Legislative Update: 3/19/10


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):

Abbott Northwestern $  2.1
Children’s Minneapolis $  3.6
Children’s St Paul $  1.5
UMMC, Fairview $  5.4
Other Fairview units $  2.1
Gillette Children’s $    .9
Health East $  2.8
HCMC $  7.5
Hennepin Faculty Assoc $    .9
St. Joseph’s $    .8
Mayo, St. Mary’s & Methodist $  3.2
Mercy Hospital $  1.1
North Country Regional $    .8
North Memorial $  2.4
Park Nicollet Memorial $  1.0
Regions Hospital $  3.7
St Cloud Hospital $  1.8
St Luke’s Duluth $    .6
St Mary’s Duluth $  1.1
United $  1.9
Unity $    .8


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.

Annual Sponsors

Children's Minnesota
Gillette Children's
Hennepin Healthcare
University of Minnesota Health
Essentia Health
Mayo Clinic
Shriners Healthcare for Children-Twin Cities