Legislature(2003 - 2004)
04/30/2003 03:15 PM House FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
CS FOR SENATE BILL NO. 105(HES) am(efd fld) An Act relating to eligibility requirements for medical assistance for certain children, pregnant women, and persons in a medical or intermediate care facility. JOEL GILBERTSON, COMMISSIONER, DEPARTMENT OF HEALTH & SOCIAL SERVICES, spoke to the HES version (H) of the bill, which would lower and freeze income levels for eligibility for the Denali Kid Care Program and would also freeze income levels for Medicaid under the special income limit for nursing homes and home and community based waiver services. Under current law, income standards for these eligibility categories increase every year by the amount of cost-of- living adjustments to the Supplemental Security Income (SSI) program or the federal poverty guidelines for Alaska. The bill would eliminate the annual cost-of-living adjustments and put in statute fixed dollar income levels for those programs based on the SSI standard that became effective on January 1, 2003 or the federal poverty guideline for Alaska, which became effective on April 1, 2002. Commissioner Gilbertson noted that the Senate had reduced the fixed income levels for the Denali Kid Care Program at 175% of the federal poverty guideline and the House HES Committee amended the bill back to the Governor's original proposal. The HES version before the House Finance Committee keeps the Denali Kid Care income eligibility at 200%. Setting the program income standard at 200% would allow the Department to maintain current Medicaid benefits to over 26,000 beneficiaries while fixing levels to realize significant cost savings in subsequent years. Commissioner Gilbertson added that pregnant women who establish eligibility before June 30, 2003 would remain eligible for nine months notwithstanding the passage of the bill. Likewise, children who establish eligibility before June 30, 2003 would be protected for a period of six months under existing continuous eligibility rules. Representative Croft referenced Pages 4 and 5, which lists the household income amounts and asked if those numbers represented the 200% freeze. Commissioner Gilbertson reiterated that the dollar levels for the Denali Kid Care Program and the Medicaid program would be locked in at the 200% poverty level and that the legislation would remove the inflation adjustments. Representative Croft asked if the 200% federal poverty guideline had already been incorporated at the 25% level for Alaska. Commissioner Gilbertson responded that the federal poverty level had been uniquely calculated for the State of Alaska. It is adjusted to reflect a 25% increase and parallels the cost-of-living adjustment that is received by federal employees because of the higher cost-of-living in Alaska. The Alaska Permanent Fund is not included in the calculation. Co-Chair Harris pointed out that the bill had originated in the Senate. He observed that at one time, eligibility had been lowered to 175% of poverty level. Commissioner Gilbertson reiterated that the Governor had introduced the legislation at the 200% and that the Senate HES Committee reduced it from 200% to 175%. Additionally, that Committee did not reflect the special income standards for long-term care. They elected to lower it from 200% to 175%. Co-Chair Harris asked where those figures were located. Commissioner Gilbertson responded on Page 4, Section 13. Co-Chair Harris asked how he could make the adjustment back to a 175% poverty level. Commissioner Gilbertson explained that the numbers listed are calculated at the 200% level. In order to indicate that reduction, each of the numbers would need to be adjusted. He added that the low-end monthly difference would be approximately $300-$400 dollars per month. Co-Chair Harris inquired the amount of general fund savings using the 175% figure. Commissioner Gilbertson responded that the fiscal note passed from the Senate would be a general fund savings in 2004 in the amount of $2.1 million dollars with total funds saved of $7.1 million dollars. He added that the State does receive enhanced federal medical funds and that the State would lose approximately $5 million in federal dollars by that reduction. The State receives funding for some optional categories, the Enhanced Federal Medical Assistance percentage. The program generates a 71% federal share. Co-Chair Harris questioned the number of Alaskans that would be affected at the 175% level versus the 200% level. Commissioner Gilbertson responded that for FY04, in the Denali Kid Care Program that 123 pregnant women and 1,214 children would be affected. He pointed out the impact in FY04 would be minimized by some extent by the fact that women that are currently eligible, would loose their coverage under the adjustment but that they would be able to retain their coverage throughout their pregnancy under federal law. Children in the Denali Kid Care Program would continue their eligibility. He reiterated that the impact in the first year would be reduced by the fact that pregnant women in that first year would not loose their coverage during the pregnancy. However, in the out years, 200 individuals will be affected. Co-Chair Harris noted that the savings in the out-years were significant given the proposed benefit cap. Commissioner Gilbertson responded it would save approximately $12 million dollars. In the far-out years, the projected savings would amount to twice what the Governor's proposal recommends at the 175% level. He commented that at the 200% scenario, in FY09, there would be a total fund savings of roughly $10 million dollars, $3.5 of that would be general fund savings. Under the 175% scenario, there would be a total savings in FY09 of $22 million dollars. Representative Joule asked if the fund source indicated in the fiscal note represented federal savings. Commissioner Gilbertson noted that the amount shows a federal savings; the federal government pays roughly 71% of the cost of the Denali Kid Care Program and as a result, most of the savings are federal dollars. He added that these are formula programs and that any reductions in the Medicaid Program, federal funds would be lost. In response to an observation made by Representative Joule, Commissioner Gilbertson stated that the reference was to language passed in the Senate, which was amended in the HES Committee. The bill before the Committee uses the original language proposed by the Governor at the 200% level and under that scenario, a $10 million dollars savings is indicated. Representative Joule asked if the program continued as is, would the federal government participate at a higher level. Commissioner Gilbertson responded that the legislation was intended to contribute to a limited general funds savings. However, no one currently in the program will loose coverage. In addition, individuals in the program do not have equal stratification of incomes. Those persons with the higher level of income will be affected by the legislation. In response to a query by Representative Joule, Commissioner Gilbertson reiterated that the Governor did not support the Senate HES version of the legislation. TAPE HFC 03 - 72, Side A MARIE LAVIGNE, (TESTIFIED VIA TELECONFERENCE), EXECUTIVE DIRECTOR, ALASKA PUBLIC HEALTH ASSOCIATION, ANCHORAGE, noted that the Alaska Public Health Association applauds the success of Denali Kid Care Program in improving the health of pregnant women and children in Alaska and urges the Committee to continue eligibility for this program at the fullest level possible. Public health research on the health impact of uninsured children is noteworthy: · Uninsured children who need medical and surgical care are 4 times more likely to go without the care they need than insured children with the same health needs. When they do receive the care, they are sicker and more likely to be seen in the emergency room. · Uninsured children are 4% times more likely to do without needed prescriptions and eye glasses, and 5 times more likely to be unable to receive needed dental care. · Uninsured children are 1.5 times more likely to arrive to kindergarten without their required immunizations. They are 8 times more likely to not have had a well child check up. · Uninsured pregnant women are less likely to receive prenatal care, placing them at risk to deliver early, low-birth weight babies and at the greatest risk for fetal and/or maternal death. Ms. Lavigne stated that the Governor's transmittal letter accompanying SB 105 states "While the cost savings associated with this bill are modest in the short-term, this measure will significantly reduce future year costs." From a public health perspective, any short-term savings does not compare to the greater long term costs to the health and well being of pregnant women and children. She added that to succeed in lowering the enrollment in the Medical assistance programs, the Legislature should consider the issue from a different perspective. SB 105 seeks to lower the enrollment in medical assistance programs by reducing eligibility for pregnant women and children who qualify at the upper levels of the income eligibility, up to 200% of poverty level. The most effective approach the Legislature could take would be to assist employers and working families to get affordable health insurance, reducing the number of pregnant women and children needing coverage by Denali Kid Care. Ms. Lavigne noted that while there are many factors contributing to 1 in 5 Alaskans lacking health insurance coverage, one of the greatest barriers is access to affordable health insurance. A study by the Anchorage Access to Health Care Coalition released this fall indicates of the 16,000 adults in Anchorage who are uninsured, 71% are working adults, the majority in business with less than 10 employees. The Legislature needs to join with businesses in addressing the issue of affordable health care insurance. In the meantime, she urged members to keep the eligibility for the medical assistance programs at the full 200% of federal poverty level to maximize the health of pregnant women and children. PATRICIA ZIMMERMAN, DOUGLAS ADVISORY BOARD, JUNEAU, testified against the proposed legislation. She provided her employment history in the pharmaceutical industry. She pointed out that the difference between the countries where there is poor health care and good health care has state involvement. She spoke in support for universal health care throughout the United States. Ms. Zimmerman recommended taxing the oil and gas companies to help provide for these insurances. She questioned why the State of Alaska is considering taxing the poorest Alaskans to decrease services. The companies that extract the State's resources should be the ones taxed. Ms. Zimmerman recommended a review of who takes the money out of Alaska. MARIE DARLIN, ALASKA ASSOCIATION OF RETIRED PERSONS (AARP), JUNEAU, voiced support for the Denali Kid Care Program noting that AARP is the world's largest organization of grandparents. She emphasized that AARP supports the 200% poverty level for that program. Ms. Darlin questioned putting the levels in statute, as that would bind future legislators. Representative Foster MOVED to report HCS CS SB 105 (HES) out of Committee with individual recommendations and with the accompanying fiscal note. Representative Joule OBJECTED. Following a brief at-ease, Representative Joule WITHDREW his OBJECTION. There being NO further OBJECTIONS, it was so ordered. HCS CS SB 105 (HES)am(efd fld) was reported out of Committee with a "do pass" recommendation and with a new fiscal note by the Department of Health & Social Services.