In March 2008, Susan, 52, was diagnosed with Stage III breast cancer. She has employer-sponsored insurance through her own job, but is having difficulty affording the co-pays for her treatment. She and Tony, her husband, have charged more than $5,000 to their credit card. Her co-pay is $25 per doctor visit and she sees a doctor as many as three times a week.

In addition to paying her co-pays, Susan also has recently struggled to maintain her coverage during a job transition. Susan had been working full-time at a mortgage company, but she was told that her job would end in September 2008. Fortunately, she found a new job, but had a 90-day waiting period until her health insurance coverage with her new company begins. In the meantime, she elected to continue her coverage under COBRA and is paying $704 a month. Although she and Tony both work, their current household income of $40,000 per year is not enough to survive the costs of treatment and insurance premiums.

"If I didn't put these co-pays on my credit card, I wouldn't have enough money to pay my bills," Susan says, "I am thankful I have insurance, but it is so distressing knowing that I almost lost my coverage and still need to complete my treatment."

Had Susan lost her job, she may have been denied insurance in the individual insurance market due to her preexisting condition. Additionally, because she was not screened and diagnosed by the state's Breast and Cervical Cancer Early Detection Program, she is ineligible for assistance through her state.

"It is frustrating to me," Joni, a stage I breast cancer survivor, says."I am at low risk for recurrence, but because I have this cancer diagnosis on my chart, I am uninsurable." Joni is paying $556 per month for individual coverage through her state's high-risk pool after being turned down by private insurers.

A report issued last week by the American Cancer Society and Kaiser Family Foundation revealed a harsh potentiality for insured individuals with life-threatening or chronic medical conditions. The report, "Spending to Survive: Cancer Patients Confront Holes in the Health Insurance System," is based on the specific experiences of 20 individuals battling cancer and their insurance companies simultaneously, and the findings are disconcerting. While the examples above and in the report are not specific to Alaska, the likelihood of similar occurrences is high due to current state health insurance regulations. Specific health insurance regulations for Alaska are described following a brief synopsis of the "Spending to Survive" study.

This study shows that even when individuals have private health insurance, they may not be protected from high out-of-pocket costs following a diagnosis of cancer. These costs may cause people with cancer to incur high amounts of medical debt. Additionally, when faced with unemployment, they may fall deeper in debt due to denial of health insurance in the individual market forcing them to purchase high-risk insurance at a staggering premium.

Some patients are forced to forego necessary treatment for cancer to avoid higher out-of-pocket costs. Those that cannot work because of their diagnosis are at an even greater risk, as they may face a series of financial hurdles to obtain coverage and treatment. Eligibility restrictions for government programs may increase the wait time before continuing treatment, or exclude individuals altogether from access to medical assistance.

Specifically, this study found "five key gaps in the health care system that can leave people with cancer and other life-threatening diseases in financial jeopardy as a result of their diagnosis."

Five Key Gaps in the Health Care System

• High cost-sharing, caps on benefits leave cancer patients vulnerable - This can occur in states with minimal regulations on costs for deductibles and premiums
• Those with employer-sponsored coverage may not be protected from catastrophically high health care costs if they become too sick to work - This can occur in states that do not mandate Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) expansions
• Cancer patients and survivors are often unable to find adequate and affordable coverage in the individual market - This can happen in states where there are no limits on the time frame for investigating a "preexisting condition"
• While high-risk pools are designed to help cancer patients and others who are uninsurable, they are not available to all cancer patients and some find the premiums too difficult to afford - This can happen in states where health insurance regulations lack restrictions on deductibles and premiums, or the extent of benefits covered
• Waiting periods, strict restrictions on eligibility, or delayed application for public programs can leave people who are too ill to work without an affordable insurance option - This can occur when individuals do not qualify because of previous income or specific program requirements

The report concluded that "Addressing the holes in the current health insurance system will be key to providing the privately insured with economic security and access to health care in the face of illness." Recent reports on individual state regulations that assist in mediating the holes in the health insurance system point out key areas of need for Alaska.

Health Insurance Protections in Alaska: An Issue of State Policy

Both federal and state regulations influence the level of coverage required by health insurance companies in their plans. However, state regulations appear to impose either higher or lower levels of protection for consumers of health insurance. Thus, the level of protection provided for individuals with private insurance varies among the 50 states. Additionally, less protection for residents possessing health insurance might lead to a greater battle for health care service reimbursement and more money out of the consumer's pocket when faced with a chronic illness.

The Kaiser Family Foundation submits yearly reports on specific health care services and health insurance coverage mandated by states, allowing for a state-by-state comparison. The state health facts reported for 2008 show that Alaska varies significantly from other states in the levels of protection available to individuals with private health insurance. Alaska regulations are lacking in at least three of the five key gaps mentioned in the "Spending to Survive" report.

Elimination riders and Pre-existing conditions - This term refers to a practice that limits coverage for a disease that was disclosed to an insurance provider during the application for coverage. States regulate whether this type of exclusion policy is permitted, and how far back (look-back period) an insurance company is allowed to investigate the presence of a disease.

A clear definition of a pre-existing condition can protect individuals with chronic diseases that involved many years of separate diagnoses. If an elimination rider is permitted and no clear definition for a pre-existing condition is required, an insurer can exclude that person (exclusion period) and deny coverage if they can show that a condition was present prior to when that policy began.

Alaska Policy

• Permits elimination riders
• No limit on look-back period
• No limit on exclusion period
• No definition of a pre-existing condition

Other States 

• Data not available

Conclusions

• Low level of protection for Alaskans

Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) expansions - Designed to help people maintain their health coverage after leaving a job, COBRA allows people to continue temporarily the health insurance they had through their employer by paying the entire premium. However, COBRA is expensive and the coverage usually only lasts for 18 months, so many individuals instead seek coverage on the individual market. If an insurance company is not required to contain a COBRA expansion by state regulations, an employee of a small business may not have an alternative health insurance option when faced with unemployment.

Alaska Policy

• Does not require health insurance policies to offer COBRA expansion

Other States

• 40 states offer this alternative to individuals who have lost their employer-based coverage

Conclusions

• State policy does not protect employees of small businesses who face unemployment

High-risk Pool Alternative - This option is available to individuals who, because of high health care costs, certain diagnoses, or pre-existing conditions, may not be eligible for other types of insurance. States mandate the costs of deductibles and premiums for this type of insurance, as well as the benefits covered. Unfortunately, individuals who have to resort to this type of coverage are often already in debt from high medical costs.

Alaska Policy

• High-risk pool available
• Mandates deductible less than $1000 - NO
• Monthly premium for $1000 deductible plan - $994
• Average costs paid for by premiums - 37 percent
• 100 percent of enrollees have a deductible higher than $1000

Other States

• 33 offer high-risk pool
• 17 mandate a deductible lower than $1000
• Other data not available

Conclusion

• Alaska offers less protection to residents in this area

Alaska Lacks Mandates for Health Care Coverage in other areas

• Women's Health
• Requires hospital stay after a mastectomy
• Alaska - NO
• 20 States - YES
  

• Mandates infertility diagnosis and screening
• Alaska - NO
• 15 States - YES
  

• Regulates and requires direct access to OB/GYNs
• Alaska - NO
• 36 States and D.C. - YES
  

• Mental Health
• Regulates and requires treatment for depression
• Alaska - NO
• 38 States - YES
  

• Improvements in mental health coverage policy since 2004
• Alaska - NONE
• 10 States - YES
  

• Regulates and requires treatment for eating disorders
• Alaska - NO
• 24 States - YES
  

• Other Areas
• Requires health plan liability
• Alaska - NO
• 16 States - YES
  

• Requires standing referrals for Ongoing Care with a Specialist - allows for continuous coverage with a specialist
• Alaska - NO
• 26 States and D.C. - YES
  

• Mandates Licensing of Health Plan Medical Directors - ensures that a qualified professional oversees health plans
• Alaska - NO
• 30 States - YES
  

This "health insurance protection report card" for Alaska indicates that there are several areas in the health care system that may be improved by state policy. For example, 33 percent of Alaska adults reported having poor mental health in 2007. Additionally, the suicide rate in Alaska is two times the national average. Changing state regulations regarding the amount of mental health coverage required by health insurance companies could assist in decreasing those rates by offering individuals more assistance through their insurance plans.

Better Protections Ahead for Alaska?

Recent state legislative activity indicates a step toward more protection for residents with private health insurance. As one of her first legislative actions this year, Senator Bettye Davis issued Senate Bill 21: Mental Health Care Insurance Benefit, which proposes to do the following:

• Require health care insurers to provide coverage for treatment of mental health, alcoholism, and substance abuse conditions
• Require parity between health care insurance coverage for mental health, alcoholism, and substance abuse benefits and other medical care benefits
• Eliminate different treatment for mental health conditions from the minimum benefits of the state health insurance plan
• Remove an exclusion for mental health services or alcohol or drug abuse from the definition of basic health care services in the law relating to health maintenance organizations
• Repeal a provision that allows optional insurance coverage for treatment of alcoholism and drug abuse based on the number of employees and the duration of employment
• Repeal a definition of costs applicable solely to treatment for alcoholism and drug abuse, including a provision that allows the cost for treatment of alcoholism and drug abuse to be determined by the insurance contract or by a contract between the treatment provider and the health care insurer
• Repeal a definition of mental health benefits that excludes treatment of substance abuse or chemical dependency

Essentially, SB 21 requires that health insurance companies not discriminate between treatment for a mental health condition and a general medical condition. Thus, individuals suffering from depression may receive reimbursement for twice-weekly therapy sessions as opposed to only 12 sessions per year. Additionally, someone needing in-patient treatment for alcohol or substance abuse may be reimbursed for his or her treatment instead of facing denial of coverage. This type of protection is valuable given the mental health status of many Alaskans.

Senate Bill 21 is a step in the right direction toward protecting Alaskans who have private health insurance. State mandates for coverage can help prevent situations like those described, where individuals are forced to forego necessary treatment or go into debt following a medical diagnosis. Additionally, when faced with unemployment and the loss of health insurance, state regulations may improve the number of individuals who are able to keep their health insurance, and at an affordable cost. The private health insurance debate is complex, as all sides of the health care delivery system influence the rights of the consumer and the freedoms of the insurer. In Alaska, policy may be the first step to more protection.

Sources

Kaiser Family Foundation and the American Cancer Society, February 2009. Spending to Survive: Cancer Patients Confront Holes in the Health Insurance System. http://www.cancer.org/downloads/accesstocare/Spending_to_Survive.pdf

Kaiser Family Foundation, 2009. Managed Care & Health Insurance-Alaska State Health Facts. http://www.statehealthfacts.org/profilecat.jsp?rgn=3&cat=7

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Lobbying seems to be an accepted part of our political culture. The knowledge that our municipalities, boroughs, industries, and other special interest groups feel compelled to hire lobbyists to influence our elected officials and government workers seems not to bother us at all. Each of us can, as individuals, try to influence the political process by writing letters or otherwise communicating directly with our state officials, but we seem to accept the idea that there is another legitimate way to exert influence. We can hire professionals-those people called lobbyists-to do the work for us. Seems sad in a way, but that is the way it is.
 
One nice thing about lobbying is that the available information about it reveals what is important to us and various special interests in our society. This information is available for Alaskans because the Alaska Public Offices Commission requires that lobbyists and employers of lobbyists report what money is paid to lobbyists and for what purposes.
 
This report tells who the lobbyists are and how much their employers paid them in direct salaries and expenses. It gives information on the amounts of money spent in providing general in-house support to the lobbying efforts. That includes entertaining and paying for trips of public officials and legislative employees, and also costs involved in urging other persons to enter into communication with those being lobbied, telemarketing and letter-writing campaigns, conducting push-pull polls, and media advertising. That last item can be fairly major, as all those full-page ads in the newspapers by ConocoPhillips and others suggest.
 
It should come as no surprise to any Alaskan that the largest employer of lobbyists in the state is the oil and gas industry. In 2006, that industry spent just under $4 million in direct salaries and expenses for fifty-two lobbyists operating under sixty-two separate contracts, plus another $8 million for support functions, mainly media advertising.
 
However, it might come as a surprise that in 2006, the next biggest lobbying category is health care, right at $2 million in direct salaries and expenses for forty-two lobbyists operating under fifty-eight separate contracts with their clients. The cost of lobbying for health care issues easily exceeds that for the other major categories: municipal issues ($1.6 million), electrical and other utilities ($890,000), and telecommunications ($850,000).
 
These numbers tell us that health care in Alaska is a major industry, second only to the oil and gas industry. The total annual expenditure for health care in Alaska is right at $5 billion, and that is why we have forty-two health care lobbyists in Juneau seeking to influence where that money goes.
 
If we look at health care lobbying in more detail we see that in 2006, the pharmaceutical industry expended $185,000 to hire nine Alaska lobbyists. Various Alaska medical associations collectively hired fourteen lobbyists at a cost of $334,000. Alaska hospitals and other health care providers hired sixteen lobbyists, expending $778,000; and health insurance companies hired six lobbyists, paying them a total of $148,000. Also, various societies having interest in health care hired thirteen lobbyists, expending $552,000 for direct salaries and lobbyist expenses.
 
Individual contracts for health care lobbying ranged up to over $100,000 each; most were in the range $20,000 to $80,000, and a few were for less than $10,000 each. Several of the lobbyists simultaneously represented two or more health care clients while also representing clients in other areas.
 
By representing several clients simultaneously, some lobbyists are able to earn rather comfortable livings. Not surprisingly, the oil and gas industry lobbyists do better than most. Thirteen of the oil and gas lobbyists in 2006 had clients paying them over $100,000 each, and lobbyist Paul Quesnel had a client (BP Exploration, Alaska) who paid him over $300,000 for his efforts during 2006. That year, another lobbyist, Lawrence Markley, earned $779,000 while representing an incredible twenty-four separate electrical utility clients who paid him fees ranging from $18,000 to $46,500 each.
 
In 2003, there were 214 lobbyists working in Alaska. In that year, however, the law was changed to lower the requirements on lobbyist reporting. The change required only 140 to report as lobbyists in 2004, but that still leaves more than twice the number of people we
elect to the legislature.
 
All this makes me wonder about how much impact my letter or telephone call to a legislator has on him or her compared to the daily influence of contacts with lobbyists. These people are professionals, and they know what is going on day-to-day in the passage of legislation, so they know when and where to place their influence. When it comes to giving our own input, that is hard to compete with because each of us has other things to worry about than what the legislative branch or the executive is doing day by day.
 
Consider the fact that we pay our sixty legislators and our governor only a total of just over $2 million for salaries and per diem each year, but the oil and gas industry, the health care industry, and other special interests pay out more than $14 million -- that's seven times as much -- on lobbyists to influence those elected officials' actions. That is a lot of money, and it puts a lot of pressure on our decision-makers. It is a wonder that most of them perform as well as they do for the Alaska public. Not all of course have, and some of those are now in jail.
 
A UAF emeritus professor of geophysics, Neil Davis has several published fiction and nonfiction works. Mired in the Health Care Morass, his newest book, is about the US health care situation and how to fix it. He writes Dose of Reality, a column about health care and insurance, for The Ester Republic. You can read more about his books at his website, www.neildavisalaska.com. This article was originally published in the February 3, 2009 issue of Alaska Dispatch, alaskadispatch.com, and is published here by permission of both the author and the editor of Alaska Dispatch.
 
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SB 82 MEDICAID FOR ADULT DENTAL SERVICES
Sponsors: Rules by request of the governor
Committee(s) and date of last action: Referred to (S) HSS Finance, 02/04/09
Description: This bill is "An Act providing for an effective date by delaying the effective date of the change of coverage of adult dental services under Medicaid; and providing for an effective date."

HB 87 MED BENEFITS OF DISABLED PEACE OFFICERS
Sponsors: Representatives Millett, Dahlstrom, Gardner, Gara, Kerttula, Kawasaki
Committee(s) and date of last action: (H) L&C, 02/02/09
Description: This bill proposes waiving payment of premiums for major medical insurance for disabled peace officers who have at least 20 years of credited service as peace officers of the public.
 
SB 61 MANDATORY UNIVERSAL HEALTH INSURANCE
Sponsors: Senators French, Ellis
Committee(s) and date of last action: Read and referred to (S) HSS, 01/20/09
Description: This bill proposes the establishment of the Alaska Health Care Program (AKCP), a program given the task of ensuring that all Alaskans have access to affordable health care insurance covering all essential services. The AKCP will be monitored and managed by an Alaskan Health Care Board of 13 members, 12 of which are to be appointed by the governor. Similar to SB 160 (25th legislative session), this bill includes

• A framework for personal choice: This bill facilitates a relationship between health insurance providers and individuals, and doesn't assume that a one size fits all solution will meet the health care needs of all Alaskans.
• A unique voucher system: By pooling money from all stakeholders, a sliding scale voucher system will ensure that every Alaskan can take personal responsibility for acquiring health insurance coverage. The system will also make it easy for multiple entities to contribute towards a health plan for an individual.
• A health care clearinghouse: The clearinghouse will disseminate information about quality health care products, assisting Alaskans who are utilizing vouchers under the Alaska health care plan.
• The Alaska health care fund: This fund will receive contributions from individuals, businesses and government to ensure that all interested parties contribute to the health of Alaskans

If passed, this bill is to take effect by January 1, 2010.

HB 62 MEDICAL ASSISTANCE ELIGIBILITY/PREMIUMS
Sponsors: Representative Hawker
Committee(s) and date of last action: Read and referred to (H) HSS, 01/20/09
Description: This bill, also known as the "Denali Kid Care Accountability Act," amends a previous Alaska Statute on medical assistance eligibility requirements. Specifically, it adds sections requiring recipients of medical assistance in families whose income is between 175 and 250 of the federal poverty level to pay premiums, on a sliding scale, for medical assistance. The Department of Health and Human Services is required to set the premium at no less than 2% of the recipient's income, and establish a system of collecting premiums from recipients. This bill requests that these changes go into effect following the approved revisions and funding to make these changes.

HB 61 MEDICAL ASSISTANCE COVERAGE
Sponsors: Representatives Cissna and Gruenberg
Committee(s) and date of last action: Read and referred to (H) HSS, 01/20/09
Description: This bill requests many changes to medical assistance eligibility for Alaskans. Among the changes are 1) disabled persons: increasing the eligibility for those in a family whose income does not exceed 250% of the official poverty level for Alaska; 2) individuals under the age of 19: increasing the family income eligibility from 175% to 200% of the federal poverty level for Alaska; 3) pregnant women: increasing the family income eligibility from 175% to 200% of the federal poverty level for Alaska.

SB 10 MEDICAID/INS FOR CANCER CLINICAL TRIALS
Sponsor: Senator Davis
Committee(s) and date of last action: Read and referred to (S) HSS, 01/21/09
Description: This bill requests that a health insurance company be required to provide coverage for any medical expenses incurred during the course of participation in an approved clinical trial.

SB 11 DEPENDENT HEALTH INSURANCE; AGE LIMIT
Sponsor: Senator Davis
Committee(s) and date of last action: Read and referred to (S) HSS, 01/21/09
Description: This bill requests that among health insurance policies covering dependents of enrollees, the defined age for "dependent child" be raised from 23 to 26 years of age.

SB 13 MEDICAL ASSISTANCE ELIGIBILITY
Sponsor: Senator Davis
Committee(s) and date of last action: Referred to (S) FIN, 02/11/09
Description: This bill requests that the family income eligibility requirements for medical assistance among children and pregnant women be raised from 175% to 200% of the federal poverty level, effective immediately.

SB 32 MEDICAID: HOME/COMMUNITY BASED SERVICES
Sponsor: Senator Ellis
Committee(s) and date of last action: Heard and Held in (S) HSS, 02/04/09
Description: This bill requests an amendment to a previous statute outlining medical assistance among health facilities, adding medical assistance eligibility for home and community-based services.

SB 38 PHARMACY BENEFITS MANAGERS; MANAGED CARE
Sponsor: Senator Elton
Committee(s) and date of last action: Read and referred to (S) HSS, 01/21/09
Description: This bill proposes to change language in a previous statute, amending "managed care entity" to "health care insurer."

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