HOUSE BILL NO. 260 "An Act repealing programs for catastrophic illness assistance and medical assistance for chronic and acute medical conditions." 4:43:46 PM AT EASE 4:44:30 PM RECONVENED Co-Chair Foster invited the bill sponsor and staff to come to the table. REPRESENTATIVE WILL STAPP, SPONSOR, introduced himself. HONOUR MILLER-AUSTIN, STAFF, REPRESENTATIVE WILL STAPP, introduced herself. Representative Stapp explained that he had been going through the operating budget book and in light of the SNAP [Supplemental Nutrition Assistance Program] backlog he had visited some of the Division of Public Assistance (DPA) facilities in Fairbanks and across the state to try to determine what kind of administration burden was plaguing the Department of Health (DOH). In his conversations with department staff, he had discovered the Catastrophic Acute Medical Assistance (CAMA) program. He had been told by the DPA office in Fairbanks that there was no one on the program, yet the office still had to process applications. He had discovered that in the past several years there had only been one person in the program. In response, he had asked the department a series of questions including the number of applications it processed for CAMA in the previous year. The department responded that it processed 6,226 applications and had approved no one. He thought it seemed administratively wasteful and wondered how no one qualified for the program. Representative Stapp explained that the nucleus of the program was effectively rendered outmoded when the Affordable Care Act (ACA) passed, and Medicaid expansion occurred. He explained that individuals enrolled in CAMA basically fell off a cliff post-2015 in Alaska. He elaborated that CAMA was designed for individuals who did not qualify for Medicaid and could not get health insurance on their own. There was a negative fiscal note associated with the bill. He asked his staff to review the sectional analysis. 4:47:42 PM Ms. Miller-Austin reviewed the sectional analysis (copy on file): Section 1 Amends existing legislation to remove references to programs for catastrophic illness assistance and medical assistance for chronic and acute conditions. Section 2 Allows the issuance of subpoenas for investigations related to medical assistance programs removing references to repealed programs. Section 3 Requires providers to grant access to records for medical assistance recipients and allows audits with adjustments for the repealed programs. Section 4 Defines medical assistance fraud and specifies offenses related to medical assistance programs, updating references to the repealed programs. Section 5 Addresses exclusion from medical assistance programs based on certain offenses with adjustments for repealed programs. Section 6 Updates the definition of medical assistance program to exclude the repealed programs. Section 7 Updates the definition of medical assistance provider to include the repealed programs. Section 8 Updates the definitions of services to exclude the repealed programs. Section 9 Adjusts regulations for civil history checks to exclude references to the repealed programs. Section 10 Repeals specific sections of existing law related to the repealed programs. Section 11 Specifies the applicability of amendments to offenses committed after the effective date of the act. Section 12 Provides transition provisions for ongoing investigations and access to records related to services provided before the effective date of the act. 4:49:20 PM Representative Hannan asked how the state received applications from 6,226 people for a program that no one was eligible for. She was concerned that there was a group of people that should have been walked through a different program. She asked if the individuals got there on their own. Representative Stapp responded that statute required it to be on the front page of the application. He elaborated that when a person went to the DPA office to fill out an application, there were "a bunch of boxes that people can check." He detailed that often when individuals applied for public assistance, many people checked all of the boxes on the form. He expounded that when a person checked all of the boxes on the form the department was required to investigate whether or not an individual qualified for the program. He explained it was the reason for the high number of applications and so few approvals. The bill would repeal the program because it was the only way he could get the box for the [CAMA] program removed from the form. Representative Josephson asked if the box individuals checked "was their entrée to Medicaid expansion or the Affordable Care Act." Representative Stapp responded, "No." He explained that there was a series of different boxes on a one-page form including things like SNAP and Medicaid. He stated that one box was for general relief and another was for CAMA. He stated that there were individuals who checked all of the boxes on the form that eligibility technicians referred to as shotgun applications. He elaborated that the forms were multiple pages with a lot of information the applicant needed to fill out. He stated it was not really unreasonable to think that when an individual reached the "check the box portion" of the form that they checked all of the boxes without giving that much thought to the process. Representative Josephson asked if the burden of telling individuals they did not qualify for something (but they would qualify for something else) was $154,000 per year. Representative Stapp answered that two things were occurring. One was the appropriation on the grants and benefits line. He noted that the budget book showed that the actual for FY 23 was $1.00. The legislature appropriated the money in the grants and benefit lines as if people would qualify for the program, but because no one did, the money lapsed or the department had authority to move up to $10 million around; therefore, sometimes the money was likely spent through the RSA [Reimbursable Services Agreement] process. He relayed that the real cost to the program was in the processing time of DPA technicians. He had asked the department how long it took to process one of the applications on average. The answer was 90 minutes and was included in writing in members' bill packets. He relayed that multiplying $6,226 times 90 minutes resulted in about 13,000 man hours. He expounded that based on the average wage of a DPA technician, the cost was around $400,000 in administrative time and payroll as opposed to the grants and benefits line shown in the fiscal note. He remarked that one of the fascinating things about being on the House Finance Committee was that the committee just saw the money allocated to the line item and it did not see the cost of administering the program. 4:53:20 PM Co-Chair Foster OPENED public testimony. Co-Chair Foster CLOSED public testimony. 4:54:18 PM Representative Galvin referenced the sponsor statement (copy on file) and observed that two applicants had qualified for the program in 2021 after ACA. She asked why and what happened to the individuals. Representative Stapp deferred the question to his staff. Ms. Miller-Austin responded the individuals fell into the window of the five-year waiting period where individuals coming to the United States from another country could not qualify for Medicaid during that time period. Representative Galvin remarked that the U.S. had recently seen quite a few people coming in from Ukraine, Somalia, and other countries. She asked if rules had been changed meaning there would never be a similar situation to the two individuals who qualified [in 2021]. Representative Stapp responded that there was a very slim window of individuals who could in theory still qualify for CAMA; however, the individuals qualified for health insurance through the ACA. He stated that having CAMA as opposed to a policy through the ACA was more disadvantageous for the individual, especially because it was income based. He detailed that the [two] individuals were eligible for CAMA because of certain standards, but refugees were exempt from the five-year waiting period on the Medicaid program. He explained that the situation basically involved legal immigrants who had not been in the state for five years. He relayed that those individuals were also legally eligible for ACA. He stated that in terms of the best interest of the individual, it was much more advantageous for them to buy a policy through ACA. Representative Galvin referred to the potential for new leadership in the U.S. government later in the year and the possibility of ACA going away. She asked if the scenario would mean the state would look at going back to using CAMA. Representative Stapp responded that even if it were possible, the program should not be designed like CAMA. He considered a scenario where ACA was eliminated. He stated it would then be necessary to unwind Medicaid expansion. He suggested that under the scenario the state should create a program similar to the old CHIP program the state used to have. He stated that CAMA was an antiquated program. He deferred to his staff to provide additional detail on the program's history. Ms. Miller-Austin responded that the program was designed to help middle class recipients who were too young for Medicare and with incomes too high to qualify for Medicaid who were not covered by health insurance or whose insurance was insufficient to withstand a catastrophic illness episode without jeopardizing their financial resources, livelihood, and essential assets. She added that CAMA was established in 1986. She noted that since that time how coverage was obtained had progressed. 4:58:58 PM Representative Galvin understood that Medicaid expansion and other things had helped fill the gap since then. She referenced the 13,000 man hours Representative Stapp discussed. She presumed that some of the applicants would need some sort of referral and would still need to fill out an application for a different program within DPS. She wanted to ensure that Representative Stapp had consulted with DPS on the topic. Representative Stapp answered that the department did not break out the programs individually, which he believed was a mistake in how it tracked workflow. He remarked that he had another bill addressing the issue. He stated that all he could do was compare the answers from the department with the number of applications. He suggested that the next legislature consider mandating the department to track its workflow in order for the legislature to better understand how long and arduous the process was and to look for efficiencies, especially with a department that had a lot of trouble with administrative workload. Representative Galvin asked if Representative Stapp consulted with DPA and if the director agreed his conclusions made sense. Representative Stapp responded affirmatively. Co-Chair Foster thanked the bill sponsor. HB 260 was HEARD and HELD in committee for further consideration. 5:02:04 PM AT EASE 6:05:33 PM RECONVENED