SB 366 An Act relating to medical support for children; allowing a member of the teachers' retirement system or the public employees' retirement system to assign to a Medicaid-qualifying trust the member's right to receive a monetary benefit from the system; relating to the effect of a Medicaid-qualifying trust on the eligibility of a person for Medicaid; relating to the recovery of certain Medicaid payments from estates and trusts; requiring persons who receive Medicaid services to be liable for sharing in the cost of those services to the extent allowed under federal law and regulations; and providing for an effective date. 1 CS SB 366 (FIN) am (efd fld) was reported out of Committee with a "do pass" recommendation and with fiscal notes by the Department of Health and Social Services and a zero fiscal note by the Department of Commerce and Economic Development dated 4/12/94. SENATE BILL 366 4 "An Act relating to medical support for children; allowing a member of the teachers' retirement system or the public employees' retirement system to assign to a Medicaid-qualifying trust the member's right to receive a monetary benefit from the system; relating to the effect of a Medicaid-qualifying trust on the eligibility of a person for Medicaid; relating to the recovery of certain Medicaid payments from estates and trusts; requiring persons who receive Medicaid services to be liable for sharing in the cost of those services to the extent allowed under federal law and regulations; and providing for an effective date." DAVE WILLIAMS, DIVISION OF MEDICAL ASSISTANCE, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, explained that under the federal Omnibus Budget Reconciliation Act of 1993 (OBRA 93), State Medicaid programs must implement provisions to obtain and enforce medical support orders for noncustodial parents on behalf of Medicaid-eligible children and to recover Medicaid expenditures on long term care and related expenditures for Medicaid recipients age 55 or older. He stressed that implementation of these provisions are necessary in order to avoid loss of federal financial participation in the Alaska Medicaid program. SB 366 would require the Medicaid program to impose co- payments for Medicaid-funded services, to the maximum extent possible. The provision would reduce Medicaid expenditures and shift costs to Medicaid recipients and providers. Discussion followed regarding the implementation of "co- payments" nominal fees. Mr. Williams disclosed that the fees would provide reduced Medicaid payments for services provided. Mr. Williams emphasized that "co-payments" would not effect service delivery. Representative Brown asked if the "co- payments" would provide a medical order to cover Medicaid services. JOHN SHERWOOD, DIVISION OF MEDICAL ASSISTANCE, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, informed the Committee that the medical support provisions would parallel other support provisions already existing for AFDC clients extending those provisions to clients who only receive Medicaid. Child Support Enforcement would then be directed to seek medical support orders from non-custodial parents. The legislation provides tools to enforce those orders. Representative Brown noted concern for the already overburdened Child Support Enforcement Agency pointing out 5 the current year budget cuts. She stressed that the agency would not be able to assume any additional obligations. PHIL PETRIE, OPERATIONS MANAGER, CHILD SUPPORT ENFORCEMENT AGENCY, DEPARTMENT OF REVENUE, responded that the legislation would place the agency into compliance with federal requirements written in 1985. He added at this time the agency completes orders for Medicaid clients, although recently there has been a hearing officer's decision indicating no authority for that concern under state statute. Mr. Petrie concluded that Child Support Enforcement will absorb the costs as part of their regular medical support. Co-Chair MacLean MOVED to report CS SB 366 (FIN) am(efd fld) out of Committee with individual recommendations and with the accompanying fiscal notes. Representative Brown addressed the Letter of Intent provided by the Senate Finance Committee. The letter would override the current law by providing the Department minimal flexibility in order to waiver the application of policy. Mr. Williams explained that the maximum extent allowable would cost more to collect than that to be received. Representative Brown warned that the intent language would provide a clause stating that it would not cost more than the amount anticipated to receive. There being NO OBJECTION to moving the bill from Committee, it was so ordered. There was NO MOTION TO ADOPT the Letter of Intent. CS SB 366 (FIN) am(efd fld) was reported out of Committee with "do pass" recommendation and with three fiscal notes by the Department of Health and Social Services and a zero fiscal note by the Department of Commerce and Economic Development dated 4/412/94.