Arkansas Republican Gov. Asa Hutchinson called on the Legislature to keep the state's private-option approach to Medicaid expansion backed by his Democratic predecessor through 2016 so that roughly 200,000 low-income residents won't lose access to insurance coverage.
But Hutchinson, in a highly anticipated speech Thursday, also called for the creation of a legislative task force to study other options for providing insurance to those who can't afford it in the future.
“It is time to close this chapter and to start a new one,” he said during the speech. “It is a new day for healthcare in Arkansas.”
Hutchinson was sworn into office this month, taking the place of Democratic Gov. Mike Beebe, who was instrumental in negotiating the private option Medicaid expansion plan. The Legislature must reauthorize the program every year with support from at least 75% of legislators, making it a politically contentious issue.
“The phrase private option itself has become politically toxic,” Hutchinson said.
Arkansas' Medicaid expansion plan, which provides subsidies to low-income individuals so that they can buy private coverage, has become a model for other states under Republican political control to consider the Medicaid expansion option available under the Patient Protection and Affordable Care Act.
Just over half the states have already implemented Medicaid expansion and several other states, including Tennessee, Utah, Wyoming and Indiana, are actively considering whether to extend coverage to more residents. The CMS has shown increasing flexibility in allowing states to adopt their own models of expansion in order to bring them on board.
The uninsured rate in Arkansas has plunged from 22.5% to 12.4% since full implementation of the federal healthcare law, according to Gallup, the steepest drop in the country. In addition, uncompensated care at hospitals decreased by $69 million in the first half of 2014, and the number of uninsured patients hospitalized fell by 47%.
Authorizing the state's private option plan through 2016 would be significant because it would allow Arkansas time to apply for a more wide-ranging waiver from the CMS. Starting in 2017, under a provision of the ACA backed by Sen. Ron Wyden (D-Ore.), states can seek a “1332 waiver” from many of the coverage requirements of the federal healthcare law. Legislators in Arkansas have already been preparing to seek such a waiver when that option becomes available.
“Essentially what we're looking for is an opportunity to deregulate the Affordable Care Act,” Republican state Sen. David Sanders told Modern Healthcare last year. “In my mind that's what the 1332 waiver does. It gives you that flexibility.”
Follow Paul Demko on Twitter: @MHpdemko
