Medicaid plan gets a pair of key nods
State senator: Bill likely ready today
House and Senate leaders spoke in favor Monday of giving about 250,000 low-income Arkansas access to government-funded private health insurance.
The separate announcements by Senate President Pro Tempore Michael Lamoureux and House Speaker Davy Carter are the first public, definitive endorsement of the plan from legislative Republicans.
In July, the U.S. Supreme Court struck down a key provision of the 2010 federal Patient Protection and Affordable Care Act and let states choose whether to extend Medicaid access to people making up to 138 percent of the federal poverty level, or $15,145 annually for an individual. The same act calls for states to set up private-insurance marketplaces called exchanges where people can pick their own insurance plan.
In February, U.S. Health and Human Services Secretary Kathleen Sebelius gave Gov. Mike Beebe oral approval to pursue such a plan — and has spoken about it publicly since — but Arkansas has not received written confirmation that the federal government will pay premiums for private-health-insurance policies for an estimated 250,000 of the state’s poorest residents. Legislators call it the “private option.”
Sen. Jonathan Dismang, R-Searcy, said he should have a bill enabling the private option ready today. Identical legislation will be put forward in the House, and the two bills will be run simultaneously because the legislative session is scheduled to end April 19.
A separate appropriation bill would be necessary to authorize the state Department of Human Services to spend the billions in federal money. Support from three-fourths of legislators in each chamber is needed to pass an appropriation.
Carter, R-Cabot, said passing the private option is the Legislature’s best choice.
“Members here have taken what arguably was a
terrible hand of cards that has been dealt to us by the federal government and they have taken that hand and turned it into what I think is something good for Arkansas, good for our citizens and it’s the bestcase scenario that I can envision under the hand that we’ve been dealt,” he said.
Lamoureux, R-Russellville, said he supports the private option because it is good for consumers, healthcare providers and the state budget and may reduce the number of people receiving traditional Medicaid services because some people will be transferred to the private option from the state’s existing Medicaid program. He said it’s time for members to start wrapping up their business to go home.
Lamoureux and Carter said they want the Legislature to pass both the enabling legislation and an appropriation this session.
“Members should have the opportunity to vote on it just up or down,” he said.
But House Republican leader Bruce Westerman of Hot Springs urged lawmakers to delay putting the expansion money into effect until July 2014.
Westerman told reporters the state needs more assurance from the federal government that it can use federal Medicaid dollars to subsidize private-insurance plans that will be offered through an online insurance exchange.
He said lawmakers shouldn’t sign off on a program that will cost the state — in later years — hundreds of millions until they have explicit permission from the federal government and a better idea of what the program will look like.
“I am not going to encourage our caucus to make a decision until we understand the true ramifications and impacts of that decision,” Westerman said.
Beebe said it’s unlikely the federal government will approve a plan for Arkansas until after it sees the Legislature has approved a bill.
“It’s a chicken and the egg thing,” Beebe said. “It’s pretty hard to get them to say a definitive ‘yes, we signed off on it’ until they actually see the bill. I think they’ve signed off on the concept.”
Westerman suggested passing legislation to allow the Human Services Department to set up the private option before the scheduled end of the session. But, he said members should not pass an appropriation bill to authorize the department to spend federal money on the new policies until lawmakers return for a fiscal session in early 2014.
Westerman said waiting would let the state Human Services Department and the federal Centers for Medicare and Medicaid Services work out details before legislators give the go-ahead.
“This would give us more time to get the plan established, to prove it, to vet it in the public eye and make sure that it’s the right thing for Arkansas going forward,” Westerman said.
The state Human Services Department doesn’t need the extra time, spokesman Amy Webb said. She said the department has started working to get approval of waivers from the federal government, set rules and have eligibility determination systems. Webb said the department anticipates being ready by Jan. 1.
She said the federal Medicaid funds won’t start flowing until Jan. 1, when the exchange becomes active. The state is paying to plan and get the private option ready before then, she said.
Webb said starting the program six months after the exchange goes into effect means less time the federal government will cover healthcare costs and less savings for the state. She said it may also mean confusion for eligible Arkansans, who would be in limbo about whether they would get subsidized health insurance until the Legislature voted in 2014.
“Delaying the federal money until July has all those other ripple effects,” Webb said.
Insurance Commissioner Jay Bradford said insurance companies are intrigued by the Medicaid population but may not be as interested in offering plans in Arkansas if the money to pay for the insurance plans isn’t included.
About 211,000 Arkansans are expected to use the exchange to buy health insurance. The private option would more than double the number of people insurance companies can be paid to cover.
Insurance companies must submit plans by the end of June. Enrollment in the exchange begins Oct. 1.
House Public Health, Welfare and Labor Committee Chairman John Burris, R-Harrison, said there is merit behind both approving an appropriation this year and waiting until 2014. Burris said if lawmakers choose to appropriate funding this year, they need to specify that the federal funds are contingent upon approval of the plan by the federal government.
Sen. Joyce Elliott, D-Little Rock, said the Legislature shouldn’t wait to appropriate the money.
“We need to keep moving while we are here and while we have momentum and get the work done so that when we come back for the fiscal session or in 2015, we are not lingering with this same issue,” Elliott said. “The taxpayers have a right to expect us to take up big difficult issues and reach a resolution.”