Interim Joint Committee on Health and Welfare


Minutes of the<MeetNo1> 6th Meeting

of the 2003 Interim


<MeetMDY1> November 19, 2003


The<MeetNo2> 6th meeting of the Interim Joint Committee on Health and Welfare was held on<Day> Wednesday,<MeetMDY2> November 19, 2003, at<MeetTime> 1:00 PM, in<Room> Room 129 of the Capitol Annex. Representative Tom Burch, Co-Chair, called the meeting to order at 1:12 PM, and the secretary called the roll.


Present were:


Members:<Members> Senator Julie Denton, Co-Chair; Representative Tom Burch, Co-Chair; Senators Charlie Borders, Tom Buford, Richard Roeding, Ernesto Scorsone, Katie Stine, Damon Thayer, Elizabeth Tori, and Johnny Ray Turner; Representatives Brian Crall, Bob DeWeese, Mike Harmon, Joni Jenkins, Mary Lou Marzian, Stephen Nunn, Ruth Ann Palumbo, Jon David Reinhardt, Ancel Smith, Kathy Stein, and Susan Westrom.


Guest Legislator:  Representative Jimmie Lee.


Guests:  Charles Douglass, Cheryl Younger, and Leah Brown, Department for Medicaid Services, Cabinet for Health Services; Charles O’Neal, John Blumenstock, Rob Rothenburger, Tommy Sampson, and P. Bausch, Kentucky Board of Emergency Medical Services; Joe and Eva Prewitt, Nelson County EMS; Shirley Eldridge, Bob Blackburn, and Bobbie Walters, Cabinet for Families and Children; Laural Walls, Division of Child Care, Cabinet for Families and Children; Commissioner Rice Leach, Guy Delius, Anita Travis,  Department for Public Health, Cabinet for Health Services; Jeff Hinton and Cathy Thomas, Governor’s Office of Technology; Jim Carloss, Jr., Pfizer; Bart Baldwin, Child Welfare League of America; Diane Lewis, Cabinet for Health Services Ombudsman; Dr. Carl LeBuhn, Robert Stone, and Nick Sauer, HIV/AIDS Advisory Council; Krista Wood, Heartland CARES, Inc.; Pam Gill, Cindy and Jim Muncie, Quinn and Company Medical; Cathy Allgood Murphy, American Association of Retired Persons; Dr. Mary Fallat, University of Louisville; Mollie Adkins, Cabinet for Health Services; Bill Schmidt and Lloyd Vest, Kentucky Board of Medical Licensure; Jessie Hogg, United Way of Northern Kentucky; Crystal Johnston, Families for Early Autistic Treatment, Inc. (FEAT); Karen Hinkle, Kentucky Home Health Association; Jodi Davis, State TB Central Program; Amanda Beck, Northern Kentucky District Health Department; Rachel Phelps; Anne Joseph, Kentucky Task Force on Hunger; Danna W. Collins, Office of Aging Services, Cabinet for Health Services; Jan Gould, Kentucky Retail Federal; John Brazel, Kentucky Pharmacists Association; Nancy S. Horn, American Pharmacy Services Corporation; Sarah S. Nicholson, Kentucky Hospital Association; Melissa Salddonis; Sean Cutter, McBrayer, McGinnis, Leslie, and Kirkland; and Sheila Schuster, Kentucky Mental Health Coalition.


LRC Staff:  Robert Jenkins, CSA, Barbara Baker, Eric Clark, DeeAnn Mansfield, Murray Wood, Cindy Smith, and Gina Rigsby.


A motion to approve the minutes of the October 15, 2003 meeting was made by Senator Roeding, seconded by Senator Tori, and approved by voice vote.


Senator Stine, Co-Chair, reported that the Families and Children Subcommittee met that morning and heard testimony on the KIDS NOW program, the link between the autism and immunizations study at Kosair Children’s Hospital at the University of Louisville, the Court Improvement Plan for the Administrative Office of the Courts and the Program Improvement Plan for the Cabinet for Families and Children, the Cabinet for Families and Children's assessment on the achievements of the state's Transitional Assistance for Needy Families (TANF) program, and recently released data from the Kentucky Youth Advocates on the economic status of children in Kentucky.  A motion to accept the report was made by Senator Borders, seconded by Representative Crall, and approved by voice vote.


The next order of business was testimony on the mandated report from 03 HB 269, relating to the use of federal and private funds for an electronic health network in Kentucky, by Bob Esterhay, M.D., Associate Professor, Acting Chair, Health Management and Systems Sciences, School of Public Health and Information Sciences, University of Louisville, Carol Steltenkamp, M.D., Chief Medical Information Officer, University of Kentucky, and Beth Naifeh Wright, Accenture.


Dr. Esterhay said that a Kentucky e-health network would improve patient safety and improve healthcare quality, help detect bioterrorism, and better inform and empower healthcare consumers about their own personal health information.  The network would allow for a better understanding of healthcare costs, establish the foundation for population-based health improvement, and reduce health transaction costs.  The nation's healthcare costs are estimated at $1.6 trillion, and Kentucky’s share is approximately $20.8 billion.  Administrative costs are estimated at $6.24 billion.  The goal is to build an e-health network that would reduce these health transaction costs by 50%.


Representative Burch asked, of the $3.12 billion saved by implementing an e-health network, how much savings patient would see.  Dr. Esterhay stated that these administrative costs relate to members of the network interacting with each other, and are based on published health care administrative costs for providers, payers, and practitioners.  Representative Burch asked about the cost to implement e-health.  Dr. Esterhay stated there is information on what other regional sites have spent.  Representative Burch asked about comparisons with other states.  Ms. Wright said that there several regional e-health networks initiatives with implementation costs ranging from $5 million to $30 million, depending on the types of services and the organizations involved.  The cost to operate and maintain the e-health network is a separate cost that would be decided when Kentucky decides on which transactions and stakeholders would be involved.


Ms. Wright said that approximately ten months ago representatives from the University of Kentucky, the University of Louisville, and Accenture formed a working group to define what an e-health network might resemble in Kentucky. Along with other providers, payers, and the government, the group examined several of the better known regional e-health network initiatives, became familiar with the National Health Information Infrastructure (NHII) agenda, and tracked potential funding sources from the federal government.  The NHII is a comprehensive knowledge-based network of interoperable systems of clinical, public health, and personal health information that would improve decision-making by allowing for more accessible health information when and where it is needed by healthcare providers.  NHII is the framework, vision, and national standard for which other local, state, and e-health networks should follow.  NHII is voluntary and is not meant to be a centralized database of medical records or a mandated government regulation.


Ms. Wright said that the Agency for Health Care Research and Quality will award $50 million in grants to multiple, local e-health network initiatives, and Kentucky has the potential to receive a portion of these funds.  Another grant opportunity is a $4 million grant from the E-Health Institute.  Along with federal funding, there may also be homeland security funding, state funding, and private sector funding.  The state could be involved with the process without having to allocate funds.


Dr. Steltenkamp said that Kentucky should create a stakeholder group that consists of employers and government (consumers), physicians and professionals (practitioners), managed care, Medicare and Medicaid (payers), and health care organizations (insurers).  She said that the stakeholder group is expanding to represent both private and public sectors.  Medicaid and state government should be stakeholders in order to have a successful e-health network.  Everyone must participate in the e-health network for it to be successful.


Senator Buford asked if there are federal dollars available for start-up expenses.  Dr. Esterhay said that there is a $50 million grant available to states that want to start an e-health initiative, and there is a $4 million HRSA grant.  He said that the stakeholder group wants the Commonwealth to provide the leadership that is necessary to make this happen as a public and private effort without allotting start-up funds.  A non-profit limited e-health network corporation should be created.  Dr. Steltenkamp said Kentucky is ahead of most states in creating an e-health network because of the work and input from the General Assembly in creating the Telehealth Network.


Representative Nunn stated that there should be a structure to study how to build the e-health network and to solicit funding.  There is no reason that the General Assembly could not be a player and help establish an e-health network.


Senator Roeding asked about Accenture.  Ms. Wright said that Accenture is a global technology company started in 2001 that has 75,000 employees. The company engages in information technology management consulting work, including government and healthcare consulting.  She said that the company was awarded one of five contracts for the Strategic Alliance Services (SAS).


Representative DeWeese asked how the $3.12 billion would be divided among the stakeholders.  Dr. Esterhay said that stakeholders would determine how the funds would be distributed.


Next was a review of the referred administrative regulations.  A motion was made by Representative Jenkins, seconded by Senator Scorsone, and approved by voice vote the accept the amendments to the following regulations: 202 KAR 7:010, 202 KAR 7:201, 202 KAR 7:301, 202 KAR 7:401, 202 KAR 7:501, 202 KAR 7:510, 202 KAR 7:601, and 202 KAR 7:701.  A motion was made by Senator Roeding, seconded by Representative Marzian, and approved by voice vote to approve all of the following administrative regulations except for 202 KAR 7:030:  201 KAR 9:350 – authorizes the Board of Medical Licensure to expunge the records of its license and certificate holders (Board of Medical Licensure); 202 KAR 7:010 as amended, – delete certain terms and provide definitions for new terms used in 202 KAR Chapter 7 (Board of Emergency Medical Services); 202 KAR 7:020 – establishes the organization and committee structure of the Board of Emergency Medical Services; 202 KAR 7:055 – establishes procedures for the Board of Emergency Medical Services to render advisory opinions upon request; 202 KAR 7:201 as amended – establishes the standards for first responders (Board of Emergency Medical Services); 202 KAR 7:301 as amended – establishes the requirements for EMTs (Board of Emergency Medical Services); 202 KAR 7:401, as amended – provides the requirements and procedures for licensure, relicensure, and reciprocity for paramedic (Board of Emergency Medical Services); 202 KAR 7:462 – repeals 202 KAR 7:461, relating to scope of practice (Board of Emergency Medical Services); 202 KAR 7:501 as amended - establishes license requirements for ambulance providers and medical first response agencies (Board of Emergency Medical Services); 202 KAR 7:510 as amended – establishes licensure requirements for air ambulance services (Board of Emergency Medical Services); 202 KAR 7:601 as amended – establishes the requirements for an organization to be approved by the Board of EMS as an EMS-TEI and certification and recertification of EMS instructors (Board of Emergency Medical Services); 202 KAR 7:701 as amended – establishes the scope of practice for individuals certified or licensed by the Board of Emergency Medical Services; 202 KAR 7:801 – establishes requirements for EMS medical directors (Board of Emergency Medical Services); 902 KAR 45:070 – establishes the standards for body piercing facilities and establishes certain standards for body piercing procedures (Cabinet for Health Services, Department for Public Health); 902 KAR 45:090 & E – implements the provisions of 2003 HB 391 to establish the minimum standards for Kentucky grown food products from the processor’s farms to be processed by Home-Based Processors and Home-Based Microprocessors and marketed at Kentucky Farmers Markets and Certified Roadside Stands (Cabinet for Health Services, Department for Public Health); 920 KAR 1:060 – moves the Institutional Review Board from the Office of Program Support to the Secretary’s office of the Cabinet for Families and Children; and 922 KAR 2:100 – establishes criteria for the certification of family child care homes (Cabinet for Families and Children).


Representative Harmon asked if medical directors and fees had been addressed in 202 KAR 7:030.  Charlie O’Neal, Deputy Executive Director, Kentucky Board of Emergency Medical Services, explained that the Board had resolved the outstanding medical director issues and found an amicable solution.  Mr. O’Neal stated that the initial numbers included in the fee regulations were reduced.  Since there has not been an increase in fees for EMTs, first responders, and paramedics for eighteen years the Board believes the fees are responsible and not burdensome.  In response to a question from Representative Crall , Mr. O’Neal stated that the national EMT registry is the basis for examinations in Kentucky.  The examinations will still be conducted at the end of the course.  In addition, the Board will control, deliver, and conduct the written exams in one of four EMT regional offices each month with the exception of December.  The change in the administrative regulation is that the exams will be administered by a Kentucky Board of Emergency Medical Services staff member.  If someone is unable to take the written exam at the end of the course or fails the first attempt of the written exam, the individual will have 30 days to take the written exam in one of the EMT regional offices.


Senator Roeding asked how the proposed amendments were different from the administrative regulation approved at the Administrative Regulations Review Subcommittee meeting.  Mr. O’Neal said that the amendments reflected suggestions that had been made by Representative Bruce.  A motion was made by Senator Roeding, seconded by Representative Stein, and approved by voice vote to approve 202 KAR 7:030 as amended.


Next was a presentation on emergency rooms and trauma certification by Mary E. Fallat, M.D., Professor of Surgery at the University of Louisville and Trauma Director, Kosair Children’s Hospital.  Dr. Fallat testified that a trauma patient is a seriously injured adult or child requiring rapid diagnosis and treatment by a team of professionals, supported by appropriate resources to decrease or eliminate the risk of death and disability.  Unintentional injury is the leading cause of death for all Kentuckians aged 1 through 34 years.  Motor vehicle crashes, falls, and homicides are the three leading causes of death and disability in Kentucky.  Thirty-six states now have an organized system of trauma care, but Kentucky is not one of them.


Dr. Fallat stated that trauma centers are hospitals designated by the American College of Surgeons as having surgeons and specialists committed to treating individuals with injuries, from mild to extremely serious injuries.  There are four levels of trauma center verification: 1) Level I, tertiary care center, with a leadership role in system development, care, education and research; 2) Level II, definitive care center, principle hospital in community; 3) Level III, maximum commitment to general trauma care, stabilization of the major trauma patient for transfer, community lacks Level I or II center; and 4) Level IV, provisions of initial care, stabilization for transfer, no requirement for definitive care.  She said that early trauma deaths can be impacted by rapid evaluation and resuscitation.  Kentucky is primarily a rural state, and the death rate from unintentional injury is greater than 50 percent higher in rural areas than in urban areas.


Dr. Fallat stated that a trauma system consists of an organized, coordinated effort, has a defined geographic area, delivers the full range of care to all injured patients, and is integrated with the public health system for injury prevention.  Trauma systems benefit patients by increasing survival of the critically injured and decreasing morbidity that is due to trauma and its secondary effects.  Other benefits of trauma centers include an organized system that improves efficiency, improves prehospital care, improves emergency departments, decreases hospital length of stay, and increases efficient resource utilization.


Dr. Fallat stated that the 1990 Trauma Systems Planning and Development Act was funded by HRSA.  Kentucky received funds in 1994, failed to receive funds in 1996, but received funds again in 2001 and 2002.  None of Kentucky’s $37 million bioterrorism grant money was designated for trauma system development. There are 108 hospitals and 99 acute care facilities, with emergency departments open 24 hours a day.  Major problems with trauma care delivery in Kentucky are the lack of specialists, delays in transport of patients to other facilities, lack of knowledge and experience of EMS and emergency department personnel, and insufficient EMS services.


Dr. Fallat said that trauma care could be improved by training hospital staff, using trauma protocols, improving transfer of trauma patients, communication, tort reform, public education, and funding support.  Kentucky’s should legislatively enable healthcare providers and hospitals to have access to funds to upgrade education and services and save money and lives.  The funds could be used for injury prevention, prehospital education, education of nurses and physicians, support for local EMS services for interfacility transport, subsidy for unfunded care, seed money for verification by the American College of Surgeons, a state trauma coordinator, a trauma system advisory committee, and a state trauma registrar.  Some funding options for trauma care would be motor vehicle fines and fees, auto insurance surcharges, cigarette tax increases, and lottery revenues.  The pool of money generated annually would be distributed for trauma system administration, data collection, education, and an indigent care fund.


Representative Westrom asked how many trauma centers in Kentucky are equipped to handle pediatrics, and Dr. Fallat said the University of Louisville and the University of Kentucky are pediatric trauma centers.  Representative Burch asked how many lives could be saved if there were mandatory laws for seatbelts, child safety seats, booster seats, helmets, and graduated driving license.  Dr. Fallat said that most children and adults do not wear protective equipment, and legislation needs to be enacted to change the laws.  The legislation would have to be enforced with fines.  Representative Stein asked how many children were injured while restrained in an inappropriate seatbelt, car seat or booster seat.  Dr. Fallat said that if a child is improperly restrained, the seatbelt would fit across the stomach instead of the hips and/or fit across the neck and not the shoulder.  Representative Stein stated that legislation needs to be enacted requiring a driving age limit for an ATV.


Senator Roeding asked why it costs $40,000 per hospital to receive verification by the American College of Surgeons (ACS).  Dr. Fallat said that the hospital must increase its resources prior to the verification process.  She said part of the $40,000 includes hiring appropriate people to do the job to become verified.  Senator Roeding asked how many trauma centers were needed in Kentucky.  Dr. Fallat said that there are four trauma centers presently, and more are needed in areas of underserved trauma care.  Senator Stine asked if there were statistics to show the impact of difficulty in obtaining medical malpractice insurance for physicians in high-liability areas.  Dr. Fallat stated that the ability to find individuals who would provide trauma care in rural areas might be dependent on the hospital subsidizing their salary to take trauma calls.  Senator Thayer asked why the Louisville city ordinance mandated use of protective equipment, but no penalties if not obeyed.  Dr. Fallat said that the ordinance has to be enforced or people ignore it.  Senator Thayer stated that education would be better than mandating equipment use.  He stressed it is the responsibility of a parent to make sure children obey the laws.  Dr. Fallat said that education in and of itself is not a good way to get people to change behavior.  Enforced legislation is needed to change behavior.  Representative Burch said that if there is no penalty to citizens if a city ordinances is not obeyed, the law is pointless.  Education does not always help because there are some irresponsible parents.


Next was testimony on Families for Early Autism Treatment, Inc. (FEAT) by Crystal Johnston, President of the Kentucky Chapter.  Ms. Johnston said that recent statistics from the Department of Education have shown an 870 percent increase nationally in autism in the past decade.  Kentucky has shown a 3,000 percent increase in autism.  The most problematic situation is while some children have been identified as autistic, there are many more children identified with a different label that will change to autism when the child reaches the age of 8 years.  She asked how Kentucky would manage the huge costs associated with the long-term care needs of people not allowed to reach independence.  The Department of Education receives federal funds to educate children, but in Kentucky this money does not go directly to the children but into the general fund of each district.  The funds can be used on anything rather than the child who generated the funds.  The majority of teachers, even special education teachers, are not trained in the most effective methods to teach special needs children.  The Department of Education should be held accountable for these children.  Special education children are not tested under KERA, and there is no accountability.  KERA mandates do not work for special education children, and there is no where to go with complaints.  To ease the burden on Medicaid, all other areas that serve these children should be looked at and held accountable for outcomes.


Ms. Johnston said that, in other states, autism is considered a medical condition and all therapy is subject to a copay.  While Kentucky requires insurance companies to provide $500 per month for therapeutic respite, it is difficult to collect.  Self-insured and out-of-state carriers are not required to comply with this law.  The Medicaid autism waiver is designed to serve only 140 children, but has not been approved by the federal government.  One-time block grants will not solve Kentucky’s problems.  She said that community supports will be less costly in the long term, rather than institutionalization for life.


Senator Buford said that he has concerns about the federal funds distributed to school districts that are not spent on disabled children.  He suggested that a letter be sent to the Department of Education to find out the amount of federal funds each school district received for disability needs and how the funds were disbursed.


Representative Harmon asked for the rationale behind the increase of autistic children in Kentucky.  Ms. Johnston stated that the reasons were underreporting and misidentification of children.  The initial numbers of autistic children were very low.  Representative Harmon asked if parents would be interested in disability vouchers, and she said that parents would be interested but there are limited places to take the voucher for services.  Parents should have alternatives for services.


Senator Stine asked if the SEEK formula requires that the money schools get through the “special needs” variable be used for those specific purposes, whether it goes into the schools' general funds.  Ms. Johnston stated that the funds go into each school’s general fund, and there is no requirement to spend funds for special needs.


Representative Palumbo asked about the causes of autism.  Ms. Johnston said that research has shown that mercury in vaccinations and environmental factors are linked with causes of autism.  Ms. Johnston suggested that the immunization of children be postponed until the child’s immune system has developed.  Representative Westrom asked about the California program.  Ms. Johnston stated that California is more advanced in behavioral treatments.


Next was a report on the HIV/AIDS Advisory Council given by Carl LeBuhn, M.D., President of the HIV/AIDS Advisory Council.  Dr. LeBuhn stated the first recommendation was to change the current HIV reporting system of Unique Identifier Codes (UI) to confidential reporting.  The Centers for Disease Control and Prevention does not accept data from the UI system because there are too many variables that allow for duplication of cases.  The 2002 reauthorization of the Ryan White CARE Act recommended that the funding for the formulation of the distribution of federal funds be changed to include the number of HIV cases in addition to the number of AIDS cases reported by each state.  The second recommendation was to increase state funds for the Kentucky Aids Drug Assistance Program (KADAP).  Currently the program serves over 700 HIV individuals.  There are approximately 160 individuals waiting to receive assistance, and the number is expected to increase to 200 by December 31, 2003.  The third recommendation was promotion of harm reduction and the elimination of legal disincentives on the sale, possession, and proper disposal of syringes.


Representative Burch asked whether, if Kentucky had HIV name reporting, it would receive increased federal funds.  Dr. Rice Leach, Commissioner of the Department for Public Health in the Cabinet for Health Services, said that it would increase Kentucky’s ability to get available funds and become more competitive with other states to receive additional federal funding.  Representative Burch asked about the number of active AIDS cases.  Dr. Leach stated there are over 4,000 reported cases.  Representative Marzian asked about the number of cases and cost of patients with Hepatitis C.  Dr. Leach said that he would send this information to the Committee.  Senator Roeding asked what legislative changes need to be made to have HIV name reporting in Kentucky.  Dr. Leach said there should be statutory authority to change to confidential name reporting.  Senator Buford stated that there is no secure system available to guarantee that names are kept confidential.


Next was an update on Medicaid durable medical equipment (DME) by Commissioner Mike Robinson, Department for Medicaid Services, Cabinet for Health Services.  Commissioner Robinson stated that diapers, underpads, and incontinence pants for ages three years and up are considered a disposable supply, reimbursed as a home health program supply only.  In an investigative study, 33 out of 49 states surveyed indicated incontinence supplies are under DME.  The study recommended moving incontinence supplies to the DME program, but this was delayed due to implementation of other cost-containment initiatives.


Commissioner Robinson stated that pulse oximeters are prescribed by a physician, meet medical criteria, are available through the DME program, and have fixed reimbursement rates for rental or purchase.  Oxygen concentrators are currently rental only, historically have required frequent repair and recalibration, and repairs and servicing is included in th rental price.  In some cases, rental may be less expensive than purchasing because of the cost of repairs and servicing.  The Department conducted a survey of pulmonary offices and product vendors and found the current models of concentrators are superior.  The Department will explore including oxygen concentrators on the type of rental or purchase agreement currently used for other DME devices.


Commissioner Robinson stated the 42 U.S.C.1395a states “Any individual entitled to insurance benefits under this title may obtain health services from any institution, agency, or person qualified to participate under this titles if such institution, agency, or person undertakes to provide him such services.”  Kentucky’s “Any Willing Provider” law, found in KRS 304.17A-270, provides that “a health insurer shall not discriminate against any provider who is located within the geographic coverage area of the health benefit plan and who is willing to meet the terms and conditions for participation establishes by the health insurer, including the Kentucky state Medicaid program and Medicaid partnerships.”


Commissioner Robinson stated that Medicare uses a “Preferred Vendor Program” to purchase certain supplies.  The Medicaid program uses “Selective Contracting” as an approach to purchasing health care services and supplies, relying on competition and market forces to set prices and requiring providers to bid for the state’s business.


Senator Denton asked about the calculations of savings that had been estimated on durable medical equipment.  Cindy Muncie, Quinn and Company Medical, stated that she used Passport estimates on utilization.  Senator Roeding asked about the reverse bidding process.  Commissioner Robinson stated that reverse bidding is normally not done in state government.  Senator Roeding stated that it would need to be done on a regional basis.  Ms. Muncie stated that it was not her intent to have one statewide vendor.  She also stated that quality must be examined as well as cost.  Senator Denton asked when incontinence supplies would be moved from home health, and Commissioner Robinson said a Request for Proposal (RFP) would have to be drafted and approved and home health agencies would need time to make the adjustment.  He said that there should be a contract awarded by July 1, 2004.


There being no further business, a motion to adjourn at 3:27 p.m. was made by Senator Thayer, seconded by Senator Buford, and approved by voice vote.