Legislature(2009 - 2010)
04/09/2009 01:09 PM L&C
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
SB 61-MANDATORY UNIVERSAL HEALTH INSURANCE 2:48:56 PM CHAIR PASKVAN announced SB 61 to be up for consideration. SENATOR FRENCH, sponsor of SB 61, said 115,000 Alaskans don't have a health insurance policy. A majority of them work at jobs that don't provide it. The idea behind this bill is to make insurance affordable so their health needs can be addressed in a fashion that allows early action to be taken instead of waiting to go to the emergency room and all that entails. The bill is modeled loosely after the Massachusetts plan that was crafted with the help of the Heritage Think Tank. It leaves the current insurance landscape in place; it does not affect anyone that has insurance coverage they wish to keep. It only makes new private insurance affordable for those who can't afford it. 2:50:46 PM SENATOR BUNDE asked if he had an age demographic breakdown of people who don't have insurance. SENATOR FRENCH said it is skewed toward the ages 18-30 demographic. Anyone who is 65 years or older has access to Medicare and the very poor have access to Medicaid. The health concerns of these young people will get treated in the event of an emergency or a catastrophe, but those costs are passed off to everyone else in the state. He believes that a health insurance plan can be crafted that will allow them to pitch in to the pool. Obviously, the more people in an insurance pool the farther and better the risks are spread. 2:52:40 PM ANDY MODEROW, staff to Senator French, flipped through the sections of the bill. The findings are on pages 1 and 2; on page 2, line 24, language establishes what the bill tries to accomplish. Language on page 3, line 9, establishes the Health Care Board that will implement the plan; page 4, line 5, starts the section on the board's powers and duties. It will oversee the health care fund, which pays for this reform and a health care clearing house that gives them some oversight into recommending how health care plans can better serve Alaskans and in other publicly funded program. The Massachusetts uses an electronic Expedia-style format for its clearing house where people can compare health plans side- by-side. The site works with public/private partnerships and other formats to get information out that connects people to health care plans. The next section deals with essential health care services and this is the most controversial part of the plan; it requires that individuals in the state have access to some kind of health care. Being enrolled in a health care plan already would count as being an IHS beneficiary. 2:55:05 PM Once everyone is in the pool there is the opportunity to continue to make other health care reforms. One of those is that a health care plan be offered to any individual regardless of preexisting conditions or other health issues they have that might prevent them from getting coverage today. Page 7 lists some essential health care services that should be included in any health care plan. The bill does not set out financial criteria, and the goal is to increase consumer choice that includes high deductible health care plans so long as they protect people in times when they need health care. The board must help ensure this provision. 2:55:53 PM Page 8 deals with the employer provisions. Depending on an employer's payroll size, there are different levies that can be assessed to help pay for this plan. This bill would not affect employers with a payroll below $500,000/yr. whether they provide health coverage or not. Employers with a payroll from $500,000 - $1,000,000 are levied 1 percent of their payroll if they don't provide health insurance. If the bar for providing health insurance is relatively low, either the employer must offer to pay 33 percent of a health care plan for premium or they must successfully enroll 25 percent of their employees in the plan that they do offer regardless of how much they offer to pay. Employers with a payroll of $1,000,000 or more have to pay 2 percent of payroll. Since that is a chunk of money, there is a big opt out clause. If an employer merely establishes a Section 125 account, which allows an employee to purchase health coverage with pre-federal tax dollars, they are exempt from the levy. The cost of establishing those accounts is several hundred dollars for an entire employer for all employees for one year. Page 9 deals with provisions that don't allow denying anyone coverage who seeks it through the clearing house framework; it allows different financial criteria, but does not allow a preexisting condition limitation to extend for more than one year. If there is a preexisting condition limitation, a plan is required to give credit for prior coverage. So if you are leaving a great state job and don't want to buy COBRA, you can buy a new plan and have it be continuous. Page 10 deals with the health care fund with funds coming from a variety of sources. Page 11 under disputes and appeals allows the right to a hearing. It also provides a variety of different things the board must come to the legislature with recommendations. Regulations can be implemented to establish this. CHAIR PASKVAN noted that the committee had written testimony from Beverly Smith. 2:58:41 PM BEVERLY SMITH said she would be available to answer questions at the next meeting. 2:59:14 PM CHAIR PASKVAN said he would hold SB 61 for another hearing.