding underpayment. He noted that
the Federal Medical Assistance Percentage (FMAP) rates have
historically been low, contributing to provider reluctance to
accept Medicare and Medicaid patients. He asked whether the
issue of low reimbursement rates leading to provider refusal is
being factored into the department's rate methodology analysis.
3:42:44 PM
MS. RICCI clarified that Medicaid and Medicare are distinct
programs, with Medicaid being a joint state-federal program and
Medicare being entirely federally funded and administered. She
explained that while Medicaid includes a federal match for state
medical costs, Medicare operates independently and sets its own
payment rates.
MS. RICCI stated that the department has raised concerns about
Medicare rates and access to services with Alaska's federal
delegation, the Centers for Medicare and Medicaid Services
(CMS), and visiting federal administrators. She emphasized that
the current rate methodology review focuses on Medicaid-specific
issues, including access, but does not include Medicare rates,
as those are determined federally.
SENATOR CLAMAN asked whether the department would be able to
provide a meaningful analysis comparing Medicaid rates to market
rates for the same services
MS. RICCI responded that the department could evaluate what such
an analysis would entail and determine whether the necessary
resources are available to conduct it.
SENATOR CLAMAN expressed strong support for efforts to establish
sensible Medicaid rates but emphasized concern that if the
resulting rates continue to discourage provider participation,
the process may be ineffective. He stressed the importance of
creating a market in Alaska that attracts physicians and other
care providers, warning that failure to do so undermines both
economic growth and access to care. He reiterated his concern
that [Medicare] rates may also be too low, not just Medicaid.
3:44:55 PM
SENATOR HUGHES asked for clarification on how Medicaid is
structured within the department, noting that it covers
behavioral health, medical, and dental services.
3:45:35 PM
MS. RICCI explained that although Medicaid is sometimes
perceived as being managed by a single division, it actually
spans multiple divisions within the Department of Health:
Behavioral Health, Healthcare Services, Senior and Disability
Services, and Public Assistance. She clarified that while
Medicaid has its own distinct budget component, administration
and service delivery are handled separately by these divisions
based on their respective areas.
MS. RICCI noted that her role as Deputy Commissioner, along with
the Office of Health Savings, provides department-level
oversight and coordination. Division directors collaborate on
cross-divisional Medicaid issues.
3:46:33 PM
SENATOR HUGHES stated her understanding that providers have
historically been reluctant to serve Medicare patients, but that
Medicaid was previously more acceptable to them. She asked
whether the department is now also seeing providers decline to
serve Medicaid patients in addition to Medicare patients.
MS. RICCI responded that provider participation varies depending
on the provider type and service area. She explained that this
variation is one reason the department is focusing Phase One of
the rate methodology project on specific provider types. She
stated that these areas were selected to help build capacity
where challenges in Medicaid reimbursement may be limiting
provider participation.
3:47:26 PM
MS. RICCI continued slide 5 and briefly explained that Medicaid
demonstration projects allow the state to explore new and
innovative ways to deliver Medicaid benefits and coverage. The
Office of Health Savings is working closely with various
divisions to develop these opportunities.
MS. RICCI introduced school-based services as the next focus
area in the transformation of care effort. She thanked the
committee and legislature for removing statutory barriers that
now allow the department to deliver services to children in
school settings. She shared that the department received a $2.5
million grant from the Centers for Medicare and Medicaid
Services (CMS) to support this initiative. She noted that the
department is currently working with a contractor experienced in
both school district and Medicaid systems to help bridge the two
and advance the project.
MS. RICCI briefly highlighted two new areas of focus under the
transformation of care arc. She explained that a recent federal
requirement, effective January 1, mandates Medicaid services for
justice-involved youth starting 30 days prior to release,
including screening, care coordination, and case management. She
noted this approach represents a shift in how Medicaid connects
with youth exiting carceral settings.
MS. RICCI announced the department received a $1.6 million award
from the Centers for Medicare and Medicaid Services (CMS) to
support this effort. She stated that Alaska is considered ahead
of other states in readiness, due to strong collaboration
between the Department of Health, the Department of Family and
Community Servicesthrough the Division of Juvenile Justiceand
the Department of Corrections. She added that this work will
inform efforts in the fifth focus area: reentry supports for
adults, which includes care coordination and screening within 90
days of release, tied to federal opportunities.
3:50:31 PM
COMMISSIONER HEDBERG moved to slide 6, Child Care, and described
the child care arc of effort, noting the governor's creation of
a Child Care Task Force that concluded its work this fall. The
task force produced two reports with a total of 56
recommendations, of which 13 have been implemented and 21 are in
progress. She outlined five focus areas for the coming year:
streamlining processes, expanding licensing options, stabilizing
the workforce, ensuring quality care, and improving
accessibility and affordability.
COMMISSIONER HEDBERG reported the launch of the Alaska Child
Care Information System, a database with portals for parents
applying for subsidies, providers handling licensing, and
internal staff. Public access to the system is expected in the
coming months. She also announced a pilot project to speed up
background checks by deploying live scan fingerprinting
equipment to four rural communities. This effort, based on a
task force recommendation, aims to improve processing times and
may later expand to other provider types.
3:52:49 PM
COMMISSIONER HEDBERG introduced a proposed new licensing
category, "friends, families, and neighbors," designed to allow
families in child care deserts to use subsidies with trusted
individuals who meet health and safety standards. She noted that
only 20 percent of eligible families currently use subsidies and
emphasized this as an area for expansion. On workforce
development, she highlighted a budget request for two positions,
including one to serve as a liaison between the child care and
business sectors to support employer-sponsored child care
solutions. The department will also conduct a study on using
vacant state buildings or school facilities for child care, in
response to high facility rental costs identified in a recent
cost-of-care study.
3:55:45 PM
COMMISSIONER HEDBERG stated the department will use its
Preschool Development Grant to provide behavioral health
consultation and coaching to child care providers, addressing
workforce turnover related to children with behavioral needs.
She shared plans to improve subsidy access through startup
grants for new providers and by introducing a geographical
income differential to account for the higher cost of living in
rural areas, ensuring more families can qualify for assistance.
3:57:48 PM
SENATOR TOBIN encouraged stakeholders to read the full list of
recommendations from the Child Care Task Force and highlighted
the 2023 Market Price Survey Report, noting its value in showing
geographic differences in child care costs. She stated that the
data helps ensure families are better served based on local cost
realities. She clarified that the redirection of Preschool
Development Grant funds is possible due to the Alaska Reads Act,
which allocated separate funding to support school districts in
developing their own pre-K programs. She emphasized that these
efforts do not reduce or interfere with school districts'
ability to provide high-quality pre-K services.
3:58:38 PM
SENATOR HUGHES referenced a recent conversation about the
limited number of contact hours in Alaska's K12 schools,
particularly in early grades, and how this impacts child care
needs before and after school. She noted that, compared to
Texas, Alaska students receive the equivalent of nearly three
fewer years of instructional time by graduation. She asked
whether the Child Care Task Force considered school day length
or calendar adjustments as a strategy to improve academic
outcomes and help alleviate child care challenges.
COMMISSIONER HEDBERG responded that the Child Care Task Force
focused specifically on children from birth to kindergarten age,
so the length of the school day for K12 students was not part
of the discussion.
4:00:11 PM
BOB LAWRENCE, M.D., Chief Medical Officer, Commissioner's
Office, Department of Health (DOH), Anchorage, Alaska, moved to
slide 7, Overdose and Suicide Prevention, which is the third arc
of effort. He stated that due to the continued high number of
deaths from overdose and suicide, the department has elevated
this issue as a key priority. He credited the legislature for
passing legislation that enabled the creation of medical review
committees, including the newly launched Opioid Fatality Review
Committee. This committee will review de-identified case
reports, develop actionable recommendations, and ensure those
recommendations reach decision-makers.
DR. LAWRENCE explained that this work aligns with the statewide
Alaska Opioid Response, a whole-government effort involving the
Departments of Health, Family and Community Services,
Corrections, Public Safety, Law, and the Mental Health Trust
Authority. He outlined five "cords of intervention":
interdiction (keeping drugs out of the state), prevention
(limiting access within communities), harm reduction (preventing
deaths, including through Narcan distribution and hepatitis C
treatment), treatment, and long-term recovery. He described
these as interconnected efforts across agencies, symbolized as a
rope pulling individuals back to freedom.
DR. LAWRENCE also noted that funding comes partly from the
National Opioid Settlement, with 80 percent of funds directed to
communities. In the past year, 18 communities and one statewide
organization received funding to support local initiatives. He
concluded by stating that similar coordinated efforts are
underway to address suicide prevention across the state.
4:04:05 PM
CHAIR DUNBAR asked about current trends in Alaska regarding
overdose and suicide rates compared to past years. He inquired
whether the number of suicides and overdose deaths has increased
over the past 10 to 20 years and whether there has been any
recent decline following known spikes.
4:04:37 PM
DR. LAWRENCE stated that overdose deaths spiked significantly in
recent years, with 2023 showing an increase of over 40 percent
compared to the prior year. Preliminary data for 2024 suggests
that overdose deaths will remain at similar levels. He
emphasized that these figures are not yet final and updates will
follow once the data is confirmed.
DR. LAWRENCE reported that suicide deaths have remained
relatively stable over the past several years, without a
noticeable spike or decline. He concluded that substantial work
remains in both areas.
4:05:26 PM
CHAIR DUNBAR asked for a longer-term perspective on suicide
rates, specifically over the past 20 to 40 years. He shared his
experience growing up in rural Alaska, where suicide was already
a serious concern, and questioned whether the state has made any
measurable progress or lost ground since that time.
DR. LAWRENCE responded that he does not currently have data on
suicide rates over the past 20 to 40 years but shares the same
curiosity. He offered to follow up and provide that information
to the committee.
4:05:59 PM
SENATOR CLAMAN noted that national trends show some improvement
in suicide and overdose rates but observed that Alaska has not
experienced similar reductions. He asked for insight into why
Alaska has not followed the national trend and whether there are
specific factors contributing to the state's lack of progress in
both areas.
DR. LAWRENCE stated that the reasons Alaska has not followed
national improvements in overdose and suicide rates are
multifactorial. He acknowledged that Alaska has gradually moved
up the national rankings, now placing secondand in some cases
firstin certain indicators, which is deeply concerning. One key
factor, he explained, is that Alaska entered the opioid crisis
later than many other states, so while other regions are
beginning to see declines, Alaska's rates have only recently
peaked. He emphasized that this is just one of several
contributing factors.
4:07:04 PM
SENATOR HUGHES shared feedback from school principals who report
long wait timesup to four monthsfor teenagers to access mental
health services, despite being given resource lists. She asked
whether there are efforts or recommendations in place to
increase the mental health workforce in communities and noted
that access challenges are likely more severe in areas outside
her own.
4:07:43 PM
COMMISSIONER HEDBERG moved to slide 8, Strengthening the
Behavioral Health System for Youth, and introduced the fourth
arc of effort. She explained that the pandemic exacerbated
mental health challenges among adolescents, a trend supported by
both data and parent feedback. While this issue is national, she
emphasized Alaska's response, highlighting a coordinated eight-
month effort by the Department of Health, the Department of
Family and Community Services, and tribal partners. The team
visited five regions and held virtual and targeted sessions to
gather input from providers, parents, and behavioral health
aides on barriers and solutions for community-based behavioral
health services.
4:09:17 PM
COMMISSIONER HEDBERG described how this process led to a shared
goal, recognition of regional differences, and a commitment to
flexibility within departments. The outcome was a behavioral
health continuum of carefrom prevention to residential and
step-down servicessupported by cross-cutting themes like data
integration, provider support, and care coordination. This work
produced 47 recommendations with specific, actionable next
steps, of which 21 are already underway by both departments.
4:11:19 PM
COMMISSIONER HEDBERG acknowledged that the effort was
intentional and collaborative, especially with tribal partners,
and noted its recognition by the U.S. Department of Justice
(DOJ). She reported that in response to a 2022 DOJ report on the
unnecessary institutionalization of children, the state has
engaged in ongoing discussions and last week signed a letter of
agreement. Under this agreement, DOJ will not pursue legal
action for three years while Alaska continues to demonstrate
progress. She clarified that the case remains open, but the
agreement reflects DOJ's recognition of the state's meaningful
efforts and ongoing commitment to reform.
4:12:43 PM
CHAIR DUNBAR asked for practical examples of changes.
4:12:55 PM
COMMISSIONER HEDBERG deferred to Ms. Ricci.
4:13:05 PM
MS. RICCI stated that some immediate priorities identified
through the youth behavioral health roadmap also address broader
challenges faced by behavioral health providers. She noted that,
since Medicaid is a major payer for behavioral health services,
three key issues emerged: whether the rate methodology aligns
with desired outcomes; whether claims are paid accurately and on
time; and whether administrative processes place an undue burden
on providers.
MS. RICCI explained that the department has made progress in
each area. The Medicaid rate methodology review is underway,
with behavioral health providers prioritized in Phase One. To
improve claim payments, the department transitioned behavioral
health claims from an administrative services organization to
the standard Medicaid claim system used for all other services
as of November 1 and is now stabilizing that process. She added
that for 2025, the department will focus on expanding provider
supports to reduce administrative barriers so providers can
spend more time on care and less on billing complexities.
4:14:57 PM
COMMISSIONER HEDBERG underscored that the letter of agreement
with the Department of Justice does not signify that the
department's work is complete. She emphasized that while
meaningful progress has been made, significant work remains to
build out and implement many of the recommended strategies. She
highlighted School-Based Services as an example of a
recommendation from the youth behavioral health roadmap that is
also part of the transformation of care arc, noting how
interconnected these efforts are.
4:15:46 PM
MS. RICCI moved to slide 8, Complex Care, and explained that
complex care focuses on a small subset of individuals with
severe needs that span behavioral health, developmental
disabilities, and complex medical conditions, often requiring
services across multiple divisions and departments. She stated
that the department's goal is to organize internally to meet
these individuals' needs rather than expecting them to navigate
fragmented systems.
MS. RICCI described the creation of weekly case review teams,
jointly run by the Department of Family and Community Services
and the Department of Health, to examine individual cases and
coordinate support across agencies. She added that monthly
complex care coordination meetings bring leadership together to
identify trends, gaps, and system-level solutions.
MS. RICCI highlighted that this work has already led to program
improvements, including waiver changes through the Division of
Senior and Disability Services. These updates allow greater
flexibility for acuity-based provider rates, new options for
supplemental staffing, and the development of a Specialized
Family Habilitation Home to serve youth with the most complex
needs. She emphasized that the approach combines individual case
perspectives with system-level reform.
4:18:24 PM
COMMISSIONER HEDBERG moved to slide 9, Division Overviews, and
said the presentation would transition from arcs of effort to
division updates.
4:18:51 PM
MS. RICCI moved to slide 10, Division of Behavioral Health.
Operation Update, 2025 Focus and provided an overview of key
accomplishments for the Division of Behavioral Health Services
outlining priorities moving into 2025. She emphasized that
strengthening the behavioral health system remains central to
the division's work. She noted that Alaska's current 1115
demonstration waiver, which underpins foundational behavioral
health services in the state, reached the end of its initial
five-year term in December 2023. She explained that renewing
such waivers requires extensive effort and approval from the
Centers for Medicare and Medicaid Services (CMS). She reported
that Alaska received approval in March 2024 to extend the
behavioral health waiver for another five years.
4:20:00 PM
CHAIR DUNBAR asked whether the 1115 demonstration waiver can be
renewed indefinitely or if there is a limit on how many times
the state can realistically apply for it. He noted that the
waiver has become foundational to Alaska's behavioral health
system and expressed concern that losing it would have severe
consequences. He asked if there is any foreseeable reason the
waiver might not continue.
4:20:31 PM
MS. RICCI responded that the department does not foresee the
1115 demonstration waiver ending in the near future. She
explained that other states often use 1115 waivers broadly,
sometimes for entire Medicaid programs, citing Arizona as an
example. She noted that Alaska's waiver, which was the state's
first, currently focuses on behavioral health reform but could
evolve over time.
MS. RICCI said the next phase involves assessing what amendments
might strengthen the waiver by determining what is working and
what needs adjustment. She added that the department will also
consider whether certain services should shift from the waiver
to the Medicaid state plan, which involves technical analysis.
4:21:37 PM
SENATOR CLAMAN asked whether the department would need to renew
the demonstration project in five years.
MS. RICCI replied that the department will need to renew every
five years and there is significant reporting that occurs on a
consistent basis.
4:22:08 PM
MS. RICCI continued with slide 10,.and stated that expanding
crisis services remains a key priority to strengthen the
behavioral health continuum of care, acknowledging that
significant gaps still exist. She explained that the department
engaged the consulting firm Milliman to assess Alaska's crisis
services system, evaluate current progress against goals, and
develop recommendations for further improvements.
MS. RICCI noted that building new services is challenging, so
these recommendations will guide the department's focus for
2025. She added that the rate methodology review includes
conversations with providers working to establish crisis
stabilization services, to better understand their financial
realities versus initial expectations. This input will help
shape future planning and rates for crisis stabilization
services.
4:22:57 PM
SENATOR CLAMAN asked whether the department anticipates any need
for additional legislation to continue developing crisis
stabilization and crisis residential services, noting that both
he and Senator Giessel have worked on related legislation. He
inquired if the laws already passed meet current needs or if
further legislative action may be required in the near future.
MS. RICCI stated that at this time the department does not
foresee a need for additional legislation for crisis services,
as it is in the implementation and operational stage of a very
large regulations project.
4:23:46 PM
SENATOR TOBIN stated that she has previously raised concerns
about partners struggling with capital needs and noted that many
continue to face these challenges. She asked whether the
department's recent assessment included questions about
partners' capital needs and if there is ongoing discussion about
identifying those needs and exploring ways to provide support.
MS. RICCI acknowledged awareness of partners' requests for
capital needs but stated she was not certain whether that topic
was included in the recent assessment. She said she would review
the assessment and follow up with additional information.
4:24:20 PM
MS. RICCI continued on slide 10 and provided the final portion
of the 2024 operational update, noting progress and upcoming
priorities. She reported that the transition of behavioral
health claims into the main Medicaid system has largely gone
well, with over $300 million in claims paid to nearly 15,000
Alaskans. She acknowledged that such a large transition brings
unexpected challenges but said the department has moved through
most of the stabilization period and will continue focusing on
this in the coming months.
MS. RICCI stated that building out provider supports remains a
key focus and that a procurement process is underway. She added
that developing sustainable crisis services also continues as a
priority.
MS. RICCI expressed excitement about expanding certified
community behavioral health clinics, which deliver coordinated
mental health and substance use disorder services under specific
certification requirements. She explained that these clinics can
qualify for enhanced Medicaid payments but that the state must
first develop certification processes, regulations, and rate
methodologies. She announced that Alaska recently received a $1
million federal grant to join the next cohort of states planning
and designing these clinics. The planning phase will conclude by
the end of this year, after which the department will apply to
participate in the demonstration project to implement this
model.
4:26:51 PM
SENATOR HUGHES asked whether certified community behavioral
health clinics operate similarly to the Health Resources and
Services Administration (HRSA) model for Federally Qualified
Health Centers (FQHCs) on the medical side. She inquired if
these clinics would provide behavioral health services with
requirements such as not turning people away, ensuring access
for uninsured or low-income individuals, and following a similar
structure.
MS. RICCI replied yes.
4:27:23 PM
MS. RICCI moved to slide 11, and described the Division of
Health Care Services as the heart of the Medicaid program,
responsible for processing, adjudicating, and paying claims,
which she compared to pumping blood through the system. She
noted that the division handles about 8.5 million claims
annually for nearly 30,000 Medicaid providers, totaling an
average of $52 million in weekly check writes. She emphasized
the importance of consistent operations for this critical
function.
MS. RICCI reported that one of the division's main focuses for
2024 was increasing operational capacity. She explained that the
division had experienced high vacancy ratesbetween 29 and 31
percentdue to generational turnover, but this rate dropped to
12 percent by December. She highlighted efforts to support and
train staff to ensure they have the tools needed to be
effective.
MS. RICCI shared that the department has developed a Medicaid
systems modernization plan to address provider feedback and
improve operations. The plan shifts from replacing entire
systems at once to using modular updates, which reduce risk and
speed up improvements. As an example, she cited the proposed
provider enrollment portal in the Governor's capital budget,
which would allow providers to submit documents, check
application statuses, and benefit from automated processing for
faster approvals.
MS. RICCI stated that priorities for 2025 include implementing
the modernization plan, expanding quality assurance frameworks
to strengthen contractual and customer service, and continuing
workforce development to maintain capacity and effectiveness.
4:30:24 PM
MS. RICCI moved to slide 12 and discussed the Medicaid
modernization efforts, noting similarities between challenges in
the Division of Healthcare Services and those previously
identified in the Division of Public Assistance. She explained
that both divisions rely heavily on manual processes such as
handling emails and matching attachments, which creates
inefficiencies.
MS. RICCI stated that the department aims to reduce manual
workload by leveraging automation and updated systems. In the
short term, smart forms are being used to address issues in
provider enrollment and service authorizations. In the medium to
long term, the department plans to implement self-service
portals to better support providers and staff.
MS. RICCI also announced the upcoming rollout of a patient
mobile app later this year. The initial version will allow
Medicaid recipients to access their ID cards on their phones,
with future versions expected to include features such as access
to claims information and other relevant data.
4:31:40 PM
CHAIR DUNBAR referenced the significant SNAP backlog the
department faced two years ago, and the concern raised last year
that Medicaid re-enrollment might experience a similar backlog.
He asked for an update regarding the status of Medicaid re-
enrollment and whether the risk period for a backlog ended.
MS. RICCI responded that the department is still completing the
Medicaid redetermination process but is now in the final phase.
She explained that in April 2023, all states were required to
restart eligibility redeterminations that had been paused during
the federal public health emergency. This included implementing
new systems and standards to automate portions of the process,
which posed a significant challenge nationwide, including in
Alaska.
MS. RICCI reported that by September 2024, Alaska had initiated
redeterminations for all Medicaid enrollees. Some cases were
temporarily suspended due to necessary system updates, and about
17,000 remain outstanding. She stated those should be fully
processed by March. Once completed, redeterminations will return
to a regular annual cycle.
4:33:32 PM
COMMISSIONER HEDBERG moved to slide 13, Division of Public
Assistance, and introduced the next three slides focused on the
Division of Public Assistance, beginning with operational
updates, followed by 2025 priorities, and concluding with an IT-
focused slide. She emphasized the importance of clarifying what
modernization entails, and on slide 13, highlighted efforts to
simplify client engagement and improve operational efficiency.
COMMISSIONER HEDBERG reported that the division launched the
Alaska Connect portal, which allows Alaskans to log in through
MyAlaska to apply for public assistance programs, renew
benefits, report changes, and securely upload supporting
documents. She stated that the portal is live and functioning
well.
COMMISSIONER HEDBERG also announced that the division
implemented the Elderly Simplified Assistance Project (ESAP) on
December 1, 2024, following approval from the U.S. Department of
Agriculture (USDA). ESAP applies to households with members aged
60 or older who have a disability, as defined by Food and
Nutrition Services. Under ESAP, the certification period for
this population extends from 24 to 36 months, requires no
interim reporting, and eliminates the interview requirement
unless requested. She noted this provides continuity of benefits
and helps manage workload by spacing out renewals, which is
significant given that 41 percent of SNAP households fall into
this category.
COMMISSIONER HEDBERG added that the division has implemented
text messaging as a tool to remind clients about interviews and
renewals. She shared that this has resulted in a 61 percent
interview answer rate and has been particularly useful for
reminding Medicaid clients to renew their coverage. The
department also reminds Medicaid clients to renew their
applications via text.
4:36:27 PM
COMMISSIONER HEDBERG reflected on the department's progress
since March 2023, when SNAP (Supplemental Nutrition Assistance
Program) application timeliness was at a low point of 28
percent. She reported that by January 2025, the average
timeliness had improved to 71 percent. The division continues
working toward the national standard of 95 percent. She credited
the improvement to the dedication and hard work of eligibility
technicians and Division of Public Assistance staff, who have
adapted to significant changes.
COMMISSIONER HEDBERG reminded the committee that during the
federal public health emergency, the USDA waived all SNAP
interview requirements, and all public assistance offices were
closed with staff working remotely. She noted that while the
transition to remote work was relatively smooth, reopening
offices proved more difficult due to staff turnover.
COMMISSIONER HEDBERG confirmed that the division is now in full
compliance with SNAP interview requirements. She shared that
staff value face-to-face interactions with clients and that
clients also appreciate the personal connection. She emphasized
that all public assistance offices are now open, offering same-
day serviceclients can walk in, complete an application,
complete an interview if needed, and receive benefits if
eligible.
4:38:26 PM
SENATOR CLAMAN asked for an explanation of "same day."
COMMISSIONER HEDBERG replied that it depends on the time of day
and the size and location of the office.
4:39:21 PM
COMMISSIONER HEDBERG moved to slide 14, Division of Public
Assistance: 2025 Focus, and outlined two primary priorities for
the Division of Public Assistance in the upcoming year:
enhancing customer service and fostering employee engagement.
She noted that in the past year, the division implemented a
continuous quality improvement process, which uses root cause
analysis to address identified errors through training, policy
updates, or IT system changes. This tracking and correction
process is ongoing.
COMMISSIONER HEDBERG reiterated that Medicaid redeterminations
will be completed by March. She also reminded the committee that
the Child Care Program Office is housed within the division and
referenced the extensive work already discussed in that area.
She concluded by acknowledging the significant contributions of
a small but highly effective team within the division
responsible for advancing IT modernization efforts.
4:40:35 PM
COMMISSIONER HEDBERG moved to slide 15, Division of Public
Assistance: IT Modernization, and emphasized the importance of
breaking down what modernization means within the Division of
Public Assistance. She explained that last year, the department
successfully migrated Alaska's Resource for Integrated
Eligibility Services (ARIES) system and its document management
system from the mainframe into a secure cloud environment. This
foundational move enables future advancements by aligning the
division's updates to technology infrastructure.
COMMISSIONER HEDBERG shared that two major Requests for
Proposals (RFPs) will be issued this year: one to migrate non-
Modified Adjusted Gross Income (MAGI) Medicaid categories off
the mainframe, and another to transition SNAP. Once those are
complete, the department will follow with the migration of
Temporary Assistance for Needy Families (TANF) and other cash
assistance programs. She confirmed the overall project remains
on track for completion in 2028, with milestones being met by
the Project Management Office.
4:41:59 PM
COMMISSIONER HEDBERG then discussed client engagement
improvements, including a second phase of the Alaska Connect
portal. This upgrade will allow clients to update demographics,
review notices, track application status, and trigger document
submission based on real-time status updates. A multi-program
smart application and a calendar feature will also be added,
giving clients clear information about benefit renewals,
interview dates, and payment details. These upgrades are set to
roll out in 2025.
COMMISSIONER HEDBERG highlighted several completed operational
efficiency improvements. The Medicaid ex parte renewal process
now automatically verifies eligibility using updated data
connections. The division also launched "advanced capture" in
November, which extracts applications and renewal forms from
incoming emails and routes them directly into the workflow
management system. This reduces clerical workload and helps
ensure documents are not lost. She noted an upcoming integration
between the clerical document management system and the
eligibility technician workflow system, improving efficiency and
communication. The division is also working to automate the
asset verification process, currently done manually with
checklists.
4:45:30 PM
COMMISSIONER HEDBERG added that the division handles a large
volume of return mail. A new solution will scan envelopes,
extract content, and automatically update client addresses,
helping maintain accurate contact information. She concluded by
mentioning phased system rollouts in both the child care and
Women, Infants, and Children (WIC) programs and commended the
project management team for their significant work, despite its
small size.
4:46:23 PM
SENATOR HUGHES asked whether any of the automated processes
described involve AI, and if so, whether there are safeguards,
human oversight, or testing in place to prevent bias and ensure
accuracy.
4:47:18 PM
COMMISSIONER HEDBERG responded that while there are limited
elements of artificial intelligence (AI) in use, they are small
in scale and applied cautiously. She emphasized that all
implementations have been tested in a controlled environment by
eligibility technicians using various scenarios to ensure
accuracy. She clarified that automation is primarily used to
connect databases and verify the presence of information, not to
make eligibility decisions. Any AI components in use are not
making determinations but are simply identifying whether
required data exists.
SENATOR HUGHES encouraged the department to ensure full
transparency if any decision-making functions are ever delegated
to AI, noting nationwide concern. She emphasized the importance
of public awareness and oversight in such cases. She expressed
interest in having an offline conversation, acknowledging that
AI has the potential to ease administrative burdens for
employees but stressed that its use must be approached with
extreme caution.
4:48:37 PM
MS. RICCI moved to slide 16, Division of Senior and Disabilities
Services, and said the division supports seniors, individuals
with developmental disabilities, and vulnerable adults. She
highlighted three major accomplishments in 2024:
- First, the division established a Direct Support Professional
(DSP) certification program in partnership with the
University of Alaska Anchorage. The initial cohort of 50
individuals completed certification, with a second cohort of
60 now enrolled. The program aims to professionalize and
stabilize the workforce and was developed with input from 13
stakeholder organizations across Alaska.
- Second, residential service reforms tied to complex care
initiatives were made. These include more flexibility in
staffing ratios, increased acuity rates, and expanded
residential options for older adolescents and youth requiring
specialized care.
- Third, development of the interRAI assessment tool, which she
characterized as a transformative change for the state's home
and community-based waiver system. The tool will allow
individuals to implement self-directed services based on
assessed needs and help the state serve more people more
efficiently. Alaska is the first state to secure a 90 percent
federal/10 percent state funding match from the Centers for
Medicare and Medicaid Services (CMS) for this effort. The
division has procured a contractor for technical assistance
and will issue a request for proposals to procure software
for testing and eventual implementation.
4:51:48 PM
MS. RICCI highlighted two key initiatives moving forward. The
first is the Pulselight system, a new critical incident
detection and trending tool that analyzes Medicaid claims and
other data to flag potential safety issues for vulnerable
adults. For example, multiple fall-related care claims from a
single assisted living home could indicate an emerging problem
not otherwise reported directly. The second focus is on
environmental modification services. Following legislative
direction, the division is implementing regulations to increase
the service cap from $18,000 to $40,000. These modifications
such as wheelchair ramps or grab barshelp individuals remain
safely in their homes. The division is currently building out
requirements and outreach efforts to expand access to the
increased benefit.
4:53:53 PM
DR. LAWRENCE moved to slide 17 and highlighted that the Division
of Public Health achieved national accreditation in March 2024
through the Public Health Accreditation Board, following a
multi-year review of the division's policies, procedures, and
quality improvement plan. He emphasized that this recognition
affirms the division's accountability and commitment to quality
and sets a guiding framework for the next five years. He gave a
brief overview of current efforts aligned with this
accreditation. He noted that, beyond the National Opioid
Settlement funds, the division received a $7 million grant from
the Bureau of Justice Assistance to support opioid response
efforts across Alaska. In infectious disease prevention, he
flagged upcoming data showing an increase in tuberculosis (TB)
and syphilis cases in 2024. He clarified that each case
represents an opportunity for treatment and intervention,
distinguishing these from overdose-related deaths where the
opportunity to intervene has passed. He assured the committee
that individuals identified with infectious diseases are
connected to care.
4:56:31 PM
DR. LAWRENCE outlined key areas of focus for 2025. First, the
division will prioritize data integration and modernization,
noting that many sections still rely on outdated technology such
as fax machines. The goal is to improve communication and
support the public health workforce more effectively. Second,
the division will launch a statewide "Community Health in
Alaska" roadmap, modeled after the youth behavioral health
roadmap. This effort will involve regional listening sessions to
assess local needs and develop tailored public health response
plans. Finally, he announced a pilot project to train and equip
public health staff to issue vital records, such as birth
certificates, directly in community settings. This idea stemmed
from a suggestion by a community partner and aims to improve
access to essential documents needed for services like public
assistance or obtaining a driver's license.
4:58:39 PM
DR. LAWRENCE concluded his overview by noting that part of the
division's broader data modernization efforts includes adopting
electronic directly observed therapy (eDOT) for disease
treatment. He explained that while traditional directly observed
therapy requires in-person monitoring, the division now has the
technology to offer this service remotely for individuals who
have access to the necessary tools. He stated that the division
hopes to implement eDOT this year as a way to improve treatment
accessibility and efficiency.
4:59:17 PM
SENATOR GIESSEL asked for an update on how the public-private
partnership to supply low-cost vaccines to Alaskans is
functioning. She also inquired how Alaska's vaccination program
would be impacted if the federal government were to reject the
efficacy of vaccines.
4:59:36 PM
DR. LAWRENCE stated that the department will follow up with
specific details regarding the public-private partnership for
low-cost vaccines. In response to the second question, he said
there is currently no indication that the federal government is
rejecting the efficacy of vaccines. He added that while the
department stays in regular contact with federal partners, such
federal actions would not directly determine or change vaccine
recommendations issued by the Alaska Department of Health.
5:00:03 PM
SENATOR TOBIN acknowledged rising rates of whooping cough,
syphilis, and congenital syphilis, and expressed particular
concern about the increasing rates of HIV among Alaska Native
men. She emphasized the importance of shifting the focus from
intervention to prevention, noting that the tools, resources,
and therapeutics already exist. She said she looks forward to
continued conversations on how to strengthen prevention efforts.
5:00:33 PM
CHAIR DUNBAR shared that as the department develops the
Community Health Roadmap, he would like to see the rise of
online sports gambling considered as part of the public health
conversation due to its connection to increased rates of
suicide, bankruptcy, and other harms.
5:01:20 PM
SENATOR HUGHES expressed concern about the attachment of youth
to bots. She mentioned the shortage of mental health providers
and the importance of finding funding to train residents of
Alaska to be providers. She noted the mental health crisis among
Alaska's is concerning.
5:03:26 PM
CHAIR DUNBAR invited the commissioner to make closing remarks.
5:03:28 PM
COMMISSIONER HEDBERG replied that the Strengthening Healthcare
Access and Recruitment Program-3 (SHARP-3) includes behavioral
health occupations. She stated that she would provide the
committee with a report detailing all the occupations
participating in both SHARP-1 and SHARP-3. She expressed
appreciation for the opportunity to present the department's
accomplishments over the past two years and share its priorities
for the years ahead.
5:04:30 PM
There being no further business to come before the committee,
Chair Dunbar adjourned the Senate Health and Social Services
Standing Committee meeting at 5:04 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SHSS DOH Overview 1.23.25 .pptx - Read-Only.pdf |
SHSS 1/23/2025 3:30:00 PM |
|
| SHSS DOH Responses from 1.23.25.pdf |
SHSS 1/23/2025 3:30:00 PM |
DOH Overview |