Begin Shrinking Expanded Medicaid, Legislature Decides

May 2, 2017

Arkansas's General Assembly has given initial approval to healthcare changes not possible under President Obama. 

The modifications would move about 60,000 out of the subsidized Medicaid expansion that took place after the Patient Protection and Affordable Care Act (Obamacare) and under the guidance of Democratic Gov. Mike Beebe. These recipients would become customers in the regular exchange. The changes also include new Medicaid work requirements.  

A final vote is expected Wednesday morning.

This number, 60,000, is roughly the number of Arkansans in the program who earn above 100 percent of the poverty line, about $16,000 a year for a single person. They will move out of Medicaid, which is subsidized by the state and federal government. 

The bill sailed through the full House but was debated in the Senate.

Sen. Bryan King (R-Green Forest) said it doesn’t go far enough to reduce the state's financial burden for Medicaid expansion.

"We are [in] far worse trouble now," he said. "We need to look at more substantive changes to the bill. We need to do things like recoup benefits to these people that are paid that they don’t get to skate off with it. It's not in here."

Senate President Jonathan Dismang (R-Beebe) countered that the legislation allows for future debate about rules. Those could be written to include asset tests for beneficiaries, a transitional plan for those being moved out of Medicaid, and a range of fiscally conservative reforms to limit the rolls.

"We've had this big carried-on debate about what this bill doesn't do. And we’ve talked a lot today about things not contained within this bill. But it does deal with a specific population and issues here in the state that I think should be addressed,” he said.

Arkansas has seen one of the highest drops in uninsured rates nationwide because of its expansion of Medicaid.

But lawmakers want to reduce the state’s burden to subsidize the program as the federal government slowly drops its contribution to states from 95 percent to 90 in 2020.

Depending on what happens in the United States Congress, the match rate could fall further. The Arkansas Hospital Association's Jodiane Tritt says their biggest worry is that people may lose coverage when they go from Medicaid to the exchange.

“There’s no longer a rolling enrollment period, if you will, so if folks lose coverage, whether they don’t pay, or something else happens, they have to wait for an enrollment period all the way rolls around again for them to be covered,” she said.

If the uninsured fall back on hospital emergency rooms for care, she says, that leaves members of her association footing the bill.  

After Medicaid expansion, the state’s hospitals saw uncompensated care costs drop nearly in half, and that helped keep some from closing, she says.

The Arkansas Department of Human Services is reviewing uncompensated care costs in anticipation of the changes.

The rule-making process that follows today's vote will bring specificity to the developing transition. And all of it hinges on federal approval, since Obamacare is still the law of the land.

If approved, the changes would take effect January 2018.

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