Overview of the Joint Commission on Health Care Presentation to VCU MPH Class November 28, 2005 Kim Snead Executive Director

Joint Commission on Health Care 2 Background The Joint Commission on Health Care (JCHC) was created by the 1992 session of the General Assembly to continue the work of the Commission on Health Care for all Virginians, established in “The purpose of the Joint Commission on Health Care is to study, report, and make recommendations on all areas of health care provision, regulation, insurance, liability, licensing, and delivery of services.” JCHC seeks to ensure that the greatest number of Virginians receives quality cost-effective health care and long-term care services.

Joint Commission on Health Care 3 Mission of the JCHC JCHC focuses on five main policy areas: — health insurance and access to care for the uninsured — health care cost and quality — health workforce issues — behavioral health care and — long-term care.

Joint Commission on Health Care 4 Membership of the JCHC Ten members of the House of Delegates, appointed by the Speaker of the House. Eight members of the Virginia Senate, appointed by the Senate Committee on Rules. The Secretary of Health and Human Resources is an ex officio member.

Joint Commission on Health Care 5 Current JCHC Members Del. Harvey B. Morgan, Chair Sen. William C. Mims, Vice-Chair Del. Clifford L. Athey, Jr.Del. Robert H. Brink Del. Benjamin L. Cline Del. Franklin P. Hall Del. Phillip A. HamiltonDel. R. Steven Landes Del. Kenneth R. MelvinDel. John M. O’Bannon, III Del. John J. Welch, III Sen. Harry B. BlevinsSen. R. Edward Houck Sen. Benjamin J. Lambert, III Sen. Stephen H. Martin Sen. Linda T. PullerSen. Nick Rerras Sen. William C. Wampler The Honorable Jane H. Woods

Joint Commission on Health Care 6 Role of JCHC Staff JCHC has a full-time staff of four: an executive director, 2 health policy analysts and an office manager — Provide impartial, apolitical analysis of issues involving health care, behavioral health care, and long-term care — Identify a range of policy options for consideration by the Joint Commission — Assist in supporting legislation and budget amendments that the members introduce on behalf of JCHC.

Joint Commission on Health Care 7 Study Process Staff research and presentation of Studies (May- October) — Public comments received (after issue brief) — Public comments summarized (next meeting after issue brief) Subcommittee meetings conducted (May-October) JCHC consideration of decision matrix (Nov.) JCHC vote on legislative package (Nov.) General Assembly session

Joint Commission on Health Care 8 Review of Federal Funding for HIV/AIDS Prevention and Treatment in VA The 2005 Appropriations Act required JCHC to review federal funding on Virginia’s HIV/AIDS prevention and treatment program — 17,000 individuals are known to be living with HIV or AIDS in VA; another 25% or 4,200 are unaware of being HIV-positive. Medicaid is the primary funding source for services for individuals with HIV or AIDS — In 2004, Medicaid expenditures in VA were $6.7 million with more than 50% for pharmaceutical expenditures. Other major sources of federal funding for services addressing HIV/AIDS include Health Resources and Services Administration (HRSA) through the Ryan White Comprehensive AIDS Resources Emergency (CARE) Act and the Centers for Disease Control (CDC) — Funding from these federal sources has been reduced — Available State matching funds have been reduced — A deficit of $6.1 million in needed funding is projected by the VA Dept. of Health in FY 2007, if additional funding is not appropriated.

Joint Commission on Health Care 9 Review of Federal Funding for HIV/AIDS Prevention and Treatment in VA JCHC members discussed the desire not to take on funding of federally- mandated programs that had their federal funding reduced, even though many of the programs are needed. Options presented but not approved included budget amendments for: $285,000 per year for other prevention funding $164,000 per year for the Advancing HIV Prevention Initiative $1 million to stabilize access to HIV primary care services in NOVA and SW VA $4.3 million to fund projected shortfall in ADAP funding for individuals with HIV/AIDS who have limited or no coverage for medication. JCHC actions approved for the 2006 General Assembly Session — Introduce budget amendment for $265,110 per year to expand HIV resistance testing program — Introduce a resolution encouraging VCU School of Dentistry to investigate funding for dental services under the Ryan White Comprehensive AIDS Resource Emergency Act — In addition, JCHC will continue to monitor funding issues in 2006.

Joint Commission on Health Care 10 Reconsideration of Medicaid Asset Transfer Policy in Virginia HB 2601 (2005) would have allowed DMAS to seek a waiver from the federal government to establish more restrictive asset transfer limits for qualifying for Medicaid long-term care services. Federal restrictions addressing the issue of improper asset transfers in order to qualify for Medicaid long-term care services, were first enacted as part of the Boren-long Amendments to the 1980 Omnibus Reconciliation Act. On the national level, Medicaid is now the largest purchaser of nursing facility services — $51 billion in 2003.

Joint Commission on Health Care 11 National Distribution of Nursing Facility Funding

Joint Commission on Health Care 12 Overview of Medicaid Long-Term Care States are not required to provide Medicaid programs. However, if they do, they must provide certain services to individuals classified as categorically needy. Long-term care services that a state must provide include: — Home health (which at a minimum includes intermittent or part-time nursing services, home health aides, and medical supplies and appliances for use in the home) — Nursing facility services for beneficiaries age 21 or older. In Virginia, nursing facility (NF) reimbursement cost $547,287,699 in 2003 (VA’s Medicaid funding requires a 50% match of State funds) — 76% of NF expenditures were for individuals classified as aged — Clearly this figure is likely to increase with the aging of baby boomers, if action is not taken.

Joint Commission on Health Care 13 Increasing Medicaid Costs Are a National Concern In response to projections showing significant increases in the cost of Medicaid LTC expenses ($51 billion in the US in 2003), groups such as the National Governor’s Association have considered methods for restricting asset transfers including changes in the look-back period and penalty provisions — Look back period is the time period examined for an improper asset transfer; currently 36 months for all transfers except trusts which involves a 60-month look back period — Penalty period is the time period that an individual is ineligible for Medicaid LTC payments due to an improper asset transfer — Penalty period = Uncompensated value of assets transferred Avg. monthly cost private pay NF at application

Joint Commission on Health Care 14 Reconsideration of Medicaid Asset Transfer Policy in Virginia A number of Options were presented for JCHC consideration — Actions to encourage purchase of LTC insurance Introduce legislation to provide a 10% tax credit rather than a tax deduction for purchase of LTC insurance Introduce legislation to provide a tax credit for employers who provide LTC insurance for their employees. — Actions to further restrict asset transfers Introduce legislation authorizing DMAS to apply for a waiver to implement more restrictive asset transfer restrictions (as HB 2601 of 2005 would have provided). — Actions that require study Introduce a resolution requesting a JLARC study of the incidence of and methods used to shelter assets in order to qualify for Medicaid.

Joint Commission on Health Care 15 Review of Health Savings Accounts HSAs were created in Medicare legislation signed into law in December 2003 — HSAs are accounts in which money is placed to pay for medical expenses; the accounts must be paired with qualifying high- deductible health plans HSA funds are tax deductible and owned by the individual even though employers can contribute into the accounts Covered individuals cannot be eligible for Medicare or have other health insurance (except for the required high-deductible insurance and specific types of coverage such as accident, disability, dental, vision, LTC) Maximum contributions currently are the lesser or $2,650 for individuals and $5,250 for families or the amount of the deductible in the high-deductible health plan HSA funds can be used for medical expenses, qualified LTC insurance, COBRA coverage, health insurance while unemployed, and in a few other specific situations.

Joint Commission on Health Care 16 Review of Health Savings Accounts Potential advantages of HSAs — Encouraging savings for future needs which may provide a source of funding for non-covered services, health insurance while unemployed, LTC needs, medical expenses after retirement but before Medicare coverage — Unspent funds in HSAs can be rolled over from year to year — For some populations, including young adults who can no longer receive coverage on their parents’ policies and lower-income self- employed individuals, HSAs may be the only type of health care coverage they can afford. Potential disadvantages of HSAs — Several studies found that while employees who have to pay a large share of their medical care eliminated 1/4 th of unnecessary visits to their doctors, they also eliminated 1/3 rd of crucial visits — HSAs may attract the “healthy and wealthy” making comprehensive coverage for others more expensive — The number of uninsured and underinsured Americans could increase if more employers and employees choose not to offer/have comprehensive health insurance.

Joint Commission on Health Care 17 Joint Commission on Health Care JCHC Internet website: Includes meeting schedules, studies, reports, and legislation. Joint Commission on Health Care 900 E. Main Street, Suite 3072E P. O. Box 1322 Richmond, VA /(FAX) JCHC Staff Kim Snead, Executive Director April R. Kees, Principal Health Policy Analyst Catherine W. Harrison, Senior Health Policy Analyst Mamie V. White Jones, Office Manager