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Arkansas Bill To Cap Medicaid Expansion Would Violate Federal Law

Sarah Whites-Koditschek
Arkansas Public Media

A bill to cap the number of enrollees in the state’s Medicaid expansion pool at its current rate, roughly 332,000, is progressing through the Arkansas legislature despite violating federal law.

HB1465, sponsored by Rep. Josh Miller, (R-Herber Springs), passed the full House earlier this month and is scheduled to go before the Senate Public Health, Welfare, and Labor committee Wednesday.

Approved by the legislature and then-Gov. Mike Beebe in 2013 as the Private Option, the state's response to the Affordable Care Act of 2009 provides health coverage for low-income Arkansans. It was rebranded by Gov. Asa Hutchinson as Arkansas Works in 2015.

The federal government currently pays for 95 percent of the Medicaid expansion costs, and that is slated to drop to 90 percent in 2020.

“It’s not a boon to the people of Arkansas,” said Miller.

Enrollment numbers have far exceeded projections, and Miller, a long-time opponent of the program, says he believes it is not sustainable for the state or the federal budgets.

Miller's bill would take effect July 1, 2017. It would not eliminate any existing enrollees, but rather, cease enrollment.

Constituents in his district resent footing the bill for the program, he says.

 “They’re tired of seeing programs like this continue to be funded with their hard-earned tax dollars and see folks who just taking advantage of this program and just accepting a hand out instead of a hand up," he said.

“Because what we’ve found, and what we’ve seen time after time, is that folks are signing up on this, [and] they’re not trying to better themselves. They’re simply taking advantage of a welfare program that’s being placed on the backs of taxpayers.”

Arkansas Governor Asa Hutchinson said in 2015 that 70 percent of Private Option recipients were working at some time while enrolled in the program.

The program has brought over a billion federal dollars to the state. It has also been significantly advantageous to Arkansas hospitals.

Jodiane Tritt, with the Arkansas Hospital Association says the changes created by Arkansas’s "private option" kept the doors open at the state’s hospitals, which used to eat the cost for patients who couldn’t pay.

Hospitals "emergency department uncompensated care decreased by 38.8 percent, the in-patient uncompensated care decreased by 48.7 percent, and the outpatient uncompensated care decreased by 45.7 percent.”

The governor advocates keeping Medicaid expansion but instituting stricter thresholds for qualifying, such as work requirements, and lowering the eligibility to 100 percent of the federal poverty level.

The federal act sets eligibility at 138 percent of the poverty level, or about $11,000 to $16,000 for a single person. So reshaping the state's model would require federal waivers to shift income eligibility and work requirements.

The governor also wishes to incentivize employer coverage.  

All together, the changes would cut some 60,000 recipients out of the state's Medicaid expansion pool.

But when it comes to capping the numbers of Arkansans currently eligible for the program, former Surgeon General and longtime president and CEO of the Arkansas Center for Health Improvement, Dr. Joe Thompson, says it’s not legal.

 “I think you’d end up in court by citizens saying that they are eligible but being denied the benefit the U.S. Social Security Act guarantees them."

Further, the legislation is not helpful.

“We [will] go down this path of having the executive branch and the legislative branch and the legal branch, fighting with the U.S. branches of government and it just isn’t a very productive pathway to pursue.”

Arkansas Attorney General Leslie Rutledge has previously weighed in on this issue. While the state can change eligibility criteria, under federal law, it cannot arbitrarily cap eligibility to those who meet requirements.

Miller has filed two other pieces of legislation this session. HB1300 would require the Department of Human Services to prioritize funding for people with developmental disabilities, and HB1653 would require the department to publicize a list of people who have died on the developmental disabilities waiting list.

This story is produced by Arkansas Public Media, a statewide journalism collaboration among public media organizations. Arkansas Public Media reporting is funded in part through a grant from the Corporation for Public Broadcasting, with the support of partner stations KUAR, KUAF, KASU and KTXK and from members of the public. You can learn more and support Arkansas Public Media’s reporting at Arkansas Public Media is Natural State news with context.

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