GAMC: A Bridge to Comprehensive Care and System Reform

After many months of negotiation and debate, we were successful in negotiating an agreement that maintains health care coverage for current GAMC enrollees. However, there are significant problems with the compromise agreement. With the passage of the federal health care reform bill, we have the opportunity to provide comprehensive, statewide coverage to very low-income Minnesotans through an early opt-into Medical Assistance (MA). The compromise law on GAMC is a critical bridge to a better option.

Our first legislative solution, Senate File 2168, was undoubtedly the most fiscally-responsible means of restoring health care coverage to GAMC recipients, while still instituting system reforms and cost-cutting measures. Although Governor Pawlenty’s proposal to auto-enroll GAMC enrollees into Minnesota Care would have been more expensive and would have imposed additional costs and coverage caps on a population that earns less than $8,000 per year, he vetoed our bill. Our attempt to override did not garner any Republican support, even though the vast majority of them had voted for the bill.

The compromise legislation, enacted just before GAMC disenrollment commenced, preserves health care and prescription drug coverage for the GAMC population and protects the Health Care Access Fund (HCAF) for MinnesotaCare recipients. The compromise maintained the GAMC program in its current form until June 1st, at which time the program will operate by providing lump sum payments to hospitals. The hospitals will then use a managed care approach to form Coordinating Care Organizations (CCOs) to provide services to GAMC patients. Drug coverage is maintained as a fee for service—a critical component for GAMC recipients, many of who are mentally ill or suffer from chronic diseases.

While the new agreement maintains the safety net, it does come with very high expectations for hospitals, which are being asked to continue providing care despite decreased reimbursement. Initially, all but one hospital declined to become CCOs, and it was only after the Department of Human Services “reinterpreted” the new law to limit the number of patients each hospital would have to take that three additional metro-area hospitals agreed to sign on.

In the final budget agreement, we successfully negotiated the inclusion of rural hospitals in the terms established by DHS and provided an additional $10 million to their uncompensated care pool, bringing that total to $30 million for reimbursement for care provided in hospitals that do not become CCOs.

Even for the short-term, the revised GAMC program is barely sustainable. Hospitals are being asked to provide care, with less money, and enrollees have to navigate a system that asks large hospitals to coordinate their much-needed preventive care. The rudimentary reforms in GAMC will be hampered by under funding and geographic disparity.

I am monitoring closely implementation of the revised GAMC program and will be visiting providers and enrollees in Greater Minnesota to best understand the issues with implementation. Early reports suggest the concerns my colleagues and I shared with the administration prior to final passage are being realized and we will continue to pursue the transfer of GAMC patients into early MA.

A far superior option is available to us as a result of the passage of the federal health care reform bill. Because Minnesota provides coverage for very low income Minnesotans with state funds, we are one of 11 states able to transfer enrollees into Medical Assistance and earn federal matching funds.

Early MA provides stability for those getting care and predictability for providers. Most importantly, it provides us with an important opportunity to bring broad system reforms to improve care and reduce costs for everyone. Foregoing this opportunity would be a strategic failure.

We fought hard to include the early MA opt-in in the final budget agreement and it will be established in state law beginning on July 1, 2010. This option is fully funded in the budget signed by Governor Pawlenty. The Governor can now opt in by signing an executive order beginning on July 1, 2010.

By opting into early MA, a decision for Governor Pawlenty or his successor before January 15, 2011, Minnesota will earn federal matching funds. The early MA option is paid for with $1.4 billion in federal funding that is leveraged by $188 million in state dollars – a $7 to $1 ratio. After three years, the state share will disappear entirely and the federal government will pay 100 percent of the cost of coverage.

Reducing the ranks of the uninsured is a cost saver for insured Minnesota families as it eliminates the “hidden tax”, paid in the form of higher premiums to cover uncompensated care. The benefit of the state spending in this area is will create 22,000 jobs, generate $2.7 billion in business activity, and produce $984 million in salaries and wages.

With the passage of federal health insurance reform in April, I know that the GAMC compromise will have a short but important role in Minnesota. I support the early MA, along with many advocacy groups and provider organizations. I hope that you will join me in urging our current, or future, Governor to adopt this measure.

Standing With Nurses

Last Friday I joined nurses and Speaker of the House Margaret Anderson Kelliher to stand with 12,000 Twin Cities nurses who will conduct a one-day strike for patient safety on Thursday, June 10, 2010.

As a policy maker, I have always strived to reform and improve health care in Minnesota because that means a healthier population. I firmly believe a critical part of that health care delivery is strong and effective nursing workforce.

Health care in Minnesota is experiencing a lot change and is under a lot of pressure.
Reforms being implemented means change in the delivery of care. Our aging population brings a larger demand of patients. At the same time, we are seeing a shortage of nurses and other health care professionals widen. Amidst this pressure, nurses are expressing their concerns for the safety of the patients they care for everyday.

Concern for patients’ safety has always been a top concern for nurses. I know this because I’ve seen it first hand for decades. In 1984, when I was in college, nurses went on strike because of their concern for their patients. In 2001, nurses negotiated with hospitals on the number of patients that each registered nurse could care for to ensure each patient received the attention they needed. In 2008 and 2009 they came to the Legislature and worked with us to put in statute patient/provider ratios to go further to ensure patients were receiving the quality care they deserve.

I’ve worked with hundreds of nurses in many hospitals. I know how difficult a decision it is to strike, because it means leaving their patients, even for one day. But they have the courage and strength to do this in order to stand up for themselves and for the safety of their patients. I am proud to be standing with them.

To watch the entire press conferences visit http://tiny.cc/tjmfj.

Session Mid Point

Dear Mighty Citizens,

The 2010 legislative session is half over. We have been wrestling with the challenges of a weakened economy and larger state deficit. The first six weeks have been a whirlwind as we have worked to improve the lives of Minnesotans and make Minnesota better.

This session we have already:
• Helped put tens of thousands of Minnesotans back to work
• Fixed 1/3 of Minnesota’s $1 billion budget shortfall
• Restored health care for 85,000 poor, sick Minnesotans
• Aided small businesses competing in a global economy
• Made Minnesota’s excellent election system even stronger

In particular, I want to mention our work on health care. After almost a year of intense work and collaboration, we successfully passed a bill to restore General Assistance Medical Care for Minnesotans in need. The solution is far from perfect, but it ensures that poor and sick Minnesotan can receive health care when they get sick. Maintaining this basic, moral objective was central to our work and I continue working to strengthen the compromise this session, taking advantage of the opportunities in the federal health package.

As we work to close our budget deficit, we will be closely monitoring the federal health care reform legislation and how it interacts with state law. By passing a law to conform to federal health care reform we can capture critical federal dollars to reduce the ranks of the uninsured and improve the quality and affordability of care we deliver in Minnesota.

Although we continue to face serious challenges, good news is on the horizon. Minnesota’s economy is getting stronger. In January, employers added 17,200 new jobs in our state - the highest one-month job gain since 2005. We’re working hard to keep that momentum going.

Working hard, we will move Minnesota closer to long-term economic recovery. Thank you for the opportunity to serve. If you would like to learn more about our legislative efforts, please visit my blog. I encourage you to share your point of view with me.

Warmly,
Erin




Jobs Bill Part I: Capital Investment (HF 2700)

The Minnesota House has passed a jobs-targeted bonding bill capable of putting nearly 20,000 Minnesotans back to work. The bill makes strategic investments in high-priority, shovel-ready infrastructure improvements.

Jobs Bill Part II: Tax Reform (HF 2695)

Continuing our focus on the economy and job creation, we passed common sense tax reforms that will create thousands of new jobs in bioscience, manufacturing, construction, and the emerging clean energy economy.

General Assistance Medical Care (HF 2680)

Working together, we passed a solution that restores basic health care for 85,000 of Minnesota’s poorest, sickest people, and prevents 20,000 working adults from losing MinnesotaCare coverage.

Bipartisan Small Business Agenda

The bipartisan Small Business Caucus is taking action to make Minnesota a better place to do business. Eight bills backed by the Caucus would free up needed capital, cut red tape, and better-connect small businesses with existing state resources. Many of these reforms come directly from the ideas of Minnesota small business owners who responded to our small business survey.

Strategic Budget Cuts (HF 1671)

The Minnesota House resolved 1/3 of the state’s $1 billion budget shortfall. Many of these cuts are difficult, but we have cut less than half of the Governor’s proposed local government cuts which will preserve jobs and limit property tax increases. Going forward, we need a balanced strategy to budget for the things Minnesotans value: quality education, health care and a 21st Century transportation system.

Common Sense Election Reforms (HF 3108)

Acting on lessons learned during the 2008 U.S. Senate election recount, lawmakers passed bipartisan election reforms to make our voting system the most reliable and efficient in the nation - while helping Minnesotans cast their ballots more easily.

Capital Bonding

My colleague Rep Paul Gardner shared the following blog about Capital Bonding and, with thanks to him, I would like to share it with you.

Every two years the Legislature and Governor work on this bill to provide funding for publicly owned buildings, property, and land. In particular, state agencies have buildings or property that are in need of repair, renovation, or replacement. Our state colleges and universities tend to have a large request because they have a lot of buildings. To be "bondable" the project has to be publicly owned, be of state or regional significance, and be a capital project--meaning it has to be "bricks and mortar" and not for ongoing operation costs. The state raises money for these projects by selling general obligation bonds on the bond market. The state then pays the debt service to pay off the bonds over time.

Many people have written me assuming that when the Legislature passes a bonding bill that the amount of the bill is actually added dollar-for-dollar to the budget. For example, the Senate just passed a $1 billion bill and someone said that they added $1 billion to the deficit. That's not the case. In our current budget, we will now just pay the debt service on the $1 billion, which is in the tens of millions or so.

The state agency Minnesota Management and Budget (MMB) starts the process by asking public entities to submit requests. Usually the requests are something like five times greater than funding available, so MMB winnows them down and eventually the Governor's office submits a proposal to the Legislature with projects he wants. This year the Governor submitted $685 million worth of projects and those projects were mostly for state agencies and higher education institutions. The House and Senate are likely to approve a bill in the $1 billion range. According to staff, this difference of $315 million would increase our debt service for FY2010 by zero and by just $2.5 million in FY2011.

The bonding bill is often touted as a jobs bill. It is true that the private sector creates most jobs, but in bad economic times when the private sector is not hiring, government can spur job growth by spending on public projects that are generally needed anyway. (This is a basic tenet of Keynesian economics.) Right now, construction costs have declined considerably so many of us believe that if we have a larger bonding bill this year it does two things: we get more projects done for less money and we can spur additional job growth albeit temporarily. A general rule of thumb is that for every $100,000 in bonding projects, you get one job. (Someone gets paid for doing the work, but there are also costs to fuel, supplies, construction materials, etc.)

So if we pass a $1 billion bonding bill instead of the Governor's proposed $685 million (a difference of $315 million), we could see the creation of 3,150 additional jobs for just an additional $2.5 million during the next fiscal year. At least in the short term, that's $793 per job when we need to put people to work. WOW.

How do we figure out what an acceptable debt level is? Well, there is no law that limits our debt level, but several decades ago, Governor Perpich used three percent of the general fund budget as a guideline and the state has pretty much stuck to that level.

Moody's (an agency that sets bond ratings) said this about our debt management: "Minnesota's debt levels have historically been a neutral-to-positive part of the state's credit profile. The state's debt issuance is highly centralized and controlled, with the bulk of bonds issued carrying the full faith and credit pledge of the state. Minnesota's metrics have tended to place the state about average or slightly better among the states for debt issuance. Moody's 2009 State Debt Medians Report shows that Minnesota ranks 25th in debt per capita and 32nd in debt as a percent of personal income, largely a result of the state's increasing personal income levels."

Caucuses and Session!

Dear Mighty Citizens,

On Tuesday, February 2nd I encourage you to take part in precinct caucuses.

Precinct caucuses bring neighborhoods together and offer all of us the chance to weigh in on the issues important to our community, state and country. Not only are caucuses the first step in choosing our elected officials, they also begin the process of forming party platforms and setting priorities.

To find where your precinct caucus is located you can visit the Minnesota Secretary of State website: www.sos.state.mn.us . The website displays the times and locations of the Democratic, Republican, Independence, Constitution, and Green Party caucuses.

Two days after caucuses, the 2010 legislative session begins. As you have done throughout the interim, please continue to stay active and to contact me with your ideas and input. Your active role in our political process helps me effectively represent our communities at the State Capitol.

Thank you for the opportunity to serve. It remains a great honor and privilege.

Fixing GAMC: We Can Do This.

At the end of this past legislative session, Governor Pawlenty vetoed funding for General Assistance Medical Care (GAMC), which provides health care to 70,000 (about 35,000 in any given month) of the poorest and sickest Minnesotans each year. Recipients on GAMC earn less than $7,500 per year and about 80% of those served have serious mental health issues. GAMC funding is set to expire on March 1, 2010.

Since session adjourned, we have been working on a solution that will preserve basic health care for the most vulnerable Minnesotans. In July, Health Policy committee members visited nine safety net hospitals all over the state to hear about the need to continue providing basic health care benefits to this medically needy population. Since August, we have held meetings with hospitals, health plans, providers, unions, counties, representatives of the faith community, safety net organizations, grass roots organizations, mental health advocates, and many others to discuss policy and financing alternatives for GAMC.

After a lot of listening, we are moving forward with our proposal to temporarily restore GAMC for 16 months in order to build a bridge to national health care reform. Temporary GAMC will offer access to basic care for those currently enrolled, protect vital health care jobs, and restore the solvency of the Health Care Access Fund through 2012. Funded entirely without new taxes, the solution relies largely on cost saving reforms, maximizing existing state and federal health care funding streams, and reduced provider reimbursement rates to pay for a pared down GAMC.

You can view our proposal online: http://www.house.leg.state.mn.us/comm/committee.asp?comm=86118.

This plan is not perfect, and there are issues we need to continue working on, but inaction is not an option. In the coming weeks before session, we will continue to work collaboratively with health care stakeholders as well as with the Governor and Republicans on a bipartisan solution that is in the best interest of all Minnesotans.

This morning, Lori Sturdavent writes about the session ahead and its challenges. Read it here http://www.startribune.com/opinion/commentary/79092092.html?elr=KArksc8P:Pc:UthPacyPE7iUiD3aPc:_Yyc:aULPQL7PQLanchO7DiUr

Next step in this process will come on Monday, December 14th when we hold a public hearing to discuss various GAMC proposals. As always, I look forward to your input and perspective.

General Assistance Medical Care (GAMC)

Casey Selix of MinnPost wrote this story which digs into the complexity of GAMC and efforts to rebuild health coverage for 35,000 sick and poor Minnesotans.

Read it here:

http://www.minnpost.com/stories/2009/10/15/12504/pawlenty_sliced_minnesotas_medical_care_for_the_poor_and_now_times_running_out