HB 176-GROUND EMER. MEDICAL TRANSPORT PAYMENTS  3:34:57 PM CHAIR SPOHNHOLZ announced that the final order of business would be HOUSE BILL NO. 176, "An Act relating to medical assistance reimbursement for ground emergency medical transportation services; and providing for an effective date." REPRESENTATIVE ZACH FANSLER, Alaska State Legislature, recapped HB 176, and paraphrased from the Sponsor Statement [included in members' packets], which read as follows [original punctuation provided]: Emergency Medical Transportation Services (EMTS) relates to the emergency transportation of patients. For what is traditionally considered an ambulance ride, EMTS reflects Alaska's unique geographical challenges to include air, water, and other approved medical transport services. As it currently stands, Alaska's emergency medical service providers incur additional uncompensated costs when providing services to Medicaid beneficiaries, by as much as sixty percent. Reimbursement for ground emergency medical transportation services occurs when the providers submit a billing to the department (specifically to the Medicaid fiscal agent Conduent) for eligible services provided; the department reimburses the provider using the established Medicaid methodology and rate; the department submits documentation supporting the payment of the federal financial participation (FFP) to Centers for Medicare and Medicaid Services (CMS); and once it is approved, the department receives reimbursement for the FFP from CMS that amounts to the appropriate federal assistance percentage (FMAP). By enacting this legislation along with an amendment to the state Medicaid plan, public EMS providers are eligible to access enhanced federal funding for emergency medical transportation of Medicaid patients. The use of transfers is clearly authorized in federal statute and is both legal and useful. Further, CMS provides reimbursement for the administrative costs associated with administrating EMTS by as much as twenty percent. Anchorage, Juneau, Kenai, and Ketchikan, combined serve approximately forty-eight percent of the state's population. In 2015 (for Kenai) and 2016 for the others, these departments provided 7,035 transports to Medicaid patients, without EMTS, the departments received just $2.1 million in reimbursements; a total collective under-compensation of roughly $3.9 million. Were they EMTS eligible, they could have collected a total of $6 million. HB 176 would allow EMS providers around the state to collect underfunded costs from the effective date, providing a financial boon to those organizations and communities. Even smaller communities such as Bethel can see over a quarter of a million dollars in EMTS reimbursements per year. As you can see from the attached bill packet, there is widespread support for HB 176 throughout the state to help our local communities receive payments to actively cover the services they provide. 3:37:23 PM REPRESENTATIVE SULLIVAN-LEONARD asked why the various municipalities would not do this independently, without any state oversight. REPRESENTATIVE FANSLER explained that there needed to be state acceptance to receive this expanded reimbursement and was not an individual decision made by a municipality. He pointed out that there was no obligation for a municipality to participate. REPRESENTATIVE SULLIVAN-LEONARD asked if they would have to follow the state mandate. REPRESENTATIVE FANSLER replied that this was his understanding. CHAIR SPOHNHOLZ suggested that "authorization" could be another way of framing this. 3:38:54 PM REPRESENTATIVE EASTMAN directed attention to page 2, line [13], of the proposed bill, and read: "is owned or operated by the state, a political subdivision of the state, or a federally recognized tribe or tribal organization;" He asked about the reason for this language, whether it was dictated by the federal government. REPRESENTATIVE FANSLER said that this language was required and was dictated by the program, that community programs which could receive this expanded Medicaid reimbursement could only be governmental. 3:40:17 PM REPRESENTATIVE JOHNSTON asked about the changes to the committee substitute. REPRESENTATIVE FANSLER explained that as the original bill had been written for ground emergency medical transportation services, and was hence limited, it had been recommended to expand the proposed bill and address emergency transportation services. REPRESENTATIVE JOHNSTON expressed her concern for the increase in usage of emergency rooms and ambulances. She questioned how, policy wise, to put "sidebars" on this. She stated that the original policy was to move individuals away from the use of emergency services and the emergency rooms and that the proposed bill was not moving in that direction. 3:43:51 PM REPRESENTATIVE FANSLER acknowledged that he was very cognizant of these concerns for an enticement that people would use emergency services, which had higher costs. He declared that the focus of the proposed bill was for transportation. He shared that he "would love to figure out a policy that starts to say let's have people using their primary care situation better." He suggested that there was a need for additional service providers and better education for defining a true emergency. He stated that it was his belief that the proposed bill did not entice the use of these services or would "drive up the use of emergency rooms." REPRESENTATIVE JOHNSTON asked if he was interested to putting a sunset clause in the bill, or an amendment for accountability, which could include a reporting mechanism. She stated that she had concerns for the proposed bill. 3:46:26 PM REPRESENTATIVE FANSLER replied that he had no interest in either an amendment or a sunset provision, at this time. He offered his belief that public testimony indicated that the use of these services was increasing statewide. He suggested a cause and effect type of experiment prior to deciding that the proposed bill had created an increase in the use of emergency services. He opined that the legislature was "inclined to be our own sunset provision or our own sidebars on these kinds of thing." CHAIR SPOHNHOLZ reminded the committee that emergency room physicians were working on a database of causes for emergency room utilization, and she suggested that this may offer a more direct solution to the aforementioned problem. 3:48:46 PM REPRESENTATIVE SULLIVAN-LEONARD asked if CPT codes were used for transportation or were the transportation billings separate. REPRESENTATIVE FANSLER said that he did not know how the medical billing was handled, although he offered his belief that a CPT code was used. He clarified that each municipality handled its own transportation for the Medicaid reimbursement and he offered an example for the City of Bethel. REPRESENTATIVE SULLIVAN-LEONARD asked if the basic transportation fee was separate from any other charges and how was it billed and matched to the patient. REPRESENTATIVE FANSLER said that he did not know. 3:53:24 PM RICHARD ETHERIDGE, Chief, Capital City Fire and Rescue, explained that most fire departments and EMS departments used third party billers. He said that the department would fill out an EMS report with detailed descriptions for everything done, as there were different rates for each type of transportation and care, and then the billing company would sort out the billing codes to go to either the insurance companies or Medicare or Medicaid. REPRESENTATIVE SULLIVAN-LEONARD asked if Medicaid made its decision based on whether the patient was injured, or if it only paid for transportation. MR. ETHERIDGE expressed his agreement. He addressed an earlier question from Representative Eastman regarding the outlying departments around Anchorage. He stated that if an organization was affiliated with a municipality and had a relationship whereby they could bill through them, that organization would be included in this program. 3:55:13 PM CHAIR SPOHNHOLZ opened public testimony. 3:55:24 PM TOM WESTCOTT, President, Alaska Professional Firefighters, stated support for proposed HB 176. He said that fire departments and EMS providers around the state determined the cost of ambulance transports and charged accordingly. He noted that Medicaid only reimbursed a percentage of the actual cost, which lead to local tax payers needing to make up the difference to maintain adequate EMS services. He stated that the proposed bill would allow departments the opportunity to demonstrate the actual costs of transports and be reimbursed accordingly when transporting Medicaid patients. He pointed out that the increase in revenue could then be spent as seen fit by the local government. He reminded the committee that as the cuts at the state level had resulted in cost shifting in local municipalities, the proposed bill would help the cities to better deal with the increased costs. He pointed out that there was about a 12-month lag for implementation of the program. 3:57:48 PM REPRESENTATIVE JOHNSTON asked about any statistics for the usage of transport for Medicare or Medicaid. 3:58:12 PM MARGARET BRODIE, Director, Director's Office, Division of Health Care Services, Department of Health and Social Services, said that although they did keep statistics, she did not know the exact costs to the municipalities because the transportation rates were capped. REPRESENTATIVE JOHNSTON asked if the statistics included anything regarding the need for transport. MS. BRODIE said that the statistics only included the transportation although projects had reviewed the claims data for emergency rooms in alignment with the transportation to see how much was for real emergency transport. REPRESENTATIVE JOHNSTON asked if this was an ongoing project. MS. BRODIE, in response to Representative Johnston, reported that this had been done as "a pilot type project to ensure that the use of emergency services aren't being abused." 4:00:04 PM CHAIR SPOHNHOLZ closed public testimony on HB 176. The committee took a brief at-ease. 4:01:59 PM CHAIR SPOHNHOLZ brought the committee back to order. 4:02:19 PM REPRESENTATIVE EDGMON moved to report CSHB 176, Version 30- LS0705\J, Glover, 4/7/17, out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, CSHB 176(HSS) was moved from the House Health and Social Services Standing Committee.