Gov. Walker pushes for national health care changes on Washington trip

WASHINGTON — Gov. Bill Walker wants to get ahead of Washington on health insurance — avoiding pitfalls and finding state-led ways to to drive down costs and make health care more efficient.

Walker, an independent, joined Ohio Gov. John Kasich, a Republican, and Colorado Democratic Gov. John Hickenlooper on Friday to unveil their "blueprint" for improving the nation's health care by encouraging competition, focusing on quality instead of quantity of service, reforming state insurance markets and improving state-federal relationships.

The nation's governors converged on Washington on Friday for the weekend's meeting of the National Governors Association.

Walker led with a plea for bipartisan cooperation. "Health care is a human issue. It's an American issue that we need to embrace. … The pendulum swinging back and forth between administrations on health care — that's got to stop," he said.

The plan includes a list of general ideas that would require broad cooperation to accomplish — lowering the cost of prescription drugs, offering greater transparency of health costs and combating "anti-competitive behavior, particularly among local hospital systems, pharmacy benefits managers and pharmaceutical companies."

"We're addressing this on a national basis so we don't end up being the victims of something that happens on a national level," Walker said. He commended Sen. Lisa Murkowski for voting against her party's health care bill last summer, saying that "what was going to happen was going to hurt Alaskans."

Any moves made by Congress need to take into account the unique challenges that Alaska faces, Walker said. "Part of it is playing defense."

In talking to congressional Republicans, Walker said he has urged lawmakers not to think in terms of what can get 51 votes, but instead as to what can solve the problems faced by the nation's health care system.

Otherwise, Walker said, the plan will be to sit down with insurance carriers and medical service providers back in Alaska and negotiate.

One thing state officials are considering is finding a way to include small businesses in the state's relatively massive health insurance program, to offer greater bargaining power.

It "would allow us to pool state employees with other populations, and the small group market might be one that we look at to put in," said Lori Wing-Heier, director of the Division of Insurance, who was in Washington on Friday.

More than 340,000 Alaskans are covered by state insurance, whether they're employees in Juneau, retirees, teachers or people who are covered by Medicaid, said health commissioner Valerie Davidson.

They are considering group negotiating. "So for example, rather than an individual school district or a political subdivision having to negotiate that on their own … consider negotiating for the 340,000 lives that the state of Alaska pays for health care," to gain better pricing options, Davidson said.

But she is cautious. "We recognize that while we have great opportunities to be able to negotiate better prices by pooling together, we also want to make sure that we do it responsibly so we don't accidentally increase costs for everybody else," Davidson said.

Alaska's health care system acts as both a warning and a model for the country. Costs, especially for rural areas, are higher than anywhere in the country. Some Alaskans face premium costs of more than $1,000 a month after receiving subsidies. Those who aren't eligible for subsidies face costs that are a multiple of that, sometimes with deductibles so high that they are effectively cut off from accessing health care.

But the state is often held up as a model for achieving what others hope to replicate: a "re-insurance" program that helps insurers pay for patients with expensive health problems, so that those costs don't weigh down the system.

While individual market insurance costs rose across the country this year, some premium costs fell more than 20 percent in Alaska. In 2017, the program spent than $55 million (mostly federal dollars) on about 600 Alaskans with high-cost conditions, according to Wing-Heier.

"What they did in Alaska is a model for a lot of us," Hickenlooper said Friday.

Some of what happens will depend on what the Legislature does, said Davidson and Wing-Heier. Bills under consideration include options for increasing cost transparency — so consumers know what a medical procedure would cost before they have it — and a potential federal waiver on Medicaid work requirements.

[A new Anchorage law is aimed at improving transparency in health care pricing. Here's how it works.]

At the end of 2017, Congress passed a tax bill that eliminated the federal penalty for not having insurance. Wing-Heier said it doesn't appear that the move had a major impact on the individual market in Alaska.

"In 2018 we think it might have lost us about 1,000 people. But relatively speaking it did not have a great impact. We didn't lose 30 percent of our market, which is what you were hearing from some of the statistics."

The greatest shifts to Alaska's market this year have been from people who left the individual market and went on Medicaid, due to the state's faltering economy, Wing-Heier said.

From October 2016 and October 2017, "26,000 more Alaskans enrolled in Medicaid. And 10,000 of those were children," Davidson said. Many Alaskans on Medicaid do live in households where someone works. But "we've seen employers that have cut insurance. They provide it for employees but not dependents because of the costs," Wing-Heier said.