(a) The department shall adopt regulations to design and implement a program for reforming the state medical assistance program under AS 47.07. The reform program must include

(1) referrals to community and social support services, including career and education training services available through the Department of Labor and Workforce Development under AS 23.15, the University of Alaska, or other sources;

(2) electronic distribution of an explanation of medical assistance benefits to recipients for health care services received under the program;

(3) expanding the use of telehealth for primary care, behavioral health, and urgent care;

(4) enhancing fraud prevention, detection, and enforcement;

(5) reducing the cost of behavioral health, senior, and disabilities services provided to recipients of medical assistance under the state's home and community-based services waiver under AS 47.07.045;

(6) pharmacy initiatives;

(7) enhanced care management;

(8) redesigning the payment process by implementing fee agreements that include one or more of the following:

(A) premium payments for centers of excellence;

(B) penalties for hospital-acquired infections, readmissions, and outcome failures;

(C) bundled payments for specific episodes of care; or

(D) global payments for contracted payers, primary care managers, and case managers for a recipient or for care related to a specific diagnosis;

(9) stakeholder involvement in setting annual targets for quality and cost-effectiveness;

(10) to the extent consistent with federal law, reducing travel costs by requiring a recipient to obtain medical services in the recipient's home community, to the extent appropriate services are available in the recipient's home community;

(11) guidelines for health care providers to develop health care delivery models supported by evidence-based practices that encourage wellness and disease prevention.

(b) The department shall, in coordination with the Alaska Mental Health Trust Authority, efficiently manage a comprehensive and integrated behavioral health program that uses evidence-based, data-driven practices to achieve positive outcomes for people with mental health or substance abuse disorders and children with severe emotional disturbances. The goal of the program is to assist recipients of services under the program to recover by achieving the highest level of autonomy with the least dependence on state-funded services possible for each person. The program must include

(1) a plan for providing a continuum of community-based services to address housing, employment, criminal justice, and other relevant issues;

(2) services from a wide array of providers and disciplines, including licensed or certified mental health and primary care professionals; and

(3) efforts to reduce operational barriers that fragment services, minimize administrative burdens, and reduce the effectiveness and efficiency of the program.

(c) The department shall identify the areas of the state where improvements in access to telehealth would be most effective in reducing the costs of medical assistance and improving access to health care services for medical assistance recipients. The department shall make efforts to improve access to telehealth for recipients in those locations. The department may enter into agreements with Indian Health Service providers, if necessary, to improve access by medical assistance recipients to telehealth facilities and equipment.

(d) On or before November 15 of each year, the department shall prepare a report and submit the report to the senate secretary and the chief clerk of the house of representatives and notify the legislature that the report is available. The report must include

(1) realized cost savings related to reform efforts under this section;

(2) realized cost savings related to medical assistance reform efforts undertaken by the department other than the reform efforts described in this section;

(3) a statement of whether the department has met annual targets for quality and cost-effectiveness;

(4) recommendations for legislative or budgetary changes related to medical assistance reforms during the next fiscal year;

(5) changes in federal laws that the department expects will result in a cost or savings to the state of more than $1,000,000;

(6) a description of any medical assistance grants, options, or waivers the department applied for in the previous fiscal year;

(7) the results of demonstration projects the department has implemented;

(8) legal and technological barriers to the expanded use of telehealth, improvements in the use of telehealth in the state, and recommendations for changes or investments that would allow cost-effective expansion of telehealth;

(9) the percentage decrease in costs of travel for medical assistance recipients compared to the previous fiscal year;

(10) the percentage decrease in the number of medical assistance recipients identified as frequent users of emergency departments compared to the previous fiscal year;

(11) the percentage increase or decrease in the number of hospital readmissions within 30 days after a hospital stay for medical assistance recipients compared to the previous fiscal year;

(12) the percentage increase or decrease in state general fund spending for the average medical assistance recipient compared to the previous fiscal year;

(13) the percentage increase or decrease in uncompensated care costs incurred by medical assistance providers compared to the percentage change in private health insurance premiums for individual and small group health insurance;

(14) the cost, in state and federal funds, for providing optional services under AS 47.07.030(b);

(15) the amount of state funds saved as a result of implementing changes in federal policy authorizing 100 percent federal funding for services provided to American Indian and Alaska Native individuals eligible for Medicaid, and the estimated savings in state funds that could have been achieved if the department had fully implemented the changes in policy.

(e) In this section, “telehealth” means the practice of health care delivery, evaluation, diagnosis, consultation, or treatment, using the transfer of health care data through audio, visual, or data communications, performed over two or more locations between providers who are physically separated from the recipient or from each other or between a provider and a recipient who are physically separated from each other.