WeeklyFinancingNewsPulseStateandLocalEditionfinal20100224.pdf (PDF | 323.46 kb)
SAMHSA222s Weekly Financing News Pulse: State and Local Edition February 24, 2010 2/24/10 1 SAMHSA222s Weekly Financing News Pulse: State and Local Edition California Florida Hawaii Illinois Iowa Kansas Kentucky Maine Michigan Minnesota Missouri Montana New Hampshire New Jersey New Mexico New York Ohio South Dakota Tennessee Utah Virginia Washington Wisconsin Wyoming To Subscribe to SAMHSA222s Weekly Financing News Pulse, please go to the following link and choose 223Health Care Financing224: https://service.govdelivery.com/service/multi_subscr ibe.html?code=USSAMHSA&origin=http://www.samhsa.go v/enetwork/success.aspx For questions or comments, please contact Kevin Hennessy ( kevin.hennessy@samhsa.hhs.gov ). SAMHSA222s Weekly Financing News Pulse: State and Local Edition February 24, 2010 2/24/10 2 Around the States: State and Local Behavioral Health Financing News California DMHC Accuses Discount Health Plan Firm of Fraud, Orders Withdrawal from the Market : On February 22, the California Department of Managed Health Care (DMHC) ordered Healthcare One LLC and its four affiliates to cease doing business in California. Arizona based Healthcare One offers discount health plans227non insurance products that offer enrollees lower rates at select health care providers for a monthly fee. DMHC alleges that Healthcare One fraudulently represented its products as insurance and claimed to offer services that did not exist ( San Francisco Chronicle, 2/23 ; Kaiser Health News, 2/23 ). Update: California Legislature Approves $2.8 Billion Budget Cut, Prison Health Care Affected : Responding to Governor Arnold Schwarzenegger222s (R) request to cut $8.9 billion from the state222s current year budget, the California Legislature passed several bills eliminating $2.8 billion in state spending. The legislature will not consider cuts to education or social services until later in the year; however, the current cuts reduce funding for prisoner medical care by $811 million ( San Francisco Chronicle, 2/23 ; San Jose Mercury News, 2/19 ; Kaiser Health News, 2/17 ). Florida AHCA Proposed Medicaid Reform Pilot Expansion; Legislature Considers Behavioral Health Cuts : Florida222s Agency for Health Care Administration (AHCA) has proposed expanding the state222s Medicaid reform pilot project that currently operates in Baker, Broward, Clay, Duval, and Nassau counties to as many as 19 additional counties. The pilot enrolls Medicaid beneficiaries in private managed care plans rather than the state222s traditional fee for service (FFS) Medicaid plans. Estimates indicate that expanding the program could save Florida $58.7 million and affect 375,000 residents. However, lawmakers note that the state faces a $1 billion Medicaid shortfall for the 2010 11 budget year. Preliminary studies have shown that the pilot saves the state money but have not assessed the pilot222s effects on access to care or outcomes. The counties under consideration for the expansion are: Brevard, Citrus, Gadsden, Hernando, Hillsborough, Jefferson, Lake, Liberty, Madison, Manatee, Miami Dade, Orange, Osceola, Palm Beach, Pasco, Pinellas, Polk, Seminole, and Wakulla. In addition to the AHCA cuts, the Florida House Health Care Appropriations Committee is also considering reducing mental health and substance abuse programs by as much as $172.4 million. The cuts are part of a budget 223priority list224 that is now open to public comment and will likely not come to final committee vote until late March ( Florida Health News, 2/18 ; Tampa Bay Online, 2/21 ; AP via Miami Herald, 2/18 ; NewsPress, 2/17 ; Kaiser Health News, 2/18 ). Hawaii State Allocates $10 Million in Federal Grant Funding to Prevent Underage Drinking : Using funds from a $10.4 million five year federal grant awarded in 2006, Hawaii has awarded $7 million to four county governments to reduce and prevent underage drinking. Through the grants, Oahu will receive $2.3 million, the Big Island will receive $2.1 million, Maui County will receive $1.4 million, and Kauai will get $1.2 million. The funds will develop a strategic plan to expand the Hawaii Epidemiological Profile for Substance Abuse Prevention ( Honolulu Advertiser, 2/17 ). SAMHSA222s Weekly Financing News Pulse: State and Local Edition February 24, 2010 2/24/10 3 Illinois Update: Task Force Calls for State Nursing Home Overhaul: On February 19, Governor Pat Quinn222s (D) task force on nursing home safety issued a final report detailing 37 recommendations to overhaul the state222s long term care system which current mixes elderly residents with the mentally ill. Governor Quinn announced the task force following a series of Chicago Tribune articles highlighting poor conditions and noting that individuals with primary mental health diagnoses make up 15 percent of the state222s nursing home patients. Among other recommendations, the task force suggests raising fines, fees, and taxes on facilities to fund increased government oversight. In addition, the report calls for the expansion of community based mental health services and suggests requiring nursing homes caring for the mentally ill to obtain special certification ( AP via Chicago Sun Times, 2/19 ). Senate Committee Approves Bill Allowing $250 Million in Bonds to Reimburse Medicaid Providers : A bill introduced by State Sen. Donne Trotter (D) would allow state universities to borrow up to 75 percent of the amount the state owes them and allow the state to issue $250 million in bonds to reimburse Medicaid providers for the remainder of the fiscal year. The bill received committee approval in the Senate and now goes to the Senate floor. The state must repay all bonds within one year ( FOX, 2/18 ). Iowa With Health Insurers Seeking Rate Increases, Lawmakers Seek Increased Transparency : After Iowa222s largest insurer, Wellmark Blue Cross and Blue Shield , announced a planned 18 percent average premium increase for individual policyholders, Iowa lawmakers are seeking increased transparency from health insurers to allow the state to determine whether rates are justified. Democratic lawmakers are crafting legislation that would require health insurers to disclose additional information including medical loss ratio227the amount of premium revenue spent on medical costs227and factors that raise and lower costs for each plan. In addition, a proposed amendment to SF 2201 would authorize the Iowa Insurance Commissioner to request the data. State lawmakers also plan to ask U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius to investigate health insurance premium increases in Iowa ( Des Moines Register, 2/19 ; AP via Chicago Tribune, 2/18 ; Kaiser Health News, 2/19 ; AP via Chicago Tribune, 2/17 ). Iowa Board of Pharmacy Unanimously Recommends Legislators Reclassify Marijuana for Medical Use : The Iowa Board of Pharmacy voted unanimously on February 17 to recommended that the Iowa Legislature reclassify marijuana to allow residents to use the drug for pain, nausea, and other symptoms of serious illnesses, including cancer, AIDS, and multiple sclerosis (MS). The Board222s plan would first create a task force to address change.State legislators are not expected to take up the issue until 2011 ( Des Moines Register, 2/18 ; Kaiser Health News, 2/18 ). Kansas House Bill Would Allow Small Businesses to Contribute to Individual Health Plans : A bill ( HB 2682 ) introduced in the Kansas House on February 9 would allow employers with 20 or fewer employees to contribute to premium payments workers make on individual health plans. However, the bill would SAMHSA222s Weekly Financing News Pulse: State and Local Edition February 24, 2010 2/24/10 4 apply only to employers not already offering health coverage. HB 2682 would also require health insurers to offer at least one high deductible plan coupled with a health savings account (HSA). Similar provisions were included in a bill ( SB 81) passed in 2008; however, they were not implemented because the Kansas Insurance Department discovered that they violated the state222s small group insurance laws. HB 2682 would address the SB 81 legal issues ( Kansas Health Institute, 2/18 ; Kaiser Health News, 2/19 ). Kentucky Medicaid Commissioner Says Managed Care Program More Costly than Traditional Medicaid : In a letter to the Kentucky House Budget Committee , Kentucky Medicaid Commissioner Elizabeth Johnson said that the state222s Medicaid managed care program, Passport, is more expensive than the state222s traditional Medicaid program. Johnson notes that the average per member cost for Passport was $388.89 per month in 200922721 percent more than the regular Medicaid program. Johnson attributes much of the difference to administrative expenses and hospital care. However, passport officials contend that the program saves the state $123 million annually. Passport currently serves 165,000 residents in 16 counties; however, the Kentucky Legislature is considering expanding the program to help close the state222s $1.5 shortfall for the 2010 12 budget year ( Courier Journal, 2/17 ; Kaiser Health News, 2/18 ). Maine Bureau of Insurance Report Says Some State Health Reform Hinges on Congress, Urges State Policymakers to Keep Working : A preliminary report released by the Maine Bureau of Insurance concludes that many state measures aimed at expanding health coverage should wait until final Congressional action on national health care reform. The report, which stems from a 2009 law asking the superintendent to review ways to improve the availability and affordability of individual health plans, notes that state policymakers should continue working on health reform but that national action will significantly affect the state222s options. The report comes as the state222s largest insurer, Anthem Blue Cross and Blue Shield , requests a 23 percent premium increase while other state insurers have requested 21 and 12.5 percent increases ( AP via WBZ, 2/20 ; Kaiser Health News, 2/22 ). Michigan Governor Creates State Medicaid Inspector General : Through Executive Order 2010 1, Governor Jennifer Granholm (D) created the Michigan Office of the Medicaid Inspector General (OMIG) on February 19. Unlike a proposal submitted to the Michigan Legislature by Michigan Attorney General Mike Cox , Governor Granholm222s OMIG will operate independent of the Michigan Department of Community Health (DCH). Governor Granholm will directly appoint the OMIG director ( Bay City Times, 2/20 ). State DCH Awards Youth Suicide Prevention Grant to Van Buren County : The Michigan Department of Community Health (DCH) awarded Van Buren County a grant to develop and implement prevention and early intervention strategies to reduce youth suicide. Using the grant funding, the Van Buren Community Mental Health Authority will coordinate a suicide prevention coalition that will include schools, the juvenile court, the County Department of Human services, and numerous behavioral health SAMHSA222s Weekly Financing News Pulse: State and Local Edition February 24, 2010 2/24/10 5 groups.Van Buren County is one of eight Michigan counties to receive the DCH funding ( Courier Leader, 2/22 ). Minnesota Governor Vetoes Bill to Extend GAMC : On February 18, Governor Tim Pawlenty (R) vetoed a bill to extend General Assistance Medical Care (GAMC), the state program providing health coverage to residents earning less than $7,800 annually. Governor Pawlenty cut funding for GAMC at the end of the last legislative session and, under the governor222s plan, the program is slated to end March 31. The bill would have extended a reduced version of GAMC through June 2011 for $284 million. House Democrats are currently considering whether to hold an override vote ( KAAL, 2/19 ; Business Week, 2/19 ). MACSSA to Conduct Pilot Project for Treating Chronic Substance Users: The Minnesota Association of County Social Service Administrators (MACSSA) has selected 10 counties to participate in a pilot program to treat chronic substance abusers. The pilot focuses on getting users into housing and employment programs rather than simply treating chemical dependency.MACCSA must secure approval from the Minnesota Legislature to launch the program, which gives counties more control over state funds. In Washington County, the program would serve 15 patients over two years ( Stillwater Gazette, 2/18 ). St. Cloud State University Receives Funding for On Campus Psychiatric Care : St. Cloud State University and St. Cloud Technical and Community College have received a $32,000 grant from the CentraCare Health Foundation to provide on campus psychiatric care. The grant, which extends a previous relationship between the two agencies, provides funding for up to 12 hours of on campus psychiatric care per month ( St. Cloud Times, 2/22 ). Missouri House Panel Approves $60 Million Social Services Cut, Mental Health Affected : A Missouri House committee approved $59.8 million in cuts to the Missouri Departments of Mental Health, Social Services, and Health and Senior Services . The cuts would reduce the departments222 budgets by 2.5 percent and eliminate $9.25 million in state funding for federally qualified health centers (FQHCs) ( Kansas City Star, 2/16 ). Montana Governor222s Administration Recommends Cutting $1 Million from Mental Health Crisis Center Funding: Governor Brian Schweitzer222s (D) Administration has proposed cutting $1 million from a $2.3 million program that funds grants to create and sustain mental health crisis centers. The centers provide voluntary short term mental health treatment for arrested individuals.Without the voluntary clinics, such individuals are frequently involuntarily committed to the State Hospital in Warm Springs ( Missoulian, 2/21 ). VA Breaks Ground on Behavioral Health Center : On February 16, the U.S. Department of Veterans Affairs (VA) Medical Center at Fort Harrison broke ground on a $6.7 million long term behavioral health facility. Expected to open in the spring of 2011, the facility will have 24 inpatient beds and be the first SAMHSA222s Weekly Financing News Pulse: State and Local Edition February 24, 2010 2/24/10 6 VA long term inpatient behavioral health facility in Montana. Currently, veterans seeking long term inpatient behavioral health care must travel to Idaho, Wyoming, or North Dakota for treatment ( ABC, 2/17 ; Billings Gazette, 2/17 ). New Hampshire Bill Would Require Health Insurers, Hospitals, and Doctors to Provide Health Care Cost Data : A bill ( HB 392) in the New Hampshire Senate would mandate an annual public hearing at which health insures, doctors, and hospitals must disclose financial information. The New Hampshire Department of Insurance would then use that data to create an annual report on the state222s health care costs. State lawmakers are also expected to introduce additional bills designed to change the way hospitals charge for services ( New Hampshire Public Radio, 2/17 ; Kaiser Health News, 2/18 ). New Jersey Update: Senate Passes Public Employee Health Care and Pension Changes : On February 22, the New Jersey Senate unanimously passed three bills designed to cut spending on government employees222 health care and pensions. Among other changes, the bills would require all public employees227including local government employees and teachers227to pay 1.5 percent of their salaries towards health insurance premiums, saving governments $314 million next year. The New Jersey Assembly will take up similar bills this week; however, they are likely to modify the bills in light of labor union objections ( Philadelphia Inquirer, 2/23 ; Kaiser Health News, 2/23 ). New Mexico House Passes Bill Allowing Judges to Sentence Drug Offenders to Treatment : Despite rejecting the Substance Abuse and Crime Prevention Act ( HB 178) on February 12, the New Mexico House amended and passed the measure on February 16. HB 178 would allow judges to sentence drug involved offenders to substance abuse treatment rather than jail. Under the bill, the offender would pay for treatment and the state may pursue charges if the offender fails to complete treatment. The bill is now on the New Mexico Senate calendar ( AP via KWES, 2/16 ; New Mexico Legislature ). New York Update: Governor Patterson222s Budget Would Cut New York City222s Public Hospital Funding: The state budget that Governor David Paterson (D) proposed January 19 would cut $370 million in funding from New York City222s public hospitals. Governor Paterson222s budget would eliminate $70 million in Medicaid funding and nearly $300 million (50 percent) of the New York City Health and Hospitals Corporations222 Disproportionate Share Hospital (DSH) payments. DSH is a federal program that subsidizes hospitals treating large numbers of indigent patients. However, the governor222s proposal asks the New York Legislature to approve $187 million in cuts to private hospitals222 DSH funding, reallocating the money to the city222s public institutions and reducing the $300 million cut ( New York Times, 2/21 ; Kaiser Health News, 2/22 ). State Allocates Federal Substance Abuse Prevention Funds to Saratoga County : The New York Office of Alcoholism and Substance Abuse Services (OASAS) announced February 18 that it will allocate $19,907 SAMHSA222s Weekly Financing News Pulse: State and Local Edition February 24, 2010 2/24/10 7 in federal grant funding to the Alcohol and Substance Abuse Prevention Council of Saratoga County. The funding comes from $540,000 distributed among 27 prevention programs in the state. Saratoga County plans to use the funding to direct more resources to programs preventing teen drinking parties ( Saratogian, 2/19 ). Ohio State Rep. Balderson Introduces Bill to Require Drug Tests for Medicaid Enrollees: State Rep. Troy Balderson (R) introduced a bill ( HB 440) that would subject adult Medicaid enrollees to random drug tests as a condition of program enrollment. Under the bill, enrollees who refuse the tests, test positive for drugs twice, or fail to complete treatment following a positive test would be suspended from Medicaid for six months ( MedCity News, 2/17 ). Private Company Seeks Approval to Purchase, Reopen State Psychiatric Hospital : Amamata LLC has offered $1.7 million to purchase the former Twin Valley state mental health hospital in Dayton. If the Ohio Legislature approves the sale, Amamata plans to reopen the hospital this year. Amamata also plans to dedicate $6 million to improve the facility and says the site will offer a full array of inpatient services for youth, adults, and the elderly as well as services for individuals with co occurring disorders. The state closed Twin Valley in June 2008 ( Dayton Daily News, 2/19 ). South Dakota House Panel Rejects Bill to Lower Drinking Age : The South Dakota House Commerce Committee rejected a bill that would have lowered the state222s drinking age from 21 to 19 in certain clubs that serve only beer. State Rep. Tim Rounds (R) introduced the bill to give young adults a controlled environment in which to drink. If passed, the bill would have placed the state out of compliance with the National Minimum Drinking Act of 1984 . The act requires that states set their legal drinking age to 21 or lose 10 percent of their annual transportation funding, which would cost South Dakota $17.5 million annually ( AP via Daily Republic, 2/22 ; Join Together, 2/23 ). Tennessee Update: Medicaid Director Recommends Using Additional Federal Funds to Avoid TennCare Cuts : Tennessee Medicaid Director Darin Gordon advised Governor Phil Bredesen (D) to use the $120 million in one time federal funds resulting from a change in Centers for Medicare & Medicaid Services (CMS) policy to offset some of the governor222s planned $500 million Medicaid cuts. Gordon wants to use the funds to mitigate or postpone proposed service caps in TennCare, the state222s Medicaid program ( Chattanooga Times Free Press, 2/23 ; Kaiser Health News, 2/23 ). Utah Senate Approves Bill to Consider Costs When Placing Drugs on Medicaid222s Preferred Drug List : The Utah Senate approved SB 41 to make cost a factor in determining which drugs are placed on Medicaid222s preferred drug list. Currently, the Utah Drug Utilization Board may only consider a drug222s effectiveness and safety when determining placement on the preferred drug list. Under the bill, which received approval in the House Health and Human Services Committee February 19, cost would be secondary to SAMHSA222s Weekly Financing News Pulse: State and Local Edition February 24, 2010 2/24/10 8 other factors and Medicaid patients could appeal to have their drugs covered. Behavioral health professionals oppose the bill because they believe it will restrict access to expensive drugs including antipsychotics, antidepressants, anti seizure medications, and anti addiction drugs ( Salt Lake Tribune, 2/19 ). Update: House Approves Bill to Expand Insurance Exchange, Passes Other Health Reform Bills : The Utah House approved a bill ( HB 294) that would expand the state222s web based health insurance exchange to insurers offering coverage to groups with more than 50 employees. The exchange currently only offers coverage for small group employers. In addition, HB 294 would expand the scope of the state risk adjuster in 2013, to include insurers outside of the exchange when ensuring that risk is spread evenly among private insurers. The Utah House also approved HB 25 and HB 52 to simplify rules surrounding the sale of health insurance and further refine electronic standards. Meanwhile, the Utah Senate approved SB 39 requiring health insurers to provide enrollees with certain preauthorization statements ( Salt Lake Tribune, 2/23 ; Kaiser Health News, 2/23 ; Salt Lake Tribune, 2/17 ; Desert News, 2/16 ; Kaiser Health News, 2/17 ). Virginia Governor, House Committee, and Senate Committee Propose Budgets, Cut Medicaid and Mental Health: On February 17, Governor Bob McDonnell (R) publicly proposed $2.3 billion in budget cuts to help close an estimated $4.2 billion deficit. Governor McDonnell222s budget would cut $300 million from health programs including, reducing mental health treatment capacity by 232 beds and taking 5 percent of funds from community service boards offering behavioral health programs. In addition, the governor222s budget would freeze enrollment in a health insurance program for low income children and reduce Medicaid provider reimbursements by $28 million. Following the governor222s announcement, the House Appropriations Committee proposed $1.5 billion in cuts, including $200 million in health and human services cuts. The House222s budget would cut Medicaid provider payments and further restrict Medicaid and Children222s Health Insurance Program (CHIP) eligibility. Meanwhile, the Senate Finance Committee released a budget proposal calling for over $700 million in cuts, including a $344 million cut to health and human services. The Senate222s proposal also restricts Medicaid eligibility and reduces provider reimbursements; however, numerous lawmakers note that an extension of the American Recovery and Reinvestment Act (ARRA) Federal Medical Assistance Percentage (FMAP) increase could mitigate some of those cuts. The Virginia Hospital and Healthcare Association noted that reduced federal matching funds as a result of decreased state spending could cost Virginia an additional $720 million in Medicaid funding ( Washington Post, 2/17 ; Washington Post, 2/17 ; Capital News Service via Fairfax Times, 2/23 ; BusinessWeek, 2/22 ; AP via BusinessWeek, 2/22 ). Washington Insurance Commissioner Warns of Fiscal Situation for Public Employee Benefit Board : In a letter to Governor Chris Gregoire (D), Washington Insurance Commissioner Mike Kreidler warned that the state222s Public Employee Benefit Board fund227the fund that pays state employee health benefits227is suffering significant declines.Kreidler notes that preliminary 2009 estimates show the fund down by $200 million. The state pays 88 percent of employee health premiums; however, beginning in the 2007 SAMHSA222s Weekly Financing News Pulse: State and Local Edition February 24, 2010 2/24/10 9 2009 biennium, the state reduced contributions because of a fund surplus. The Governor222s Office was aware of the fund222s situation prior to Kreidler222s letter and Governor Gregoire requested an additional $60 million for the fund in her supplemental budget proposal ( SpokesmanReview via Seattle Times, 2/20 ). Wisconsin Update: Joint Budget Committee Clears BadgerCare Plus Basic Program : The Wisconsin Legislature222s Joint Finance Committee cleared Governor Jim Doyle222s (D) plan to create a new program, BadgerCare Plus Basic, to provide limited coverage for uninsured childless adults earning up to 200 percent of the federal poverty level (FPL) currently on the waiting list for the state222s BadgerCare Plus program. The state would fund the new program through a $1 million federal grant and a $130 monthly premium paid by program enrollees ( Superior Telegram, 2/17 ; Kaiser Health News, 2/18 ). Wyoming Five State Agencies to Update Behavioral Health Services Plan: The Wyoming Departments of Health, Education, Corrections, Family Services and Workforce Services have begun working to update the state222s comprehensive plan for mental health and substance abuse services. Wyoming222s current plan was created in 2001. A Spokesperson for the state noted that the behavioral health landscape has changed significantly since 2001, prompting the update ( AP via KIFI, 2/18 ; Little Chicago Review, 2/17 ). House Passes Health Care Reform Bills : The Wyoming House passed HB 128 to allow Wyoming residents to shop for health insurance across state lines. The bill would also create a multi state consortium of insurance commissioners to streamline insurance regulations. In addition, the House passed HB 108 authorizing the Wyoming Insurance Commissioner to create flexible guidelines for high deductible plans coupled with Health Savings Accounts (HSAs) ( Wyoming Tribune Eagle, 2/21 ).
