Planned Cuts In Federal Health Care Dollars Put Arkansas Benefits In Jeopardy

May 29, 2017

Arkansas is preparing an application for changes to the state’s Arkansas Works healthcare program even as federal lawmakers propose budget cuts that would significantly de-fund it.

The Congressional Budget Office on Wednesday released an analysis of the possible impact of health care legislation passed by the U.S. House, the American Health Care Act, that found a proposed $834 billion in cuts would cause 23 million people to lose insurance under the legislation — 14 million of those would be Medicaid patients.

That legislation, now being re-written in the U.S. Senate, also drops the federal match rate for Medicaid expansion back to 70 percent, the pre-Affordable Care Act rate for traditional Medicaid. Arkansas has been preparing for a federal match rate drop to 90 percent by 2021.

Such federal cuts would shift more financial responsibility to the states, says Craig Wilson, health policy director for the Center for Health Improvement. 

Arkansas would then decide whether to allow coverage to lapse for some Medicaid beneficiaries, or pick up the bill.

“Clearly, states under budgetary restrictions and balanced budgets like we have in Arkansas, that is a great consideration that our state legislature and the governor is going to have to take,” he said.

In fact, Arkansas was already planning to reduce over $800 million of state Medicaid expenses, and scale back its expansion of the program under the Affordable Care Act.

The state legislature approved changes to the program earlier this month that Governor Asa Hutchinson estimates would move 60,000 people out of Arkansas’s Medicaid expansion pool. The state is now applying for federal waivers to drop the program’s income eligibility threshold from 138 to 100 percent of the poverty line and add new work requirements that were not possible under the Obama Administration.

Beyond that, President Trump’s proposed budget slashes more than 800 billion dollars from Medicaid and other entitlement programs.

Shakica Washington is one Arkansan among many who would be impacted. She's a middle-aged woman who suffers from severe depression, a degenerative joint disease, and a range of other ailments that have left her wheelchair bound.

She sees a doctor each week nearly as many times as most Arkansans go to work, and her care is paid for by Medicaid. She gets benefits through what is referred to as the traditional Medicaid pool. Because of her disabilities, she was eligible for the program even before Arkansas opted to expand the Medicaid program in 2013 to cover individuals who earned too little to join the healthcare exchange through the Affordable Care Act.

Cuts to Medicaid would impact services for both of those populations.

“I’ve got diabetes, anemia… My kidney disease is getting better. I have carpal tunnel in both hands. I have a skin disorder where I break out in blisters,” she said, sitting in her wheelchair outside of the room where her weekly group therapy meets at the Community Mental Health Center in Little Rock.

Washington says she used to work as a nurse assistant in Little Rock until the physical requirements of the job became too difficult with her joint pain. Since then, her daily physical pain and depression has become so bad she doesn’t want to do anything, even eat.

Admittedly, her group therapy is a bright spot.

“You’re not the only one going through that’s feeling the way you feel," she says. "Make[s] you feel like your depression is not singling you out. You’re not the only one that’s going through wanting to kill yourself or in pain or broke all the time,” She said.

Washington says she takes more medication than is covered by her current Medicaid plan, and finances are tight. Because she can no longer work, she says she can’t afford to meet all the needs of her teenage kids.

Indeed, her chronic ailments make her among society’s costliest patients.

Both of Arkansas’s U.S. Senators, Tom Cotton and John Boozman, will have a hand in shaping Senate legislation to repeal, replace, or modify health care as we know it this summer. Cotton declined to speak to Arkansas Public Media, though he is in the Senate healthcare working group.

Sen. Boozman says his goal is to lower premiums for middle-income people by making the insurance market more competitive.

Arkansas Senator John Boozman says he's involved in weekly discussions to develop Senate legislation.
Credit Jacob Kauffman / KUAR

“I worry about Medicaid, but I also worry about people who are beyond the Medicaid cutoff.”

He says he’s also concerned about federal spending and the efficacy of prioritizing funds for low-income programs. 

Boozman says he will push to keep pre-existing conditions covered under new legislation, along with allowing young people to stay on their parents’ health insurance plans until they are 26 — both changes introduced under the Affordable Care Act.

Boozman says he is working closely with Gov. Hutchinson.

The governor has spoken out in favor of keeping federal support for the state’s Medicaid expansion.

Expanded federal funding for Medicaid has brought over $3 billion dollars to the state since 2013, according to the Arkansas Department of Human Services.

The Senate is expected to complete a draft of legislation by the end of the summer.

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