Legislative Updates & Alerts

GAMC Agreement Moving Fast

Governor Tim Pawlenty and DFL legislative leaders finally reached a deal to maintain the GAMC program. The “deal” fell apart several times during the week but a final legislative language was released to the public on Wednesday March 10, and the bill was heard and passed in both the House and Senate health finance committees on Thursday March 11.  Both bills are expected to be acted on by the full House and Senate by the week of March 15.

Most testifiers, including representatives of hospitals and the Minnesota Medical Association, supported the proposal under the rationale that some kind of program was better than no program.  MMA told committee members that this bill should not be billed as “reform” but as a cut to providers.  In addition, several testifiers told legislators that they must consider these cuts in balancing the budget.

The good news is that the deal continues the GAMC program beyond the scheduled elimination date of April 1, 2010.  The bad news is that it is significantly scaled back.  What has been an approximately $500 million per year program is now funded at $164 million. What had been a program that provided all services through inpatient and outpatient providers is now a program where services will only be reimbursed through hospital-based Coordinated Care Organizations (CCOs).

Effective, June 1, 2010 the Commissioner of Human Services may contract with the 17 hospitals that provide the most GAMC care.  Any hospital who becomes a CCO will be required to provide all services for GAMC patients, both inpatient and outpatient.  They will be paid a capitation fee to provide those services and they will be expected to accept all risk for the patient’s care.

Highlights of the proposal include:

• Preserves GAMC in its current form until June 1 with provider payments cut by 63 percent.
• Beginning June 1 the program would operate through a “coordinated care organization” (CCO).  The 17 hospitals representing about 70% GAMC caseload and providing geographic access would be eligible to be CCOs.
• The CCOs are required to coordinate and provide all necessary care for a set fee.
• Outpatient/physician services other than those provided by staff physicians of CCOs are not covered unless they contract with a CCO.
• From June 1 to November 30, 2010, hospitals that are not CCOs will share a $20 million uncompensated care pool to pay for GAMC patients who need medical services. After November 30, 2010, services are available only through a CCO.
• Beginning December 1, 2010, other hospitals may join but the pool of money is limited.
• Effective June 1, 2010, a prescription drug pool will reimburse pharmacies and other providers for prescription drugs. Prescription drug costs will continue to be covered outside of a CCO.  CCOs will be required to pay in the aggregate 20% of the state’s appropriation for the prescription drug pool.  Each CCO assessment must be in proportion to the system’s share of total funding provided by the state for CCDs.

The exact hospitals included in the 17 is not completely clear but they include Hennepin County Medical Center, Regions Hospital, University of Minnesota Medical Center-Fairview, Immanuel St. Josephs, North Memorial, Abbott Northwestern, St. Cloud Hospital, Mercy Hospital, Fairview Ridges, United Hospital, St. Mary’s Duluth Clinic, Mayo Psychiatric  Hospital, St, Mary’s Region Health Center-Detroit Lakes, Mercy Hospital-Carlton, North County-Bemidji, Mahnomen Hospital, and Rice Memorial-Willmar.

Also added back to the bill is the section that requires the commissioner, in consultation with the Drug Review Board and Pediatric mental health providers, to identify recommended dose ranges for atypical antipsychotic drugs and drugs used for ADD/ADHD based on available medical, clinical and safety data research.  The Commissioner is required to periodically review the list of medications and pediatric dose ranges and update the medications and does listed as needed after consulting the Drug Utilization Review Board.

In addition, situations where a collaborative psychiatric consultation and prior authorization should be required before the initiation or continuation of drug therapy in pediatric patients, including, but not limited to high-does regimen, off-label use of  prescription medication, a patient’s young age, and lack of coordination among multiple prescribing providers must be identified.

DHS will also track prescriptive practices and uses of psychotropic medications in children with the goal of reducing the use of medications, where appropriate.  Effective July 1, 2011, the commissioner must require prior authorization and a collaborative psychiatric consultation before an atypical antipsychotic or ADD/ADHD drug meeting the criteria established under this provision is eligible for payment.  The collaborative psychiatric consultation must be completed before the identified medications are eligible for payment, unless: the patient has already been stabilized on the medication regimen; or the prescriber indicates the child is in crisis.  In this case the consultative evaluation must be completed within 90 days.

Dr. Schiff has indicated that Minnesota has a good track record in this area—and the medical community has not been identified as a state that over subscribes medication for
children.  This provision has been strongly supported by NAMI.

ADD/ADHD Diagnosis for Special Education

The ADD/ADHD (H.F. 2995/S.F. 2708) bill was considered in the Education policy Committees and there were several amendments considered.  This bill is being pursued by the Minnesota Social Workers Association to allow social workers to make a diagnosis of ADD and ADHD for the purposes of getting an independent medical plan for kids in school. There was discussion by the special education community that adding practitioners who could diagnose ADD/ADHD might lead to more referrals for special education services without providing the schools more money for this.  Senator Solon wanted to pursue her amendment to add educational requirements for the social workers.

The bill passed out of the House Education Committee limiting the new authority to diagnose ADD/ADHD to social workers and counselors.  One version of the bill also allowed Marriage and Family Therapists to do this but they were deleted from the proposal.  An amendment that would have required these two groups to be allowed to diagnose ADD/ADHD only if  the practitioner “successfully completed course work and supervised clinical experience in administering, interpreting, and integrating psychometric testing for the purpose of differential diagnosis,” failed after testimony from the school social workers opposed it as well as the bill author.  As the bill now stands in the house, social workers and counselors will be added as practitioners who can make the diagnosis.

Primary Caries SF633/HF984

The bill that passed last year in the House that encouraged physicians to perform primary caries prevention at the time of the child and teen check up was acted on in the Senate.  The Senate author adopted last year’s House language which dropped the mandate for screening and defines prevention services to include a visual exam of the mouth without using probes or other dental equipment, risk assessment using an AAP and Pediatric Dentistry tool, and a fluoride varnish beginning at age 1 to those assessed by the provider of being high risk for decay.  Pediatricians are already reimbursed for these services. If a pediatrician provides these services they must provide and document in the medical record that the family received information about preventing dental disease and the importance of finding a dental home.

Governor Recommends Drastic Cuts to Medical Education

The Governor’s proposed supplemental budget contains a $55 million reduction to the Medical Education and Research Cost (MERC) fund.  This is the main state funding program that supports a portion of the costs of the required clinical training for health
professional students and residents.  This 83% reduction will affect the University as well as our partner sites – hospitals, clinics, and pharmacies throughout Minnesota — where clinical training occurs.

MERC covers clinical training of medical students and residents, dental students and residents, pharmacy students and residents, advanced practice nursing students, physician assistant students, and chiropractic students.   The purpose of the fund is to compensate hospitals, clinics, and other health care providers for a portion of the costs of clinical training.  MERC is administered by the Department of Health.  MERC funds can only go to organizations that provide clinical training to students and residents from one of the state’s Sponsoring Institutions (e.g. U of M, Mayo, Hennepin, St. Scholastica, state colleges).  In essence, the money follows the students and goes to hospitals, clinics, and pharmacies.

MERC funds go both to medical schools and to residency training sites.  The Governor recommends cutting the dedicated payments to the University of Minnesota (Academic Health Center and Dental School) and University of Minnesota Medical Center, Fairview    ( 32.5 percent cut to $5.35 million in 2009).  He also recommends cutting the general distribution to eligible hospitals, clinics, pharmacies, and other providers based on their proportion of medical assistance and general assistance medical care (87.5 percent cut to $60.7 million in 2009).

Biggest impact of the residency cuts are (estimated in millions):

Committee Deadlines and Budget Resolution

As the second committee deadlines approaches, legislators are rushing to get policy bills passed by, Friday, March 19th.   Bills must be through all policy committees by Friday to remain alive for the year, unless a special vote is taken in the rules committee.   March 29th is the third deadline, where finance bills are to have cleared their finance divisions.  Leadership indicated that they may waive the committee deadline for health and human services and K-12 until there is action by the federal government on the FMAP extension and health care reform.  Legislators will be taking most of the Passover/Easter week off.
The House Budget Resolution was announced and cuts of $155 million out of HHS assuming $408 for FMAP and $147 for GAMC.  If FMAP does not come through and GAMC does not pass, the HHS target is down $710 million. This does not include any assumptions for additional funding if federal health reform is adopted.

No Smoking in Cars with Kids?

The House Health and Human Services Policy and Oversight Committee on Wednesday heard H.F. 379 (Slawik, DFL-Maplewood).  The bill would allow law enforcement officers to issue citations to drivers of cars in which smoking was occurring and a child under 18 was present.  Tickets could be issued only if the driver was stopped for another offense.  After hearing testimony from public health officials, the bill was laid on the table.  Rep. Slawik said that she remains committed to passing the bill, but that the issue is not yet ready to move forward.

Alcohol Prices to Go Up?

The House Health Care and Human Services Finance Division on Tuesday heard two bills that would increase taxes on alcohol to fund CD treatment and law enforcement costs of treating substance abuse.  H.F. 1896 and H.F. 2125 (Clark, DFL-Minneapolis), would increase excise and gross receipts taxes on alcohol, proposals opposed by alcohol retailers and manufacturers.  The bills were laid over for possible inclusion in the omnibus HHS finance bill.  Last year an alcohol tax increase was in the tax bill vetoed by the Governor.

Sara Noznesky, MN-AAP Lobbyist

Mark Your Calendar! Peds Day at the Capitol is March 3rd

There are no children in the legislature and no pediatricians elected at the state capitol. Legislators need to hear from you on issues important to you and your patients.

Date: Wednesday, March 3rd
Time: 12:30- 4:00 p.m.
Location:  Minnesota State Capitol

Agenda
12:30   Registration, Capitol Room 118
1:00     MN-AAP issue overview
1:15     Advocacy 101: How to be an advocate for your patients and your practice
1:45     Discussion with key legislators
2:15     Meet with your legislator and attend a Legislative hearing
4:00     Debrief and follow up, Axel’s on Grand Ave. in Saint Paul.

For more information contact either Sara Noznesky at snoznesky*AT*mnmed.org or Melissa DeBilzan at debilzan*AT*mnaap.org.

RSVP to Melissa DeBilzan at debilzan*AT*mnaap.org so that we can set up an appointment for you. Please include your home address in your email so that we can set up a meeting the correct elected representatives.

Pawlenty Releases Budget Changes: Cuts All Around, One Small Positive for VFC Admin Fees

Gov. Tim Pawlenty presented his supplemental budget Monday that outlines how he would erase a $1.2 billion state budget deficit.  Keeping with his ongoing pledge to not raise taxes, his budget recommendations rely on cuts to his familiar targets of health care and local government aid. He also relies on $387 million in federal money that has not yet been approved by Congress.

The budget proposal cuts $347 million from health and human services program. About one-third of those savings would come from reducing MinnesotaCare eligibility for single adults from 250 percent of poverty ($27,084 a year) to 75 percent of poverty ($8,124 a year).  Hospitals and long-term care facilities receive significant cuts. The 1.5 percent rate cut for non-primary care physician services established through unallotment is extended two additional years under the proposal.

For details on the Governor’s budget recommendations click on the following link to the Department of Budget and Management: http://www.mmb.state.mn.us/

The proposed change would result in about 21,500 low-income adults losing their health care. MinnesotaCare is a premium-based program for working Minnesotans that provides subsidies on a sliding scale.  If passed, the only adults without children who would qualify for MinnesotaCare would be those who in past years qualified for the General Assistance Medical Care program.

The proposal also undercuts Minnesota’s efforts to achieve universal coverage and health care reform. The budget proposal includes cutting $10 million from the State Health Improvement Program – a statewide effort to reduce tobacco use and obesity by making communities healthier that was passed as part of Minnesota’s 2008 Health Care Reform Act.

The only silver lining in the budget proposal is the recognition for the need to address issues surrounding the administration fee for vaccines provided under the federal Vaccines for Children program. The proposal increases the amount of reimbursement for administration of non-MNVFC vaccine supplied by the federal government but not in conjunction with an office visit from $1.50 to $8.50. The increase is paid for by suspension of the fee paid to retailers such as grocers for each food support EBT transaction (electronic card payment).

 GAMC Passes the Legislature—Already Vetoed by Governor

What looked like a bipartisan effort to save the GAMC program was abruptly halted by Governor Pawlenty with his veto of a bill to continue coverage Thursday night.

Efforts to maintain coverage for recipients of General Assistance Medical Care (GAMC) coverage continues to move quickly through the Legislature.  Governor Pawlenty has proposed transferring these individuals into the MinnesotaCare program beginning April 1, 2010.  The DFL legislative leaders are proposing maintaining a scaled back GAMC program with a 50 percent cut to physician payments.

The Senate passed an amended proposal Thursday, February 11 to continue the GAMC program. The Senate dropped a funding source that would have assessed a hospital and HMO surcharge designed to draw down more federal Medicaid money, but kept steep reimbursement cuts.  The bill passed on a party-line vote of 45 to 20, with DFL lawmakers supporting it.

Before passing the bill, the Senate dropped the surcharge on hospitals and HMOs in response to indications that Gov. Tim Pawlenty would veto a GAMC fix that included the surcharge.  To pay for the bill, the bill’s author Sen. Linda Berglin, DFL-Minneapolis, proposed using $110 million that was scheduled to be transferred from the General Fund to the Health Care Access Fund in 2011. The $110 million transfer had been scheduled to cover the additional costs expected to occur as a result of the governor’s plan to transfer GAMC enrollees to MinnesotaCare.

The House version of the bill, authored by Rep. Erin Murphy, DFL-St. Paul, was passed on Thursday February 18 with a bipartisan vote of 125-9.  Many looked at this vote as a sign that the Republican Governor would sign the bill.  Surprisingly, Thursday night he announced that he had vetoed the bill because it “does not represent meaningful reform and does not address fundamental cost issues.”  If you’re interested, read the Governor’s veto message.

Legislative leaders said they will attempt to override the Governor’s veto as early as Monday February 22.  In order to be successful they will have to convince at least three House Republicans to vote for the override in order to get the two-thirds voted needed.

Amended Dental Caries Bill Moves Forward

Legislation encouraging physicians to provide basic dental screenings for children as part of their child and teen check up is moving forward.  HF 984 (Norton-DFL, Rochester) was amended last year in response to MN-AAP concerns, from language that mandated that these services be provided by physicians to language that says the Commissioner of Human Services shall encourage physicians to provide these services.  The services would include a general visual exam of the child’s mouth without using probes or other dental equipment, a risk assessment using the factors established by the American Academies of Pediatrics and Pediatric Dentistry, and application of fluoride varnish beginning at age 1 to those children assessed by the provider as being high risk.

The bill passed the House Finance Committee on February 16 and is awaiting final action on the House Floor.

The Senate companion bill SF 633 (Berglin-DFL, Minneapolis) is in the Senate Finance Committee.  It still has the old language mandating the service, but the expectation is that Senator Berglin will adopt the House language.

Complete Streets

On February 16th the House Transportation Policy and Finance Committee held a hearing on Complete Streets policy. The bill, SF2461 (Lourey-DFL, Kerrick) and HF 2801 (Obermueller-DFL, Eagan), implements a “complete streets” policy for state-funded roads. “Complete streets” is a method for planning, scoping, design, implementation, operation, and maintenance of roads in order to reasonably address the safety and accessibility needs of users of all ages and abilities. It is also expected to support safe walking and biking, thereby one of many important policy changes to increase the overall activity level of children and adults alike.

The bill was amended and laid over for further discussion.

Mental Health Professionals Want Authority to Make ADHD Diagnosis

A number of other bills have been introduced that the MN-AAP will be reviewing. HF2995/SF2708 sponsored by Rep. Tillberry (DFL-Fridley) and Sen. Lynch (DFL-Rochester) would allow all mental health professionals to diagnose ADD and ADHD for purposes of identifying a child with a disability in a school setting.

Currently a licensed physician, an advanced practice nurse, or a licensed psychologist is qualified under law to make a diagnosis. Proponents of the bill say that allowing mental health professionals to make this diagnosis would stream line the process and make it easier for parents to bring the diagnosis to the school.

Birthing Centers Legislation Returns, No Requirements to Ensure Safe Outcomes for Newborns

SF2702/HF3046 sponsored by Sen. Linda Berglin (DFL, Minneapolis) and Rep. Maria Ruud (DFL-Minnetonka) would require licensure for birthing centers to be established in the state.  Currently there are no standards for birthing centers in the state, yet a recent Pioneer Press article highlighted a new birthing center in Saint Paul.

The bill establishes licensing standards for facilities not connected to, or associated with, a hospital to perform low-risk deliveries following low-risk deliveries. Low-risk pregnancy is defined to be a “normal, uncomplicated prenatal course as determined by documentation of adequate prenatal care and the anticipation of a normal uncomplicated labor and birth, as defined by reasonable and generally accepted criteria adopted by professional groups for maternal, fetal, and neonatal health care, and generally accepted by the health care providers to whom they apply.” Birthing centers would also be precluded from abortions, general or induction anesthesia and surgical procedures except those normally accomplished during an uncomplicated birth, including episiotomy and repair.

There is no consideration for immediate newborn care currently in the legislative proposal.  The MN-AAP will monitor the bill to ensure safe outcomes for newborns.

Compromise Reached on Limitations to Board of Medical Practice Authority

Legislation to limit the Board of Medical Practice’s (BMP) ability to take action against a physician solely on the basis of prescribing, administering, or dispensing long-term antibiotic therapy to a patient who has been clinically diagnosed with chronic Lyme disease was withdrawn for consideration in the House Health Care & Human Services Policy and Oversight Committee on February 17 following a compromise agreement with the BMP.

The bill SF 1631 (Marty-DFL, Roseville) and HF 2597 (Ward-DFL, Brainerd), would have put the BMP limitation in statute, creating a very bad precedent of having the Legislature tell the BMP how to regulate medical practice and how to define the standard of care.  Under the compromise no legislation will move forward and the BMP will voluntarily agree to a moratorium on taking action related to Lyme disease for up to five years while more study is done on the efficacy of long-term antibiotic therapy for Lyme.

Chiropractic Practice Expansion

The Minnesota Chiropractic Association is planning to introduce legislation to rewrite portions of the chiropractic practice act.  The bill would change the definition of chiropractic from “the science of adjusting any abnormal articulations of the human body…” to “the health care discipline which emphasizes the inherent recuperative power of the body to heal itself without the use of prescription drugs or surgery.  Chiropractic focuses on the relationship between structure, primarily the spine, and function, as coordinated by the nervous system, and how that relationship affects the preservation and restoration of health.”  The bill would also authorize chiropractors to use the term “Chiropractic Physician” with patients.

Sara Noznesky, MN-AAP Lobbyist

The Legislature has moved into the final days before the constitutionally-required adjournment date Monday, May 18. Unfortunately, the Governor and legislative leaders have not yet reached agreement on budget items. In order to avoid a special session, a global agreement with the Governor would need to be reached by the end of this week to allow sufficient time to process bills and complete their work on time. While this seems unlikely right now, it is still entirely possible. Stay tuned.

Child Passenger Safety Passes House

The child passenger safety (booster seat) bill (SF99) has passed its final hurdle and could become law by the end of the week. Previously passed by the full Senate, the bill passed the full House this evening overwhelmingly 85-42. Next, the Senate will need to either accept the changes made by the House or reconcile difference in conference committee.

The Governor signed the bill on 5-15-09.

Newborn Screening Bill Still Stalled in the Senate

The newborn screening bill is set for a full House vote on the House floor but has stalled in the Senate waiting for one last hearing. The Department of Health needs this bill to pass this session so they can maintain this critical program and step up parent and provider education about the program.

Please contact your legislators and Gov. Tim Pawlenty to urge them to support a bill that will protect Minnesota’s newborn screening program. This life saving program has been under siege once again this session by privacy zealots so legislators need to hear from you about the importance of this program for children’s well-being.

First Omnibus HHS Bill Passes

The big news this week is that the House and Senate completed work on their Health and Human Services Omnibus bill conference report early Sunday morning after a full week of work concluded with a 20-hour sprint to the finish.

This bill passed both bodies this afternoon but the Governor is expected to veto the bill immediately because the reductions are substantially than he proposed. Nevertheless, the contents of the bill are still important as this will become the base for the second bill.

Following is a summary of relevant provisions:

Article 4, Department of Health

Health Information Technology

• Requires the  uniform standards to be updated on an ongoing basis and an annual report to  the legislature.
• Requires the  electronic  health record to be a “qualified electronic health  record—makes other changes to conform with federal law.
• Authorizes the  commissioner to collect certain data.
• Establishes a loan  account.

E-Prescribing

• Requires “backward compatible” and NCPDP SCRIPT
• Requires the use of E-Prescribing by January 1, 2011.

Prior Authorization and Uniform Formulary
Requires the Commissioner of Health in consultation with the Administrative Uniformity Committee at the Department of Health to develop, by July1, 2009 or in six weeks from adoption of this section, a uniform prior authorization and formulary exception form. All group purchasers must accept this form (including part D) or by phone. An electronic system must be in place by January 1, 2011. Effective January 1, 2011, the uniform drug authorization must be accessible by health care providers, and accepted and processed by group purchasers, electronically through a secure Internet site.

Medication Therapy Management
Requires a Pharmacy Benefit Manager that provides prescription drug services must make available medication therapy management services for enrollees taking four or more prescriptions to treat or prevent two or more chronic conditions. Defines medication therapy management duties—including identifying drug interactions, communication essential information to the patient’s primary care providers and education the patient.

Article 5, Health Care

Outreach Grants
Adds outreach, targeting geographic areas with high rates of families with un-enrolled children and racial and ethnic minorities with health disparities.

School District Enrollment and MA Billing

• Requires public and charter schools to comply with state health care program outreach requirements.
• Requires districts to have the applications available, maintains current law requirement that schools designate an enrollment specialist, and requires districts to have a link on their web site on how to obtain an application and enrollment assistance.
• Allows the commissioner to use an interim rate and then a settle up payment.
• Establishes an open enrollment process for MnCare that is tied to the public education system.
• Establishes a “fast lane” process that would blend MNCare and Free and Reduced lunch applications.

Urgent Dental Care Services

• Authorizes pilots to reduce the total costs to the state dental services provided to persons through emergency rooms.
• Establishes a subcommittee to the health services policy committee to advise the commissioner on criteria for critical access, coverage, delivery models, and services to be added or eliminated. And study of critical access dental providers.
• Defines the services that will be eligible for dental coverage for non-pregnant adults.

Health Services Policy Committee
Adds study of reimbursement based on patient-centered decision making, high cost specialty services where there is a high variation in utilization across physicians, and best practice policies to minimize C Sections including standards and guidelines for health care providers and health care facilities.

Non-Payment for Certain Hospital Acquired Conditions.
Adopts non-payment language for the federal nonpayment for never events including hospital acquired infections and medical errors, however, adds additional conditions for non-payment for both hospitals and physicians.

Early Hearing Detection
Increases the newborn screening fee to provide funding for early hearing services to families identified through the universal newborn hearing screening.

Payment Reform
Requires the commissioner by January 1, 2011, to establish performance thresholds for providers included in the provider peer grouping system developed by MDH. Effective January 1, 2012, any provider with a combined cost and quality scores below the threshold shall be prohibited from enrolling as a vendor in state health care programs.

Colorectal Screening
Extends MA coverage to participants who have been screened by the demonstration project and who needs treatment. Allows State-only funded MA to be paid for individuals screened by the demonstration project. Adds an expiration date that coincides with a colorectal cancer prevention demo project—December 31, 2010.

Anesthesiology Payment Limits
Limits the reimbursement for anesthesiology services provided to physicians for the medical direction of CRNA’s shall be the same as the rate paid to CRNA under medical direction.

Pharmacy Rate
Reduces the pharmacy rate from AWP minus 14% to AWP minus 15%. Adds PA’s to list of eligible providers.

Prior Authorization of Diagnostic Imaging
Effective January 1, 2010, requires prior authorization for outpatient CT, MRI, MRA, PET, cardiac imaging and ultrasound diagnosis imagining. Exempts prior authorization for ER, inpatient hospitalization, or concurrent or on the same day as an urgent care facility visit. Allows DHS to contract with a private entity and must be based on evidence based medical literature. Exempts, Medicare and PMAP.

Eligibility Increases
Incorporates a number of eligibility increases for children under 275% of FPG, and also allows children and families to buy MnCare without restrictions under 200%.

Asthma Demonstration Project
Establishes a pilot with at maximum of 200 American Indian Children in first class cities to  include HEPA filters, and other furniture, bedding and equipment to reduce toxins.

Claims and Utilization Data
Requires a report by December 15, 2009 to allow for the release of summary data on claims and utilization for Minnesota Government Programs to the U of M and Mayo and other institutions to conduct an analysis of health care outcomes and treatment effectiveness.

Administration of Publicly Funded Healthcare.
Requires DHS to study the alignment of services to families and children and report by September 15, 2010.

COBRA Premium State Subsidy.
Pays 35% of the COBRA until December 31, 21010 for people who elect COBRA and are eligible for state government programs.

Pilot for Intensive Medication Program
Requires the commissioner to establish a pilot project for an intensive medication program for patients with chronic conditions and a high number of medications.

Managed Care Contracts
Health plans objected to proposals to recapture monies in their reserves but legislators were unwilling to let them off the hook from experiencing cuts like other constituencies in the health care arena. This provision creates a new withhold for health plans and also extends the withhold to county based purchasing. Withhold is 3.5% from January 1, 2010 to December 31, 2010. Effective for January 1, 2011,through December 4%, for calendar year 2012 and 2013 withhold 4.5% and for 2014 goes back down to 3%.

Specialty Provider Payment Ratable Reduction (MA, GAMC, MNCARE)
Effective July 1, 2009, physician and professional services will have a 5% ratable reduction for fee for service, and January 1, 2010 for health plans (PMAP). Certain primary care outpatient services provided by primary care physicians are excluded from the cut (procedure codes 99201 to 99215 and codes 99381 to 99412). PT, OT, Chiropractic and other basic care services are reduced by 3% for FFS and for October 2, 2009 for PMAP.

Based on feedback from the MN-AAP, legislators recognize the need to expand the list of CPT codes and have committed to ensuring all general pediatric services (as well as geriatrics, general internal medicine, family medicine, women’s preventative health and family planning) are protected from cuts when a final budget bill is completed.

C-Section –Blended Rate
Effective October 1, 2009, requires a single rate for the following DRG’s 371, 372, and 373, consistent in the increase of vaginal deliveries and reduction in C-Sections, such that the reduction in C Sections is less than or equal to one standard deviation below the average in the frequency of cesarean births for Minnesota health plan program clients at hospitals performing greater than 50 deliveries per year. Also establishes blended rate for professional services. Eliminates prior authorization.

Article 7, Chemical and Mental Health

Autism Spectrum Disorders Task Force
Creates the Autism Spectrum Disorders Task Force composed of 15 members. Two physicians, one named each by the MN-AAP and MAFP, are included as members of the Task Force. The Task Force is significantly scaled-back from the original proposal which included 28 members.

Sara Noznesky, MN-AAP Lobbyist

The Legislature shifted gears again this week as Finance committees held their final meetings and quickly passed omnibus spending bills. They have engaged in lengthy floor sessions in order to consider amendments and pass bills. Once budget bills pass both the House and Senate, conference committees will begin. House and Senate Leadership will meet to establish new global targets for each area of spending. At that point, members of the House and Senate will meet to reconcile differences in their bills before reaching a final agreement. Conference Committees are required to complete their work by May 7.  Whether the Governor participates in the discussions (and when he joins) may be an indicator for how long the legislature will be in session. Most insiders expect that the Governor will veto the budget bills as soon as he receives them because the bills are dependent on revenue from tax increases which the Governor opposes.

House Health and Human Services Budget Proposals Released

The House released its proposed Health and Human Services Budget earlier this week. Overall patients and providers did significantly better under the House proposal than under the Governor’s proposal. This is primarily due to the fact that the House proposes to raise $1.5 billion in revenue to help close the budget gap, leaving just over $400 million in cuts necessary in the HHS area. In comparison, the Governor cut $2.2 billion from the HHS budget over the same two-year period.

Following is a brief overview of the finance provisions in Rep. Tom Huntley’s bill, H.F.1362.
The House did not accept the most egregious of the Governor’s recommendations, namely dramatic cuts to eligibility and benefits (including dental, PT, OT and speech language pathology). The House also rejected the Governor’s proposal to eliminate the Health Care Access Fund and merge the revenue into the General Fund. Finally, the House rejected the Governor’s proposal to virtually eliminate the Statewide Health Improvement Plan (public health funding). The House and Senate are expected to try to capture as much federal funding as possible both from the stimulus package and S-CHIP reauthorization package.

The House bill includes the following items:

• 3% reduction for providers, except primary care providers (family physicians, pediatricians, internists, pediatric, family, adult and geriatric nurse practitioners)  Excludes radiology, lab, rx, medical supplies and primary care – (procedure codes 99201 to 99215) and preventive medicine services (procedure codes 99381 to 99412)
• 3% ratable reduction for hospitals
• 5.2% ratable for Mental Health DRG’s 2009, made to hospitals for mental health services within diagnosis-related groups 424 to 432 liability
• Modified adult dental program rather than elimination of the benefit
• Managed care withhold to reduce ER admissions ($1.3 million FY10/11)
• Eliminate patient incentive grants.
• E-Health Initiative and E-Records loan program–$4 million to get $20 million federal—some funding is retroactive (consistent with federal stimulus)
• Pharmacy reimbursement cut 1%
• Funding to create uniform formulary exception and prior auth forms
• Patient-Centered Decision Making as a study
• Express lane eligibility for children via free and reduced school lunch applications
• Presumptive eligibility for children
• Study on aligning income methodology for eligibility for families and children for MA and MNCare
• Autism Task Force
• Reform for Personal Care Assistance eligibility and benefits

Senator Berglin’s Health and Human Services Budget proposal is expected either over the weekend or early next week. Many of the provisions the MN-AAP has expressed concern about are expected to be included in Senator Berglin’s bill including prior authorization for ADHD and mandatory primary caries prevention. Her budget bill is required to cut an additional $200 million (for a total of nearly $600 million) and is expected to be more painful than Rep. Huntley’s bill.

As a result of delays receiving fiscal notes, neither the House nor Senate HHS Budget bills met the legislative deadline and will make an additional procedural committee stop before advancing next week.

Provider Tax Increase

The legislature continues to dance around a potential increase in the provider tax. A sick tax increase had been hinted at as a possible part of the final solution since the beginning of session. Both Representative Huntley and Senator Berglin introduced bills last week to raise the tax.

The House Tax Committee held a hearing on H.F.2315 (Huntley) to raise the tax 1% in order to hear the pros and cons of the provider tax.  After hearing from many provider groups in opposition, including physicians, the bill was laid over without any action.  The House did not include an increase in the provider tax as part of their initial proposal.

When the Senate Tax Committee chair introduced his version of the tax bill on Tuesday without a provider tax increase it looked like the issue was dead for now.  But then on Wednesday, the Senate Tax Committee amended the Senate tax bill to include a placeholder for increasing the provider tax on hospitals and surgical centers only.  The language leaves the amount of the increase blank. The amendment excludes physician services.

Chair of the Senate Tax Committee, Thomas Bakk, DFL-Virginia, has said he does not want to increase the sick tax. However, he wanted to amend the bill as a procedural matter, so that if the negotiations with the Governor do in fact result in an increase the provider tax, the change will be codified in the tax bill instead of the budget bill.

A number of committee members made statements during the committee that they do not want to increase the sick tax, but the fact that they have this “placeholder” language is disconcerting – the Senate has now created an opportunity for that very thing to happen.

Early Childhood Bills Also Move

Early Childhood is an important topic at the capitol this session as well. H.F.2088 (Slawik), the House Early Childhood Omnibus bill passed earlier today. The Senate E-12 Education bill, S.F.1328 (Stumpf), passed before the recess. Differences in the bills will now be worked out in conference committee.

Sara Noznesky, MN-AAP Lobbyist

A Short Break for Legislators to Gear-Up for Upcoming Deadlines

Minnesota legislators took a break for Easter and Passover before coming back to face some difficult spending decisions. Lawmakers returned Tuesday and the pace picked up quickly as they faced a Thursday deadline for all finance bills to have made their rounds through the finance divisions. Internal deadlines give legislative finance committees less than a week after that to put the finishing touches on spending bills before sending them to the House and Senate floors for votes.

Tuesday April 7 was the second committee deadline for the Legislature.  With the passage of this deadline bills must be through all non-tax and finance committees in order to be considered alive.  Because of this, all policy committees are now done with their work for the year.  Also, we now have a better idea what bills are alive and what bills are dead.

Now Starts the Budget Work

Minnesota’s Constitution requires the Legislature to adjourn no later than May 18. It is still unclear whether or not the Democrats, who control both the House and the Senate, and Republican Governor Tim Pawlenty can reach agreement on a new state budget. If not, the Governor would have to call a special session before the state budget expires on June 30.

With deadlines for policy committees behind us, the work on passing a balanced budget will now become the main focus of the Legislature.  The most recent budget forecast projects a $6.4 billion deficit for the next two year period. With the help of the federal stimulus money that shortfall has been reduced to $4.6 billion. The Legislature is required to pass a balanced budget before they adjourn.  This can be done through spending cuts, revenue increases, or most likely, a combination of both.

Governor Pawlenty continues to promote a budget that includes no new tax increases and large cuts to the health and human services programs. Because of strings that are attached to the federal stimulus money, he is no longer recommending eligibility cuts for Medical Assistance (MA) or MinnesotaCare.  He is still recommending a 3 percent payment cut to all providers, elimination of most of the optional benefits for adults enrolled in MA, and elimination of the Health Care Access Fund.  The Governor’s recommendations total more than $1 billion in cuts to the health and human services programs over the next two years.

The Senate Democrats have released an outline of their budget recommendations that includes a 7 percent across the board cut to all program areas (including K-12 education) and $2 billion in new revenues. They argue that this is the fairest approach so that no one program takes the brunt of the cuts.  The size of a 7 percent cut to the HHS area totals $719 million in cuts.  When stimulus money is added the 7 percent cut is offset to a 5.9 percent cut, totaling $606 million in cuts.

The House Democrats most recently released their budget ideas. Their outline protects K-12 education from cuts, cuts health and human services programs  between 4 and 15 percent, protects the Health Care Access Fund, shifts nearly $1 billion into the next biennium, and recommends $1.5 billion in new revenues.  The targets for cuts to the HHS areas total $489 million in cuts, or just less than 5 percent.

The task immediately before legislators is to begin passing omnibus budget bills out of committee.  With cuts ranging from $500 million to over $1 billion needed, the challenges that face them are great.  Because the size of the cuts, discussions are floating about using an increase in the Provider Tax to help solve the problem.  The 2 percent Provider Tax raises over $500 million each year.  Even a ½ percent increase would raise $250 million over the two-year biennium.

Also of interest to physicians is that fact that both the House and the Senate are considering modifying the Governor’s recommendation to cut MA physician payments by 3 percent.  The Governor recommends cutting payments for all outpatient providers y.  Sen. Berglin and Rep. Huntley are recommending cutting every provider 3 percent except for office visits and preventive services provided by primary care providers.  This is an acknowledgement that primary care physicians are under-reimbursed for their services.

Following is an update on the status of a number of policy bills.

Prior Authorization for ADHD Drugs and e-Prescribing

SF 1401 (Berglin) requires the Commissioner of Human Services to establish a utilization review program within the MA program for attention deficit/hyperactivity disorder (ADHD) and attention deficit disorder (ADD) medication and psychotropic medication prescribed to children. The program would require prior authorization for ADHD medication prescribed to children younger than five years of age and a second opinion from a commissioner-approved provider. The bill also requires a physician to receive a second opinion from a commissioner-approved provider for children ages 5 to 18 years of age for ADHD medications that exceed certain dosages.

This is being pursued because a similar program in the state of Washington saved their Medicaid program over $1 million per year in prescription costs.

The MN-AAP is working with the Minnesota Psychiatric Society to express concerns about added prior auth requirements and the impact the bill could have on access to mental health services for children.

The bill also requires the Commissioner of Human Services establish a pilot project to incorporate e-prescribing applications with a clinical information database to reduce errors, increase patient safety, duplication of therapies and reduction in waste.  The commissioner shall ensure that each provider identified has the ability through e-prescribing software to receive the following:
(1) a patient’s specific medication history for the last 100 days;
(2) the preferred drug list and formulary verification;
(3) prescription details; and
(4) drug interaction alerts.

The commissioner shall evaluate the project in terms of the number of prescriptions written by the providers participating in the demonstration project and report to the Legislature by March 15, 2011.

Health Care Homes Required for Chronic Disease

To ensure the use of health care homes, legislation is moving in the Senate that would require MA patients with chronic or complex disease to select a primary care clinic with clinicians who have been certified as health care homes.  SF 1474 (Berglin) would implement this requirement only if there are two or more primary care clinics with clinicians who have been certified as health care homes available to the enrollee.

This bill is awaiting action in the Senate Finance Committee and could be included in the omnibus HHS budget bill.

Newborn Screening Changes Now in Omnibus Policy Bill

Legislation designed to allow Minnesota’s newborn screening program to continue is moving forward in a compromise version that still has many opponents. Last year Governor Pawlenty vetoed needed legislation because of concerns with privacy advocates over the ongoing use of the gathered blood spots without parent’s consent.  The compromise language (found in HF1341, Thissen) requires that all bloodspots be destroyed within 25 months unless the Department of Health has parental consent to keep the specimens longer.

The Senate companion bill to HF 1341 did not make the committee deadline because key Senators did not support the compromise that the Governor proposed.  They believe that it will severely threaten our role as a pro-medical research state.  To keep the bill alive the House language has been amended into a separate bill, HF 1760.  This bill has met deadline in both bodies.

Booster Seats and Primary Seatbelt Penalty

Two bills to strengthen our traffic safety laws to protect vehicle passengers are still moving through the legislative process. Child passenger safety bill has passed the Senate floor and met the policy committee deadline in the House. The bill, SF 99 (Carlson), would require children up to 8 years old and 4 feet 9 inches tall to use proper child restraint systems, such as booster seats. The bill is scheduled for a hearing Monday morning in the full House Finance Committee.

The seatbelt bill SF 42 (Murphy) would make not wearing a seat belt a primary offense, which would allow officers to stop and ticket motorists for not wearing their seat belts.  Currently, drivers can be ticketed for not wearing a seat belt only if they are stopped for another violation. This bill is also still alive in both the House and the Senate.  It is awaiting action is the finance committees of both bodies.

Dental Caries Prevention

A bill related to primary care physicians performing fluoride varnish and dental exams during Child and Teen Check Ups met the policy deadline. The Senate version of the bill (SF633, Berglin) requires that primary care providers do an inspection of the oral cavity and apply a fluoride varnish as part of any child and teen checkup. Pediatricians and family practice doctors raised concerns about this being a mandate. If the preventive check is done, the primary provider must inform the patient of the etiology of dental caries, and the importance of a dental home, and advise the parent that they contact the HMO or DHS in order to secure an appointment. The Senate passed the bill with the mandate in place to the floor—although it was referred back to the finance committee for an anticipated fiscal note. It is unclear whether the bill will be included in the Senate budget package due to an anticipated fiscal note.   The House language (HF984, Norton) is permissive and has no fiscal note therefore it passed out of the House policy and finance committees.

Prior Authorization and Uniform Formulary

This bill, initiated by St. Mary’s Duluth Clinic, requires the commissioner of health, in consultation with the Minnesota Administrative Uniformity Committee, to develop a uniform prior authorization and formulary exception form that allows health care providers to request exceptions from group purchaser formularies, including Part D plans, using a uniform form, within six weeks from the enactment date or July 1, 2009, which ever is later.  Effective January 1, 2011, the uniform prior authorization and formulary exception form must be accessible by health care providers, and accepted and processed by group purchasers, electronically through a secure Internet site.  Electronic transmissions from providers would be required by January 1, 2011.

The House also passed a similar version of this bill and is working with the Council on Health Plans to come up with a form that can be implemented this spring.

MA Coverage Elimination for Ineffective Preventive Services

SF 1442 /HF 1783 eliminates benefit coverage under state health care programs for those clinical preventive services that the U.S. Preventive Services Task Force has recommended against providing to an asymptomatic patient, or has been graded by the task force as a “D.” Lead level testing for pregnant and women is specifically excluded and would remain a covered benefit. This bill is yet another attempt to gain fiscal savings.  The bill has met policy deadlines.

Health Care Homes Outreach Requirement

SF 1474  requires the state health plan enrollees who have complex medical conditions to select a primary clinic with clinicians as certified health care homes, if there are two or more primary care clinics with clinicians who have been certified as health care homes available to the enrollee. The MN-AAP is reviewing the bill to ensure that access would not be restricted for children based on the availability of health care homes. It remains unclear whether this will result in any savings to the state, but it has met deadline and is being considered for inclusion in the Omnibus HHS Finance bills.

Committee Schedules for Next Week

Check http://www.leg.state.mn.us/leg/sched.asp for the most up-to-date information.