Health policy bills see progress in Alaska Legislature

With the Alaska Legislature scheduled to adjourn later this month, provided no special session is called, we have an update on some of the health policy bills that have been considered this session.

The 80th Percentile Rule

Senator Giessel’s bill to annul the 80th percentile rule and replace it with a new reimbursement standard that would be 300 percent of Alaska’s Medicare payment for the medical service provided is unlikely to pass this session. The bill has been in the Senate Labor & Commerce Committee since the beginning of February and is still not scheduled for a hearing.

In her sponsor statement, Senator Giessel argues that the 80th percentile rule has driven up healthcare costs:

“The 80th percentile methodology for calculating reimbursement for provider claims was instituted in 2004 in Alaska for the alleged purpose of protecting Alaska consumers from excessive bills from their medical providers. Additionally, it was intended to incentivize medical providers to Alaska with the promise of lucrative insurance reimbursement. Today the Administrative Rule drives up the cost of healthcare by incentivizing incremental increases in charges for services.

Under this Rule, the provider’s claim is reimbursed by the insurer at an amount calculated to be equal or greater than the 80th percentile of the typical charges for a diagnostic code in a specific geographical area. In practice, this means that a large group practice containing the vast majority of medical providers in a specialty could set the price and insurance reimbursement for any of the procedures done statewide.”

Mental Health

Senator Giessel has seen progress on her SB 169, which passed out of the Senate at the end of March 19-0, with Senator Stedman excused.

Currently, in a behavioral health clinic a mental health professional must have a supervising psychiatrist physically present at least 30 percent of the time in order to bill Medicaid. The bill would allow a physician to supervise mental health providers, either “in person or with a communication device.”

“There have been reports that some clinics have up to a 2-year waiting list,” said Senator Giessel. “That is completely unacceptable; while patients wait, their conditions worsen and often lead to other negative behaviors such as assault, robbery, severe depression and even death.

With health care services expanding in Alaska via the use of telemedicine, particularly in rural areas, the removal of this barrier opens doors to expand needed behavioral health care treatments to many more Alaskans.”

Rep. Spohnholz’s HB 358 would require carriers to provide coverage for mental health benefits provided through telehealth. The bill passed out of the House Health & Social Services Committee with three recommendations to pass and three no recommendations. The bill is in the Labor & Commerce Committee with a heading scheduled for April 9th.

Work Requirements

While the House bill to require DHSS to apply for a waiver to establish Medicaid work requirements has not progressed, the Senate bill has passed out of the House and Social Services Committee 3-1. Senator von Imhof made no recommendation on the bill.

The bill has been referred to the Senate Finance Committee but has not yet been assigned a hearing data.

End of Life

The House is considering a right-to-try bill that would allow terminally ill patients who have exhausted available treatment options access to experimental drugs. The bill would provide immunity to physicians for prescribing, dispensing, or administrating experimental drugs under certain conditions.

The bill stalled last year in the Senate after passing the House unanimously. This year, the bill has moved through the Senate Health and Social Services Committee and the Judiciary Committee. The bill is currently in the Senate Rules Committee.

“Since 2014, 34 states have signed “right to try” legislation into law with strong, bi-partisan support,” said primary sponsor Rep. Grenn. “It is clear this is a human issue that goes beyond state and party lines, and could provide Alaskans increased access to potentially life-saving treatments in the times they need it most.

In allowing Alaskans facing terminal illness the ability to access safe, but experimental drugs in consultation with a doctor they trust, this bill offers new hope when all FDA-approved options have been exhausted. I urge your support of House Bill 43.”

Rep. Drummond’s medical aid in dying bill remains stalled in the House Judiciary Committee.

Health Care Costs

Representative Grenn’s HB 193 is scheduled for a hearing next week in the House Labor & Commerce Committee after moving out of the House Health & Social Services Committee. The bill would ban medical providers from balance billing in emergency situations when a patient is unable to choose an in-network provider.

“The most common occurrence for balance billing is during emergency situations where patients are left without the option or wherewithal to ensure they are treated by an in-network provider,” said Rep. Grenn. “As a result, they find themselves on the hook for hefty medical bills, despite having proper health insurance. HB 193 would help Alaskans already dealing with the turmoil of a medical emergency by removing them from the billing side of the equation. When a patient is already in a dire situation, they should not be punished for the inability of an in-network provider to respond to their crisis.”

Under the bill, the patient will only be required to pay the cost that would be charged if the provider was in-network, with the payment counting toward their in-network deductible.

The insurer would have to pay the non-network provider the greater of the amount:

  • Of the median negotiated contract rate generated using the in-network health care providers for the service provided;
  • That follows the 80th percentile rule; or
  • That is at least 350% of the amount reimbursed by Medicare