Call to Order and Roll Call
Thethird meeting of the Interim Joint Committee on State Government was held on Wednesday, September 24, 2014, at 1:00 PM, in Room 154 of the Capitol Annex. Representative Brent Yonts, Chair, called the meeting to order, and the secretary called the roll.
Members:Senator Joe Bowen, Co-Chair; Representative Brent Yonts, Co-Chair; Senators Ernie Harris, Christian McDaniel, R. J. Palmer II, Albert Robinson, Damon Thayer, and Reginald Thomas; Representatives Kevin Bratcher, Dwight Butler, Larry Clark, Will Coursey, Derrick Graham, Mike Harmon, Kenny Imes, James Kay, Martha Jane King, Jimmie Lee, David Meade, Suzanne Miles, Brad Montell, Sannie Overly, Darryl Owens, Tanya Pullin, Tom Riner, Bart Rowland, Steven Rudy, Sal Santoro, Diane St. Onge, John Will Stacy, John Tilley, Ken Upchurch, and Jim Wayne.
Guests: Jim Erwin and Cookie Crews, Department of Corrections; Marc Stern, University of Washington; Joe Cowles and Sharron Burton, Personnel Cabinet; Anne Peak, Healthy Reentry Coalition of Kentucky; and Billy Jones Stockton.
Approval of Minutes
A motion to approve the minutes of the August 27 meeting was seconded and passed without objection.
Kentucky Employees’ Health Plan (KEHP)
Representing the Personnel Cabinet, Joe Cowles, Commissioner, Department of Employee Insurance, and Sharron Burton, Deputy Executive Director, Office of Legal Services, discussed the 2015 plan year and 2014 accomplishments.
Mr. Cowles said that in 2014 KEHP began a three-year strategy to include wellness in the plan. LivingWell and consumer driven health (CDHP) plans were introduced, focusing on consumerism, personal health awareness, and a better understanding of healthcare costs. Over 81 percent of members chose a LivingWell plan. By July 2014, more than 137,000 had completed the Health Assessment required by the LivingWell promise, compared to 34,990 in 2013. Almost 16,000 members received a biometric screening (Vitality Check). CDHP enrollment increased from 12,869 in 2013 to 65,142 in 2014. Dispensing of generic prescription drugs increased from 80 percent to 83 percent during the first three months of utilization. This saved KEHP $10 million during the first six months of 2014. The number of employees electing tobacco use plans increased 28.72 percent due to expansion of the product range, extension of the smoker rate to adult dependents, and explicit reference to the tobacco use surcharge in enrollment literature. KEHP achieved its health awareness and cost transparency goals for 2014.
Vendor contracts for 2015 were completed in August. The vendors for 2015 are Anthem Blue Cross Blue Shield (Anthem), CVS/Caremark, WageWorks, Humana Vitality, and Compass SmartShopper. Anthem has operated in Kentucky for more than 75 years. It is the largest insurance carrier in the state, with 1.3 million members. The Kentucky network includes all hospitals and 96 percent of providers. The national network includes 96 percent of hospitals and 92 percent of providers. The CVS/Caremark network includes more than 67,000 pharmacies nationwide. WageWorks is a leader in administering flexible spending accounts (FSAs) and health reimbursement arrangements (HRAs) and provides COBRA administration services. South Carolina, Florida, and Michigan are WageWorks clients. HumanaVitality has partnered with KEHP for several years to promote wellness. Compass SmartShopper, formerly Compass ChoiceRewards, has been a partner since 2013. More than 2,000 KEHP members have utilized Compass and earned incentives of over $200,000.
The four plan options for 2015 are identical to those offered in 2014. Benefits will remain the same, and premiums will not increase. Premiums decreased slightly for the parent-plus, couple, and family options in the Standard CDHP plan. Members may fulfill the LivingWell Promise by completing either the online health assessment or a Vitality Check between January 1 and May 1, 2015. Copays for mental health services and allergy injections have been reduced. A maximum out-of-pocket for prescription drugs has been added as a benefit enhancement tied to health care reform. For the first time, unused healthcare FSA funds up to $500 will carry over to the new plan year.
Due to changes in federal law, employees who waive health insurance coverage may choose a Waiver General Purpose HRA (stand-alone HRA) only if they are covered by another group health plan that provides minimum value. Members covered by an individual policy purchased through Kynect or governmental plans such as Tricare, Medicare, or Medicaid are no longer eligible for the stand-alone waiver. They may be eligible for the Waiver Dental/Vision Only HRA or may elect a health plan. Ms. Burton said the federal government classifies the stand-alone HRA as a health plan, but because it does not have certain consumer protections and reforms associated with health plans, the federal government requires it to be coupled with a group health plan. The stand-alone HRA violates the Affordable Care Act prohibition against annual limits because it is capped at $2,100.00. Mr. Cowles said that KEHP has sought guidance on this issue from the U. S. Department of Health and Human Services.
When asked by Representative St. Onge, Ms. Burton said that someone who buys an individual policy directly from an insurance company would not be eligible for the stand-alone HRA unless the person has group coverage, which the IRS defines as employer-sponsored coverage.
Answering Representative Graham, Mr. Cowles said that a plan member whose spouse has group coverage in the private sector would not be precluded from selecting the stand-alone HRA. Representative Graham requested that Mr. Cowles and Ms. Burton be invited to return to the next meeting to allow for more in-depth discussion.
Responding to Representative Rudy, Mr. Cowles said a member whose spouse has group coverage through a federal plan would be eligible for the stand-alone HRA. Tricare plans, which cover the military, are excluded; this exclusion has become controversial.
There being no further questions, Representative Yonts thanked the speakers and asked them to prepare to return to an additional interim meeting.
Health Care Services in Kentucky’s Correctional System
Jim Erwin, Deputy Commissioner, Office of Adult Institutions, Department of Corrections (DOC), testified about actions taken by DOC in response to the death of inmate James Embry in January 2014. He was accompanied by Ms. Cookie Crews, DOC Health Services administrator.
Representative Yonts read excerpts from the DOC critical incident review report. Mr. Embry, age 57, died from dehydration and starvation after refusing food and drink while an inmate at Kentucky State Penitentiary (KSP). The report concluded that Mr. Embry’s death occurred due to the failure of many interacting systems to address a correctable situation and the failure of staff to follow written standing orders and protocols. Representative Yonts commended DOC for a thorough report and diagnosis of the problems that led to Mr. Embry’s death.
Representative Yonts said issues of concern include conflicts between nursing staff, institutional staffing levels, staff absences, status of the physician who signed the death report, filling of vacant positions, inmate medical copays, inmate Dorris Kirtley’s transfer to Kentucky State Reformatory for medical treatment, hunger strike policy, state regulation relative to contract employees, cost of inmate medical treatment and whether it should be in a nonprison environment, healthcare provider/prisoner ratio, and provisions for medical parole.
Representative Clark, Senator Thomas, and Representative Owens cautioned against the committee dealing with this incident if it is under investigation by the Attorney General. Senator Thomas moved to table the topic, and Representative Bratcher seconded the motion. Representative Yonts said the DOC report is public and that committee staff have said they are not aware of an active investigation. The motion to table was not called for a vote. Mr. Erwin said the critical incident review has been referred to the Attorney General for review and possible investigation of criminal conduct. He is prepared to offer testimony that would not interfere with possible litigation.
Mr. Erwin said that, in 2005, DOC entered into a Memorandum of Agreement with the University of Kentucky to contract for health services with Correct Care Integrated Health (CCIH). In 2011, the university decided to end its subcontracting role, and DOC contracted with a new provider, Correct Care Solutions (CCS), on March 1, 2014. The CCS contract provides for all health care and psychiatric services and staffing for 12 DOC facilities, all specialist subcontracts, all offsite hospital network medical care, all supplies and equipment, utilization management, and the 340B pharmaceutical management system. The contract establishes institution-specific staffing patterns and provides the services of full-time equivalent physicians, advanced registered nurse practitioners (ARNP), psychiatrists, nursing positions, and additional support staff. Specialty services such as mobile x-rays, physical therapy, surgery, and dialysis are subcontracted through CCS. The annual contract budget is $46,000,000. DOC pays an average daily population (ADP) rate of $9.60 per state inmate in DOC facilities, regardless of their need for medical services. The CCS contract provides a plan for filling physician vacancies and incentives to fill them quickly. CCS is required to have a regional office in Kentucky, and it is located in the Oldham County area.
The 2014 budget bill provided for a pilot program to conditionally parole infirm inmates. The program is under review and gives the DOC commissioner authority to certify that a prisoner meets criteria for conditional parole. DOC has 227 medical beds for male inmates at Kentucky State Reformatory; of those, 67 are in its nursing care facility. The Kentucky Institution for Women has 20 medical beds. A medical review of all inmates by DOC determined that 10 male inmates and one female inmate met the criteria. They were recommended for parole, and DOC is trying to place them in nursing care facilities. After release, they become eligible for Medicaid, which is a cost savings for DOC. Sex offenses prevent many inmates from being eligible for the program.
Following the critical incident review of Mr. Embry’s death, DOC revised the hunger strike protocol. It is being implemented and includes medical, psychiatric, psychological, and administrative services. Wardens and deputy wardens will be actively involved in monitoring hunger strikes.
DOC terminated the employment of the two psychologists named in the critical incident review because they violated policy and protocol. Both individuals have appealed to the state Personnel Board, and a hearing has been scheduled. The nurse practitioner identified in the report, a CCIH employee who stayed on under the CCS contract, has also been terminated. In accordance with personnel regulations, the DOC Commissioner issued a memorandum to the physician identified in the report, stating that his services were no longer required as a nonmerit employee. DOC has reviewed the critical incident report with all staff psychiatrists, psychologists, security personnel, and unit management staff to emphasize and reinforce policies and protocols. DOC has enhanced the protocol for the treatment team, which is a multidisciplinary committee that reviews problematic inmates. The team meets weekly to review medical and mental health status in individual cases and also interviews inmates prior to the meetings.
DOC contracted with the American Correctional Association for an independent audit of medical operations. The audit, completed in June 2014, is an open document. It reveals no concerns and indicates that protocols and policies are being followed and that staffing is appropriate. The isolation of segregated inmates is a national concern. DOC has been implementing evidence-based programs for segregated inmates to provide incentives and interaction that will benefit the inmate, as well as the safety and security of the institution.
Mr. Erwin agreed to provide a list of specific staff assigned to each DOC institution. Representative Yonts said this information was not included in the CCS contract on file with the LRC Government Contract Review Committee.
Responding to a series of questions from Representative Yonts, Mr. Erwin said both state and contract employees are assigned to KSP, but he does not know which individuals were scheduled to work on the day in question. Staff absenteeism is not a common problem. DOC chose to contract for medical services because the state pay scale makes it difficult to attract and retain state employees in the medical field. Friction among nursing staff was largely an administrative problem. New policy and protocol for staff is explicit regarding what constitutes a hunger strike and how to address it.
Inmates are not charged copays for psychiatric or psychological evaluations, psychiatric medications, or chronic care medications. For nonchronic care situations, inmates in both the general and segregated populations are charged three dollars per visit, with no additional charge for follow-up. Indigent inmates do not have to pay. Protocol relating to sick call rounds is being monitored and enforced through greater administrative oversight by the warden and deputy warden. Video footage is reviewed at least twice weekly to ensure that inmates under medical care are visibly seen during rounds. Inmates suffering from dementia are assigned to health care facilities, with the exception of the few who are able to function in the general population. Each institution conducts annual training, and contract employees undergo the same training as state employees. CCS is responsible for maintaining medical training and continuing education credits for its employees.
In response to Representative Owens, Mr. Erwin said that prior to the incident written and unwritten protocols were in use for medical treatment and evaluation, laboratory work, and advanced medical intervention. Employees who failed to follow protocol were subject to dismissal.
When asked by Representative Riner, Mr. Erwin said that data to track individual inmates’ health status may be available after the new electric health records system is fully implemented. Improving inmate health is a goal of DOC.
Responding to Representative Yonts, Mr. Erwin said alerts have been built into the system to determine whether bar code scanning procedure is being followed. DOC is exceeding its goal to meet periodically with vendors. Central office has the ability to participate remotely in meetings of the multidisciplinary treatment teams to ensure they are appropriately conducted.
Representative Yonts said the committee does not want to impair anyone’s rights or due process but may have additional questions later, depending on the Attorney General’s action. He thanked Mr. Erwin for his presentation and said it appears that DOC has made significant changes to correct problem areas.
Dr. Marc Stern, an internist physician, correctional health care consultant, and Assistant Affiliate Professor in the School of Public Health, University of Washington, Seattle, Washington, testified about contracting for correctional health care services and inmate hunger strikes. Representative Yonts said Dr. Stern contacted him and offered to lend his expertise after learning of the incident at KSP.
Dr. Stern said he formerly served as Assistant Secretary for Health Care for the Washington Department of Corrections. He evaluates, investigates, and monitors prison and health care systems nationwide for organizations and state and federal agencies. Most of his time is spent dealing with problems that have occurred in prisons and jails. His testimony reflects his personal opinions.
States and municipalities may choose to outsource for health care services to overcome civil service and union barriers to salary or because union contracts may prohibit working in prisons. Outsourcing can provide access to expertise on policies and procedures, negotiation, utilization management, and telemedicine. It can reduce costs through efficiency of operation and improved purchasing power. States or municipalities that operate inefficiently can probably save money by outsourcing to a good contractor. They can save even more by operating efficiently.
Outsourcing also has disadvantages. Costs may increase due to duplication of administrative personnel and services, misalignment of incentives, price hikes by the vendor, or because of the private company’s profit margin. There may be less flexibility to adjust to changing healthcare needs. Unexpected termination of the contract by the vendor is a risk, as happened in June 2014 when Corizon Health, Inc., decided to end its May 2013 contract with the Virginia Department of Corrections. Political pressures may lead a state to contract for services to give the impression of smaller government.
Liability avoidance is not a valid reason to subcontract. Some states and municipalities believe they can save on malpractice costs by outsourcing, but vendor contracts usually incorporate liability risk in the contract price.
The need to outsource can be avoided by making salaries competitive, taking legislative action to reduce hospital costs, adopting other states’ successful policies, and using selective purchasing. The National Institute of Corrections (NIC) and the National Commission on Correctional Health Care (NCCHC) can provide technical assistance. Partnering with departments of health, public hospital systems, federally qualified health centers, and universities is another helpful avenue.
When outsourcing, the state should be involved in approving the vendor’s local and regional leadership. Contracts with a multiple renewal option are preferable over long-term contracts. Requests for Proposal (RFPs) should describe prison medical services in detail to facilitate intelligent, cost effective proposals from vendors. The RFP should focus on desired outcomes rather than a detailed definition of structure and process. Dr. Stern said he is willing to share his personal library of public RFPs, assembled while he was teaching for NIC.
Dr. Stern commended DOC’s critical incident review and subsequent action plan. His impression is that there was a poor attitude among KSP staff. This could have been caused by poor hiring practices, poor oversight and supervision, poor organizational structure, understaffing, lack of training, or poor communication between medical and custodial staff. The report suggests that a patient safety culture was lacking. It was shocking to him that an inmate was punished for actions that appeared driven by illness.
Hunger strikes are almost always linked with a demand, usually short term. Data from the International Committee of the Red Cross indicates that hunger strikes usually do not result in death. Most hunger strikers do not want to die but are prepared to die for their cause. The 1991 World Medical Association Declaration of Malta on Hunger Strikers, updated in 2006, is the premier document guiding the conduct of physicians and medical personnel when presented with hunger strikes. It appears that Mr. Embry did not have decision-making capacity and was not a true hunger striker. Instead, he suffered from serious mental illness.
Dr. Stern recommended that DOC physicians, if allowed by law, be able to intervene and force feed someone who is not mentally capable in life or death situations. A process should be in place, ideally without need of a court order. Malta and other research suggests that people who stop eating and drinking completely will likely die within 3-5 days; if given fluids, they could live as long as 75 days. Hunger strikers who have lost 15-20 percent of body weight are in the danger zone. When Mr. Embry died, he had lost about 23 percent of his initial body weight. Refeeding too quickly can also cause death.
Responding to Representative Riner, Dr. Stern said that good nutrition is important to a positive health outcome in the prison population. It can also save taxpayer dollars by preventing the need for pharmaceuticals and medical procedures. His research of one state indicates that the mortality rate for prisoners was lower during incarceration than after release. The prison environment can be protective of health.
There being no further questions, Representative Yonts thanked Dr. Stern for traveling to Kentucky to assist the committee.
Senator Bowen, Co-Chair of the Task Force on Elections, Constitutional Amendments and Intergovernmental Affairs, reported on the September 23 meeting. A motion to adopt the report was seconded and passed without objection.
Anne Peak, a social services planner at the Kentuckiana Regional Planning and Development Agency (KIPDA) Area Agency on Aging and Independent Living, Louisville, Kentucky, said she chairs the Healthy Reentry Coalition of Kentucky (HRC). This new organization supports persons reentering the community from the criminal justice system by educating them on healthcare options, preparation for the transition, and what they can do for themselves. She said Medicaid will cover the cost of treating inmates at community hospitals if they are there more than 24 hours. Representative Yonts thanked Ms. Peak and asked her to provide her comments and contact information to committee staff for forwarding to the Department of Corrections.
Billie Jones Stockton said she worked for the Department of Corrections for 16 years. She was a psychological practitioner at Blackburn Correctional Complex and also worked at Northpoint Training Center. Since retiring in 2012, she has been involved in reentry issues and is a member of the Bluegrass Reentry Council. She also represents the Kentucky Council of Churches on the steering committee of the Governor’s Task Force for Reentry. She is concerned that at one institution where she worked a prison warden was elevated to the job of health services administrator and was not qualified to make medical decisions. In addition, medical screening of prisoners was usually handled by persons who were not registered nurses (RNs). She feels they often disregarded medical concerns that merited the attention of a physician or RN. She said the last statement on her written comments is incorrect and should be disregarded.
Representative Yonts thanked Ms. Stockton for her testimony and asked her to give her contact information to committee staff.
There being no further business, the meeting was adjourned at 2:57 p.m.