Alaska Legislature HHSS committee — 2026-11-10

This meeting of the Joint House and Senate Health and Social Services Committees will now come to order. It is 1:05 PM Tuesday, November 10th, 2026, in the Denali Conference Room at the Anchorage Legislative Information Office building. Members present are Representatives Josephson, Mears, Gray, Senator Tobin, and on the line we have Representative Prax, Representative Fields, Representative Ruffridge, Representative Schwanke, and Chair Dunbar, and myself, Representative Mena. Chair is here in person. Let the record reflect that we have a quorum to conduct business.

Please take this time to silence your cell phones today for the duration of the meeting. Staffing the committee today We have Kayla Brown as our Health and Social Services Recording Secretary, Tristan Williams and Cassie Enter as our LAO moderators, and Katie Giorgio is my committee aide. If you need anything during the meeting, please do not hesitate to get her attention. Additionally, if you are online on Teams or over the phone and you would like to speak, please unmute to do so. Today we are hearing a presentation from the Department of Health on operational impacts to the Division of Public Assistance as related to House Resolution 1, also known known as HR1 or the One Big Beautiful Bill.

This was a law that was signed into the federal law in July 2025 by President Trump. This is a huge impact and has a lot of significance to Alaska's healthcare world, our safety net, as well as to the Division of Public Assistance. And now that we are more than a year into implementation We think that it is of utmost importance to know how the Division of Public Assistance is implementing this law prior to the next legislative session. Presenting today, we have Commissioner Heidi Hedberg from the Department of Health, Deputy Commissioner Emily Ricci, as well as Director Deb Etheridge with the Division of Public Assistance. Please come forth, put yourself on the record, and begin your presentation.

For the record, my name is Heidi Hedberg, Commissioner for the Department of Health.

As the Chair Amina had mentioned, HR 1 was signed into law July 4th. 2025. That was a mere 16 months ago. HR-1 is not just a new policy or implementation change. HR-1 is a very complex and is requiring the department to take a phased implementation effort.

As you can see on this slide before you, each of these areas need coordination under a multi-year effort that is spanning across both the SNAP and the Medicaid programs. And each of these areas is overlapping phases as we are looking at the technology, the policy, the workforce, our stakeholder engagement, and as we are communicating to Alaskans. These efforts are critically important, but they are also pulling resources from our existing DPA staff that are focused on the operational improvements so that we can increase our timeliness and decrease our errors across our existing programs. Our priority continues to be implementing the requirements of HR1 while protecting access to coverage for eligible Alaskans.

Let the record reflect that Senator Claman joined us at 1:07 PM. I also want to recognize Representative Eischeid and Representative Foster and would like to invite you all to come join us at the dais if you'd wish.

For the record, Heidi Hedberg. So on slide 3, every HR-1 requirement creates work across multiple areas across the Division of Public Assistance. And successful implementation of the HR-1 requirements is going to require coordination across the 6 different areas that you see on the screen before you. These changes are interconnected. A single policy change can require our IT systems to be updated, updating our client notifications, ensuring that our staff are trained to the different process or policy, and possibly new quality control measures.

Our workforce is central to this implementation. We must ensure that our eligibility technicians are trained, they have the tools and the operational support needed to apply these increasingly complex requirements accurately. Quality and financial accountability are critical. Implementation requires that our processes are focused on prevention and early identification of potential eligibility errors, particularly as the federal requirements are increasing the state's financial exposure. There's also a direct impact to Alaskans.

Changes to eligibility enrollment affect both the clients served by these programs, our providers, our tribal partners, our community organizations, that are helping the clients access these benefits. So we cannot approach these, these areas as independent because all of these 6 areas are interdependent across each of these changes within HR-1. And so our strategy must account for the entire division, both the work that is currently underway in addition to the changes with HR-1. So, with the next handful of slides, we are going to be focusing on the Medicaid program and walk you through each of those changes, and that will be led by Deputy Commissioner Emily Ricci. And then we'll move over to SNAP and we'll walk through the 3 different changes within the SNAP program.

Good afternoon. For the record, my name is Emily Ricci and I'm the Deputy Commissioner with the Department of Health. And on slide 4, you see 4 different changes that will impact the Medicaid program as a result of HR 1. There are more changes than what is listed on the slide for the extent of HR 1 and its connection to the Medicaid program, but these 4 are the most impactful and have already occurred or will be occurring within the next 12 to 18 months. So, the first change I wanted to start with is changes to noncitizenship coverage, which took effect October 1st, 2026.

In effect of October 1st, certain noncitizens who had been eligible for federally funded Medicaid benefits became no longer eligible for those benefits as a result of HR 1. This primarily affected asylees, refugees, those with temporary protected status, including trafficking victims, Ukrainian, Afghani parolees, and others. In August, the division began outreach to nearly 1,000 individuals who were identified as potentially being impacted by these changes that were occurring October 1st. We— the division connected— the division coordinated a connection to kind of the federal SAVE repository, which is the federal database that Medicaid is required to connect to for these types of issues. I used that data to, again, identify individuals who might be impacted and whose status would be impacted under this change, provided outreach to individuals asking them to either confirm their status or to let us know if their status had changed, because sometimes that occurs in the process.

If they believe their status has changed, they have 90 days to provide us with paperwork demonstrating that their status has changed. Some of that—. Some of individuals are still in that 90-day reconsideration period right now, so these numbers are not final. But as of October 1st, about 775 individuals were disenrolled from the Medicaid program. 200 Individuals were determined to remain eligible.

Under the Medicaid program after October 1st, and the majority of those disenrollies were actually children, so about 400, just over 400 children. There is an eligibility option called CHIPRA 214, and the department is currently reviewing whether or not electing that eligibility option will allow us to extend coverage to pregnant women and children who would be impacted by these changes. The eligibility option may be a little bit broader than what— than simply applying to people who are impacted by these changes. So, we are undertaking kind of a thorough review of that, and if it is determined feasible, we will be moving forward in implementing that.

The next item that will take effect will begin on January 1st, and these are changes to retroactive coverage for the Medicaid program. Currently, Medicaid provides 90-day retroactive coverage, which means that if an individual is determined eligible to December 1st, providers can submit bills for reimbursement for Medicaid for healthcare costs—eligible healthcare costs were incurred in the 90 days leading up to December 1st, so September, October, November. Beginning January 1st, HR1 changes the retroactive eligibility period and shortens it to 60 days for most adults who are covered through Medicaid and kids, and then 30 days for adults who are in the Medicaid expansion population. So, what this means is that providers will have a more limited timeframe for which they can be reimbursed for services that were provided to individuals who are determined to be eligible for Medicaid beyond that 30- or 60-day window.

The next change that will take effect is 6-month renewals, and those will also take effect January 1st of this year. So, currently Medicaid eligibility is reviewed every 12 months for most for all Medicaid enrollees. However, beginning January 1, 2027, individuals in the Medicaid expansion population will have their renewal period shortened from 12 months to 6 months. Now, this does not impact everyone who is enrolled in Medicaid. This only applies to the Medicaid expansion population.

And there's about just under 200,000 Alaskans who are enrolled in Medicaid as of October. And the Medicaid expansion population accounts for about 58,000—57,000, 58,000 individuals. So, it is a portion of the Medicaid population.

The 6-month renewal also excludes individuals who are Alaska Native or who are American Indian. They would remain on a 12-month renewal period. So, we estimate that that is probably around 28% of the current Medicaid population. So, when we kind of look at the, the current enrollment and try to back out those individuals that would remain on a 12-month cycle, we estimate around 40,000 Alaskans will move from a 12-month renewal cycle to a 6-month renewal cycle effective January 1. The renewal periods will be phased in, so they will occur as an individual's eligibility or as their renewal period comes up or naturally occurs.

So, effectively, someone who is up for renewal in December of this year would be renewed under the current rules, which provide a 12-month renewal period. So, they would be renewed again December of next year, and at that time, if they were part of the Medicaid expansion group that was subject to 6-month renewal, their next renewal period will be 6 months. Conversely, someone who is renewed in January and is part of the Medicaid expansion group and is not otherwise excluded would have their renewal period occur in July. So, what this means practically from a division perspective is that we anticipate the workload associated with these renewals really beginning to pick up in the May and June timeframe as the first round of shorter renewals begins on that July timeframe. I'm happy to talk about the next component or pause for questions.

I think we'll pause before we talk about that asterisk on the good faith effort. Right now, I first want to recognize that Representative Coulombe joined us at 1:17 PM, and I also want to extend an invitation to join us at the dais if you'd wish. I have Senator Tobin and then Senator Claman and then Rep Fields. Senator Tobin. Thank you, Madam Chair, and thank you.

This is helpful information, I think, particularly for the public, as much of the changes that are occurring from H.R. 1 Were so delayed, it's difficult for for the public to understand what the future impacts might be. I'm particularly curious about the first bullet point here on non-citizens coverage. You mentioned that there's about 775 folks who have now been removed from Medicaid coverage. What happens if that person walks into an emergency medical facility and needs care?

Will they be receiving that care and who pays for it? Through the Chair, Senator Tobin, for the record, this is Emily Ricci with the department. So individuals who would maybe otherwise not be eligible for Medicaid as a result of this would still remain eligible for emergency Medicaid, which means that emergency Medicaid— Medicaid could cover their costs if they are incurred in an emergency room or if they are associated with labor and delivery. But those costs are limited to costs incurred in a 72-hour period, so they are not comprehensive.

Follow-up? Thank you. Thank you, Madam Chair. And so just to be clear, there are certain parameters within that emergency Medicaid. What if somebody came in with an issue that is not covered in that emergency Medicaid?

Would they receive care and who would pay for it? Through the chair, Senator Tobin, for the record, this is Emily Ricci. It would be uncompensated care. I do not believe there would be a payer for that care outside of the individual themselves.

Senator Kaufman. Thank you, Madam Chair. A couple of questions. First, with regard to the retroactive coverage and the 6-month retroactive, what happens if somebody is— the process of getting them approved goes on for 6 or 8 months and there have been bills that have come in and then 6 or 8 months later they're finally approved. What happens in the retroactive?

Are they only going to pay the last 60 days' bills, or will they then go back to the earlier bills? Through the Chair, Senator Claman. So, the retroactive period is from when that person first becomes eligible for Medicaid. And so, that would be the— effectively, the first day of the month for that application is submitted and then approved. So, if that approval occurs later on, let's say 3 months later or 4 months later, it would go back to that the first date of that month where it was approved, and the retroactive coverage would be 60 or 30 days prior to that date.

But Director Etheridge, would you like to clarify anything? For the record, this is Deb Etheridge, Director for Public Assistance, and that is correct. Okay. And then—. Sorry.

Yep, second question on a different topic. You were talking about when the renewal periods get shorter from 12 months to 6 months, and to a large portion of the Medicaid population, And you said there's more work, but more work for who? Through the chair, Senator Claman, more work for everyone. More work for the person who is applying, although again, we are trying to do as much as we can through an automated process. And a lot of our focus with the Division of Public Assistance right now is to automate renewals as much as possible using data that we have in our systems.

But it is also more work for the eligibility technicians. We are effectively processing more renewals than we otherwise would. Follow-up? So does that mean that partly due to these shorter periods, effectively your department needs more staff to actually process the applications because they have to— I mean, at some level when I hear more work, that tells me more people needed to do the work. Is there anticipated staffing needs to address the more work?

Through the chair, Senator Kaufman, we are evaluating those staffing needs. But as you'll see throughout the presentation, this is one of several circumstances where there is, there is more work that the department, that the division has to undertake. Again, I think strategically we are— it is, it is essential that we focus on updating our systems, on continuing to work through the modernization and automate as much as possible. But we do anticipate additional resources. Thank you.

Representative Fields. Thank you. Through the chair, at the risk of stating the obvious, this bill is intentionally cruel, expensive to the state of Alaska, expensive to all of us who have health insurance. It'll be expensive to the state that way. It seems intentionally designed to sabotage Medicaid.

So, just making an observation about that. Director Ritchie started to answer my question about automated renewals. To what extent can we use AI to validate that, yes, someone who was eligible 6 months ago is still eligible? That's one of those requirements that seems intentionally designed to kick people off of care for which they are, in fact, eligible through adding unnecessary red tape. So I don't know if you can elaborate more on how much we can automate that.

Thank you. And I know there's a future slide that's related to the exclusions and exceptions, so I don't know if you wanted to save that for that.

Representative Gray. Thank you, Madam Chair. I'm kind of leaping off of Representative Fields' comment, and it just seems to me that the additional work burden on everyone requiring probably additional employees just means that this is a bill that's going to grow government. We're going to have to increase the number of employees. We're going to have to do more work where, as before, we didn't.

So it's— I just want to make that clear. This is a big government bill that's growing the government for no good reason. Having said that, I'm curious about In that vein, you know, overhiring so that we make sure that we have folks who can help those who need it most to make sure that they don't lose coverage. Like, you know, let's just go big. Like, we'll hire people whose job is to make sure that folks don't lose their Medicaid coverage.

I mean, the bill doesn't prohibit that. I guess that's my question. We could create new positions to just make sure that the folks who need it most don't lose their coverage.

Through the chair, Representative Gray, there are a number of different strategies that we are working through now. I mean, our, our primary goal is to make sure that every individual who is eligible for coverage remains covered and that to the degree that as we talk about new terms, exclusions, exemptions, exceptions later on in the presentation, that individuals that are eligible for those are able to access those. Again, I think the The primary goal is that we automate as much of this as possible, and then that secondary goal is to make sure that we have people available who can support Alaskans when they're applying to the system. I have a quick question, and then I'll take you, Representative Josephson, on the— when you talk about the outreach to noncitizens, I'm curious if you have any lessons learned from redetermination, especially considering that a lot of that population will be English language learners? Did you incorporate any language accessibility?

And also, were there any partnerships or outreach to other organizations? I'm thinking community health centers that work extensively with non-citizen populations to provide safety net care. Through the chair, Representative Mena, we have been working very closely with different stakeholder groups. One of the things that we've, one of the lessons that I think we learned from redetermination, and there's a number of different lessons from the redetermination effort, things that work that we have revived as we are walking through this process, But one of those really was to make sure that others outside of the division have a chance to review the notices that we're sending out and the letters and to give us feedback on that. And so we are trying to really actively engage in that, and we did that for the noncitizen coverage notice.

Director Etheridge, you can probably add some of the other elements of that communication that we worked through.

For the record, this is Deb Etheridge, Director of Public Assistance. Representative Mena, Chair. We did do direct one-to-one meetings with agencies such as Catholic Community Services, who supports a number of non-citizens or individuals coming to Alaska. Again, as Deputy Commissioner Ricci stated, we've been working with stakeholder groups to provide information, and then also We have been diligent in updating our website and directing individuals using our Stay Covered campaign to our website and then providing tools for people to hopefully provide additional information. Our goal is to really share the impact and what's happening.

And then with that feedback from the stakeholder groups, we did expand languages that were available on our limited English proficiency and we you know, we revamped how we're communicating. It's been a wonderful partnership with our stakeholders. Thank you. Representative Josephson. Yeah, through the Chair, thank you, Madam Chair.

On the issue of staffing and whether the department feels that more is needed, would that come in the form of a report to the next administration, or might it make its way into the FY a '28 budget draft.

For the record, Heidi Hedberg through the Chair, Representative Josephson. Yes, we do need more staffing to support these new requirements, and we have shared that information through the budgeting process.

Thank you. And then I know we have the bottom of the slide about the good faith effort. If you could expand on that. For the record, this is Emily Ricci. So, the last item on the slide and one that we've talked about in the past, we will continue to talk about, is working community engagement requirements.

So, these are new requirements that apply to the Medicaid expansion population. They do not apply to other eligibility groups outside of that Medicaid expansion population, which I think is important for anyone listening online. But the—. Work and community engagement requirements require those individuals who they apply to, to have demonstrated 80 hours of work, community service, or educational attainment, or other kind of similar activities in the month prior to application. And in order to be eligible for Medicaid, they have to demonstrate those hours again in that month prior, and we have to verify that.

This is a, potentially one of the kind of largest and most controversial elements of the bill. And many states are working— every state is working to implement it by January 1, 2027. The bill includes a number of exclusions and exceptions for this requirement that states are required to automate and use electronic data sources to verify as much as possible. And that requires very complicated system integrations. We're—.

Again, I will talk about those in the next few slides, but the state has requested a good faith effort exemption for the work and community engagement requirements from the Centers for Medicare and Medicaid Services. This is an allowable provision that was included in the bill really by our congressional delegation because they understood the modernization effort that we are undertaking right now for our eligibility systems. As well as the complexity of the system requirements that work and community engagement will require. And so we have submitted that to the Centers for Medicare and Medicaid Services and have requested an extension to January 1, 2028. So we are awaiting approval for that right now.

Thank you. I have a question about the good faith effort exemption process and how it compared to the SNAP process. So right now we're still waiting to hear back on whether the exemption has been accepted. What was the wait time for the state when they applied for the SNAP good faith waiver exemption? And is it comparable to the process for Medicaid, or is it different?

Uh, to the chair, for the record, this is Deb Etheridge. The wait time was less than 30 days for the response from Food Nutrition Administration on the approval for the extension. It is much different with the good faith waiver versus the exemption.

Representative Mena, for the record, this is Emily Ricci. The good faith effort exemption and the requirements for that are outlined in federal law pretty clearly, but they've also been outlined through the interim final rule that was issued June 1st that I will talk about as well. You know, I think the Centers for Medicaid and Medicare Services right now are working incredibly hard to also develop, like, the policies and to help states operationalize this, which I think may account for some of the delay in the time period between receiving the good faith effort exemption and making a determination. But we have been in close contact with CMS for the last year. They have come and visited.

They have seen our systems. They understand the challenges that we are facing. They are providing significant technical assistance to the division right now, which is very helpful with some of our systems work. And I think they are— they, they very much understand where we are at. Thank you.

And then I believe online we have Representative Ruffridge and Representative Schwanke. Representative Ruffridge.

Yeah, thank you, Chair Mina. I wanted to go back to one of the questions or comments earlier about some of the individuals who are potentially going to be either removed or lose coverage in the next year. And it seems like there is a correlation between plans that may be available under the healthcare exchange and Medicaid eligibility, and I'm wondering if you can speak to that relationship, or if there is a relationship for people that may lose coverage. They may have options for coverage, is how I understand it, through a subsidy of some sort, and I'm wondering if you could speak to that. Through the Chair, Representative Ruffridge.

For the record, this is Emily Ricci. For individuals who are disenrolled from Medicaid as a result of either noncitizen coverage or work and community engagement requirements, they are not eligible for any of the subsidies through the Federally Facilitated Marketplace.

Okay, thank you. Representative Schwanke.

Yes, thank you, Madam Chair. Through the Chair, I have a question for Director Etheridge. I want to kind of go back a little bit pertaining to the eligibility check. Could you describe kind of the current process that you go through for the annual eligibility determination for Medicaid enrollees and share with the committee any efficiencies that the division has made over the last couple years in this process that might help us address this going forward when it steps down to a 6-month eligibility process.

Through the Chair, Representative Schwanke, this is Deb Etheridge. To start, the center— CMS, Center for Medicare and Medicaid Services, requires the state to conduct what's called an ex parte renewal where we initiate a renewal for an individual. Prior to sending a renewal form out. So it's our, we ping against automatic resources such as the Department of Labor, SAVE, I think Deputy Commissioner Ricci mentioned that, permanent fund information to determine if the person is likely to remain eligible. If they are likely to remain eligible, then we will renew their Medicaid.

Coverage without requesting an additional form. If we're unable to, let's say, verify income or the income's above the 10%, then we will send them a pre-populated renewal form to be returned within 30 days to the Division of Public Assistance. This initiation of ex parte begins at least 60 days prior to the renewal date. Once we receive the renewal information, then it's received by an eligibility technician and processed in order received. And we have a statewide workforce or a tool that we use so that no matter where you reside in the state, we operate and operate statewide.

Did you want to add? For the record, this is Heidi Hedberg. Through the chair, Representative Schwanke, there's been significant enhancements that's happened over the past 4 years. I think year 1 was stabilization. There was— we appreciate the legislature and the appropriations with the funding for capital to improve our IT systems and the additional staffing that has helped with the operational efficiencies.

With client engagement, the applications are now online and they are smart forms, and we are seeing a high percentage of Alaskans that are leveraging those applications applications online. In addition, we have Alaska Connect, and the director can talk about the Alaska Connect portal, which is really a one-stop shop that enables the client to have access to their information, and there's a phase 2 that will be rolling out soon. In addition, all of the offices are open for same-day service. So the first focus several years ago is really ensuring that clients had access and we were meeting clients where they were. The next was focusing on our workforce.

So in addition to the additional PCNs that we have received over the years, Dr. Atheridge has really overhauled the training program. And so it's an adult training theory. Everything is modularized, so adult learners, some move faster than others. And there's a lot of enhancements that the director has been leading through ensuring that staff have the right tools And they are working and we are measuring their performance and where we can target those improvement areas. In addition, there's been a significant focus on our IT modernization.

And so we have future slides in that space. So I will hold that discussion, but I want to earmark that there's a lot of the conversations that we are having is around how do we automate and how do we leverage automation Maybe it is AI, maybe it is integrations with our systems so the systems are talking together. So it allows the eligibility technician to just focus on one system instead of toggling between multiple systems together. So those are some of the highlights that we have accomplished over the past 4 years.

Thank you. Thank you very much. Could I have a follow-up, please? Follow-up?

Through the chair, thank you for that. I really appreciate it. I know that the department has done a tremendous amount of work. Just a quick question follow-up. Could you describe very quickly what your RTP grant will do to kind of help push you even further forward in the automation and ability to maybe improve our ability to process going forward here?

For the record, Heidi Hedberg through the Chair, Representative Schwanke. So the Rural Health Transformation Program funding is intended to change the healthcare system out in community. It is not being used to modify our eligibility system. We have separate funding from CMS that is focusing on that as a match to the general funds the legislature appropriated. Thank you very much.

Thank you. I think we can proceed to the next slide.

For the record, this is Emily Ricci, and moving to slide 5, I'm going to introduce what I call the 3 E's, 2 of them are on this. So we have exclusions and we have exceptions, and on the last slide we had an exemption.

And beginning— and these come from the interim final rule that was published on June 1st by the Centers for Medicare and Medicaid Services. And the reason that this rule is particularly important is because states have had to kind of build systems and develop policies without formal guidance being developed or issued until June 1st of this last year. So on June 1st, the interim final rule was published and it provided states with more formal guidance on how to begin to implement some of the policies that were outlined in federal statute. And as part of that rule, there's a series of exclusions or exceptions that individuals are entitled to, particularly those that are subject to work and community engagement requirements. I think part of our challenge is going to be and is how to explain these to Alaskans in a way that is streamlined.

But for policymakers, just know that this is kind of the world that CMS has crafted in terms of how we are thinking about different exclusions or exceptions. And you see here exclusions on the left-hand side. So these are individuals who have some reason why they would be excluded and the requirement would not apply to them, the working community engagement requirement. In the middle, you see mandatory exceptions, so the requirement would apply to individuals, but it is excused due to the exceptional circumstance. And then the right-hand side is something called short-term hardship exceptions.

States can but do not have to elect to provide short-term hardship exceptions to their Medicaid programs. Alaska is moving forward with the short-term hardship exceptions, so we are working to build those in. But it is an option. So these, again, these terms are new and confusing, but part of our challenge is to make sure that we're communicating very clearly to Alaskans kind of what is— what falls under these different exclusions or exceptions. So moving on to the next slide, what does this look like in practice?

So this is slide 6, and many of you have seen some version of this slide in past committee hearings, and this is really important for a couple of different reasons. This is important because this is what we have— this is what Alaskans who would otherwise be eligible or otherwise be subject to work and community engagement requirements, if they have either an exclusion or an exception and we know about that, then we do not have to apply the work and community engagement requirements prior to their enrollment. So these are really important. Important to Alaskans and to the Division. They're also important because this is what the Division is trying to build into a system that can communicate and be automated and check databases from a number of different sources, and it's pretty complicated.

So this is kind of the core when we talk about work and community engagement requirements. This slide is the core of what we're trying to build into an adaptive system and then communicate out to Alaskans, and it's quite complicated. So, on the left-hand side, you see excluded individuals. And just for individuals who may be watching or listening on the phone, I want to highlight— so these are individuals, again, within the Medicaid expansion population who would not be subject to work and community engagement requirements. And I just want to emphasize this because we hear a lot of confusion from people.

Alaska Native or American Indian Medicaid expansion enrollees are not— they are excluded excluded from work and community engagement requirements, as are disabled individuals, as are parents, caretakers, relatives, and family caregivers for children under 14 or individuals with a disability, former foster youth under age 26, individuals who are already meeting TANF or SNAP requirements, those participating in drug and alcohol treatment programs, and pregnant or postpartum women. So again, there's, there's a few more under that, but these exclusions are really important because it means individuals do not have to meet those same requirements in order to be eligible for Medicaid. On the right-hand side, you see some of the mandatory exceptions as well as the short-term hardship exceptions. And again, we are working to build out system options for those. There's one place I just want to pause for a second, and I want to talk about that fourth bullet down under excluded individuals medically frail individuals.

And I just—. This is something that you may have heard about nationally if you're following this. It's also, I think, an example of what states have been trying to work through over the last year. So, I think when we presented to the committee earlier this spring, we presented kind of how we were approaching medically frail, determining whether individuals would be excluded because they were medically frail. And effectively, what we have to use as a Medicaid plan is we are using code sets that are submitted for billing and reimbursement, right?

And what we are—. What we and other states are trying to do is to take those code sets and translate it into understanding if there's a way for us to determine that a person is medically frail. And the reason I highlight that is because, again, these are code sets that are intended more for billing than for diagnosis, although we do have diagnosis codes as part of that. So states, including Alaska, moved forward in developing a medically frail code list that we could use to try to identify those individuals. And we did that under, you know, informal guidance from CMS that had been pretty consistent throughout, you know, the prior several months.

When the interim final rule was published June 1st, I think one of the largest changes in the interim final rule that was different than some of the informal guidance that had been provided prior actually related to medical frailty. And in the interim final rule, they determined that medical frailty was demonstrated both by diagnosis and then by a functional impairment. And it's that second step, that functional impairment, that states are working through right now in partnership with CMS. But that functional impairment is a little bit harder to get at from code sets. So Alaska, like other states, has, has kind of reshaped our code set.

We plan to share it with stakeholders probably in the next few weeks, as soon as we can, so we can get some feedback on it. But this is an area where I would expect to see a little bit of movement in the next several months or year or so. I know there's a series of 23 states who have litigated over this, and we will see how that shapes up. But this is just one example of things that we're having to work through.

I actually— with the With the committee's permission, I would like to skip forward a little bit to slide 9, because you think about these exclusions and exceptions and how critical they are to understanding who is eligible or not, and what those translate into from a system side, we try to depict in the slide. So we have on the left-hand side all of these different modernization efforts relative to DPA system, right? And each one of these have to be updated or created or implemented and have gone live in order for us to translate that PowerPoint slide of exceptions or exemptions— exclusions, excuse me— into a system that can coordinate all of those different pieces of data, right, and check to see if someone is eligible and then make that determination automatically. So the division is doing this, and we have a lot of strong support, again, from CMS and from others, but it is very complicated. And the reason I wanted to highlight that is because this is just one of several system work streams that the division is undertaking right now.

This is in combination with and interdependent to the eligibility modernization effort, but it also ties into the SNAP reinvestment activities that we'll hear about later. And so, again, this is just a little bit of a snapshot of the system complexity complexity that our Division of Public Assistance is trying to work through and is building out right now. So there's a lot of activity happening, but the next 12 to 18 months is a very critical time. Do you mind if we go back to slide 6, please?

I'll pause for questions. Yeah, I think we might have a lot of questions on this slide, and I have two initial questions to tie back into Representative Fields and what Representative Gray brought up in terms of automation. Do you mind going through all of these parameters and divide them up between which ones can be ex parte and automated within the department and which ones will have to be manual and based on paperwork that Alaskans have to put in? Through the chair, Representative Mena, the majority of these should be automated by the time we finish the system build-out for work and community engagement requirements. It's one of the reasons that that, again, I— that other slide, we have to have these interdependencies, both for the applicant and for our eligibility technicians.

I think the ones where it will be— where we will require probably maybe more intervention are going to be some of the short-term hardship exceptions. So, particularly those related to individuals who are traveling outside of the community for medical care. I think receiving inpatient or institutional care, we have some information, but that information may be delayed if it's claims data. Claims data is submitted anywhere from 30 to 90 days or even a year later, and so using that to try to identify individuals can be challenging. We are working to connect these systems as well to the Health Information Exchange and hoping that we get some more information through that, but there's also permissions that we need to make sure that we can use that, that data in a way that meets the federal need.

Director Etheridge, do you have thoughts on some of the other categories?

To the chair, Deb Etheridge, Director of Public Assistance. I would say that we are allowed to accept self-attestation, at least in the first year, and that will go towards our ability to automate the eligibility determinations. And we're actively updating our application for services to ask the right questions so that we can build that attestation into our application. So really working to streamline, our goal is not to have to ask additional questions to the individual. Just to maybe clarify or expand on that.

So initially the system will look for information on all of these categories. Again, I think traveling outside of the community or receiving inpatient or institutional care might be delayed. Same with participating in a drug or alcohol treatment and rehabilitation program. But the system will check to see if we have data that we can use to automatically exclude or accept individuals. In the case that we don't have that information, or if someone is newly applying to Medicaid, there will be an opportunity for them to attest under the penalty of perjury— those are the terms that CMS is requiring states to include— that they that they effectively have one of the circumstances that would allow them to either be considered excluded or accepted.

Um, and so we will have that built in to the system. So it's not quite automated, but it is ideally a simpler approach. Now, in year 1, self-attestation can carry over into that 6-month renewal period, but for year 2, States have to support that self-attestation with some kind of data upon the renewal period. They cannot rely entirely on the self-attestation for the initial application and renewal. So, and then, and I'll start to keep track of the queue, I have Senator Dunbar and then Senator Tobin.

With the about $65 million in appropriations for the Division of Public Assistance a few fiscal years ago, is that sufficient enough to help with the automation process process with the previous modernization effort as well as now automating all of these changes from HR1? For the record, Heidi Hedberg to the chair.

Not yet. We have used—. We are maximizing the dollars that we have. We are identifying some of these changes that were unanticipated, and I think we're going to get into a future slide where we're going talk about some of the, the tenant as an example that we had to build out that we had not planned for. So there is some unanticipated costs that we are seeing, but currently we are using the funding that we have right now.

Thank you. I'll go to Senator Dunbar and then Senator Tobin. Senator Dunbar. Chair Dunbar. Thank you, Madam Chair.

I believe this question is for Deputy Commissioner Ricci, but anyone that's able to answer it, and you may have already You partially answered it with this process of attestation, but how does HR-1 define the terms Alaska Native and American Indian, and how will the department determine who is Alaska Native or American Indian for the purposes of the exclusion?

Through the chair and to the chair, for the record, this is Emily Ricci. So we can follow up in writing with how those are defined, but we have been working very closely with the tribal health system on making sure that we are aligned in using those definitions. They were kind of further defined in the IFR on June 1st, and the only reason I'm saying we will follow up with you is I don't want to quote you that directly today, but we have it very clearly outlined. Again, we are working collaboratively with the tribal health system. The actual definition is slightly broader than Alaska Native and American individuals.

It also includes individuals who might be eligible for IHS services, and so we're working on trying to make sure that we're including language that's really clear for people, but also doesn't end up accidentally confusing individuals who may be eligible. I think we are able to use self-attestation to determine if an individual is Alaska Native or American Indian. So that will be an option as we move forward. But Director Etheridge, would you like to add or clarify anything? No.

Okay. For the record, I'm sorry, this is Deb Etheridge. I don't have any clarification. Follow-up, Madam Chair? Oh, follow-up.

Thank you. So it sounds like you are seeking to collaborate with Indian Health Service and perhaps have access to their data, but if someone attests to being Alaska Native or American Indian, is there any follow-up process from the department or CMS determining whether or not that attestation is sort of factually accurate? And then is that attestation option available indefinitely or only during the initial rollout of these requirements and exclusionary categories? Uh, through the chair to Senator Dunbar, this is Emily Ricci. So the attestation is an option consistently, at least for, um, kind of that, that first application and/or kind of that first renewal.

It's that second 6-month renewal or determination where there has to be data to support. In terms of attestation, we are, you know, we would accept self-attestation for an individual saying they were Alaska Native or American Indian and meet that definitional requirement. From an audit perspective, and this is really important because there's a very high program integrity focus from the Centers for Medicaid and Medicare Services, we would need to make sure that if that case is reviewed as part of an audit, right, that that attestation is in place and that we are following CMS requirements. One area that we are still working through, and again, we are working in collaboration with tribal health organizations, but one area that we are still working through is if there is any documentation or verification required following a self-attestation at a future point in time. I don't think CMS has been really clear on what those requirements are.

And so right now we're moving forward with accepting that self-attestation without requiring any further documentation or verification. But we do need to clarify the timelines on that with CMS, and we don't have a response yet to that. Final question. Follow-up. Mr. Madam Chair, if I could.

Thank you. Very quickly. So I guess two things on there. I hope that if there is documentation required, after 6 months or whenever it is, that that is a one-time thing and never has to be repeated by the individual because if someone is an Alaska Native or American Indian, they're not— that status is not going to change going forward. But the second question I have is, how are these attestations practically going to work?

So if I have someone in a rural community that has no notary public there, how will you do signature verification? Will it be able to be done electronically? How exactly are these attestations going to work? Is an email enough? Does it need some other kind of witness?

How do the— how will the attestations work? Through the Chair, Senator Dunbar, for the record, this is Emily Ricci. The attestations don't require a notary. They don't require a witness. They would be a self-attestation under penalty of perjury.

Again, there's specific—. I keep repeating that because that is what CMS is highlighting consistently in the guidance and the informal guidance that we are receiving and that states are receiving, Director. And we are working to make the attestation available electronically as well as in paper form. Director Etheridge, would you add anything?

To the Director— to the Chair, this is Deb Etheridge. We currently receive electronic signatures on forms, and that would be similar to what would be on an attestation. An individual is also able to sign a form by calling in to our virtual contact center, and we accept an electronic signature that way. And then in rural areas, we also have fee agents who support individuals who are applying.

Okay, thank you, thank you, Madam Chair. Senator Tobin. Thank you, thank you, Madam Chair, and I want to make a point and then ask for some clarity, particularly on the bullet point around veterans. We know that 1 in 10 veterans were covered through Medicaid, especially those who may not qualify for VA services, or they may have combined their Medicaid services with other forms of health insurance. Across the nation, it's about 1.6 million veterans who are receiving care and services through this expansion population, which now it seems like they will not be covered through these, these particular systems, particularly as the bullet line says veterans with total disability rating.

So I'm going to ask for clarity When it says total disability rating, is that a DOD definition or is that the VA definition, which the VA definition can change depending on what services the veteran is qualifying for and is receiving. Additionally, what, what is our plans as a state to deal with these Alaskans who have provided care and service and particularly protected our freedoms that may not have coverage now? They might have a 60% disability or 70% disability they are older populations. What are we going to do to take care of those Alaskans? And that's a question I ask to you if you have recommendations that we might consider for future legislation.

Sorry, through the chair, Senator Tobin, the— you're correct, it's a veteran's disability, 100% total disability, or it can be a temporary disability. And then when an individual presents as a temporary disability, we just have to re-verify that. And speaking to Senator Dunbar's concern about Alaska Native, American Indian, if it's 100% disability, we likely will not reverify that again, any more than we would Alaska Native or American Indian. So the— there's an order of duration. So if an individual, let's say, doesn't meet the 100% total disability, we do work through the list of durable exempt—.

Excluded— exclusions. And we, you know, we— if they meet another exclusion, then we find them eligible under that exclusion. And so it's our goal is to really apply all the rules to the individual to make sure there isn't an option for otherwise to continue to receive benefits or healthcare benefit. As far as what the plan is for individuals who are no longer eligible for care, I can't speak to that.

Through the chair, Senator Tobin, we have been giving some thought to, to are there different ways as a state we can support individuals who don't have access to health insurance for a variety of reasons. Maybe part of it is these changes to Medicaid. Maybe part of it is because they can't afford coverage through the exchange, or I mean, there's a number of different reasons why Alaskans may not be able to afford health insurance right now. And so I think we are trying to give a lot of thought to what would that look like, what are opportunities. I don't have an answer for you today on that.

I think there is a tie-in, a very important tie-in with the Rural Health Transformation Program. When we think about opportunities to change how we are delivering care and then opportunities to think about how we are insuring and paying for care, I think those two have to evolve together. I think we're having a lot of conversations on how we are trying to improve care delivery for providers and for patients, I think we— it's going to be a good time to start having those conversations out of necessity on how we need to think about insurance coverage in Alaska with some of these changes that are taking effect and just the cost of care increasing.

I want to recognize for the record that Senator Olson joined us at 1:59 PM, and I would like to invite— extend an invitation for you to join us at the DICE if you'd like. I have another question just related to all all of these exclusions, exceptions being focused on the Medicaid expansion population. So how is someone— how does someone know that they're in the Medicaid expansion population? Through the chair, Representative Mena, that is one of our communication challenges. How do we ask the average or anyone— I mean, I don't even like to think about my own health insurance, right?

How do we ask someone the questions that we need to ask them to help them understand whether or not these apply to you. So, it's almost like, how do we help you understand if you're part of the Medicaid expansion population without using the words Medicaid expansion population? So, we do have a screener that we've developed on our website that people can look at to try to understand if these requirements may apply to them. And they include some of the questions here along with others. So, right now our goal is to have people, if they are unsure, They can start by using the screener that's available on our website.

We will be rolling out, I think, more high-profile communication plans in the future as we get kind of closer to that ultimate implementation date.

And briefly, is the screener online right now, and how does someone go to the screener? Through the Chair, Representative Mena. I can't remember where it is on our website, but I have seen it on our website and it should be live now. So we can follow up with a link to the committee. Wonderful.

We should put that on the front page. Representative Fields. Through the Chair, following up on Ms. Ricci's answer, it seems like some of the people who need health care the most and who in the absence of health coverage will be the most expensive in terms of uncompensated care are the people least equipped to navigate this new labyrinth of bureaucracy that Congress has created. Under the systems you're creating, can a healthcare provider, for example, attest for someone that they meet some of these requirements? So, for example, someone experiencing co-occurring addiction and mental health issues can continue to be covered by Medicaid.

Through the chair, Representative Fields, when I think about the different ways that people can provide information to us that let us know that they meet an an exclusion or an exception, I think about kind of 3 different ways. The first is electronic, which is preferable because no one has to do anything. The second is self-attestation. And then the third would be a provider being able to actually give us that information directly. And I just— I say that that's kind of the third preferable option just because that is more work on a provider that already has a lot of work within a healthcare system.

But we will offer that as an option. Can I ask a follow-up? Follow-up? Yeah, I mean, I just think about homeless people who are receiving services at ANHC, and the providers basically track people down and make sure they're receiving continuous health coverage. It saves everyone money.

It's more humane. And I'm just curious, as we go forward, if we can learn how many of these people are losing coverage because they don't know they have to go to the website and fill out this form. I guarantee they're not closing the website, right? We know that's not going to happen, so I'd be curious to see how that takes place in the real world. Thank you.

Through the Chair, Representative Fields, I think there's really an opportunity to begin to leverage some of the work, again, from the Rural Health Transformation Program, thinking about building out community health workers. I know that's one area that we've really wanted to invest in with Year 1 and Year 2 grants, so I think community health workers can assist with that. I also think as we build out our eligibility modernization and that matures, there will be more opportunities to look at expanding things like hospital presumptive eligibility. And I really think about FQHCs for that. I think right now we're pretty limited because that is an entirely manual process.

But within the next, I would think, 18 to 24 months, that will become a process that has electronic interfaces. And so that will make it easier for us to consider kind of different options in that space. So there are I think there are definitely more tools that we can use and that we can grow and mature to help address that.

Representative Josephson. Yes, through the Chair.

When you've calculated or estimated those who fall off the rolls, either regular or expansion Medicaid, it strikes me as incredibly complicated to do that because Through, through one lens, I think the committee is concerned about H.R. 1, And I know you're powerless to deal with that directly. But through another lens, the exceptions sort of swallow the rule. I mean, there's all sorts of opportunities, and I don't mean to suggest they're disingenuous. There's lots of opportunities to enjoy an exclusion or an exception.

So how do you go about weighing who fell off the rolls? Through the chair, Representative Josephson, that actually leads very nicely into the next slide. I designed it that way. Thank you.

So moving on to slide 7, this is a preliminary estimate looking at information that we have today in our systems related to individuals who would meet requirements for exclusion or exceptions, or we have evidence that they meet the income requirements to kind of meet those community work and community engagement standards. I will qualify this by saying this is preliminary. We published an estimate in February, and we are working to update that, but we wanted to share with you and the committee today what we had available. So again, this is preliminary. We will have kind of more formal updates in the next month or so.

But if you look at today's population, the total Medicaid enrollee population right now is just under 200,000, and the baseline Medicaid expansion enrollment is about 57,000 Alaskans. And of those, again, looking at information that we have, we were able to exclude using those exclusions that we noted in the last slide, almost 35,000 Alaskans, so just over 34,500 Alaskans. Again, this is information that we have in our system, so we don't have to do any self-attestation. You know, we don't have to reach out to providers. So then we looked at individuals who might be living with one of those short—.

In one of those areas that would qualify for a short-term hardship exception. I'm going to get these E's right. Exception. And we identified just over 500 Alaskans who would be accepted from the requirements based on that. Then we looked at individuals who also were reporting income that would meet that $580 a month standard, which effectively qualifies them as meeting the community and work engagement standards.

And there were just over 9,000 Alaskans. So in, in In total, based on data that we have today, we were able to identify almost 79% of the Medicaid expansion population would qualify for an exclusion and an exception, or would meet the existing work requirements. Now, that number does not include some of the short-term hardship exceptions. We did not—. We were not able to look at those.

I would also note these numbers are deduplicated. So, again, this is kind of the closest calculation we have. So what we see then is we have almost 13,000 Alaskans, so about 20%, who would be— who would need to either attest that they or provide evidence that they qualify as an exclusion or an exception or would have to demonstrate meeting work and community engagement requirements.

And I just want to make a note here and let the committees know about the MNAT report that was released earlier this year in February, because I compared some of these numbers back to the MNAT report and how they were assessing how many Alaskans would lose coverage was based on moderate manual exemption compliance to moderate manual compliance. If there's a high manual exemption and compliance, half of those folks would lose coverage. And under moderate manual compliance, 72% of folks would lose coverage. So with the updated numbers from this slide, which says 12,850 Alaskans that would be subject to these requirements, that's about 6,000 Alaskans lower than the Menat report. And I just want to note that if you use those same percentages, it would be between 6,425 Alaskans to 9,252 Alaskans that would lose coverage.

And so I'm just wondering, you know, I've talked to— with a few different stakeholders about how many Medicaid enrollees there are. There is already a drop in enrollees from the February report. And I think it was looking at the Georgetown Medicaid and CHIP enrollment data and the Medicaid snapshots. You know, I've heard that enrollment since January of 2025 has fallen 63,000. So how much of that is related to impacts from Medicaid redetermination, and how much might this be related to incoming HR1 implementation and the fear and anxiety that people feel related to these work and community engagement requirements.

Through the chair, Representative Mena, for the record, this is Emily Ricci. I guess first I would say we are working to update that MNAT, that, that MNAT estimate. So again, these are preliminary. We will have kind of a published round 2 of those estimates from MNAT probably in the next 60 days. So we will update those.

In terms of the changes in overall enrollment, you know, we— Alaska took probably 2 years at least to work through the redeterminations. You know, and we did that within a mitigation plan that CMS was aware of. So that means that our redeterminations really began to kind of close in July of last year. At the same time, we had been really sensitive to procedural disenrollments or trying to be sensitive to procedural disenrollments, which are individuals who have not responded back to us for a variety of reasons because we know it can be hard for people to—. For us to find people.

And so we really waited until the very end of the redetermination period to begin actually taking efforts to disenroll individuals who were non-responsive. What we also saw is that we had a system where an eligibility worker had to actually go into the system and close a case. The cases were not automatically closing if an individual, you know, did not respond, did not provide the paperwork, or otherwise absent. And that became— that kind of built up over time. We were able to make some technical changes in the system so that those cases auto-closed, which they used to.

We had suspended that during the pandemic, and now we implemented that auto-closure again. So that auto-closure took effect in January, where individuals or cases where we are— we don't have any sort of response within the time period are now auto-closing instead of waiting for an eligibility technician to actually physically go in and close the case. I think that has contributed somewhat to the change that we are seeing since January, because those cases were otherwise being left open. There's other, there's other elements that may be contributing to this. We have worked with Evergreen Economics and asked them to look at the eligibility changes over the last 2, 2.5 years to help us identify what some of these trends are.

But we are, we are also tracking very closely the percentage of recipients to enrollees. And one of the things that we saw during the pandemic was a, a really high split between the number of Medicaid enrollees that were actually receiving services, the recipients, and the number of individuals who are enrolled in the Medicaid program but were not— we were not seeing any claims for them, they were not receiving services. And what we've seen is we've seen a decrease in the number of Medicaid enrollees who are not recipients. And we've seen a small but—. Or, yeah, a small to moderate decrease in the number of recipients, but the largest decreases are really in those individuals who were not incurring claims, who are not using services.

At the same time, we're seeing an increase in the level of utilization and kind of the overall cost and intensity of services from existing Medicaid recipients. And I share all of this because we want to make sure that individuals who are eligible for Medicaid remain eligible. I think we also are still seeing a little bit the effects of maintaining eligibility through the pandemic and the very lengthy redetermination process combined with the manual work that has to happen to close some of these cases. But we're trying to really monitor how many people are actually receiving services and are they maintaining coverage? Are we seeing large changes in those areas?

Director Etheridge, would you add anything? Uh, to the chair, this is Deb Etheridge. I would agree that, um, as we've looked at an automated It is in our best interest to ensure that individuals return their information and we process those. Otherwise, they turn into what you may have heard before is churn and coming back into our system. And so we're paying close attention to that.

And we did auto-close— start auto-closures, and that did impact the numbers. I want to assure people who are listening that prior to any auto-closure that happened, we did run them through the the ex parte process again and attempt another renewal. And so we've really tried to do our outreach to ensure that individuals stay on benefit if they are otherwise eligible. And with that drop of $30,000, so that makes a lot of sense. And thank you for the comprehensive answer about how you did the redetermination and how it— a lot of that drop was towards the end of the redetermination process.

Is the amount of Medicaid enrollees that we lost similar to other states that went through redetermination? Through the Chair, Representative Mena, I would like to follow up with you on that. I'm not certain. Okay, and I do see Representative Ruffridge and Representative Schwanke with their hands raised. Representative Ruffridge.

Thank you, Chair Mena. Quick question on, again, sort of this idea of losing coverage.

What is the— if a person loses coverage under this HR1, what is the options for them, and is that something that the department is working on with people if they lose coverage? What are the options for other coverages, and what is the approximate cost to that person? Is that something that you're working on?

Through the chair, Representative Ruffridge, there's very limited coverage options for individuals who lose Medicaid eligibility as a result of noncompliance with work and community engagement requirements. Again, we are specifically—.

We cannot transfer that information to the Federally Facilitated Marketplace, and they are not eligible for any subsidies in the Federally Facilitated Marketplace. They would remain eligible for emergency Medicaid, which is that 72 hours of coverage in an emergency setting, or if a pregnant woman comes to an emergency room. So there are limited options available. And again, that is something that I think we need to have a conversation with the legislature in the next year or so. Follow-up?

Yeah, just a follow-up. Yeah, if I may. So I want to make sure I understand what you said correctly. So this is not a— this is not noncitizen coverage. This would be a person who lost coverage because of some component of HR1 as a requirement that they did not meet.

So this is that 12,000 number that you have on the slide. If that— if those individuals lose Medicaid coverage because they are technically eligible for Medicaid coverage, but failed to commit to the requirements, they are also not eligible for other types of coverage? Is that what you're saying? Through the chair, Representative Ruffridge, this is Emily Ricci. They are not eligible for subsidies on the federally facilitated marketplace.

Now, they could apply for Medicaid the following month and demonstrate that they met those work or community engagement requirements in the month prior to application. So, there's nothing that prohibits them from applying again in that next month. But they would— they are— the bill is written such that they are not eligible for federally facilitated marketplace subsidies if they are ineligible for Medicaid as a result of not meeting work and community engagement requirements. Understood. Thank you.

Representative Schwanke and then Fields. Yeah, thank you, Chair Mena. This question may be for Deputy Commissioner Ricci. Could you kind of describe what you anticipate the process looking like for confirming employment and community engagement? At least, is there guidance from CMS on this thus far?

Or, you know, is somebody going to be able to volunteer for a nonprofit or for a day? And then can you help us understand that process? Through the chair, Representative Schwanke, for the record, this is Emily Ricci. So we are developing different processes based on whether the individual has provided sufficient kind of working hours, whether they are providing information that would qualify them for volunteer hours or educational attainment. Again, our policy is always to try to check electronic options or electronic information that already exists first.

So we can do that through certain wage data that we have access to, to confirm employment, we can also do that by connecting to the National Student Clearinghouse. We are working to connect our systems to that, as are other states, so we're trying to gather information from those sources. If we're unable to gather information from those sources, then we would ask the individual to demonstrate through some— through providing some sort of evidence, and I think we are, you know, we and other states are designing out kind of what that would include, what we would accept. And we are building out a system where they could upload that. Ideally, again, we want to make it as easy as possible.

We want to reduce friction. So is it possible for someone to take a picture of a W-2 statement or something with their phone and upload it to their account? That's what we are envisioning and trying to, to build out right now.

Director Etheridge, do you want to talk about the community volunteering or any of the standards that are being established for that? I do. To the Chair, Representative Schwanke, this is Deb Etheridge. There's a few arcs of effort that are happening at the division. Commissioner Hedberg mentioned the portal, the client portal and the provider portal.

So our goal is to have an interactive portal for an individual to look and see what is required, what is outstanding with the ability to upload load and then also have an opportunity for providers to have a view into those individuals that they're trying to serve and maintain to see what is missing, what is required. We're also working to do some extensive outreach to individuals, identifying in advance what, what is, what satisfies the division for volunteerism or employment. And then in doing some external outreach in order to really reach out to those individuals to try to help them understand what we need in order to make a determination. And so our goal is to really be proactive for the individual so that they're prepared at that renewal time.

Follow-up? Follow-up. Thank you for that. So I wanna build kind of on something that Senator Dunbar was getting at. And so you're— You're describing a self-attestation concept, and that makes a lot more sense if you're describing whether or not you're Alaska Native.

That makes a lot less sense if you're describing to the Department of Health how you volunteered or had a job or whatever. So, I guess I, I hope that there's some additional backup required there, some attestation from an employer or somebody that you're working with. So just put that out there. Through the chair, Representative Schwanke, this is Emily Ricci with the Department of Health. And yes, particularly for individuals who need to demonstrate those work and community engagement requirements, we, we will require documentation of some kind.

And there's a lot of complexities to figure out what qualifies as volunteering, what are the organizations where you can volunteer at. How do you ensure that the documentation you're getting is from one of those organizations? And how do you do all of this while creating a process that is reasonable for an individual to easily access and navigate, while also ensuring that we can meet the audit standards that we are going to have all of, all of these things reviewed by at some point? So that documentation will be required. I appreciate that.

Thank you very much. Thank you, Senator Tobin. Thank you, Madam Chairman. I have a question, and I am happy to work with you offline on this. We have partners in Washington State who are actually working with their workforce development agencies to do the attestations of work and volunteers, which helps them build out their career pathways and career guidance for their high school students.

And for folks who are returning back to the work environment or potentially want to reskill or upskill for other career options. One of the things we lack in the state is that real qualified use of data to inform our career pathways and options, especially for critical careers that we lack bodies in. I'm curious about the work that you've done with other departments to think about how Alaska might take this horrible situation that we find ourselves in and use it as an opportunity to really build out a structure that we lack? And if you have not done that, what can we do to help you to build out those systems that we can find some— something to point to as a success in this horrific situation that I think we're about to face? Through the Chair, Senator Tobin.

So we have done a little bit of work with some of our sister agencies, but I think there's a lot more that we can do. I think part of that is kind of of capacity on our end right now and making sure that we're focusing on meeting some of these, like, very fast deadlines and/or even with a good faith effort exemption, deadlines will be challenging for us technically. One area that I've really thought about is in our Medicaid program, I think we can do more to support care coordination, particularly for people with complex needs. And in other states where you have more of a managed care organization, setup, individuals, when they are enrolled in a managed care plan for their Medicaid program, complete like a health risk assessment, right? And we can debate how effectively those work in other states, but the idea is that you are getting information at the beginning from someone so that you can ideally help meet their needs in the system.

We are going to have to really ask people for information to determine if they are excluded or accepted, I want us to be able to use that information to ensure that those individuals have the support and the care coordination they need, particularly if they're medically frail. And, you know, we have a new opportunity, I think, to build a care coordination and support program in our Medicaid program to support individuals who are medically frail or who have some of these other circumstances. And we haven't had the opportunity to think about that or to identify that at the time of enrollment or renewal before. So that is one opportunity that I I see coming out of it, and I would really like to build on that in future stages. I just have another comment, and I know we need to keep moving on with the presentation, but I know of— I think it was the New York City Health Department.

They convened a lot of their nonprofit partners as well to help with ensuring that there's opportunities and good collaboration and meeting the community engagement requirements and volunteer work, and I'm curious if the department has done any engagement maybe with Four Acre Group or with existing partnership that we have with the Community Foundation. Through the chair, Representative Mena, one effort that the department is going to move forward with in the next, you know, several months is actually to take the incredible policies that Director Etheridge and her team have developed and kind of the manuals for translating those into, you know, how you actually operate those policies and put those forward in a public document so that individuals will have the opportunity to look at those and to give feedback. And I think that is one way we are hoping where we can start to get some of that feedback from entities around the state in terms of, "Have you thought about this? This doesn't make any sense. You know, this policy has this gap." And so, we are working to put that together into an implementation plan that we can post publicly and get feedback on, and that might be the beginning of an avenue to start those discussions.

We have been meeting together with Alaskans Together for Medicaid as well as tribal health organizations on a monthly basis, and they have been a very, very helpful resource for us. But we want to make sure as well that we are including individuals outside of those groups in terms of gathering public input and feedback.

We are deeply committed to those engagements. I think our limitation right now is probably just bandwidth in terms of how much we can take on while we're also trying to stand up a lot of these technical requirements. Thank you. I think you can proceed on to the next slide. So moving on to slide 8, this is just kind of a, a map of the different steps that we have in terms of building out our systems to be prepared for work and community engagement requirements.

So we are currently kind of at that first step, securing the systems. So we are working to build out a module that will kind of be that, that I'm not a systems person, so it's not a systems integrator, but I think about it as kind of the technological system hub for our community engagement requirements. It's a standalone module that will connect in with our integrated eligibility system. So, we are building that right now at the same time we are building out a secure environment. Once that secure environment is complete, and that requires approvals from the Centers for Medicare and Medicaid Services, you know, approval to connect, approval to operate, we will be able to move that module into the secure system.

Then we begin the connections to all of these different federal and state databases that I've talked about, and we begin to work through the process until we hit test and go live. Again, that go-live date we're aiming for is January 1, 2028.

Oh, I have a question on this slide, actually. And so I appreciate the previous presentations from DPA and then the meetings just related to the broader DPA modernization effort. And I know that being able to user test and have staff testing is really important for the implementation of modernization. And you just mentioned, you know, in a different space with the community engagement requirements, being able to work with stakeholders externally in the future. But for this modernization effort, since it's ongoing and you're supposed to go live sooner, how and will the department incorporate feedback from the provider sector on how you're doing your staff testing and how you're getting your system ready?

Through the chair, Representative Mena, yes, we intend to. Director Etheridge? Through the chair, Representative Mina, it's an iterative process. This open source tool will be used to gather the information. It's a rules engine.

And so again, it'll be thoroughly tested internally with the outcome and then provide information on process and how it operates for an individual with our stakeholder groups. And we've done— we've started doing some our Eligibility Modernization Office has been doing presentations on the modernization plan and how it operates as soon as— as recent as yesterday with the Benefit Advisory Council. And so we will continue to do external presentations on our modernization so that they can experience that. Same is true with our portals and how how individuals will experience and we'll get feedback from them. We're also sitting with providers to learn how they're operating so that we can understand where their barriers might be so we can solution that.

Okay, thank you. And I see Representative Ruffridge has a question.

Yeah, thank you, Chair Mena. I'm wondering on this readiness and implementation, is there Are there fines in HR1 to states or the departments if they don't meet the expectations under this program? Through the Chair, Representative Ruffridge, for the record, this is Emily Ricci. There's not a fine per se, but you would, you know, the state would potentially fall out of compliance, and then I think if You know, if there was an audit for like a normal, what they call a PERM audit, for individuals who receive Medicaid during that time period, then that would be reflected in the PERM audit findings. And there were some changes in the bill regarding, you know, the Secretary's ability to kind of provide almost like good faith exclusions to audit findings beyond a certain amount.

I think CMS and states have been more focused on making sure that they have— that they are in compliance and/or that they either— that they have a mitigation plan that's been approved by CMS so that if those audits occur during this time period, we have documentation explaining why we are in compliant or are operating under a mitigation plan. But there's no specific fine per se.

I have one more question. I know in the past we've discussed if there's other external staff, external of Department of Health, that could help with eligibility, and from what I vaguely recall, there's maybe CMS prohibitions. So I just wanted to ask again and maybe get more clarity on that. There's already the virtual call center contract with the federal waiver, where they can help a little bit with the applications. And so I'm wondering, what are those prohibitions, or is there an opportunity that we could relook at to be able to work better with our tribal and perhaps nonprofit partners to help with eligibility and all of these big changes that are coming onto the state?

Through the chair, Representative Mena, for the record, this is Deputy Commissioner Ricci. I You know what, those are things that we're thinking about all the time. I will say that a lot of— it becomes easier to utilize more support from external partners when we have different systems because that allows us to manage some of the permissions on the systems in a more targeted way than we have right now with some of our older systems. And there's— and that becomes important from different kind of federal compliance perspectives. But we are absolutely trying to figure out how can we— how can we utilize, even if it's kind of thinking about what does support look like from a different perspective with our different entities.

We meet regularly with our tribal— with the tribal eligibility workgroup on a monthly basis. We are also trying to meet regularly now with different enrollment kind of support staff from different entities outside of the tribal system. So, we are trying to have those regular meetings. I would say too, our systems, including the AlaskaConnect portal, are trying to build in the capacity for individuals to support Alaskans who are applying for Medicaid in a way that is, that can be maybe less formal than what we have to have in place today, right, because of the limitations on system permissions that we have in our existing systems. But Director Etheridge, Commissioner Hedberg, would you add anything?

Deputy Commissioner, I think you did a really good job. I think the question is, we get a lot of asks like how I can support, and I think our systems need to change first. There is also a lot of support with what is called assisters who are helping individuals apply for Medicaid or other public assistance programs, and that is something that can happen today. And we work with a variety of organizations that are currently engaging in that, and that is incredibly helpful. I think the question that you were getting at, Chair Mena, was can they help make a decision if somebody is eligible?

And with Medicaid, the way we want our system set up is that rules engine is going to be looking at, does that person—. Is that person eligible or not? And it should be automated so that the help that's coming from external is really helping an individual apply for Medicaid or apply for some of these other public assistance programs. But we do get this ask, and I think right now our focus is making sure we can get our systems up and running to a point where then we can take it to the next stage and reevaluate where we're at. Thank you.

Representative Gray. Thank you. Um, through the chair, I I just wanted to kind of ground this in real-life patients, like from where I'm seeing it. I think, you know, you guys are doing a great job of presenting what you're required to present, and— but I, outside the legislature, I work in urgent— I work in an urgent care. I go there every week.

I see patients, and just a couple of weeks ago, I had a patient, 42 years old, male, came in. For fatigue, which is no one's favorite patient, but I went and saw the tired 42-year-old. But through talking to him, you know, I suspected some things. We got a point-of-care blood glucose. It was extremely high.

We got a point-of-care A1C, which was the average of his blood sugar over the past 6 weeks. It was extremely high. This was somebody who needed insulin. It's a first-time diabetic. You know, we're making the diagnosis.

He hasn't seen a doctor in 10 years. He's from Africa and he speaks French, and so I'm using a translation phone. And I get kind of excited because, you know, you see a lot of like bug bites and like sort of dumb things, but I was like, "You know what? I can do this. I am going to help this person." And so I went back to my desk and I called Walmart and I was like, "Hey, I have a first-time diabetic, he needs He needs to be on insulin.

We need to make this as cheap as possible. He doesn't speak English, he speaks only French. I hope you have a French speaker. They laugh, hahaha. I was like, but we're gonna do this.

To make the story come to a close, he paid, and I made it as cheap as I possibly could. I knew he was gonna be a cash pay. I knew he was a cash pay. And so the legally cheapest I could make it was $225 with the test that I'd ordered. And he went to pay, and I regret this every single day that I didn't tell them to just not charge him because it was $108.

He had $108 on his bank card and the bill was $225. So they zeroed out his bank card and he left. And I called the pharmacy later that day and I was like, did he pick up his insulin? And of course he didn't because he didn't have any money. He didn't have any money.

And so when we're hearing all of this, And talking about this, I'm thinking about so many patients in Anchorage who cannot afford any care at all. They cannot be seen. And, you know, we have Lisa Aquino here. She's the director of Anchorage Neighborhood Health. I gave him all the information for Anchorage Neighborhood Health.

I was like sliding scale using the French translator, sliding scale. I text her. I am so grateful for her. If I had a dime for every time I text her and be like, hey, do you guys have any Korean-speaking doctors? Do you guys have any Romanian-speaking doctors?

People don't understand how many folks we have in Anchorage who don't speak English, and it's really hard to do healthcare. It's really hard. And these people are not trying to avoid meeting requirements. He's a construction worker. He came from work.

I can't— it's just, it kills me. I wish we could just give good medical care for free. I wish we just had a clinic where we didn't have to go through all these complicated things to figure out how to give people basic healthcare. And it's hard for me to sit here. Thank you.

Thank you for sharing, and I think it really grounds how terribly difficult and onerous this federal law is that this is placed upon us on a state to help deliver healthcare in the best way that we can to Alaskans.

I know that we have a little over 15 minutes left, and I heard from the Department of Health liaison that we might be able to stay a little bit after, and I think that would be appropriate if the committee members are okay with staying 10 minutes after time. The rest of the slides are on the SNAP aspect of HR1, so So if people don't have any further questions on the Medicaid portion, we can transition to the SNAP portion.

For the record, this is Deb Etheridge, Director with the Division of Public Assistance, and that's very powerful. It's hard to follow. I'm going to talk a little bit about the changes that are happening to the SNAP program, which were part of HR 1. I'll start with the work requirements, and then I'm going to talk a little bit about state administrative cost sharing, and then the state benefit cost sharing based on payment error rates.

There were changes that affect those individuals who are able-bodied adults without dependent children and their exception, or who's going to fall into that able-bodied adult adults rule. And so previous rule, I tried to be very clear, previous rule for the age range was 18 to 54. Those were the ABOD adults, which means that they are, if they're not working or not in compliance, they can only receive 3 months of SNAP benefits. Under HR1, the age range changes to 18 to 64. This becomes very important, and I'll talk about it in a little Also, a person was exempt from the ABOD requirements if they had a child under the age of 18.

That changed to, for households having a child under the age of 14. Prior categorical exemptions were veterans, people experiencing homelessness, and certain former foster care youth. These categories no longer independently qualify. There is one new tribal exception. There's no comparable previous category or rule, but Alaska Native— qualifying Alaska Native and American Indian people are, including statutory Indian urban categories, are exempt from able-bodied work requirements.

The state of Alaska applied for a good faith waiver. Representative Mena had mentioned it, and we received a good faith waiver for implementing these changes for 1 year. We have subsequently asked for an additional year for this good faith waiver and we've been granted that waiver. And wondering why, why does the state of Alaska require or ask for the good faith waiver is that there were changes impacting our ability to do reporting and administration. We operate our SNAP program in our legacy system, which is called EIS, Eligibility Information System, that those changes really prevented us from success in implementing on the administrative side of the world.

But also we had to do a lot of stakeholder engagement. This is a change that impacts individuals and their food benefits. Also a group that was— people may not be tracking to, but our elderly simplified application Extension, which allows us to, for all households who have only elderly in the household or children under the— minor children, we could renew those individuals for 3 years. Those— that age category was up to, you know, started at age 60, but now has to change from 60 to 64 for eligibility for ESAP because individuals between the age of 60 and 64 are required under ABOD now. Next question.

Yes, Representative Fields. So just so I understand this, so Congress says that 15-year-olds should go hungry unless they're supporting themselves, even though they're dependents? I mean, am I reading that chart right? Through the chair, Representative Fields, What that means is that the dependent children that exempted an individual from the ABOD requirement in that household is no longer the exemption, but the child may still be in the household and eligible. Through the chair, I just don't understand how we're requiring children to be in school and have a job.

I assume they are supposed to get a job after school. Is that practical. I mean, I just, I just don't understand the practicality of children being required to work to eat if they're simultaneously in school. Does that make any sense to you? Correct.

Through the chair, it is— the age range does start at the age of 18 for able-bodied work requirements. So an individual who falls in that able-bodied adults without dependent children, that starts at age 18. if that— I'm going to use a scenario. If a woman is 20 and a man is 21 and the child is under the age of 14, those two adults don't have to meet able-bodied work requirements. I see. If the child is over 14, then they would have to meet those— then the adult, adult has to meet the able-bodied work requirements.

Okay, thank you.

Senator Tobin. Thank you, um, thank you, Madam Chair, and I just want to go back to that slide very quickly because it's something that many of us who've been working in the space of youth experiencing homelessness, particularly those who might be 19, they finally are able to go to school but they don't have any income that they can turn to. They have no parents parents to take care of them. They may not have the ability to qualify for subsidized student loans, and even then they may not want to take them out. Will they be able to qualify for food benefits, or would they be exempt under this new provisions under HR 1?

Through the Chair, Senator Tobin, they would fall under the need to meet those able-bodied work requirements at this time. Thank you. Follow-up? Follow-up? I just want to mention, Madam Chair, that we know one of the ways that you can help stop the cycle of poverty is to get educated.

And this seems to be antithetical to ensuring that those young people who are going to school and who might have had struggles prior to that would be able to access supports from their government that are here and able to, to give them resources simply because there's been a change to allow billionaires to keep more of their dollars.

Representative Fields. I'm still trying to, through the chair, wrap my head around Congress trying to make 15, 16, and 17-year-olds go hungry. What— so we're going to kick some people off Medicaid because they can't navigate the red tape labyrinth. People with 16-year-old children. How does your department interface with 16-year-old children who now don't have food because their parents got bumped off of care, for which they're probably eligible, by the way.

Through the chair, Representative Fields, the child may still be able to be in the household and receive SNAP benefit.

I see the concern, and there are ways to meet the work requirements. I shouldn't say, you know, in this and this speaks to Senator Tobin's concern, is that individuals who are in school would meet the requirements for the able-bodied work requirements. If the person's in substance use treatment, they could also meet the requirements. There's also individuals participating in the TANF program. The Division of Public Assistance operates the work services program through TANF and employment and training through SNAP, and those individuals who are in compliance with that would then be eligible for SNAP benefits.

Can I ask a follow-up? Follow-up. I mean, so some of these people are going to lose coverage. Does the department, when someone loses coverage, does the department know that they have a 16-year-old? I mean, do you all even have the ability to follow up with a 16-year-old and say, hey, this federal requirement, remove food assistance from your parents, but maybe you can apply.

I mean, do we have that ability, or how are we actually going to connect with a child whose parents no longer receive food assistance? Through the chair, Representative Fields, we establish a household. So it would be, in this scenario, it's two parents and a child. The child still remains eligible and the parents are no longer eligible. For the SNAP benefit.

It's a household. Through the chair, I get that. I'm just saying, how do you actually connect with a child who's in school to make sure at least the child still has food? I don't— like, does that work? Do you have that infrastructure?

Have we done that before? Like, operationally, can you maintain continuity of a food benefit for that child?

Through the chair, Representative Fields, I hope I'm answering this correctly. We have what's called a primary applicant. That individual may not receive any benefits, but they're the individual applying on behalf of a minor child, and that's how the state becomes engaged. However, they could be an emancipated child, and then we would work with them directly.

Please, please proceed.

Another area that was impacted by HR-1, and you may remember from last year, is that the cost share for the administration of the SNAP program transitioned from formerly being a 50% federal reimbursement and a 50% state investment. And after the bill, it changed to 25% federal, 75% state investment. Last year, you'll see on this chart that last year we were funded at the 75% of the required funding for the year because of the difference between a state fiscal year and a federal fiscal year. For state fiscal year '28, there will be one additional quarter that requires funding.

So I'm going to spend a little time and talk about the SNAP benefit cost sharing based on payment error rates. So the state of Alaska— well, the rule outlined that states that are above 6% of error rate could be subject or will be subject to paying a portion of the SNAP benefits. On this slide, you'll see the scenarios based on a projection of our SNAP benefits. So we're projecting out to 2030 what will pay out in SNAP benefits. So at 5%, if our error rate's between 6% and 8%, the cost to the state of Alaska in 2030 would be about $16 million.

If we're between 8% and 10%, the cost to Alaska will be $32 are almost $33 million. And then if we're at 50% or more, the cost to the state of Alaska in 2030 will be $49 million.

I'm going to talk a little bit on— oh, I can pause for questions. Senator Claman.

Thank you, Madam Chair. On this topic about the error rate, I know we had some discussion in the last few months about factors that caused Alaska to have a, for lack of a better description, a statistically unrealistic error rate compared to other states and that we were essentially at a disadvantage on the error rate that should be corrected or should be identified so that we, so that although it may at one level calculate as that higher level, we won't be penalized in the same way because of of practical realities that we face and what's the status of that? I think that might be relevant to the next slide as well.

Correct. See, I'm getting ahead of myself.

Through the Chair, again, this is Deb Athridge. Senator Claman, the State of Alaska did have a very high error rate and it was during a period of time where we were delayed and untimely in making determinations for our SNAP in that program. We've been working really diligently to bring that error rate down. I think the highest error rate was around 60%, and now we're projecting, it's not state reported and not finalized, but for 2026, we're looking at about an 18% error rate. And so we've been really driving down the error rate.

If we were to remove the incidence of, cases that have an unworked application, if we were to be able to drive down timely or become more timely in 100% of our cases and we could take those— that percentage of error out of that 17%, we would be sitting at about an error rate of 6%. And so we are, you know, very close and we're working really hard to decrease our error rate. And I'm going to speak speak a little bit to the formulas in which we're, we're doing that because we've progressively reduced our error rate. In 2024, it was 24% and '25 is 23.15, and now we're looking at 26. Commissioner Hedberg talked a little bit about some of the investments that we've been making at the Division of Public Assistance.

Deputy Commissioner Ricci also, also spoke to to. So we are using insight, investment, and prevention, and these are kind of the buckets in which we are trying to drive down our error rate. We do targeted case reviews to identify errors. We've invested in an assessment, quality assurance assessment tool, so that we can, before it goes through quality control, before my quality control unit sees it. We're doing those quality assessments, and then through that quality assessment, we're able to analyze the data and identify where the errors are occurring.

An example for SNAP is we were making a number of errors around household composition, and so we've— I'm going to move back over to investment and investing in staff. We, we have focused, focused on quality training with our staff. We've done a lot of work to provide additional training. And so then we focused on, you know, household composition and training eligibility technicians on household composition and how to do that. And we've actually seen a reduction in the errors of household composition just directly related to our training.

Very proud of the work that we're doing in that way. We're investing— one of the areas of concern that I was very aware of is that eligibility technicians couldn't find where to find the information in order to make a correct determination. We operate SNAP in a legacy system, which means that it's not smart. There's nobody, there's nobody connecting to things. All of our eligibility technicians manually enter.

They look up the rules. They're literally snipping pictures, putting it in case notes. It takes a lot of time to do that work, and there's just so much room for error. And so we invested in a central location for our staff to find all the relevant information and we are invested in keeping that up to date, including our standard operating procedures for eligibility technicians. So we've invested in training, we've invested in space for them, and then we have an ongoing quality committee, and that quality committee has developed what's called an FYI tool that our workers will send back and forth to each other that identify errors so that we are really being dynamic and how we're addressing that.

Ultimately, we'd like to prevent errors and not have them happen at all. And so part of our investment plan is to work to operationalize a tool that can work right in real time with our eligibility technicians to say, this looks like it's an error. This was on the application and you're not adding that income together correctly.

Follow-up. You talked about on a path to getting under 10%. What would be your timeline to think you'll get under 10%?

Through the chair, Senator Claman, you know, every year we're driving, you know, we're really driving down. I think I've identified the 6%, the largest error that we're making right now, and we're making a plan for correction for that. So it's my goal to have our, our error rate down by next year. Thank you. We have Senator Dunbar and then Representative Schwanke.

Thank you, Madam Chair. And so I heard you talk about additional training and systems and space. I just want to ask you sort of a series of relatively quick questions. Did you mention increased staff? Have you increased staff, and would increasing staff reduce the error rate?

Through the chair, Representative, we have— yes, we have, we have two areas in which we've been able to increase staff. The legislature appropriator funded 15 eligibility technician positions that we've put forward, and we have operationalized a virtual contact center to to really provide that direct service on the phone with merited staff. And then we also have those non-merit staff, the contracted staff. And we have a non-merit demonstration waiver through the Food Nutrition Assistance Administration. And those non-merit staff, which is our contracted staff, we have high-quality reviews through them and we've been able to to increase the staffing and access and operationalize more case processing for SNAP.

And then that actually takes a lot of burden off of our eligibility technicians to look at other programs and really support all the programs that the Division of Public Assistance administers. So we know that we have a lot coming ahead of us, and we know that there is going to be a need for additional staff. And right now we're really up, you know, doing our projections for what that volume looks like along with what our operational system changes, then what we can automate at the same time. And so we're really walking that path together. Follow-up, Madam Chair.

Yeah, and this partially goes off of a comment that was made, I think, earlier by Representative Fields— uh, Gray— that some of these increased requirements. You know, you see the term error rates, the errors can be very small and not meaningful in how they impact the bottom line, but these penalties are very meaningful to us. And so if it takes additional staff to get us from 15 to 10 or 10 to 5, if you look at the delta here, that could be $30 million. And so it makes financial sense for the state of Alaska to hire $10 or $20 million worth of additional staff if it can save us $30 million. And in that sense, these requirements will likely grow government.

But I guess I would urge you when you come to the legislature this coming year to make those requests. That is, again, it makes financial sense for us if we can get under 5% we can save $49 million to the state, to the people of Alaska. And so if it takes significant additional staffing to get us under that 5%, please come to the Health Committee and to the legislature as a whole and our Finance Committee and make those asks. And speaking for myself, I will advocate for those additional staffing positions because it just makes financial sense for us looking at this chart. Do you have any comment on that?

Through the Chair, Senator Dunbar, thank you for your comments. I would say there's sort of 3 drivers that we are focusing on. Clearly, there is staffing, and I think we have presented to you the— a lot of significant changes within Medicaid in addition to SNAP. And I think driving down our error rate is critically important so that we can get below that 5% Error rates are either client-driven or staff-driven. I think Director Etheridge has identified that she has tools in place to identify what are the causes of these errors, and we are focusing our resources on driving those down.

And so that is a concerted effort. But I would also just present to this committee that there's a significant body of work around the IT modernization that has to happen to automate. And reiterating what Director Etheridge said is that there is a tool that will screen after an application has been processed by an eligibility technician to quickly identify if there is any missing information or to correct information. And that screener is critically important, and we feel a lot of immense pressure in order to work through these tasks very quickly. I would say the third is how we are supporting our clients to ensure that they have the information that is easy for them to access.

Food—. FNA, Food Nutrition Administration— does not require a lot of information. We have very little information that is sometimes submitted on applications, so it is very difficult to follow up to collect a lot of information. So one of the challenges that we have is how we can collect as much information as possible to make these eligibility determinations. So in a recap, it's how are we supporting the client, modernizing our system, and then yes, staffing is definitely a resource need, but I think it's all three of those.

And there's a lot of work that is happening, as I had mentioned, interdependencies between SNAP and Medicaid because the Division of Public Assistance is managing all programs.

Thank you. Thank you, Madam Chair. Thank you, Representative Schwanke.

Yeah, thank you. Through the chair, I want to add on to what Senator Dunbar was getting at. I'm afraid I have a little bit more of a negative perception of this. I, I— my understanding is Alaska has the highest error rate I find that absolutely unacceptable. I don't understand why it hasn't been brought down in a more significant manner over the last couple years.

I'd like to know if you guys have some sort of idea of how many years Alaska has led in the error rate metric. And then have you engaged any sort of professional that does risk analysis and have they been able to give you any sort of concept of a cost-benefit analysis on this issue? What is it going to take for us to get that error rate down?

That's, that's my question. Through the Chair, Representative Schwanke, thank you for your questions. I would say that we are working in earnest to drive down this payment error rate, and it is predicated that we have functioning IT modernization systems, that our staff are trained, and that we have that quality improvement process set up so we're identifying where errors are happening at the root cause and targeting our training. We had—. We do have a contractor that went in 3 years ago and looked at the business process, the workflow, and identified a series of recommendations to improve the efficiencies of the workflow.

A lot of that was around document management systems, and we integrated our document management system with our workflow for those efficiencies. But this takes time as we are driving down our, our rate We do have the tools, as Director Etheridge mentioned. Qualtrics is a tool that is truly identifying the root causes of these errors so that we have a quicker identification and identifying the solutions with our staff that are working in the field on what those resolutions are. So this is all work in progress.

All right, thank you. Representative Fields. Through the chair, I just want to share with Representative Schwanke that the governor slashed dozens of positions from the department several years ago. We actually funded half of them because we knew it would produce delays in error rates. The governor then vetoed those positions.

So a lot of this is the direct result of eviscerating staff in the department in addition to the capital needs that the commissioner mentioned.

All right, please proceed.

For the record, Heidi Hedberg. So this is our final slide, and I think before you we've had a, a pretty robust conversation on the changes to HR1, the response to that with Medicaid and SNAP, which is really multifactor. The 6 different areas that I outlined, everything is interdependent. So if we're Are we making a change in policy? Are we updating our IT systems?

Are we updating our work— or training our workforce and making sure that we have those quality measures in place? So, this is the focus. These are the 4 areas that we are working through as we are timing out these system changes and the interdependencies and how we are moving forward, ensuring that we are communicating to Alaskans and that stakeholders are at the table. Working with us through these system changes. Thank you.

Thank you. I'm trying to see if there's any questions from committee, and I have a few before we close. Go ahead. Thank you. Through the chair, I attended Mike Jones's food affordability summit a few weeks ago.

He's from ICER, and I believe the SNAP benefit is about about $1,200 on average for Alaska person, you know, per month. And I think just something that I'm just making the comment on is that I think the folks who passed this bill and implemented these changes, I think the goal was to save money, that we would have, you know, that ultimately if we increased the administrative burden, that some folks would opt out, and that way we could have less folks on SNAP and we could save money. But I think I think what's lost is that when folks, you know, for whatever reason, lose that $1,200 a month, I mean, it's not that they're going to stop buying food. It's just that they're going to buy food, but they're not going to pay their rent, or they're not going to be able to afford their heating, or they're not going to be able to afford their gas bill. They're not going to be able to afford to take care of their car.

There's just all these ripple-down effects that happen, particularly in Alaska, and particularly, I guess, in rural Alaska, it's felt even more acutely. And so I think when we talk about SNAP, I think people sometimes get into their mind that we're just talking about people buying their groceries, but if you lose your SNAP, then you could end up homeless. Like, and again, it's just all part of the same picture. They end up in our emergency rooms and we're paying the absolute highest possible bill to help folks that if we'd helped them earlier, we could have saved ourselves that cost.

Thank you. I have a few, just two more questions, and some of them could also just be follow-up for later. One could just be follow-up. I'm curious with the discussion that we have about adding more, more positions to DPA, and I want to make sure that DPA has your maximum capacity and workers that you need to implement all of these changes going on. What your current current vacancies are.

I know there's been some transition with the long-term non-perms and how recruitment and retainment is going with that. So, I'd love those numbers as a follow-up. Two last questions that I have. One is just back on the DPA modernization, and I have the timeline from last December. I think by this time of the year, a year later, we should be on— in progress for Milestone 2, 2.5, and 3.

That's related to non-MAGI Medicaid, data architecture infrastructure and then also on SNAP. Are we still on track with the milestones on top of the HR1 implementation?

To the Chair, Deb Etheridge, we have— we are well into Milestone 2 and working through that. We've had some slippage with that and we are anticipating our first category of eligibility transitioning in February. We have recently issued a notice to award for our milestone 2, which for some of you— 2.5, which is the data lake. And we anticipate that that is staying and staying on track. We're working with our partners at Food Nutrition Administration over the advance planning document for milestone 3.

And as soon as we have that approval in Milestone 3, we'll be putting out the RFP for that. And so generally, yes, I would say we are staying on track with our expectations for modernization. Thank you. And one final question. Oh, actually, I see a question from Representative Ruffridge.

Representative Ruffridge.

Thank you, Chair Mena. I'm wondering, so we, I think in, prior legislative session with HB 344, I believe, and an expansion of our SNAP program and move to the broad-based eligibility. How has that played into, if at all, the error rate for SNAP? And I just wanted to know if that was something that changed that or helped that or or what's irrelevant. Through the chair representative, broad-based categorical eligibility has a couple of functions, but one of them that it does is it removes the requirement for verification of asset, which is an area of potential error for us if we fail both— if we fail to check the asset or if the person makes an error.

And so We haven't seen an increase in applications or recipients based on broad-based categorical eligibility, but we do believe we're seeing an increase in our success and/or a decrease in our error rate due to it.

Just a follow-up, briefly, Madam Chair, if I may. Follow-up. Thank you. Is that a— is that decrease in the error rate measurable at all, or it's just sort of based on feeling? Are we able to know what reduction that put in place?

Through the chair, Representative, I can say at a high level that we've seen the wages and household— we've seen just a slight decrease in the percentage of errors in that way. We still have our 3 highest errors, areas of error are missing reports, wages and salary, and household composition.

Position. Okay, thank you. Mm-hmm. Great. I just have one final question, and thank you for staying a little bit over time.

This goes back to Representative Gray's comments about really the heart of what we're trying to do here, especially as a committee and working together with our executive branch on this federal law that's been placed onto us, is trying to make sure that Alaskans can get the care that they need and knowing that there's so much bureaucracy that they have to untangle. So in thinking about the Manat Report and how there's going to be an update, I'm wondering if there is a way to incorporate in the Manat Report which populations and demographics we know are— that will be at the highest risk of losing eligibility. And even external of the Manat Report, how can we as a legislature help you all, whether it's language access, whether it's more individualized outreach, whether we can do more outreach as legislators as we communicate to our districts. I have an incredibly multilingual district, and I know there's a high percentage of people in my district that rely and depend on SNAP and Medicaid. What can we do to help make sure that we're preventing these big numbers and projections of thousands and thousands of Alaska of working Alaskans that might lose their benefits?

Through the Chair— to the Chair, Mina, I think that Deputy Commissioner Ritchie kind of mentioned this in the middle of the presentation where when we're looking at access to healthcare, right, and the ability to afford a health insurance plan, I think there is a role for the Rural Health Transformation Program. Uh, there has been a lot of conversations in community with how to become more administratively efficient, how to use community health workers, which is new. Um, there's a few groups in Anchorage, but overall new to Alaska, and leveraging this group to help individuals with this process, with finding a health insurance plan that they can afford. Our second goal is around pay for value. And so I think, as Deputy Commissioner Ricci alluded to, there has been some cursory conversations in exploring what is something that we can do because we understand that there are many individuals that cannot afford health insurance for a variety of reasons.

And so I think this is a timely conversation that we are starting to wrap our arms around through the Rural Health Transformation Program. Separate from that, you know, our goal is to make sure that we become compliant with the requirements of the changes within Medicaid and within SNAP and the system changes that have to happen so that we can minimize the penalties related to our SNAP payment error rate, errors rates within our PERM, Medicaid PERM rate. So again, that our focus is we have an effective, efficient system that people can navigate. We are ensuring that they have access to Medicaid if they qualify, and we're making sure that we have a healthcare system that is supporting people with the right, the right care at the right time at the right place.

Thank you. Thank you to our Department of Health leadership and Director Etheridge with the Division of Public Assistance. I know that you all have had to work through a lot with HR1 with the Rural Health Transformation Program, and I appreciate you all taking the time in the interim to come forth to the committee and also the time of our committee members as well as our Senate committee members for learning more about how we can best prepare for HR 1 and these new changes in the next legislature as well for the next administration. I appreciate this committee hearing today. The time hearing is— the time is 3:19 PM in this hearing of the joint House and Senate Health and Social Services Committees is now adjourned.