Commissioner Adam Crum from the state Department of Health & Social Services recently visited local health providers. He also presented a discussion on Medicaid during a recent Ketchikan Chamber of Commerce luncheon.
Governor Mike Dunleavy’s budget includes cuts to the state’s Department of Health & Social Services. Commissioner Crum discussed potential service changes due to the funding decrease, specifically to Medicaid.
“The current path of state spending on Medicaid and health care in general is unsustainable,” said Crum. “As many of you know, Alaska has the highest health care costs in the nation. The Health Care Cost Institute actually shows that Anchorage—these major cities—is 65% above the national average for health care costs. That’s just Anchorage. So as you get further away from that—from the hubs into these smaller communities, those numbers actually go up even more,” Crum said.
Crum said Medicaid serves 216,000 Alaskans; almost one-third of the population. But he said they’re taking a phased approach to the new budget changes. They exempted critical access hospitals, primary care providers, and federally qualified health centers from the 5% funding reduction. The department has the ability to reduce Medicaid cost by implementing rate adjustments, service utilization, program administration adjustment, and eligibility. So far, they have only implemented the first three options.
“The idea is that Medicaid program dollars, both combined state and federal, will be used to pay health plan premiums and cost shared requirements for those moving into the marketplace,” said Crum. “Medicaid will act like a secondary payer for those transitioning into the marketplace, ensuring medicated enrollees with private coverage will still have access to services such as long-term care and behavioral health.”
The department is working with Public Consulting Group to determine whether moving portions of the Medicaid population into the federally facilitated marketplace will save the department money. The restructuring should benefit eligible Medicaid enrollees by connecting them to private coverage. Populations that will remain with Medicaid include the medically fragile, citizens with incomes below 50% of the central poverty level, those on dual Medicare/Medicaid, incarcerated individuals and those recently released from prison; and aged, blind, and disabled enrollees.
Crum said the goals of the restructuring plan aim to rebalance the current behavioral health system.
“Intervene as early as possible in the lives of Alaskans to address behavioral health early warning signs before symptoms cascade into functional impairment, and improve overall behavioral health—and improve the overall behavioral health system accountability by reforming the existing system’s care,” said Crum.
Crum said all current eligibility criteria will remain the same and no one will lose access to coverage. He hopes this will ease the transition. Public Consulting Group should complete their report within the next month and it will be public record. Changes based on the analysis of a waiver won’t be implemented without community input and stakeholder engagement.
Crum said the changes will attract new insurance providers and increase competition among insurers to possibly lower the cost of health care in Alaska. However, there is concern this may not help private insurance holders. Brittany Pope is the owner of Be Well Counseling. She says when considering private practices that primarily use private insurance, the department needs to look at more than just cost containment, but also expense containment for the practitioner.
“I think specifically Medicaid budget cuts affect practitioners because you’re not going to get highly qualified practitioners here when you cannot pay a competitive wage,” Pope said. “And also when you can’t get licensed in the state and you have all the barriers that the state put up with that, you’re talking about expanding services, you’re actually not expanding services because you’re cutting rates. So I think that—that correlation right there of cutting, you’re going to limit access to resources too.”
She said failing to decrease the cost and expenses will result in fewer providers.
Rita Menzies is a nurse with three sons. One of them has a rare seizure disorder and autism. Menzies said she’s concerned about the health and social services budget because it impacts her son’s ability to attend daily living activities at Community Connections and could lead to additional health issues.
“One of my observations is that with the lack of day-hab services, our kids and loved ones are going to have a lack of physical activity and socialization, which will then predispose them to diabetes, depression, obesity, and heart disease,” said Menzies.
In response to Menzies’ comment, Crum says they will continue to look for day-hab solutions.
“We’re going to continue to look at that. I can just say personally, my heart goes out to those groups as well and those families to try to help as much as possible,” said Crum. “So this is going to be an ongoing conversation and if we can’t do it around our current roles, perhaps we can get creative and find something that’s going to work on this. But it’s going to be an ongoing talk.”
