HB 16-MEDICAID OPTIONAL SVCS & COST CONTAINMENT  4:17:28 PM CHAIR PRAX announced that the final order of business would be the SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 16 "An Act requiring the state medical assistance program to provide certain services; relating to cost containment measures for the state medical assistance program; relating to payment for adult dental services; and providing for an effective date." 4:18:02 PM REPRESENTATIVE ANDY JOSEPHSON, Alaska State Legislature, as prime sponsor of SSHB 16, paraphrased the sponsor statement [included in the committee packet], which read as follows [original punctuation provided]: Medicaid offers a myriad of optional services, many of which Alaska chooses to offer to program recipients in our state. As listed in AS 47.07.030(b), these services cover a wide variety of health care needs, whether preventative (e.g. nutrition services for pregnant women, clinic services, and low-dose mammography screening), chronic (e.g. long-term care and hospice care), or emergent (e.g. emergency hospital services), or combinations thereof. Alaska also chooses to cover dental services, both preventative and restorative, for eligible adults. In June of 2019, all funds appropriated towards adult dental Medicaid benefits were vetoed days prior to the beginning of the new fiscal year. This forced numerous program recipients to cease treatment, leaving multiple Alaskans who were in the process of receiving dentures literally toothless. Ultimately, reinstated funding ensured that this program would continue, but not until months after the initial veto. HB 16 aims to prevent such uncertainty to program recipients in the future. This bill ensures that the listed services in AS 47.07.030(b) would be maintained in future years and not be subject to similar future cuts. Please join me in maintaining coverage for these individuals by supporting HB 16. 4:28:39 PM REPRESENTATIVE JOSEPHSON gave the PowerPoint presentation, titled "House Bill 16" [hard copy included in the committee packet]. On slide 2, he showed a graph of Alaska Medicaid funding from fiscal year 2012 (FY 12) to (FY 21) and pointed out that there was an increase in FY 15. He moved to slide 3 to present a list of mandatory and optional Medicaid services. He said the bill would add two services, and this would cost $35 million. He moved to slide 4 and showed a table that lists Medicaid optional services by state. The table indicates the services each state has selected, and he indicated that the red denotes rejected services. He pointed out that Maine and Wisconsin are more generous with the services selected. He moved to slide 5 to explain Medicaid eligibility in Alaska. On slide 6, he explained that optional services have already been a target for cost-cutting measures, and he referred to an action by the governor to remove adult dental services, which was rejected by the legislature. REPRESENTATIVE JOSEPHSON showed slide 7, which listed intended Medicaid cuts in 2020. He expressed the opinion that the administration would need flexibility; therefore, nothing in the proposed legislation would stop cost-containing measures. He informed members that he would have to confirm whether the $102 million total was the governor's goal in FY 20. He moved to slide 9 and explained that the legislature had weighed many options, while slide 10 depicted a graph of annual Medicaid funding and the governor's proposed reductions. He advanced to slide 13 to explain Maine's Medicaid law. He said slide 14 provides a breakdown of the states that have, in one form or another, a required check in order to modify a state's plan. He concluded on slide 15 and expressed eagerness to see the proposed bill move to the next committee, because in some states the governor alone can make significant changes. 4:38:32 PM REPRESENTATIVE MINA shared that she has spoken with residents who voiced that adult dental should be a necessary part of primary care and not just an optional service. She offered the understanding that amendments to the state's Medicaid plan must be subject to legislative approval, and this is why there is a proposed bill to allow post-partum treatment under Medicaid. She questioned which [parts of the Medicaid plan] are currently subject to legislative approval. REPRESENTATIVE JOSEPHSON expressed the opinion that the question highlights the point that there is a need for authority; otherwise, the governor would have filed a bill. He expressed uncertainty concerning why the governor removed adult dental [services from the Medicaid plan] without filing a bill requesting it. He further elaborated that little in the Medicaid program is subject to legislative authority, and he relayed that AS 47.07 provides that the department "may" offer the following optional services. REPRESENTATIVE MINA asked what else is subject to legislative approval besides optional services. REPRESENTATIVE JOSEPHSON answered that cost-containment measures in AS 47.07.036 are also at the administration's discretion. He referred to slide 6 of the presentation regarding cost-cutting measures and said that the governor made the changes so he could reach the $102 million; however, the legislature rejected this action. He read from AS 47.07.036, which read as follows: If the department finds that the costs of medical assistance for all persons eligible under this chapter will exceed the amount allocated in the state budget for a fiscal year, the department may implement cost containment measures to reduce anticipated program costs 4:44:47 PM REPRESENTATIVE SUMNER asked what the effect would be if there was a reduction in Medicaid funding. He opined that if the department "shall" instead of "may" do optional services, and it did not have the funding, it would have to cut some fraction of all services, rather than selectively. REPRESENTATIVE JOSEPHSON responded that the administration was going to the Centers for Medicare and Medicaid Services (CMS) to cut adult dental service. He explained that the bill was written at the time of the adult dental cut. REPRESENTATIVE SUMNER suggested that instead of focusing on the veto, the focus should be on a potential situation where the earnings reserve account goes empty. He asked whether, under SSHB 16, the state would not be allowing the selection of prioritized vital health services. REPRESENTATIVE JOSEPHSON responded that, under SSHB 16, members would not be allowed to change who is eligible, nor eliminate optional programs; the bill would have the legislature involved in the process. 4:49:01 PM REPRESENTATIVE SADDLER referred to Representative Josephson's suggestion that the governor opted in 2019 not to fund optional dental services in order to create a larger permanent fund dividend (PFD). He expressed the understanding that on the floor of the House of Representatives, no one should ascribe motives to people, and members can debate the merits of SSHB 16 without ascribing the governor's motives. 4:49:53 PM REPRESENTATIVE RUFFRIDGE inquired whether, if the bill were to pass but the state cannot pay the necessary services on Medicaid, no individual programs would be cut, but rather, the cuts would be across the board because all services would be required. He asked for confirmation that in order to make a cut, the legislature would need to convene and move to cut the service. REPRESENTATIVE JOSEPHSON responded in the affirmative. 4:50:50 PM REPRESENTATIVE MINA, looking at the list of optional services provided under AS 47.07.30(b), questioned whether the federal match rate is just 70/30. REPRESENTATIVE JOSEPHSON expressed uncertainty and suggested that for some services the state's share may be higher. REPRESENTATIVE MINA asked about the fiscal note and how brain- injury case management would be funded, as it is not currently funded by general fund grants. REPRESENTATIVE JOSEPHSON offered his understanding that it is not funded through the Medicaid program. He said this was added because of the concern that the governor wanted to cut $250 million from Medicaid. He expressed the opinion that there must be some way for the legislature to be involved. REPRESENTATIVE MINA offered her understanding that brain-injury case management, as well as pregnant women case management, are listed in statute; however, these services are not in the current state plan, which is why there is the fiscal note. She expressed the desire not to ascribe the worth of one service over another. She questioned whether there is a way to narrow the bill, so it focuses on the services that are currently in the state plan. REPRESENTATIVE JOSEPHSON concurred that the cost comes from putting a service into the state plan. He observed that the 2019 administration is not the same as the 2023 administration, and he reiterated that SSHB 16 is a legacy bill. REPRESENTATIVE MINA offered her understanding that the intent of the bill is that optional Medicaid services, whether cut or changed by the executive branch, would require legislative authority. She noted that the bill would also add two new services to the state plan. REPRESENTATIVE JOSEPHSON concurred that the intent of drafting the bill was to not allow the governor alone to strip away programs. Furthermore, he noted that there is a $30 million savings to the state because the proposed sponsor substitute would remove chiropractic care. REPRESENTATIVE MINA commented that the biggest impact from cutting Medicaid and optional services is losing the federal dollars. REPRESENTATIVE JOSEPHSON suggested removing the two programs that he added, because they are costly. He suggested implementing a Wisconsin- or Maine-style amendment, which would add the involvement of the legislature. 4:58:43 PM REPRESENTATIVE SUMNER questioned whether chiropractic care was removed because of the fiscal note or because of the reimbursement rate. REPRESENTATIVE JOSEPHSON answered that it was removed because of the cost on the fiscal note. 4:59:07 PM REPRESENTATIVE RUFFRIDGE asked whether chiropractic services fall under the language "may offer". REPRESENTATIVE JOSEPHSON responded that it does fall under this language, but the state does not. 4:59:32 PM REPRESENTATIVE SUMNER asked whether it would require legislative action to remove chiropractic care from the "may offer" list and add it to the "shall offer" list. REPRESENTATIVE JOSEPHSON suggested that it could be taken off the "may offer list," and then the legislature could move forward with the Wisconsin- and Maine-style of reform. REPRESENTATIVE SUMNER offered his understanding that the bill just changes "may" to "shall", striking chiropractic from the list; however, it would take a future legislative act to make it possible. He further opined that the reason there needs to be a bill for post-partum care is that it is an eligibility issue, not a service issue. 5:01:11 PM REPRESENTATIVE MINA pointed out that an amendment to the state Medicaid plan requires legislative action. REPRESENTATIVE JOSEPHSON suggested that Representative Mina knows more than the bill sponsor does. 5:02:25 PM CHAIR PRAX announced that SSHB 16 was held over.