Editor's note: This story originally ran on July 13, 2005.
Soaring costs and suspected abuses call for new controls in a state program intended to provide in-home help to Alaskans with severe disabilities or those who are elderly and frail, state officials said this week.
Spending for personal care services such as help with housework, bathing and getting from bed to wheelchair has risen an astonishing 900 percent since 2001, when the state first allowed people in need to hire friends and some relatives as caregivers. That fiscal year, the program cost the government $8 million compared with more than $80 million in the budget year that just ended, according to the state.
The client count grew too, from 1,425 four years ago to about 3,800.
A recent audit of the program found a number of problems, including shoddy record keeping, poorly done assessments and unsupported billings.
The state on Tuesday unveiled new rules to control the spending and curb abuses. The goal is to "bring integrity" to the program so that it is not at risk of being shut down, said Joel Gilbertson, commissioner of the state Department of Health and Social Services.
Before 2001, people in need had to rely on private agencies to assess their needs, then employ and manage attendants providing personal care, which was paid for through state and federal Medicaid dollars. After the policy change, some relatives, neighbors, friends and others could begin receiving payment even if they had previously been providing the services for free.
"Lo and behold, the state of Alaska put them on the payroll, " Gilbertson said. That happened before he was commissioner, he said, and it has taken the Murkowski administration a couple of years to figure out what needed to be done, partly with the help of audits.
Private agencies still handle administrative duties and bill Medicaid for the care, even when needy clients hire, fire and manage their own assistants. They also still take a cut of the payments, said Jon Sherwood, a medical assistance administrator.
They decide whether a person needs care, and how much -- which is a blatant conflict of interest, since the more care someone needs, the more the agencies can make in Medicaid billings, Gilbertson said.
Under the proposed new rules, the state would require independent assessments by trained nurses employed by a state contractor to establish whether someone needs care and how much.
The state also wants to make these changes:
* A doctor would certify that the client has a medical condition that justifies the need for personal care.
* Services would be limited to people at risk of going into a nursing home or hospital, or of losing their job, without it. To qualify, people also would need help with at least two basic activities such as eating, dressing and getting around.
* Most clients could not get "stand-by assistance, " in which an aide is on hand in case, say, the individual starts to fall. People with histories of falling or other special needs could still get it.
* Families or others would provide help when it makes sense. For instance, if an aged man is living with his grown son or daughter, the state shouldn't pay someone to cook his meals, Gil-bertson said.
Officials expect the changes to be controversial but say there is no need for alarm. Few people likely will lose the service altogether, and they may be people whose conditions have improved so that they no longer need it.
The state isn't proposing to cut the rate it pays for personal care services, Sherwood said. It's not putting a blanket cap on how many hours of care a person may receive. And it's not limiting who can provide the care. The average cost per client currently is $23,095 a year.
The proposed rules appear reasonable, said Pat Luby, advocacy director for the Alaska office of AARP. He said good-quality help is necessary, but abuses should be stopped. For instance, he knows of someone getting paid to provide much more help than her mother needs or gets.
In Anchorage earlier this year, a nurse and her home health care business were indicted on charges of scheming to steal $1.5 million from Medicaid. Sherry Trotter is awaiting trial on charges that she billed Medicaid for services even though she didn't assess that patients needed the care or billed for more hours than were called for or documented, said Don Kitchen, a prosecutor who directs the state Medicaid Fraud Control Unit.
Kitchen said he welcomes the state's effort to tighten the rules and reduce losses.
The state has evidence of problems from a recent audit of personal care by a contractor, APS Healthcare out of Silver Spring, Md.
Auditors reviewed a sampling of cases in which claims were paid between January and November 2004. Some assessments used vague, layman's terms such as "female issues" or "bowel problems, " making it hard to judge whether the person really needed the care, the audit found.
In all, out of $542,000 worth of personal care claims examined, auditors found that one-quarter of the payments were made in error, according to a summary report.
Auditors also blamed state officials for not providing oversight and giving mixed messages to personal care providers.
The state has recently hired new staff for the program, going from a lone employee to five, plus a manager, said Odette Jamieson, a nurse who now manages the program on an acting basis.
Daily News reporter Lisa Demer can be reached at firstname.lastname@example.org and 257-4390.