By Carly Horton
Alaska Journal of Commerce

Gov. Sarah Palin has introduced a bill that would establish an Alaska health care information office to give consumers information on quality, cost and other important matters to help them make better-informed decisions about health care.

Items in the Health Care Transparency Act are based on recommendations by the Health Care Planning Council and the Health and Social Services Certificate of Need Negotiated Rule Making Committee.

The bill centers on two major proposals: The establishment of a governing body to oversee health care reform in Alaska, and the creation of a Web-based information site where consumers can access information about potential health care and insurance providers.

Alaska's health care providers had mixed reactions when it came to the Web site, but were more or less unanimous in their support of a governing body.

“That was our top priority for this legislative session,” said Rod Betit, President/CEO of the Alaska State Hospital and Nursing Home Association. “It's the only thing that will ensure changes take place.”

The association is a nonprofit corporation organized under state law that counts 36 of the 37 health care institutions in the state among its members.

Paul Sherry, CEO of the Alaska Native Tribal Health Consortium, said he hadn't had a chance to review the bill but he's been supportive of the creation of a long-term group for some time.

“There hasn't been a high-level health board in the state for 20 years,” Sherry said. “But the devil is in the details - we still don't know how it's made up or how well it's resourced, for example. What's encouraging is that the state is beginning to look at strategies for health care reform in an organized way.”

An Internet database for all health care facilities in the state has been proposed to provide objective, unbiased and factually based information, according to Senate Bill 245.

The database must include a geographically indexed list of all health care facilities in the state by region; information on costs, quality and type of service offered; and the types of insurance and payment accepted by each health care facility.

According to James Jordan, executive director of the Alaska State Medical Association, there have already been movements within the insurance industry to profile physicians.

“It's not as easy as it might seem,” Jordan said. “There's a lot more to it than just looking at what the cost isÉ What about outcomes? You can capture outcomes, but that is the data that is most difficult to come by. And the cost of adopting electronic medical records is significant. That can be a real issue.”

Rod Betit said health care reporting can be an asset to consumers, but a system can take years to set up.

“This idea just popped up,” Betit said. “It has July 1, 2008, as its effective date, which is just impossible. The system hasn't even been defined yet.”

Betit said hospitals are already required to report information, and he questioned how this system would be different.

The governor stated in a written release that health care must be market- and business-driven, rather than restricted by the government. To that end, she has proposed repealing the controversial certificate of need (CON) program.

According to the Alaska Center for Public Policy, CON is a program administered by the Alaska Department of Health and Social Services. It monitors the development of health care facilities and was established to prevent excessive, unnecessary or duplicative development of such structures. It also provides for public scrutiny of projects.

Generally speaking, any proposed health care facility, proposed increase to the number of beds in an existing facility, or addition to the number of health care services provided requires a certificate of need if the total expenditures will exceed $1 million. Only a few exemptions exist.

Alaska Health and Social Services Commissioner Karleen Jackson concluded that the CON program does not benefit the citizens of Alaska given the litigious environment surrounding it.

Alaska's health care community disagrees.

Betit said eliminating the CON would drive consumer health care costs up since hospitals would not be able to offset the cost of treating uninsured patients. He said when a group of orthopedists in Juneau opened up an MRI facility without going through the CON program, the local hospital lost $750,000 per year.

“Repealing it is just a bad idea,” Betit said. “It is not something that will serve Alaska well in the long term.”

Jordan said the Alaska State Medical Association supports the elimination of CON in the state's urban areas, but not in smaller communities.

“It's been a long-held position that the marketplace should be allowed to run where it can,” Jordan said. “The marketplace is large enough to have competitiveness in large cities. But in many of the smaller communities, you have community-owned hospitals - it's a little different circumstance.”

Paul Sherry said there are arguments for and against CON. On the plus side, it generally ensures that unneeded facilities are not built. On the flip side, it's an unwarranted government intrusion in a free market economy.

“We haven't really taken a position yet,” Sherry said. “There are arguments both ways.”

The House version of Palin's bill, HB 337, was heard Jan. 24, while the Senate version, SB 245, was heard Jan. 25 in the respective Health, Education and Social Services committees.

According to Sherry Hill, assistant commissioner of public affairs for the Alaska Department of Health and Social Services, several changes were proposed, including alterations in the make-up of the oversight group.

The information for the Web-based information site would focus on health care providers, facilities and costs. “We're really trying to narrow what kind of information we would gather that would be made available to the public,” Hill said.

Legislators also raised concerns about eliminating the CON. According to Hill, the House and Senate recommended keeping the CON program for nursing homes, critical access hospitals and residential psychiatric treatment centers.

The bill was scheduled to go before the Senate on Feb. 8 and the House on Feb. 9.

“It's entirely possible there will be other changes in each of the three areas,” Hill said. “We just don't know what those are.”