Alaska Health Policy Review

Dear Reader:

In Alaska today the kids are not doing very well and the retirees are not doing very well. I hope the folks in the middle are doing better, but I don't think that is the case either. Nevertheless, I promise not to spend the rest of the afternoon watching escapist musical extravaganzas and sappy romances from the 1930s. There is work to be done.

There are way too many children in Alaska from low-income families that do not have regular access to health care. Denali KidCare is a program that can effectively and efficiently provide resources to ensure the children can get the care they need. Unfortunately, too many legislators have other priorities.

Most of the Denali KidCare bills introduced this session have been stuck in the quagmire of committee neglect with no hearings and little if any movement. Only SB 13 has toddled between committees in an unsteady but purposeful gait, as if on little tennis shoes (pardon me, I could not pass up the imagery). The bill would increase income eligibility requirements of the Denali KidCare program from 175% of the Federal Poverty Level to 200% -- a very modest gain by national standards, but a real life and death gain for thousands of Alaskan children.

SB 13 has made the journey through Senate Health and Social Services Committee, and the the Senate Finance Committee, but has been stuck in Senate Rules for about three weeks where it awaits transmission to the floor of the Senate. Perhaps the committee members could use a firm but gentle push.

Meanwhile, grandma and grandpa, soon to be retiring Alaska public employees, won't be able to help their grandchildren pay health care bills because they themselves are headed for very troubled times. They will have little or no Social Security, a 401k-type account with a pittance in it, and a health savings account that is likely to run out of money in a few short years leaving them meager resources with which to pay for expensive retiree health insurance. How did the golden years turn into the desperate years? That story is up next.

Lawrence D. Weiss PhD, MS
editor, AHPR
ldweiss@gmail.com

Commentary: Pensions and Health Care for Public Employees in Alaska

By Lawrence D. Weiss PhD, MS
Editor, Alaska Health Policy Review

Health care is a big story, but sometimes there is an even bigger story wrapped around it. That is the reality in this case. This is the story about the destruction of pensions and adequate health care plans for Alaska public employee retirees. It is a discussion about the history, facts, and consequences. More importantly, it is an introduction to a healthier and more secure future for Alaska public employees and their families.

Facts Were Optional

On May 11, 2005, the first day of the special session of the Alaska State Legislature, then Governor Murkowski held a press conference. He was questioned extensively by reporters regarding his support of SB 141, which would destroy the Public Employees Retirement System (PERS) and the Teachers Retirement System (TRS), both of which had good pension and health plans, and replace them with a plan similar to a 401k, and a vastly inferior health plan.

Many questions had been raised about the wisdom of this radical change in public policy, about the data upon which the decision was based, and about unintended consequences of the new public policy. A reporter asked the Governor if he thought perhaps that the issue needed more study before making such a drastic change. In response, the governor noted in part that, "Research is just a cop-out for not making a decision." There was in fact no additional research, and in less than two weeks SB 141 was rammed through the special session.

SB 141 had the deceptively innocuous short title of: "Public Employee/Teacher Retirement/Boards," but it was a bill that dramatically weakened retirement benefits including health care for nearly all state and municipal public employees in Alaska. Under the former defined benefits system, public sector retirees were promised certain benefits -- a monthly paycheck and health care benefits depending on salary, length of service, and perhaps other factors. These benefits were not influenced by what the stock market does, or by the savings behavior of any individual retiree. That is why a defined benefits system provides retirement security.

Under SB 141, however, this traditional retirement system was scrapped and replaced with a privatized, defined contribution retirement scheme. Under this plan, every retiree has his or her own account, and each is responsible for putting some of his or her own money into it, along with a contribution by the state on a sharing basis. In addition, the individual worker would be responsible for investing this money, or even withdrawing it. This is very similar to 401k plans in the private sector -- and the available research on these plans increasingly shows them to be largely incapable of providing retirement security, particularly to low- and middle- income workers.

Worst Retirement Plan in the Nation

As a result of passage of SB 141, public workers in Alaska arguably have the worst "retirement plan" of all public workers in the United States. Most workers cannot rely on 401k-type retirement plans for retirement security precisely because these accounts are subject to the whims of the stock market, high fees for financial services, and early withdrawals for a variety of reasons. In other words, with defined contribution plans, there is no guarantee that there will be enough money in the account to live on through retirement. Indeed, there is no guarantee that there will be anything at all in the account. The retiree gambles everything on this account, but actually has little control over it in key respects. The Alaska Legislature converted a solid defined benefit retirement security program, into a defined contribution retirement gamble plan for most public workers hired after July 2006. Moreover, the situation is much worse for future Alaska public employees than this implies.

Social Security, a classic defined benefit plan, was instituted in legislation passed in 1935. For a number of reasons, that legislation included nearly all workers in the private sector, but left it up to public sector elected officials whether or not their employees would be included. Decades later, in the early 1980s, this loophole was closed -- partially. After that time, no public employers could opt out of the system; however, those who were already out of the system did not have to include their employees under Social Security. But by the early 1980s, most public employers were in the Social Security system. Currently there are only seven states in which most or all public employees are not in the Social Security system: Alaska, Colorado, Louisiana, Maine, Massachusetts, Nevada, and Ohio.

However, every one of these states has a classic defined benefit retirement system which guarantees retired public workers a pension until the end of their lives -- at least that was true until July 2006. Beginning July 1 of 2006, new Alaska public employees lost their retirement security because they were not offered a defined benefit plan with a traditional pension and a viable health plan. This makes Alaska public workers the most vulnerable public workers in the United States, because they are the only public employees who have no defined benefit pension, and no Social Security safety net. They have neither a defined benefit plan from the state, nor will they have Social Security, the federal defined benefit plan enjoyed by 95 percent of the United States population.

I do not believe that the full magnitude of this emerging retiree disaster is well understood by Alaskans. Historically, state pension plans have established a de facto gold standard in the marketplace that private employers had to match, more or less, if they wanted to attract desirable workers. In Alaska, that critical standard has been destroyed, and now it may be a race to the bottom as private employers realize there will be few consequences to the destruction or dilution of their retirement plans. Moreover, this situation in Alaska set a dangerous precedent for public workers in other states, particularly in those states that have opted out of the Social Security defined benefit plan for their public employees.

Board Member Looks at the Facts

Gayle Harbo retired after teaching mathematics in Fairbanks for 25 years. She was very good at what she did. In 1989 she was named Alaska Teacher of the Year. She is still very good at what she does, and now she is secretary of the Alaska Retirement Management Board (ARMB). As such, she is one of nine trustees that have fiduciary responsibility for the billions of dollars of assets of the state retirement systems (there are seven different retirement systems).

Ms. Harbo is also a member of the Alaska Retired Educators Association (AKREA), which is a local affiliate of the National Retired Teachers Association (NRTA). In an AKREA newsletter, Ms. Harbo wrote an excellent summary of the history and consequences of SB 141, which eliminated the traditional pension plan for Alaska public employee retirees. I am pleased to reprint her excellent article. It was originally written in September 2006, and has been edited here for length and clarity:

[SB 141was a] hastily written bill, over 100 pages in length. It was so poorly crafted that it required almost 40 pages of corrections, introduced in the '06 Legislature as HB 475. HB 475, however, did not pass, nor did an effort to delay implementation until more information could be gathered regarding the effect of SB141 on employers, employees and communities. Senate Bill 141 put in place a system more expensive than PERS Tier III [the most recent version of the Public Employees Retirement System before SB 141 added Tier IV] and did nothing to address the unfunded liability [the amount by which the liabilities of a program exceed program assets, at a given date]. It created a closed system for those employees hired prior to July 1, 2006. PERS [Public Employees Retirement System], a system with almost 31,000 active members and 18, 400 retirees has 160 employers [as of 2006]. TRS [Teachers Retirement System] has over 9,600 active members and over 9,000 retirees, a ratio of almost 1:1. There are 58 employers in the TRS system.

Proponents of SB 141 should have done a bit more homework before imposing a Defined Contribution on new employees. They should have paid more attention to funding ratios rather than dollar amounts. For the 2005 valuation performed by the new actuary, Buck Consultants, the PERS funding ratio [the ratio of a pension plan's assets to its liabilities] for total benefits was 70%, in 1979 the funding ratio was 68%, yet the funds recovered without Draconian measures. For TRS the funding ratio in '05 was 61%, in 1980 it was 67%. Part of the reason for the difference between the PERS and TRS funding ratios is the number of actives contributing compared to the number of retirees receiving benefits, and also the fact that in the 80's the state failed to fund the TRS system for 2 consecutive years, so dollars which could have been earning interest were lost.

More interesting in the use of funding ratios, is the comparing assets to liabilities without including health care costs. Alaska is one of only four states, eight systems, which pre-funds health care. Without health care, the funding ratio for PERS is 119% and for TRS, 91%. These are important figures and speak to the only problem the Legislature should have addressed -- how [to create] a system for new employees which retained the Defined Benefit component for the retiree's monthly benefit, while addressing the issue of quality health care.

Legislators who encouraged waiting to implement the bill realized that part of the problem was the poor data supplied by the previous actuary to the TRS and PERS Boards [prior to implementation of SB 141 TRS and PERS had their own boards of trustees, but with passage of SB 141 they have all been merged into one]. Mercer had been used for over 20 years [as pension plans actuary] and when the Boards requested an audit in 2001, the auditor, Milliman found that Mercer had made gross errors in calculating health care costs. The correction of these errors is the reason for half of the increase in the employer rates [e.g. what they contribute to the retirement funds] as calculated from the 2002 valuation, and in each future calculation. Mercer underestimated the impact of early retirement programs and of allowing elected officials to join the systems.

The new [as of November 2005] actuary, Buck, continues to find Mercer errors, even after the audit. In March it was revealed that in the 2004 valuation Mercer underestimated healthcare benefits in PERS by 7% and in August another error in the same valuation regarding the Judicial system revealed an error in health care that resulted in an increase in the recommended employer contribution of almost 14%, from 37% to 51%. Let us not forget that Mercer is the actuary who advised the Administration and the Legislature on SB 141. Would you trust Mercer's advice? Dollars paid to Mercer by the Administration increased from $350,000 in FY '01 to $560,000 in FY'06, yet the Department of Law of this same Administration is reviewing Mercer's errors in past valuation reports in consideration of recovering costs.

The Alaska Retirement Management Board faced with resolving the liabilities of a system that is now closed to new employees offered a solution and recommendation to the Legislature in March of '06 after receiving Buck's evaluation of Mercer's 2004 valuation. The Legislature did nothing with any suggestion offered to help pay down the debt in either 2005 or 2006.

The result of the closed system is a huge jump, for FY'08, in the employer contribution rates. The rates for PERS will be 39% and for TRS 54%. These rates reflect a change from use of a percentage payroll method to a level dollar amount contribution -- they reflect reality of the debt. It is important to remember that these rates imply the goal of a funding ratio of 100%, while even the Attorney General's office says a system is healthy at 80%. It is also important to remember that without health care, a benefit not provided by most systems, TRS is at 91% and PERS at 119% [both funding ratios are exceptionally good places for a pension fund to be]. A hybrid system with a Defined Benefit and modified health care program would have solved the problem, not a Defined Contribution plan, which solves nothing.

It is important that the new Governor [Palin] involve the parties affected by the retirement systems, employees and employers, in crafting a solution, which provides security to retirees and a stable workforce to schools, public safety and state services. It is not too late to go back. In speaking against a delay in implementation of SB 141 Senator Bert Stedman said if we delayed by even one year we would have 4400 more new employees under the Defined Benefit plans. His predictions are way off the mark. As of September 1, [2006] only 200 new employees enrolled under the DC plan. Of the 218 PERS and TRS employers, only one, the State of Alaska, has given its non-vested employees the option to change from DB to DC. Only 5 have made the change.

Let us work together with the new Governor to make Alaska proud. Let us work to return to a system, which will attract a stable quality workforce and keep Alaska as a place where people come and make their homes and raise their families.

Legislators Bring Back Pensions in Other States

Some time ago an Alaska legislator mentioned to me that he thought SB 141 was the worst piece of legislation passed in many years in Alaska -- and I would have to agree. However, this is what is important: the attack on pension and retiree health systems by ideologues and by those who believe they can profit from these changes is increasingly being met by a powerful upsurge of resistance by public employees and their families who understand the critical necessity of maintaining or returning to a defined benefit plan, in other words, a traditional pension. Two recent victories come to mind.

The threats to continuation of the traditional defined benefit plans for Colorado government workers have been resolved by two victories. First, the governor and the state Legislature worked out an agreement on how to reform the system without eliminating defined benefit plans for public workers. The compromise will be a little less generous for future hires under new legislation, but members of the Public Employees' Retirement Association have essentially saved the DB plans.

The compromise legislation emerged in the General Assembly's final days as Democrats, PERA and Colorado's employee unions developed a plan to fix the pension plan's $11.3 billion unfunded liability. The governor, who had threatened a special session if a PERA bill was not passed, agreed to the compromise. Second, Americans for Prosperity (who supported eliminating defined benefit plans through a ballot initiative) withdrew its ballot initiative to eliminate DB plans.

There is also the most interesting case of West Virginia. In 1990, the state Legislature, in a moved designed to "save money," decided to eliminate the defined benefit plan for new teachers and place them in a defined contribution arrangement with individual accounts. The state soon found that this move neither saved money nor provided teachers with adequate retirement income. Recruitment of teachers and the loss of experienced teachers to surrounding states increasingly became a concern.

Consequently, in 1995 the state Legislature abolished the DC plans for new hires and placed them under the defined benefit plan. The change from DC to DB saved the state money and provided a better retirement and a guaranteed retirement income for the state's teachers. However, there were a group of teachers in limbo. They we given the choice as a group: to either stay in the DC plan or return to the DB plan. The Legislature set two thresholds for the vote: a majority of the teachers had to vote, and then a majority of those voting had to approve returning to the DB plan. There were 22,707 eligible votes -- 56 percent (12,747) voted in the election and 61 percent (7,821) voted to return to a defined benefit pension plan.

Pensions are Not Dead

I would like to draw your attention to an excellent article by Teresa Ghilarducci, professor of Economics at the University of Notre Dame, Future Retirement Income Security Needs Defined Benefit Pensions. Here are a couple of paragraphs from the introduction.

Are defined benefit (DB) pension plans dead? They certainly look dead. Last year, several airlines famously dropped their DB plans onto the government-backed insurer (the Pension Benefit Guaranty Corporation). Meanwhile, in the first week of 2006, the International Business Machines Corp. (IBM) followed the lead of the Sears Holding Corp., Verizon Communications and over 67 other companies, which froze or closed their DB plans to new hires in 2005. IBM and the other "DB freezers" have instead opted for 401(k) plans, which shift the risk of preparing for retirement from the company to the individual worker. Now, retirement savings depend on workers' ability to save regularly, invest wisely, and at low costs.

However, these trends lead to the misleading conclusion that DB plans are going the way of the dinosaur. Quite the contrary, many employers continue to offer these plans. Most Fortune 500 companies, public sector employers, new small professional firms (Frieswick 2002), schools, and hospitals all maintain DB plans. Additionally, a small number of employers that replaced DBs with defined contribution (DC) plans, such as the state of Nebraska, are now switching back. The truth is employers will continue to sponsor DB plans because both employers and workers often prefer them for sound reasons.

Problems with the New Retiree Health Plan

Several significant changes were established under SB 141 in the new health care plan for retirees, which are certain to prevent many retiring public employees from ever having access to the retiree health care plan. Other changes make the plan so costly to retirees that they may be forced to abandon it at some point in their lifetime. Finally, SB 141 includes language that allows the termination of the retiree health plan at any time. All of these are reasons to support a return to the traditional PERS and TRS retirement plans along with their former health components.

Employees Must Work longer and Retire Later to Receive Health Benefits

Under PERS III and TRS II, access to health insurance for retirees with at least 10 years of service at age 60, or retirees at any age with at least 25 years of service.
Under PERS IV and TRS III, access to health insurance for retirees with at least 10 years of service at Medicare-eligible age (at least 65), or at any age with 30 years of service.

Retirees Must Retire Directly From State Service to Be Eligible for Health Insurance

Under PERS III and TRS II, there is no requirement to retire directly from state employment to be eligible for health insurance; there are only age and length of service requirements.
Under PERS IV and TRS III, employees must retire directly from state employment to be eligible for health insurance, and they must meet more stringent age and length of service requirements.

Regardless Of Length Of Service, Retirees Must Pay The Full Health Insurance Premium Until Eligible For Medicare

Under PERS III and TRS II, once age and length of service requirements are met, the state pays the full cost of health insurance for the life of the retiree.
Under PERS IV and TRS III, the retiree is always responsible for paying 100% of health insurance premium costs until Medicare eligible if retirement occurs prior to Medicare eligibility and all other conditions are met. Once Medicare eligible, and all other conditions are met, a retiree must pay 10% to 30% of health insurance premiums for the rest of his or her life in order to retain the health insurance.

Health Reimbursement Accounts (HRA) Are Quickly Drained After Retirement

Under PERS III and TRS II, there is no need for retired employees to have HRAs because the state pays for 100% of health insurance premiums for the life of the retiree once other conditions are met.
Under PERS IV and TRS III, HRAs are established for employees to help pay for health insurance premiums after retirement. Employers are required to contribute, and employee contributions are voluntary. The state of Alaska asked Mercer Human Resource Consulting to run a series of projections on post-retirement HRA expenses for typical employees. Most of the projections indicate that HRA accounts would be entirely or largely depleted during the first five years of retirement.

Health Insurance Premiums Can Be Changed As Often As Monthly

Sec. 14.25.480 Medical Benefits

(j) The monthly group premiums for retiree major medical insurance coverage are established by the administrator in accordance with AS 39.30.095. Nothing in AS 14.25.310 - 14.25.590 guarantees a person who elects coverage under (a) of this section a monthly group premium rate for retiree major medical insurance coverage other than the premium in effect for the month in which the premium is due for coverage for that month.

The Retiree Health Plan Can Be Changed or Terminated At Any Time

Sec. 14.25.490. Amendment and termination of plan.

(a) The state has the right to amend the plan at any time and from time to time, in whole or in part, including the right to make retroactive amendments ...

(c) The state may, in its discretion, terminate the plan in whole or part at any time without liability for the termination.

Conclusion

The new defined contribution retirement plan, together with the new expensive and often unusable retiree health plan, has been the only option offered new Alaska Public employees hired since July 1, 2006. It was forged in a politically charged climate of ignorance, deception, and high-pressure tactics. It is a public policy disaster for the state of Alaska. You can follow the effort to return to the previous defined benefit, traditional pension, and effective health plan at the site of the Alaska Public Pension Coalition. You can follow both sides of the question by attending or listening to hearings of HB 30 and SB 23, and reading associated documents. Your comments invited.

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Alaska Health Policy Calendar

This calendar of health policy-related legislative meetings is current as of April 1, 2009 at 3 PM. Please visit the Alaska State Legislature's list of committee hearings for the most current listings, as they are subject to change.

April 3, 2009, 1:30 PM
What: Senate Health and Social Services Standing Committee
Where: Butrovich 205; Juneau
Other Information: SB 38 Pharmacy Benefits Mangers; Managed Care; teleconferenced

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Bill Watch: Bills on the Move

Bill Watch: Drugs

HB 17 PROHIBIT TOBACCO USE UNTIL AGE 21
Sponsor: Representative Crawford
Committee(s) and date of last action: Read and referred to (H) L&C, then (H) FIN, 01/20/09
Description: This bill requests to change the legal age from 19 to 21 for the purchase, sale, exchange, and possession of tobacco. Specifically, it requests that any statute listing the legal age as 19 for the above activities be amended to the age of 21.

SB 52 SALVIA DIVINORUM AS A CONTROLLED SUBSTANCE
Sponsor: Senator Therriault
Committee(s) and date of last action: 03/18/09 (S) Referred to Finance
Description: Salvia divinorum and Salvinorin A are compounds of a plant used for medicinal purposes and with hallucinogenic properties. There has been an increase in its use, and has the potential for misuse and abuse. This bill requests that it be listed as a controlled substance.

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Bill Watch: Education

HB 58 EDUC LOAN REPAYMENT PROGRAM
Sponsors: Representatives Thomas, Wilson, Millett, Harris
Committee(s) and date of last action: Awaiting next committee assignment, then (H) FIN, 03/31/09
Description: This bill requests that general funds be set aside for incentive use to recruit individuals in occupations facing a shortage. Dentists and licensed practical nurses are among the occupations listed that would have access to these funds and incentive programs. Allocation of these funds is grouped by geographical location, with more funding available to professionals who are employed in rural areas of the state. A minimum of one year of employment is required for eligibility, and the amount of funding increases incrementally with the number of years of employment.

SB 18 POSTSECONDARY MEDICAL AND OTHER EDUC PROG
Sponsors: Senators Wielecheowski, Thomas, Ellis
Committee(s) and date of last action: Referred to (S) FIN on 03/16/09
Description: This bill proposes to raise the number of new students enrolled in medical education through the WWAMI program from 20 to 24 by 2010, and from 24 to 30 by 2012.

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Bill Watch: General Health Policy

ensures that the confidentiality of individually indentifying health information of a patient is secure and protected;
improves health care quality, reduces medical errors, increases the efficiency of care, and advances the delivery of appropriate, evidence-based health care services;
promotes wellness, disease prevention, and management of chronic illnesses by increasing the availability and transparency of information related to the health care needs of an individual for the benefit of the individual;
ensures that appropriate information needed to make medical decisions is available in a usable form at the time and in the location that the medical service is provided;
produces greater value for health care expenditures by reducing health care costs that result from inefficiency, medical errors, inappropriate care, and incomplete information;
promotes a more effective marketplace, greater competition, greater systems analysis, increased choice, enhanced quality, and improved outcomes in health care services; and
improves the coordination of information and the provision of health care services through an effective infrastructure for the secure and authorized exchange and use of health care information.

SB 139 INCENTIVES FOR CERTAIN MEDICAL PROVIDERS
Sponsors: Senators Olson, Wielechowski, Meyer, Davis
Committee(s) and date of last action: 03/25/09 Heard and Held in (S) HSS at 1:30 PM Butrovich 205, then to (S) FIN
Description: "An Act establishing a loan repayment program and employment incentive program for certain health care professionals employed in the state; and providing for an effective date."

SCR 1 BRAIN INJURY AWARENESS MONTH: MARCH 2009
Sponsor: Senator McGuire
Committee(s) and date of last action: Transmitted to the governor on 03/11/09
Description: This bill proposes that the month of March be "Brain Injury Awareness Month," effective for 2009.

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Bill Watch: Medical Assistance and Health Insurance

HB 61 MEDICAL ASSISTANCE COVERAGE
Sponsors: Representatives Cissna and Gruenberg
Committee(s) and date of last action: Read and referred to (H) HSS, then to (H) FIN,
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.

HB 62 MEDICAL ASSISTANCE ELIGIBILITY/PREMIUMS
Sponsors: Representative Hawker
Committee(s) and date of last action: Read and referred to (H) HSS, then to (H) FIN,
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 87 MED BENEFITS OF DISABLED PEACE OFFICERS
Sponsors: Representatives Millett, Dahlstrom, Gardner, Gara, Kerttula, Kawasaki
Committee(s) and date of last action: Heard and held in (H) L&C, then (H) STA, then (H) FIN,
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.

HB 118 MEDICAL ASSISTANCE ELIGIBILITY
Sponsor: Representative Gara
Committee(s) and date of last action: Referred to (H) HSS, then to (H) FIN, 02/25/09
Description: "An Act expanding, and relating to advertising about, medical assistance coverage for eligible children and pregnant women; relating to the poverty guideline and cost sharing for certain recipients of medical assistance; having the short title of the 'No Child Left Uninsured Act'; and providing for an effective date."

HCR 9 HOME HEALTH AIDES FOR SENIORS
Sponsors: Representatives Cissna and Gruenberg
Committee(s) and date of last action: Introduced and referred to (H) HSS, then to (H) FIN, 02/25/09
Description: This bill promotes the expansion of home health services to older Alaskans and adults with disabilities by requesting that the governor direct the Department of Health and Social Services to apply to the federal government for additional waivers under the home and community-based waiver program to better serve older Alaskans and adults with disabilities through a federally reimbursable service either as a separate service or as a service that may be combined with other waivers.

SB 10 MEDICAID/INS FOR CANCER CLINICAL TRIALS
Sponsor: Senator Davis
Committee(s) and date of last action: Read and referred to (S) FIN, 3/13/09
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: 03/20/09 Referred to (S) L&C, then (S) FIN
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: Heard for the second time in (S) FIN and referred to (S) RLS, 03/11/09
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: 03/30/09 CSSB 32 Heard in (S) FIN AT 9:00 AM, Senate Finance 532, moved to (S) RLS
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: 04/03/09 Scheduled to be heard in (S) HSS at 1:30 PM in Butrovich 205, then (H) L&C, then (H) FIN
Description: This bill proposes to change language in a previous statute, amending "managed care entity" to "health care insurer."

SB 61 MANDATORY UNIVERSAL HEALTH INSURANCE
Sponsors: Senators French, Ellis
Committee(s) and date of last action: Referred to (S) L&C, then (S) FIN on 03/16/09
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.

SB 65 MEDICAID FOR ADULT DENTAL SERVICES
Sponsors: Senators Davis and Ellis
Committee(s) and date of last action: Heard and Held in (S) HSS, 02/02/09
Description: This bill is "An Act repealing the repeal of preventative and restorative adult dental services reimbursement under Medicaid; providing for an effective date by repealing the effective date of sec. 3, ch. 52, SLA 2006; and providing for an effective date."

SB 79 MED BENEFITS DISABLED PEACE OFFICERS
Sponsors: Senators McGuire, Paskvan
Committee(s) and date of last action: Referred to (S) FIN, 03/05/09
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 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."

SB 87 MEDICAL ASSISTANCE ELIBILITY
Sponsor: Senator Wielochowski
Committee(s) and date of last action: Heard and held in (S) FIN, 02/25/09
Description: This bill proposes an additional eligibility category for Medicaid services. Specifically, it adds children, pregnant women, and other specified individuals in families with incomes between 200% and 300% of the federal poverty level. Additionally, individuals in this income category would be required to pay a yearly premium for medical assistance. The premiums would be determined by a sliding scale based on annual income. The range for premiums would be set at no less than $240 per year and no more than $1200 per year.

SB 155 MEDICAL ASSIST FOR COGNITIVE DISABILITIES
Sponsor: Senator McGuire
Committee(s) and date of last action: 03/18/09 (S) Referred to (S) HSS, then to (S) FIN
Description: "The department shall establish in regulation a system for setting medical assistance reimbursement rates based on the functional level of care needed by an eligible recipient with a diagnosed cognitive disability, regardless of the recipient's need for medical or personal care support. The system must address eligible recipients' needs for appropriate assessment, rehabilitation, case management, ongoing support and respite or companion services, regardless of whether the services are provided in a health care facility or under a home and community-based waiver granted under 13 AS 47.07.045."

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Bill Watch: Mental Health

HB 52 POST-TRIAL JUROR COUNSELING
Sponsor: Representative Kerttula
Committee(s) and date of last action: Read and referred to (H) JUD, then (H) FIN,
01/20/09
Description: This bill proposes to make available up to 10 hours of psychological counseling for any juror serving in a criminal trial where graphic images or content are presented.

HB 83 APPROP: MENTAL HEALTH BUDGET
Sponsor: Rules by request of the governor
Committee(s) and date of last action: Heard in (S) FIN on 03/27/09, Senate Finance at 9:00 AM Senate Finance 532; Heard in (S) RLS and moved to (S) Calendar, 03/30/09
Description: This bill outlines the specific appropriations for each component of the state's mental health program.

SB 21 MENTAL HEALTH CARE INSURANCE BENEFIT
Sponsor: Senators Davis and Ellis
Committee(s) and date of last action: Read and referred to (S) HSS, then (S) L&C, then (S) FIN, 01/21/09
Description: This bill proposes to implement parity in the types of medical services covered under existing health insurance plans. Specifically, it proposes that health care insurance policies be prohibited from denying coverage or discriminating health care services related to mental health, alcoholism or substance abuse; that there be no difference in coverage between physical and mental health coverage; and that these changes take effect no later than July 1, 2009.

Bill Watch: State Boards and Issues

HB 25 HEALTH REFORM POLICY COMMISSION
Sponsor: Representative Hawker
Committee(s) and date of last action: Read and referred to (H) HSS, then (H) FIN),
01/20/09
Description: This bill proposes that issues related to health care and health care policy be given high priority among government officials. Specifically, it proposes the addition of a new chapter in the Alaska Statute 18, establishing the Alaska Health Reform Policy Commission, outlining the composition and duties of that commission, to be effective immediately.

HB 63 COUNCIL DOMESTIC VIOLENCE: MEMBERS, STAFF
Sponsors: Representatives Fairclough, Holmes, Coghill, and Wilson
Committee(s) and date of last action: 03/20/09 (S) Referred to Finance
Description: This bill requests that the number of members of the Council on Domestic Violence and Sexual Assault be changed from three to four, and that at least one of the four members is a representative of a rural area of the state. In addition, this bill amends the length of term for public members from two to three years of eligible service. Other changes include adding the Department of Corrections as a regular collaborator with the council.

HB 75 HEALTH COMMISSION/PLANNING
Sponsors: Representatives Cissna and Gruenberg
Committee(s) and date of last action: Read and referred to (H) HSS, then (H) FIN,
01/20/09
Description: This bill requests the establishment of the Alaska Health Commission, whose purpose is to provide policy recommendations ensuring quality, accessibility, and affordability of health care throughout the state. The commission is to have 15 members, of the following composition: one member from the Alaska Mental Health Trust Authority, one member from the University of Alaska Health Education and Training Program, one member representing the Alaska Native Tribal Health Consortium, one member from the Alaska Primary Care Association, one member from the Alaska State Hospital and Nursing Home Association, one member from the health industry, one member from the Alaska Nurses Association, two health care consumer members/advocates, and six members of the Alaska legislature. This act is to take effect by July 1, 2009.

HB 123 EXTEND SUICIDE PREVENTION COUNCIL
Sponsor: Representative Flairclough
Committee(s) and date of last action: 03/26/09 Heard in (H) STA at 8:00 AM Capitol 106 and moved to (H) FIN, 03/27/09
Description: This bill proposes to extend the Suicide Prevention Council to June 30, 2013, effective immediately.

SB 35 EXTEND SUICIDE PREVENTION COUNCIL
Sponsors: Senator, Davis, Ellis, Therriault
Committee(s) and date of last action: Moved out of (S) HSS and referred to (S) FIN on 02/27/09
Description: This bill amends a previous act to extend the termination of the Statewide Suicide Prevention Council from June 30, 2009 to June 30, 2013.

SB 40 EXTEND SUICIDE PREVENTION COUNCIL
Sponsor: Senator Therriault
Committee(s) and date of last action: Read and referred to (S) HSS, then to (S) FIN,
01/21/09
Description: This bill is identical to SB 35.

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Bill Watch: Family Health Issues

Bill Watch: Worker's Compensation

HB 104 WORKER'S COMP. MEDICAL TREATMENT FEES
Sponsor: (H) Labor and Commerce
Committee(s) and date of last action: Signed into Law, 03/30/09
Description: This bill is "An act adjusting certain fees for treatment or services under the Alaska Workers' Compensation Act to reflect changes in the Consumer Price Index; and providing for an effective date.

SB 20 WORKER'S COMP MEDICAL/REHAB RECORDS
Sponsors: Senators French and Thomas
Committee(s) and date of last action: Read and referred to (S) L&C, then (S) JUD,
01/21/09
Description: This bill proposes that any documents containing personal and confidential information of an employee that is receiving, or has received, worker's compensation, are kept in a confidential location away from the public's view.

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Bill Watch: Bill Tracking Explanation and Acronyms

Bills listed here were selected based on a series of subjective criteria to determine whether they were "health policy-related" or not. All bills currently sitting in the Senate and House Health, Education, and Social Services committees were examined, and any that obviously dealt with non-health-related education or social services issues were eliminated. Every other House and Senate committee was then examined for health-related bills, which were included in the final list.

After determining the full set of health-related bills still in committee or pre-filed for the new session, they were divided into several general categories. This was done to facilitate finding bills that dealt with certain key health policy issues and to make overall navigation of the list easier. The remaining bills were categorized as "general" health policy related because of the wide range of subjects they covered.

The information listed for each bill includes the bill number, the short title, the primary sponsor or sponsors, the committee in which the last action on the bill took place, and the date on which the last action on the bill took place. A short summary of each bill is also included.

Abbreviations have been used for committee names. The committee names and their abbreviations are:

(H) HSS: House Health and Social Services Committee
(S) HSS: Senate Health and Social Services Committee
(H) L&C: House Labor & Commerce Committee
(S) L&C: Senate Labor & Commerce Committee
(H) EDC: House Education Committee
(S) EDC: Senate Education Committee
(H) FIN: House Finance Committee
(S) FIN: Senate Finance Committee
(H) JUD: House Judiciary Committee
(S) JUD: Senate Judiciary Committee
(H) STA: House State Affairs Committee
(S) STA: Senate State Affairs Committee
(S) RLS: Senate Rules Committee

AHPR Staff and Contributors

Lawrence D. Weiss, PhD, MS, Editor
Kelby Murphy, Associate Policy Analyst
Jacqueline Yeagle, Newsletter design and editing

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