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September 13, 2012     Lovell Chronicle
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September 13, 2012 I The Lovell Chronicle I 3 Committee debates health insurance exchanges BY DAVID PECK The State of Wyoming may have painted itself into a corner when it comes to avoiding the mandates in the 2010 Patient Protection and Affordable Care Act, testimony before the Joint Labor, Health and Social Service Committee of the Wyoming Legislature re- vealed last week. The committee, chaired on the House of Represen- tatives side by Rep. Elaine Harvey of Lovell, met for three days at the Lovell Community Center (see re- lated stories). Wyoming has taken a strong stance against the Affordable Care Act, com- monly called Obamacare, but in assuming that the ACA would be found uncon- stitutional, the Wyoming Legislature delayed steps that will now cause the state to miss certain dead- lines under the act, likely resulting in Wyoming resi- dents being offered health- care from a federal health insurance exchange rath- er than a state-operated exchange. Members of the Health Insurance Exchange Steer- ing Committee testified be- fore the Health Committee Thursday, and in the case of Harvey, she took off her Health Committee hat and put on her Exchange Com- mittee hat. "Ironically, sitting here today, it's exactly what we intended to not happen," said steering committee co-chairman Bill Landen (R-Casper) in regard to the federal exchanges. "In January 2014 a federally- run exchange will come to Wyoming." Harvey agreed with the irony, noting, "We strongly felt that we wanted to steer our own ship, seek a Wyo- ming-based solution that fits Wyoming people, not the federal government. In- stead, we have defaulted to the federal government. We will be subject to a federal- ly-facilitated and operated insurarice exchange."" A healthcare exchange is a virtual marketplace where individuals and busi- nesses can shop for insur- ance, theoretically leading to lower prices. Gov. Matt Mead's Health Care Policy Advisor Elizabeth Hoy told the com- mittee that dealing with the Obama Administration in regard to the Affordable Care Act has been extreme- ly frustrating, noting that the act contains a number of hard deadlines that can only be changed by Con- gress and yet the Admin- istration has failed to an- swer questions asked by the Governor. Wyoming has sent a number of questions specif- ic to the Wyoming situation to the Dept. of Health and Human Services and has yet to receive a response. "Without answers to these important questions it's hard to know how to pro- ceed," Hoy said. "A number of other states are on hold, too, waiting for answers to questions." Meanwhile, Hoy point- ed out, the state is facing a deadline on Nov. 16, 2012, to submit a 30-page form for moving forward with its own health care exchanges. In a press conference Tuesday Gov. Mead said he sent a letter to the sec- retary of HHS in July and also joined Republican gov- ernors to send another set of questions. "It is hard for us to make decisions when we cannot get answers to what I believe are fair questions for the Secretary," he said. During Thursday's Health Committee meeting, Co-Chairman Sen. Charles Scott of Casper said states tend to fall into two cat- egories: those who "feel Obamacare is just wonder- ful and are going all out to be ready" and what he called "another very large group profoundly skeptical and not proceeding as fast" while awaiting the outcome of the presidential election in November. "There's quite a di- vide," Scott said, "and as I read the act, it's more flex- ible than HHS is claiming. If we need to play catch-up, we can." "it totally blows my mind that the secretary of HHS simply blows off a sitting governor, and he's not the only governor asking questions. At the end of the day they're going to do what they want to do if the current administration remains in power." Rep. Elaine Harvey Rep. Keith Gingery of Jackson pointed out that the legislature this year passed a bill - Sen- ate File 58 - that prevents the Health Insurance Ex- change Steering Committee from moving forward with any formal agreements on health care exchanges until April 1, 2013, and he asked if the Governor could "move forward by himself." "My opinion is that the legislative branch ought to make that decision," Scott said. "If we decide to go with an exchange, I think the feds will bend over back- wards to work with us." The Health Exchange Steering Committee, co- chaired by Harvey and Landen, started studying the ACA and health care ex- changes using funding from a federal planning grant, but under SF58 passed in February "no state agency or any person representing the state of Wyoming" can commit the state to oper- ating a health exchange or enter into any agreement regarding the ACA before April 1. The bill did appro- priate $25,000 from the general fund for legislators on the steering committee to travel to meetings. Basically, Landen told the Health Commit- tee Thursday, the legisla- tion required the steering committee to stand down, though he and Harvey were allowed to continue with some study work and research. With deadlines passing for Wyoming to set up its exchange and legislation in place to prevent it, Landen said it is the steering com- mittee's opinion that the state should be prepared with legislation that will allow the State Insurance Dept. to deal with any re- quirements to be placed on state agencies by the feder- al government and to also begin working with oth- er states in a way that can save the state money. "Our opinion is to set up a monitoring group to advise the agencies and en- act interstate compact leg- islation so states can work across state lines," Landen said, adding that the state will have to now deal with the federal exchange pro- gram "that is coming' and either "partner with the federal government on an exchange or operate on our own." "We have session law on the books preventing us from doing anything un- til April 1, 2013. If we pass legislation to allow the in- surance department to do anything to facilitate an ex- change, it may be a viola- tion of state law," he said. Hoy emphasized that the governor's office will not act without legislative au- thorization, and Gingery noted that the bill states that the steering commit- tee cannot "commit" the state to an exchange or enter into an agreement, but he said he doesn't see where the state is prohib- ited from having meetings and working on plans and recommendations. Harvey said the prob- lem is that the original fed- eral planning grant did not commit the state to an ex- change, but newer planning grant requirements would "move us into a commit- ment stage," and with SF58 on the books, the steering committee elected to turn the grant money back. The state appropriation did allow legislators to con- tinue work, and she said she has attended several meetings on the issue, but there has been no funding to perform detailed actuari- al studies on the exchanges and their ability to function in Wyoming. Gingery raised the question of whether the leg- islature could block all ef- forts by the federal gov- ernment to come into the state with an exchange and "make it clear we don't want to assist in any man- ner," and Scott agreed that the federal government can- not force the state to partic- ipate, noting, "I don't know how they can compel the in- surance department to do certain things. It's a compli- cated situation." Harvey said the state still has to consider 82,000 Wyoming residents with- out health insurance and another 30,000 to 40,000 residents who are under- insured, carrying cata- strophic insurance only. "We are penalizing our own people by not having an insurance plan," she said. Harvey said one solu- tion might be a private mar- ket solution in the form of regional compacts - a way to buy and sell insurance across state lines, set up risk pools and lower costs. Some 25 states have con- sidered compact legislation, she said, under the guide- lines of the Health Care Compliance Association. "My question is wheth- er we can gather like-mind- ed states and pursue like- minded compacts," she said. WYOMING'S DIFFICULTIES Harvey presented a detailed PowerPoint pre- sentation, the same Pow- erPoint she delivered at a recent Council of State Gov- ernments meeting. The presentation was entitled "Health Insur- ance Exchanges aren't Af- fordable in Wyoming" and detailed the issues facing the state due to its small population. After initial demo- graphic information, Har- vey pointed out that Wy- oming is a "low benefit mandate state," so add- ing all of the ACA benefits, changing rate bands and removing restrictions on limits all at the same time would increase rates in the individual market by 30 to 40 percent. With small group rates in Wyoming al- ready twice the national av- erage, more employers may consider self-insurance as they evaluate the financial impact of the new regula- tions on their business, in- cluding the high cost of ad- ministering the exchanges due to the state's smal| pop- ulation base. Others will drop insurance. Sen. Leslie Nutting of Cheyenne said that as a federal employee she par- ticipated in an insurance exchange for years. "I don't think Wyoming citizens have anything to fear with a federal insur- ance exchange," she said. "The ideas (expressed to- day) have great potential and are not in conflict with federal exchanges." But Harvey countered that she has attended prob- ably 10 meetings with HHS and called it "probably the most frustrating experience I've ever had" because the agency won't answer specif- ic questions. "They could not give us any guidance or rules," Har- vey said. "The last one was two weeks ago, and they wouldn't even let us speak." As for the Obama Ad- ministration's lack of re- sponse to Gov. Mead's ques- tions, Havey said, "It totally blows my mind that the sec- retary of HHS simply blows off a sitting governor, and he's not the only governor asking questions. At the end of the day they're going to do what they want to do if the current administra- tion remains in power." Legislative committee takes on full agenda in Lovell BY PATTI CARPENTER The Wyoming Legisla- ture's Joint Labor, Health and Social Services Com- mittee held a three-day meeting in Lovell last week to look at major issues af- fecting the state. Rep. Elaine Harvey (R-Lovell) co-chaired the meeting with Sen. Charles Scott (R- Casper). Numerous officials from throughout the state attended, along with mem- bers of the public. The committee looked at budget proposals for the three departments under its umbrella of responsibili- ties. Each department was asked to present a budget with 4 and 8 percent reduc- tions as requested by Gov. Matt Mead earlier this year for review by the committee. "We had our march- ing orders from Legislative leadership to examine the budget cuts proposed by these three departments," explained Harvey. "We could then accept them in full and recommend their acceptance, we could reject them in full and tell them to go back to the drawing board or we could reject them in part and recom- mend other areas for them to investigate cuts." The committee accept- ed the budgets "in full" pre- sented by the Dept. of Fam- ily Services (DFS) and the Dept. of Workforce Services. The Dept. of Health budget is not due until November. The DFS budget actu- ally exceeded the required cuts with a reduction of 9.5 percent recommended. Most of the cuts were per- sonnel related. Harvey re- ferred to the DFS budget as a "sweetheart deal" because Medicaid eligibility will no longer be determined in their field offices, which allows them to reduce the personnel expenditure pre- viously required to perform that function. Harvey explained that, currently, if a family is poor and in need of assis- tance, they apply for Med- icaid through the Dept. of Family Services, but due to changes in the state's com- puter system due to take effect in July of next year, those applications will be made directly to the Dept. of Health. Harvey said the procedural change made it easy for the department to reduce their budget due to the anticipated reduction in personnel needs. Layoffs are not expected because the department will not fill several positions in many areas that are currently va- cant and will reassign du- ties instead. "In all of this, no one got laid off," said Harvey. "Through retirement and attrition they did not re- place staff and they just re- assigned duties." The Dept. of Workforce Services presented a bud- get that reduced expen- ditures by 8 percent with the biggest cuts in areas of training. "When the economy picks back up, the training programs can go back into place," said Harvey. Harvey noted that the reductions included more than $350,000 in grant pro- grams for private employ- ers to train employees. The reductions also included around $150,000 in educa- tion programs for daycare providers and approximate- ly $151,000 in contractual services to the individuals providing the educational services. Harvey said that these are all good programs and the funding is not necessar- ily going away, it's just been reduced for the time being. Other cuts for this de- partment were for in-state travel and equipment rent- al expenses. "They met their 8 per- cent and we approved their budget in whole," said Harvey. The Dept. of Health budget proposal is not due until November, so the committee will review that agency at their next meeting in November. In the mean- time, the committee re- viewed numerous issues re- lated to Medicaid and other health related services and issues related to the Afford- able Care Act, sometimes re- ferred to as Obamacare (see related story). The committee also re- viewed a number of policies and programs, including a review of a proposal by U.S. Congress to cut funding to the Temporary Assistance to Needy Families program (TANF), which is a feder- ally funded program. This proposal would impact fed- eral block grant money re- ceived by the state to pro- vide "temporary" assistance to families for rent, utilities and other expenses not cov- ered by food stamps. Har- vey said the proposal did not go through and therefore no adjustments were made to the program, but the com- mittee needed to hear that from the department's direc- tor Steve Corsi. The federal government was also considering elimi- nating the "welfare to work program," a key element in the state's program, which only provides assistance for up to five years. "We have received na- tional awards for our pro- gram and we are a model for every other state," said Harvey. "Director Corsi re- ported that although the federal government was considering eliminating the program, they did not." The committee also dis- cussed Medicaid enrollment fraud, with Corsi reporting on current efforts to reduce enrollment fraud since his department is currently re- sponsible for enrollments. Although there is still some fraud, according to Harvey, it is less than 5 percent. She said the committee contin- ues to look for ways to re- duce that percentage even more. The Dept. of Workforce Services brought two poli- cy changes related to unem- ployment insurance fraud to the committee for review. Both were rejected by the committee, which asked for further study on the issues. The first policy raised the payback penalty for those collecting unemploy- ment insurance benefits il- legally from the state's 5 percent to the federal gov- ernment's standard of 15 percent. The committee felt the penalty could un- fairly penalize "innocents" who have already collect- ed their benefit at the be- ginning of the month but start a new job in the mid- dle of the month. Harvey said the increase could pun- ish those looking for work and trying to get off of un- employment benefits. She said the policy also had the federal government dictat- ing where the funds would go instead of the state. Cur- rently the state of Wyoming requires penalty funds to go into the common school fund, but the federal gov- ernment places them in the unemployment insurance revenue fund, explained Harvey. "The federal govern- ment wants to do this be- cause, in other states, there are unemployment funds that are going under," ex- plained Harvey. "In our state, the fund is healthy because we are fiduciary-re- sponsible. We do a good job of keeping our fund healthy and we want to keep it that way. The federal govern- ment can't tell us where the funds from penalties should go. Our state constitution determines that." The committee also de- nied a policy that penal- ized employers who did not respond in a timely man- ner because they felt it was "subjective" and didn't take into consideration factors that might be outside of the employer's control, like the department responding to their requests in a less than timely manner. "We want to differen- tiate between those who make a mistake and those who intentionally defraud the system," said Harvey. "The law doesn't discrim- inate in this way and the federal government doesn't want us to discriminate in this way. They want a 15 percent penalty placed on everybody." Another hot topic cov- ered was the costs associ- ated with mental health services as covered by Ti- tle 25 rules. The commit- tee heard extensive testi- mony about the problems associated with Title 25, which requires patients to be held under observation in certain circumstance.s. Problems with availability of beds at the state hospi- tal in Evanston has forced patients to be either held in jail or sent to expensive pri- vate facilities. The commit- tee also heard moving testi- mony from families caught in the middle who were lit- erally bankrupt under the current system and about individuals who were re- leased back into the com- munity with little or no support. "If they're not in jail or in the crisis beds in Wor- land, they go to the WBI (Wyoming Behavior Insti- tute), which is a huge ex- pense per day," said Har- vey. "Although they get some treatment there, they don't get a treatment plan until a bed opens up in Evanston. There's been a breakdown in communica- tion at Evanston and we've heard horror stories of peo- ple being dropped off at homeless shelters or with family members who didn't know they were coming. We've heard about cases where they are discharged with only three days of medication after spending 10 days getting their medi- cation regulated." "We know that there are still problems out there and we are working on them and will continue to work on them for some time," said Harvey. "We have a new ad- ministrator at the Wyoming State Hospital (Bill Sexton) and he has already recon- figured rooms so the wait is considerably less and he is working on improved dis- charge planning. As we're starting to see things get rearranged, we are already seeing fewer return custom- ers to the system." Harvey noted that this is about the fifth time the committee has heard re- porting on this issue and the situation seems to im- prove with every report. The meeting discussed many issues in depth and resulted in several bills or- dered into draft form, in- cluding a bill concerning Title 25 issues related to minors, a bill requiring fa- thers to pay for Medicaid births and for the medi- cal care of the child, a bill dealing with Title 14 (court ordered placements of mi- nors) and rules regarding eligibility for Medicaid and Medicaid Fraud. Harvey said she thought that all three days of meet- ings were very productive and she was pleased with the turnout and participa- tion by residents and repre- sentatives of organizations from throughout the state. The next meeting of the committee will take place Nov. 12-13 in Casper.