State Medicaid changes delayed

Officials had hoped to get federal approval by last week

With federal approval taking longer than expected, Arkansas officials said Monday, they expect to have to wait until after Jan. 1 to implement state-sought changes to Arkansas’ expanded Medicaid program.

Amy Webb, a spokesman for the state Department of Human Services, said the department will need 60 days after federal approval is granted to implement the changes, which include moving about 60,000 people off the program by restricting eligibility to people with incomes of up to 100 percent of the poverty level, instead of 138 percent of the poverty level.

To start by Jan. 1, as had been planned, the department needed to receive approval from the federal Centers for Medicare and Medicaid Services by Thursday.

“We do feel good about the request, and we’re optimistic that the changes will be approved,” Webb said. “Unfortunately, it’s just taking longer than we had hoped.”

J.R. Davis, a spokesman for Gov. Asa Hutchinson, said state officials still expect the approval to be granted, but don’t know when that will happen.

“Obviously, it’s taken a little longer than we thought,” he said. He said he didn’t expect the delay to cause any problems for state government.

“The most important part is these are substantive reforms that we think will strengthen the program and concentrate our resources on those who need it most,” he said.

While they wait for federal approval, state officials have already begun the process to make the required changes to state regulations.

Those regulations cleared the state House and Senate committees on Public Health, Welfare and Labor on Monday.

In addition to lowering the income cutoff for eligibility, the changes, which the state Legislature authorized during a special session this year, include imposing work requirements on many of the 248,000 Arkansans who would remain on the program, known as Arkansas Works.

If the changes took effect Jan. 1, they would save about $4.5 million in federal Medicaid funds and $286,000 in state funds from Jan. 1 through June 30, according to information the Human Services Department submitted to the public health committees.

During the state’s fiscal 2019, which starts July 1, the changes would save about $56 million for the federal government and $3.9 million for the state, according to the department.

Bradford Nye, the department’s director of policy development, told lawmakers it’s common for the department to seek approval of new rules from federal officials and the state Legislature at the same time.

If federal officials require any changes to the state’s plans, the department could restart the state rule-making process to incorporate the revisions, he said.

Once the change in the income cutoff takes effect, the department plans to start terminating coverage for those who are no longer eligible at a rate of about 5,000 people each month.

According to the proposed regulations, the requirement to spend at least 80 hours a month working or on other approved activities will apply to enrollees age 30-49 next year and will be extended in 2019 to those age 19-29. Enrollees age 50 and older will be exempt.

Enrollees will be considered to be in compliance if they report earning at least $736.78 a month. That’s the average monthly income over a year for a worker who earns the state’s minimum wage of $8.50 an hour and works 20 hours a week.

Enrollees who earn less will be required to report their work and other activities using a state website. In addition to working, approved activities include taking high school, college or vocational classes, looking for a job or volunteering.