Legislature(2017 - 2018)HOUSE FINANCE 519

02/16/2018 01:30 PM House FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
Heard & Held
Heard & Held
Heard & Held
+ Budget Amendments by: TELECONFERENCED
- Pat Pitney, Director, OMB, Office of the
- Neil Steininger, Chief Budget Analyst, OMB
Heard & Held
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
HOUSE BILL NO. 176                                                                                                            
     "An Act relating to medical assistance reimbursement                                                                       
     for ground emergency medical transportation services;                                                                      
     and providing for an effective date."                                                                                      
2:14:18 PM                                                                                                                    
REPRESENTATIVE  ADAM WOOL,  SPONSOR,  explained  HB 176.  He                                                                    
stated  that the  bill allowed  reimbursement to  local fire                                                                    
departments  and emergency  medical  transport providers  to                                                                    
get  more  fully  reimbursed when  transporting  a  Medicaid                                                                    
payment.   He   stated    that,   currently,   the   maximum                                                                    
reimbursement  was  $400  for an  ambulance  ride,  but  the                                                                    
service cost  more than $400  to the departments.  He stated                                                                    
that  it allowed  for the  Department of  Health and  Social                                                                    
Services (DHSS) to apply for  reimbursement from the federal                                                                    
government.  He  explained  that  many  states  had  similar                                                                    
allowments. He  noted that currently, the  response services                                                                    
were only compensated  a fraction of the cost,  so this bill                                                                    
allowed for 50 percent more of the funding.                                                                                     
Representative  Wilson queried  more  information about  the                                                                    
Representative  Wool  replied  that  $600  was  mission.  He                                                                    
stated that  the provider would  send in $300 to  the state;                                                                    
the  state would  apply and  receive $600  from the  federal                                                                    
government; and  $600 would be  returned to  the department,                                                                    
with a net of $300.                                                                                                             
Representative  Wilson asked  who was  paying for  the other                                                                    
Representative  Wool responded  that Medicaid  paid for  the                                                                    
$400. He  stated that typically  Medicaid was paid  for with                                                                    
50 percent  from the state  and 50 percent from  the federal                                                                    
Representative Wilson  surmised that $1000 would  be charged                                                                    
for the ambulance. The first  $400 would come from the state                                                                    
Medicaid program. She  stated that, once the  other $600 was                                                                    
sent, the  state would  pay an  additional $300  and another                                                                    
$300 from  the federal government. She  wondered whether the                                                                    
$600 totally came from the federal government.                                                                                  
Representative Wool replied that  the entire $600 would come                                                                    
from   the  federal   government.  He   deferred  to   other                                                                    
testifiers for more information.                                                                                                
2:20:38 PM                                                                                                                    
ROB EARL,  STAFF, REPRESENTATIVE ADAM WOOL,  returned to the                                                                    
example of the  $1000 ambulance ride. He  explained that the                                                                    
first $400 would  be paid through state  Medicaid, which was                                                                    
funded  divided  in  half  between  the  state  and  federal                                                                    
government.  He  stated that  there  would  be a  $600  non-                                                                    
reimbursed  cost, so  the provider  would submit  their non-                                                                    
federal match of $300 to  DHSS. He explained that DHSS would                                                                    
then  receive $300  from the  federal government,  and would                                                                    
return  the  entire $600  to  the  provider. Therefore,  the                                                                    
provider would net $300.                                                                                                        
Representative   Wilson  wondered   about  the   20  percent                                                                    
administrative fee.                                                                                                             
Mr. Earl responded  that the administrative fee  could be up                                                                    
to 20 percent of the entire transport cost.                                                                                     
Representative Wilson  wondered whether there was  a cap, so                                                                    
the department could not go higher than 20 percent.                                                                             
Mr. Earl replied that there  was a state plan amendment that                                                                    
DHSS would  apply for federal  Medicaid. He stated  that, at                                                                    
that  state, the  20 percent  was able  to be  added to  the                                                                    
provider's  costs.  Then they  could  apply  for the  larger                                                                    
Representative Guttenberg felt  that the example "low-balled                                                                    
the  cost."  He  queried  a  maximum  allowable  amount  for                                                                    
reimbursement.  He  wondered whether  there  was  a need  to                                                                    
include medivac air transport.                                                                                                  
Representative Wool  reported that they would  be adding air                                                                    
and water transport  to the bill. He stated  that Alaska had                                                                    
many  remote areas.  He did  not  believe that  there was  a                                                                    
maximum  allowable reimbursement,  because the  transport of                                                                    
longer hauls was expensive.                                                                                                     
2:25:10 PM                                                                                                                    
Vice-Chair Gara supported  the concept of the  bill. He felt                                                                    
that the fiscal  note showed that of the  $21 million annual                                                                    
cost to the state, $11  million would come directly from the                                                                    
federal government and  the other $10 million  would be some                                                                    
form of statutory designated receipts.  He queried the state                                                                    
cost of the bill.                                                                                                               
Representative Wool  responded that the $21  million was not                                                                    
a cost,  rather it was  a net gain  to the state.  He stated                                                                    
that  $11  million  of  that   gain  was  from  the  federal                                                                    
government, and $10 million was from the providers.                                                                             
Co-Chair Seaton  asked for a  bubble flow chart.  He thought                                                                    
it would make it easier to  follow the numbers. He asked for                                                                    
an example to be included.                                                                                                      
Representative Wool agreed to provide that information.                                                                         
Representative  Grenn  wondered  whether there  would  be  a                                                                    
change in percentage depending on a cost change.                                                                                
Representative  Wool believed  there  was no  change in  the                                                                    
percentage based on cost of service.                                                                                            
Representative Pruitt  wondered whether there was  a general                                                                    
fund expenditure.                                                                                                               
Representative Wool responded  affirmatively. He indicated a                                                                    
person  to manage  the program  would  be paid  for with  GF                                                                    
Representative  Pruitt  remarked  that  the  Anchorage  Fire                                                                    
Department  would  send  the  state  $300,  which  would  be                                                                    
submitted  to  the federal  government,  and  the full  $600                                                                    
would be returned  to the fire department.  He surmised that                                                                    
the concept was that the  fire department would receive $300                                                                    
from  the federal  government. He  wondered why  the federal                                                                    
government would want to participate in the program.                                                                            
Representative Wool  replied that  the example  was correct.                                                                    
He  stated that  there  was something  in  federal law  that                                                                    
required the federal government to make those payments.                                                                         
Representative  Pruitt  wondered  whether the  other  states                                                                    
required  the local  community to  go through  the state  to                                                                    
access the  federal money;  or would the  state take  on the                                                                    
role to  request all. He  queried the number of  states that                                                                    
had the program, and how the models compared to the bill.                                                                       
Representative  Wool  replied that  California,  Washington,                                                                    
Montana, Nevada, Texas, and Florida  had similar programs in                                                                    
place.  He  furthered  that Oregon,  Nebraska,  Kansas,  and                                                                    
Illinoi had pending programs. He  deferred to Mr. Clough for                                                                    
more states' information.                                                                                                       
2:32:44 PM                                                                                                                    
SCOTT  CLOUGH, ALASKA  FIRE  CHIEFS,  PORTLAND, OREGON  (via                                                                    
teleconference),  stressed that  the program  was not  a new                                                                    
program. He shared  that it was an  entitlement program that                                                                    
was part of  Title 19 of the Social Security  Act. He stated                                                                    
that every state  participated in the program  in some form.                                                                    
He  shared that  the concept  was  in effect  in Alaska.  He                                                                    
remarked  that there  was no  limit to  the program,  in the                                                                    
reimbursement  section. He  stated  that  as an  entitlement                                                                    
program, it was  a cost-based program. He  shared that other                                                                    
Medicaid programs had an upper  payment limit (UTL), but the                                                                    
UTL was tied to cost in  this program. He used California as                                                                    
an example, and remarked that  the cost per transport in the                                                                    
larger  cities were  approximately $500  to $600.  He stated                                                                    
that,  conversely, there  were  remote  areas in  California                                                                    
that saw  transport costs of  $4000 to $5000 on  the federal                                                                    
program.  He stressed  that  the  cap was  the  cost of  the                                                                    
transport  service.  He  noted   that  the  program  was  an                                                                    
opportunity  for  the  local  government  to  share  in  the                                                                    
federal government's  Medicaid program.  He shared  that, if                                                                    
an  agency  had  a  $1000  cost  of  transport,  they  would                                                                    
currently receive  Medicaid funds  from the state  for $400.                                                                    
He furthered that  there was an uncompensated  cost of $600.                                                                    
He  shared  that,  instead of  the  state  participating  in                                                                    
federal financial  participation, local government  would be                                                                    
allowed  to participate  in federal  financial participation                                                                    
at  the  same rate.  He  remarked  that  50 percent  of  the                                                                    
uncompensated  cost  was  the   non-federal  share  was  the                                                                    
partnership  of   the  fire   department  and   the  federal                                                                    
government.  He stated  that  the  federal government  would                                                                    
match the 50 percent.                                                                                                           
2:37:50 PM                                                                                                                    
Mr. Clough  shared that  the program  was voluntary  and the                                                                    
individual  local   government  providers  were   asking  to                                                                    
participate. Therefore,  there could  not be  an expenditure                                                                    
to the  state. He shared that  the state may need  to hire a                                                                    
full-time equivalent  (FTE) employee for  program oversight,                                                                    
but  the  cost  of  that  hire  must  be  paid  for  by  the                                                                    
participating parties.  He stressed  that there  would never                                                                    
be  exposure   to  the  GF.   He  agreed  to   provide  some                                                                    
illustrations to  help describe the 20  percent. He stressed                                                                    
that  the state  had  the  right to  charge  a  fee for  the                                                                    
services, because  the program  was voluntary.  He explained                                                                    
that the fee was arbitrary as  it related to the cost of the                                                                    
charge.  He  stated  that Indiana  charged  27  percent  and                                                                    
California  charged  20  percent.  He  stated  that  the  20                                                                    
percent  fee  was  a  cost  associated  with  the  ambulance                                                                    
2:41:58 PM                                                                                                                    
RICH ETHERIDGE,  JUNEAU FIRE CHIEF, JUNEAU  FIRE DEPARTMENT,                                                                    
stressed that fire departments across  the state were seeing                                                                    
unprecedented calls for service  and decreasing revenues. He                                                                    
stressed that the call volume  in the Juneau Fire Department                                                                    
increased 16 percent  the year prior, and the  year prior it                                                                    
increased 14 percent. He furthered  that the call volume had                                                                    
already increased 10  percent from the year  prior, so there                                                                    
was no expectation of flattening  the call volume. He shared                                                                    
that the bill would help to  make up the debt portion of the                                                                    
budget.  He remarked  that he  estimated  that Juneau  would                                                                    
receive approximately  $500,000, which  was enough  money to                                                                    
put another ambulance into service.                                                                                             
2:45:18 PM                                                                                                                    
Co-Chair  Seaton queried  the percentage  of Medicaid  runs,                                                                    
compared to the total.                                                                                                          
Mr.   Etheridge   responded    that   Medicaid   runs   were                                                                    
approximately 25  percent of the  call volume.  He furthered                                                                    
that  smaller communities  with larger  Medicaid population,                                                                    
the  Medicaid runs  could be  80  percent or  90 percent  of                                                                    
their  call   volume.  He  shared   that  the   Juneau  Fire                                                                    
Department saw  approximately 5000  incidents per  year, and                                                                    
80 percent of those 5000 incidents were medical calls.                                                                          
Co-Chair Foster OPENED Public Testimony.                                                                                        
KATHIE  WASSERMAN,  EXECUTIVE   DIRECTOR,  ALASKA  MUNICIPAL                                                                    
LEAGUE, spoke in support of  the bill. She stressed that the                                                                    
bill allowed  for the municipalities to  access needed funds                                                                    
through  other  avenues.  She  shared  that  the  money  was                                                                    
revenue neutral, so there would be no cost to the state.                                                                        
Vice-Chair Gara shared  that he did not  recall receiving an                                                                    
email from  his community  on their stance  on the  bill. He                                                                    
noted  that each  communities' tax  caps were  different. He                                                                    
wondered whether  the bill  would raise  the revenue  to the                                                                    
municipality, if Anchorage were to leverage $3 million.                                                                         
Ms. Wasserman answered that she  thought it most communities                                                                    
would put the money in their  general fund, and then pass it                                                                    
to the fire department to cover those costs.                                                                                    
Vice-Chair  Gara stressed  that he  was a  cosponsor of  the                                                                    
Representative Wilson  felt that the bill  would be positive                                                                    
for every community. She assumed  that the City of Anchorage                                                                    
would apply  the money  to their  general fund,  because the                                                                    
city  "took  care  of  their  police  departments  and  fire                                                                    
stations."  She  stated  that  it  was  different  than  the                                                                    
Fairbanks  North  Star  Borough, because  there  were  "fire                                                                    
service  areas."   She  wondered  whether  there   was  that                                                                    
distinction in the bill.                                                                                                        
Ms. Wasserman replied that  each community would participate                                                                    
differently in the program.                                                                                                     
2:50:24 PM                                                                                                                    
BILL   HOWELL,   BETHEL   FIRE   DEPARTMENT,   BETHEL   (via                                                                    
teleconference),  testified in  support of  the legislation.                                                                    
He  stated  that   the  bill  would  match   what  the  fire                                                                    
department had  as its discretionary budget.  The department                                                                    
had  a  conservative  estimate  of  a  cost  of  $1,200  per                                                                    
ambulance  run, and  they were  losing  money annually  from                                                                    
Medicaid runs.  He remarked that the  Bethel Fire Department                                                                    
provided  an important  public service  and were  looking at                                                                    
ways  to provide  training and  keep the  service going.  He                                                                    
asked the committee to pass the legislation.                                                                                    
2:53:01 PM                                                                                                                    
JIM   STYERS,   FAIRBANKS   FIRE   CHIEF,   FAIRBANKS   (via                                                                    
teleconference),  spoke in  favor of  the bill.  He detailed                                                                    
that the  bill would impact  the city and its  citizens. The                                                                    
state's budget  situation was  trickling down  and impacting                                                                    
municipalities. He was fully supportive of the bill.                                                                            
2:55:32 PM                                                                                                                    
ALEX  BOYD,   ANCHORAGE  FIRE  DEPARTMENT,   ANCHORAGE  (via                                                                    
teleconference), spoke in support  of the bill. He announced                                                                    
that the Anchorage  Fire Department was seeing  a 38 percent                                                                    
increase  in transports.  He  stated  that, currently,  they                                                                    
were  answering  28  thousand  transports  in  the  City  of                                                                    
Anchorage. The  costs were  going up  while the  support was                                                                    
going down.                                                                                                                     
Representative  Pruitt  asked if  Mr.  Boyd  saw any  impact                                                                    
based on the tax cap.                                                                                                           
Mr.  Boyd responded  that  he was  unfamiliar  with how  the                                                                    
collection of the  funds would impact the tax  cap, but felt                                                                    
that there may potential to  relieve the tax encumbrances by                                                                    
alleviating some of the potential bond propositions.                                                                            
Representative Pruitt  had not  heard this  information from                                                                    
anyone  in the  community. He  did not  want to  unknowingly                                                                    
cause any other challenges.                                                                                                     
2:58:44 PM                                                                                                                    
Co-Chair Foster CLOSED Public Testimony.                                                                                        
Co-Chair  Foster asked  that amendments  be turned  into his                                                                    
office by the following Tuesday.                                                                                                
Co-Chair  Seaton  asked  if Ms.  Brodie  was  available  for                                                                    
Co-Chair  Seaton   wondered  whether  the   program  treated                                                                    
regular  Medicaid patients  and Medicaid  expansion patients                                                                    
in the same manner.                                                                                                             
MARGARET   BRODIE,  DIRECTOR   OF   HEALTH  CARE   SERVICES,                                                                    
DEPARTMENT    OF   HEALTH    AND   SOCIAL    SERVICES   (via                                                                    
teleconference),  responded that  the patients  were treated                                                                    
the  same.  She furthered  that  the  department received  a                                                                    
higher federal match for the Medicaid expansion population.                                                                     
Co-Chair  Seaton wondered  whether there  would be  a higher                                                                    
match for the Medicaid expansion client in the program.                                                                         
Ms. Brodie  replied that there would  not be a charge  of 50                                                                    
percent  regardless of  the client.  She  stated that  there                                                                    
would be an examination of  the claims, and then there would                                                                    
be an appropriate match request.                                                                                                
Co-Chair  Seaton  queried  the   percentage  for  the  match                                                                    
portion  for  the  transport   for  the  Medicaid  expansion                                                                    
Ms.  Brodie responded  that the  department would  apply the                                                                    
same match requirements as the original claim paid out.                                                                         
Representative Guttenberg wondered how  the bill would apply                                                                    
across  the  state,  because of  the  different  systems  of                                                                    
emergency medical transport.                                                                                                    
Ms. Brodie replied that it  would be anyone who provided the                                                                    
match  for  the unpaid  share.  She  stressed that  all  the                                                                    
entities already  enrolled in the Medicaid  program, and met                                                                    
all the other requirements.                                                                                                     
3:03:35 PM                                                                                                                    
Representative  Guttenberg indicated  that  the concern  was                                                                    
the tax cap for various  communities. He surmised that there                                                                    
would not  be a detrimental  effect of every  entity, should                                                                    
they not file for the program.                                                                                                  
Ms. Brodie agreed.                                                                                                              
Vice-Chair Gara noted  that the only state cost  was for the                                                                    
administrative position, which would be reimbursed by fees.                                                                     
Ms. Brodie relayed  that there were no  state funds, because                                                                    
the match would be provided through the fees.                                                                                   
Vice-Chair  Gara indicated  there  had  been some  testimony                                                                    
that the  fee could be  capped at  a lower amount.  He noted                                                                    
that the  department would not  charge more than  was needed                                                                    
for the position.                                                                                                               
Ms. Brodie replied  in the affirmative. She  stated that the                                                                    
department would only charge the  amount of the costs, which                                                                    
were currently 0.28 percent.                                                                                                    
Representative Wilson understood that the  bill did up to 20                                                                    
Ms. Brodie responded, "That's correct."                                                                                         
HB  176  was  HEARD  and   HELD  in  committee  for  further                                                                    
Co-Chair  Foster  relayed  the   agenda  for  the  following                                                                    
meeting on Monday, February 19, 2018.                                                                                           

Document Name Date/Time Subjects
DHSS Review WDR-HB176-2-6-18.pdf HFIN 2/16/2018 1:30:00 PM
HB 176
HB176 Sponsor Statement 2.13.18.pdf HFIN 2/16/2018 1:30:00 PM
HB 176
HB176 Additional Documents - HB 176 GEMT Summary 2.13.18.pdf HFIN 2/16/2018 1:30:00 PM
HB 176
HB176 Supporting Documents - LTRs of Support 2.13.18.pdf HFIN 2/16/2018 1:30:00 PM
HB 176
Combined_Budget_Amendments_Detail_Backup_2-13-18.pdf HFIN 2/16/2018 1:30:00 PM
HB 284 HB 286
HB 286 HB 284 FY2019 Combined Amendment Summary and Detail.pdf HFIN 2/16/2018 1:30:00 PM
HB 286 HB 284 FY2018_Supplemental_Summary_Feb_13.pdf HFIN 2/16/2018 1:30:00 PM
HB 284
HB 286
HB 286 HB 284 FY2019_Amendment_Summary_Feb_13.pdf HFIN 2/16/2018 1:30:00 PM
HB 284
HB 286