SENATE BILL NO. 76 "An Act relating to complex care residential homes; and providing for an effective date." 10:03:03 AM EMILY RICCI, DEPUTY COMMISSIONER, DEPARTMENT OF HEALTH, (DOH) introduced herself. She explained that the department was working on the bill in close coordination with the Department of Family and Community Services (DFCS). DR. BOB LAWRENCE, CHIEF MEDICAL OFFICER, DEPARTMENT OF HEALTH, discussed a presentation entitled State of Alaska, Department of Health, Department of Family and Community Services, SB 76: COMPLEX CARE RESIDENTIAL HOMES(copy on file). He looked at slide 2, "SB 76 Supports Alaska's System of Care SB 76 strengthens Alaska's health care system, enabling Alaskans to access services in settings tailored to their specific care needs. Dr. Lawrence addressed slide 3, "What Is Complex Care? Definition: Co-occurring behavioral, medical, or disability-related needs requiring a multi- disciplinary team and multiple programs. Vision: A coordinated system that delivers compassionate, timely, and person-centered care for the most vulnerable and complex Alaskans. Dr. Lawrence pointed to slide 4, "What Is Complex Care? Behavioral health conditions Disruptive behaviors Carceral system involvement Out of state treatment Psychiatric hospitalization Public safety encounters Co-occurring medical conditions Frequent emergency department visits Harm to self or others Ms. Ricci discussed slide 5, "What Does SB 76 Do? SB 76 creates the necessary statutory framework to allow the Department of Health to license and regulate a new setting: Complex Care Residential Homes (CCRHs) Ms. Ricci relayed that the department envisioned the new setting to be homelike, based in the community, and with multi-disciplinary support and consistent monitoring for individuals. 10:07:51 AM Ms. Ricci pointed to slide 6, "CCRHs Fill a Gap in the Care Continuum There is a gap in Alaska's current continuum of care for ongoing, specialized residential settings. Ms. Ricci drew attention to more acute settings listed on the right-hand side of the slide, including psychiatric hospitals or residential psychiatric treatment centers for youth. The left-hand side of the slide showed less acute settings for care, which relied on funding and support from the department's Home and Community Based Waiver services. She continued that there was a small group of individuals with severe behavioral and medical needs. There may be some cognitive impairment, but the level did not qualify them for the waiver. For the individuals, she identified that the system was struggling to find appropriate discharge care, and a greater amount of care was needed than was currently available in the system. Senator Kiehl recalled that the previous year the legislature passed a bill in which the department had worked on creating a different category of home. He asked how the new category fit into what she was describing. Ms. Ricci replied that the new "Adult Host Homes" license was created with statutory support the previous year and would fit under the waiver between the assisted living homes and complex care homes. Currently the individuals supported in the bill did not meet the requirements for the Home and Community Based Waiver system. 10:11:20 AM Ms. Ricci looked at slide 7, "Establishing a New Residential Setting Identify Needs and Define Scope Create New License Type Determine Services to be Provided Establish Reimbursement Mechanisms Ms. Ricci identified that next steps would include working with the people currently providing care for the individuals in question. Dr. Lawrence pointed to slide 8, "Who Would Benefit from CCRHs? Youth Multiple behavioral health diagnoses Treatment in an out-of-state facility Adult Severe and persistent mental illness Frequent hospital visits and self harm history Senior Dementia with behavioral health diagnoses Does not qualify for Medicaid waiver services Fetal alcohol and autism spectrum disorders Cognitive impairment Highly disruptive behaviors Dr. Lawrence looked at slide 9, "Key Features of a CCRH CCRHs will offer a new residential care setting in Alaska. Fewer than 15 residents 24/7 care from a multi-disciplinary team More supportive than assisted living homes and less restrictive than a psychiatric hospital Specialized monitoring, intervention, and/or treatment to meet the needs of residents Dr. Lawrence emphasized that the new care setting proposed in the bill would be adaptable. Dr. Lawrence spoke to slide 10, "Benefits of a CCRH • Improves care for Alaskans with complex needs • Adds a license type for home-like settings that offer care in the most clinically appropriate environment • Allows for service specialization and for specific requirements to be set forth in regulations • Promotes community safety by offering a new service setting for individuals with complex behavioral health needs Dr. Lawrence qualified that the new care setting being proposed would offer care beyond an assisted living home but not so restricted in a hospital or psychiatric care facility. 10:15:00 AM Ms. Ricci discussed slide 11, "Sectional Analysis Section 1. Amends AS 47.32.010(b) to add "complex care residential homes" to the list of entities regulated by the Department of Health. Section 2. Amends AS 47.32.900(2) to update the definition of "assisted living home" to exclude complex care residential homes. Section 3. Adds AS 47.32.900(11) to modify the definition of "hospital" to clarify that it does not include complex care residential homes. Ms. Ricci pointed to slide 12, "Sectional Analysis Section 4. Adds AS 47.32.900(22) to introduce a new definition for "complex care residential home." It is defined as a residential setting that provides 24-hour multi-disciplinary care on a continuing basis for up to 15 individuals with mental, behavioral, medical, or disability-related needs requiring specialized care, services and monitoring. Section 5. Amends the uncodified law by adding a new section that requires the Department of Health to submit for approval by the United States Department of Health and Human Services amendments to the state Medicaid plan or apply for waivers necessary to implement the provisions of Sections 1-4. Ms. Ricci looked at slide 13, "Sectional Analysis Section 6. Amends the uncodified law by adding a new section specifying that sections 1-4 of the bill will only take effect if the United States Department of Health and Human Services approves the required Medicaid waivers or amendments by July 1, 2031. The commissioner of health is required to notify the reviser of statutes within 30 days once the necessary approvals are received. Section 7. Provides that sections 1-4 take effect the day after the United States Department of Health and Human Services approves amendments to the state plan or waivers submitted under Section 5. Senator Kaufman looked at the fiscal notes and asked about federal funds. He asked if there were any potential issues with funding. Ms. Ricci replied that the department did not anticipate any issues but was still building out funding sources from a Medicaid perspective. One of the aspects of the populations that was particularly challenging was that there were individuals with very specific needs and specific demographics. She discussed a category of youth with disruptive behaviors but did not qualify or developmental or intellectual disability waivers. She discussed a category of adults with severe eating disorders, that were more extreme than was typically imagined and needed specialized care in a structured setting. She discussed adults with dementia that had inappropriate behaviors that the Alask Pioneer Home and others could not care for. For the groups, there could be certain Medicaid waivers to cover the care that was needed. She relayed that the department would be working with consultants to identify the different Medicaid waivers and funding streams that aligned with each of the needs. 10:19:08 AM Senator Kaufman asked if there was anticipation of getting more clarity on funding streams that might be reflected in revised fiscal notes. Ms. Ricci relayed that the current available information the department had was reflected in the fiscal notes. She noted that the department intended to build out the certification, funding, and services with providers, stakeholders, and contractual experts. Senator Kiehl asked about the zero Medicaid services fiscal note. He asked if the department anticipated that the note would really be indeterminate. Ms. Ricci relayed that the fiscal note was zero because many of the individuals in question were receiving very high-cost care that was paid for through the Medicaid program. She added that also any waivers the state would be considering there was a federal budget neutrality requirement. For those reasons the department thought the fiscal note would be zero. 10:21:19 AM Co-Chair Hoffman OPENED public testimony. 10:21:38 AM MICHELLE BAKER, EXECUTIVE VICE PRESIDENT, SOUTHCENTRAL FOUNDATION, ANCHORAGE (via teleconference), testified in support of the legislation. She worked in the behavioral services division. She mentioned adults and children awaiting to be discharged from the hospital without residential services with complex care services. She gave examples of individuals that needed complex care that was not currently available. She recommended an amendment to the bill and referenced Section 4, line 10, and removing "not more than 15." She reasoned that removing the language would give providers more flexibility to think about clinical service delivery models. 10:25:52 AM DAVID WILSON, DIRECTOR OF PUBLIC POLICY, MATSU HEALTH FOUNDATION, WASILLA (via teleconference), spoke in support of the legislation. He thought the bill was a vital step in providing required care. He thought the bill would set a standard for excellence in care. He echoed the comments of the previous testifier regarding amended language in the bill. 10:27:52 AM JARED KOSIN, PRESIDENT AND CHIEF EXECUTIVE OFFICER, ALASKA HOSPITAL AND HEALTHCARE ASSOCIATION, ANCHORAGE (via teleconference), testified in support of the bill. He cited that one out of every seven hospital beds in the state was occupied by individuals that needed to go but had no option for appropriate care to transition to. He urged the passage of the bill. 10:29:00 AM ISAAC SMOLDON, COMMUNICATIONS DIRECTOR, MY HOUSE, WASILLA (via teleconference), spoke in support of the legislation. He believed the legislation would allow My House to better serve its clients. He urged the committee to pass the bill as soon as possible. Co-Chair Hoffman CLOSED public testimony. Senator Kiehl reviewed the fiscal notes. He addressed FN 1 from DOH, OMB Component 2665. He detailed that an FY 26 cost of $153,200 and one full-time position with an even funding split between federal receipts and General Fund (GF) match. The amount leveled off at $150,200 with the same funding composition. Senator Kiehl addressed FN 2 from DOH, OMB Component 2944. The note reflected a first cost in FY 27 of $197,100 split almost 50/50 between federal receipts and GF match for one full-time nurse consultant position. The amount leveled off the following year slightly higher with $204,100 going forward. Senator Kiehl addressed FN 3 from DOH Medicaid Services, OMB Component 3234, which had zero fiscal impact. Dr. Lawrence thanked the committee. Ms. Ricci thanked the committee. SB 76 was HEARD and HELD in committee for further consideration. 10:32:17 AM AT EASE 10:35:27 AM RECONVENED