February 15, 2013

Legislative Notes for ASHNHA members; compiled from hearings, reports, news accounts and good old fashioned face to face discussion in the Capital City

Health Care Action Heats Up in State Affairs

With Senate HSS having exactly one 20 minute hearing so far, it seems the health care action has moved to State Affairs. Members of both House and Senate State Affairs committees listened intently to two briefings from Commissioner Hultberg and her staff as she outlined the challenges of the AlaskaCare Employee Plan on February 7 and 14.

The hearing on the 14th is one of the frankest and most interesting hearings on health care we have heard in several years.  It’s worth a watch.

In the first hearing, Senate Chair Fred Dyson and House member Wes Keller expressed a lot of support for the Commissioner’s message on cost management. She also briefed the committees on the procurement status to renew the third party administrator for the State retiree and active employee accounts. That procurement, which is among the largest the State does, is in process with proposals due any day. We might see an award in a few months. Typically these contracts have had appeals which drag out the process.

Mike Barnhill, Deputy Commissioner of Administration, told the Committee that potential vendors were sent claims files and as part of the response, were required to provide a profile of what their payments would be to this existing set of claims.  Barnhill explained this is a way to test the network of providers that these TPA’s could bring to the State contract—whether in-state or out of state.

The second hearing dug deeper into the cost and cost driver issues. The State plan expenses were $102 million in FY 2012 for active employees. Hultberg testified that after a couple of years of flattening out have been followed by a recent jump. “In FY13 we have seen a jump, and we are not out of the woods,” said the Commissioner. 

The concern was further underscored by the trends in cost in the last year.  Overall costs rose 4%, but unit price went up 9% while utilization went down 4%.

“We have seen a flattening out for two reasons—because nationally we are talking about health care costs and it tends to have a depressive effect,” she said.

“Why?” asked Chair Dyson

“I’m speculating that as we talk about cost and make the costs we are paying transparent, providers take a look at their own costs and decide this is not the time for cost increases.“

Speaking of transparency --one focus of the hearing was the display of Alaska provider fees.  Two slides in particular highlighted the concerns the Department has on physician charges in Alaska.   We attach two of the slides here from the presentation –one from the infamous Milliman Study.

Below are the links to the two presentations. –Spirited discussion on CON, provider costs and you name it.

Since there is a focus on wellness-you might want to watch these while working out on your treadmill.  At least that’s what I should do.

First hearing Feb 7

Second hearing Feb 14

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Medical Tourism

A lot of continued discussion occurred on medical tourism and DOA is waiting for the new vendor to see if they bring a “Centers of Excellence” network with them. Commissioner Becky Hultberg laid out a passionate case that employees need a choice.

The conversation continued at the Joint State Affairs hearing this week.

Representative Doug Issacson, former mayor of North Pole and a new representative from the Interior asked, “We are getting more sophisticated here as we can afford it. However, a lot of our population is still going outside as our population is not confident yet with our services. Are you suggesting that to get a handle on costs our population needs to go outside?”

Hultberg clarified, “It’s a question of whether we can afford more and more. I’m not trying to make a generalization that we shouldn’t do more here, but I am starting to question if we can afford to bring more here with the costs.”  She went on to cite some professional fee procedures that were thirty-six times the UCR in Seattle.

Senator Cathy Giessel, an advanced practice nurse, added in to the discussion, “We have wonderful specialist providers here that are acting rationally in the market. They have very little competition.” She suggested that sending patients outside will create competition.

Issacson inserted again. “I understand the value of choices and I understand the value of fiscal restraint but I also understand, using the state’s money, that we need to induce our industry’s ability to meet the needs of our people in state.”

“I’m from a smaller community—if you don’t have the equipment and providers can’t amortize that equipment you don’t have the service in an emergency.  That’s why a small community keeps a fire department. People don’t appreciate the fire department until there is a fire.”

Issacson asked about provider consultation.  “We have growing centers of excellence in our communities—have you talked with the hubs? With our communities?”

Hultberg said she has had many conversations with ASHNHA and with some hospitals but would like to do more.

Hultberg will be speaking at the ASHNHA meeting on Tuesday and the conversation will continue. 

Hultberg Defends Small/Community Hospitals

At the February 14th hearing in Joint State Affairs, Commissioner Hultberg took a break from laying out a grim picture of provider transgressions related to cost to sympathize and embrace the role of the community hospital.  This matches a consistent message she has shared with ASHNHA during our dialogues.

Senator Fred Dyson prompted the response when he asked, “We hear from medical providers -particularity the professionals -that reimbursement rates are marginal and they can barely make a living. What do you think?”

Hultberg said, “It depends on who you are talking about- we tend to lump all providers together.” If you look at hospitals, the margins of small hospitals are much smaller than our urban hospitals. But when you look at our specialists they are very highly compensated.”

In later comments Hultberg said, “Fortunately in our society we have decided that no one gets turned away if they need care at our community hospitals. That means there are a lot of uncompensated costs which are borne by hospitals and then those costs may be shifted to other payers. This is understandable.”

New Executive Director of the Office of Rate Review

Jared Kosin is the new Executive Director of the Office of Rate Review in the Alaska Department of Health and Social Services.  Jared and his wife Jenny, who was born and raised in Alaska, moved to the Anchorage area from Denver, Colorado last year.  Jared is an attorney and has his M.B.A.  He briefly practiced law in Colorado, but has spent a majority of his career in public policy.  Prior to joining the Commissioner’s Office and then the Office of Rate Review, Jared was the Policy Director and Legislative Director for the Colorado Speaker of the House.
Jared realizes that he has big shoes to fill from Jack Nielson, the previous long-serving Executive Director of Rate Review.  Jack retired in December. Given Mr. Nielson’s extensive experience and accounting background, Jared is not here to “replace” Mr. Nielson.  Rather, Jared believes that he offers a unique skillset that can be just as effective.  “With my background and training, I am in a good position to understand the complexities of the state’s rate system and its everyday impact on a policy, business, and legal level.” 
Jared is originally from Chicago, Illinois, but couldn’t be more excited about calling Alaska home. 

ANMC Hospital Leadership Transition

ANMC Hospital Administrator, Gary Shaw, announced that he has accepted the position of President at the Allina Health Cambridge Medical Center in Cambridge, Minnesota. He will continue working as administrator at ANMC until May and will assist ANMC during the transition.

“My time at ANMC has been truly memorable and I’ve thoroughly enjoyed working for staff across the Consortium,” said Shaw. “ANMC is a fantastic place to work and the organization’s future is tremendously bright. The achievements we’ve accomplished together over the last two years have been beyond belief and accomplished only because of the solid people we have throughout this organization.”

ANTHC head Roald Helgesen says the Consortium will go through a consultation process to determine the right mix of duties and qualifications for the new CEO prior to recruitment.

Gretchen Guess Leaving for Warmer Climates

Gretchen Guess, regional director of Business Development, is leaving Providence Health & Services Alaska in April. Gretchen accepted the position of ambulatory care service line director at St. Vincent’s Healthcare in Jacksonville, FL., part of Ascension Health, a Catholic health care system.

Gretchen has served with Providence since 2007, when she was hired into Strategic Planning. She also served as program manager of Business Development before being promoted to her current role. During her time at Providence, Gretchen oversaw the planning and development of multiple projects including contributions to Generations, Providence Extended Care, the purchase of Alaska Open Imaging, the LifeMed joint venture, a trauma program for Providence Alaska Medical Center and, most recently, a proposal to build the Providence Mat-Su Surgery Center.

In announcing her departure, Bruce Lamoureux said, “Gretchen’s dedication and work will have a lasting impact on Alaska. The projects she helped develop will allow Providence to continue to provide the best care possible for Alaskans here at home.”
In a Providence memo to staff he said, “I will miss Gretchen’s innate curiosity and keen analytic skills. She is very effective at devising multiple solutions for any given problem. Gretchen is also a humble person who shuns the limelight, yet readily gravitates to the opportunity to serve.”

ASHNHA agrees. Gretchen not only has worked and contributed to multiple venues in her career at Providence, but as a state legislator, policy analyst, and community volunteer.

She is both one of the smartest people I know AND  she comes from a great Alaska family with both of her parents very involved in building Alaska during the 60s-80s.  I’m betting we see Gretchen again some day soon back in the 49th State.

Providence will be recruiting for a new regional director of Business Development.   

30 Down, 60 to Go

This week we passed the 30 day mark of the 90 day session. While health care has a limited role in legislation this year, the pace of the session is intensifying in relation to oil taxes, in-state gas production, and cruise ship wastewater; and the budget reviews are heating up.

In the 2006 election, a voter initiative was passed that reduced the statutory length of the session from 121 days to 90 calendar days. The 2008 session was the first 90 day session. Although the session adjourned on time, some members of the legislature claimed that legislation was rushed and public input was jeopardized. The initiative passed by a narrow margin.

The 90 day session continues to get mixed reviews. There is only a finite amount of committee review and issues a legislature can manage given the time constraints. This can give a distinct advantage to the Governor who has a lot of constitutional power.  Detractors argue that the shorter session has not saved money as more work is done in non-session venues at a greater expense.

What it means for ASHNHA and other advocacy groups is intense competition for attention to our issues during the legislative session. Next week during the Legislative Fly-in Board Meeting in Juneau there are also visits by the Anchorage Chamber, the Primary Care Association, the Key Campaign (disabilities) and many behavioral health groups.   It means we need to shift more of our attention to non-session visits and issue education.

Unlike other state legislatures with longer sessions, the comparatively short Alaska Legislature session allows many lawmakers to retain outside employment, especially in the state's many seasonal industries.Those in favor also argue that a lot of time was wasted in the old days.

When I first arrived to work in Juneau in 1982 there was no session limit. I remember the session went through June in 1983, until exasperated fishermen legislators like Sitka’s Richard Eliason threatened to walk out and he wasn’t the only one.  In 1984, the legislature put a constitutionally restricted 120 day session before the voters which is still on the books today.

The 90 day 2006 voter initiative is not binding like the constitutional limit of 120 days but Legislators still take it as the will of the people.
The session ends on April 14 of this year.

House Budget Close-Out

It looks like the House DHSS budget closeout will occur on Friday March 1. Draft closeout recommendations will be out on February 27 if not earlier.  The Senate closeout will be about two weeks later—March 14.  The House traditionally sends their subcommittee reports to the full committee for public hearing during the first part of March prior to the legislatures “soft” shutdown during energy week—when about half the legislature goes to Washington DC for meetings.

ASHNHA Members to Make Presentation to House Health & Social Services Committee

At 3:00pm on Tuesday, February 19th, ASHNHA members Laurie Dotas (Presitage Care & Rehabilitation Center), Mike Powers (Fairbanks Memorial Hospital), and Dr. Andy Mayo (North Star Behavioral Health) will provide an overview to the committee of an acute care hospital, a long-term care facility, and a behavioral health hospital.   This opportunity allows ASHNHA members the chance to interact with legislators at the committee level and provide information with regard to running these types of facilities in Alaska.  We will provide details on how the presentation was received in the next edition.

US Readmission Rates Have Not Changed Significantly From 2008 to 2010

In a recently released study by the Robert Wood Johnson Foundation entitled, “The Revolving Door:  A Report on U.S. Hospital Readmissions,” researches looked at five categories of readmissions:  all medical discharges, all surgical discharges and discharges from acute myocardial infarction, congestive heart failure, and pneumonia. 

The report found that the rate of readmissions had not improved significantly from 2008 to 2010 in most regions and hospitals.  The report also found that readmission rates vary widely across geographic regions.

You can view the report by clicking here.  

Slow Session for Health Care Related Legislation

The 2013 Legislative Session is not producing much legislation relating to health care.  This could be, in part, due to the Medicaid expansion decision that is currently being researched by DHSS Commissioner Streur and Governor Parnell.  In addition, oil and gas tax legislation have the attention of most legislators as the Governor continues his push to promote more oil and gas exploration and increase the amount of oil flowing through the pipeline.

You can see the legislation ASHNHA is tracking here.

US House of Representatives Introduce Medicare-for-All Bill

Rep. John Conyers (D-Mich) has proposed legislation establishing a universal, single-payor healthcare program similar to Canada’s health care system.  Thirty-seven House members have signed on to the legislation.  Under this legislation, hospitals would be paid a lump sum within a budget to cover all operating expenses.  Physicians would be paid either as a salaried position or a fee-for-service payment.  However, Republicans have been opposed to single-payor health care legislation and it’s unlikely that this bill will see any movement in the foreseeable future.

You can see the legislation by clicking here.

Legislative Hearings for the week of February 18-24

Monday, February 18th @ 1:30pm - House Health & Social Services Finance Subcommittee – Behavioral Health and Mental Health Trust

Tuesday, February 19th @ 8:00am – Senate Health & Social Services Finance Subcommittee – Medicaid

Tuesday, February 19th @ 3:00pm – House Health & Social Services Committee – Presentations by Tribal Behavioral Health Directors Committee and ASHNHA

Wednesday, February 20th @ 8:30am – House Health & Social Services Finance Subcommittee – Public Health

Wednesday, February 20th @ 1:30pm – House Finance Committee – Confirmation hearing on Alaska Mental Health Trust Authority Board of Trustees

Wednesday, February 20th @ 1:30pm – Senate Health & Social Services Committee – HB 88 Statutory References to Mental Retardation

Thursday, February 21st @ 8:00am – Senate Health & Social Services Finance Subcommittee – Medicaid

Thursday, February 21st @ 11:00am – Senator Lisa Murkowski speaks to House and Senate in a joint session

Thursday, February 21st @ 3:00pm – House Health & Social Services Committee –Presentations by Alaska Brain Injury Network and Key Coalition

Friday, February 22nd @ 1:30pm – House Health & Social Services Finance Subcommittee – Work session

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