As the future of Medicaid expansion in Arkansas hangs in the balance, a new analysis by the Kaiser Family Foundation has found that it's been a resounding success.
Arkansas was the first state that expanded Medicaid by getting a waiver that would allow the state to use federal expansion funds to pay for private insurance premiums. The initiative, known as the “private option,” has allowed Arkansas to cover close to 220,000 people as of June 30.
“Early implementation experience reported by stakeholders suggests that the vast majority of beneficiaries are receiving much-needed care, the state has succeeded in keeping spending in line with its federal budget neutrality agreement, hospitals are experiencing unprecedented declines in their uncompensated care costs and the state's Marketplace is stronger and more robust because of the inclusion of private option enrollees,” Kaiser says in its analysis.
These enrollees have been able to access services, and hospitals say they've seen a 55% drop in uncompensated care costs and signs of people seeking care in more appropriate community-based settings instead of emergency rooms.
Financially, the private option is credited with saving the state over $88 million and generating new revenue of $29.7 million in state fiscal year 2015.
Despite these positive developments, Republican Gov. Asa Hutchinson remains on the fence about the waiver's future. Right now the private option is on track to end December 2016. The decision to expand Medicaid actually took place under his predecessor Mike Beebe, a Democrat.
As recently as Aug. 19, Hutchinson revealed during a speech that he is open to letting expansion continue, but only if it can get more flexibility from the Obama administration on how it takes place in his state.
At a speech in front of the Health Reform Legislative Task Force and the Governor's Advisory Council on Medicaid Reform, he outlined he wanted a waiver that would allow the state to:
• Mandate participation in employer-sponsored insurance when it is available and provide premium assistance to workers.
• Require people earning more than 100% of the federal poverty level to pay premiums capped at 2% of household income. Currently, the private option subsidizes private health insurance for Arkansans earning up to 138% of the federal poverty level, at no cost to the participants.
• Require referrals to work training for the unemployed and under-employed.
• Eliminate non-emergency medical transportation coverage.
• Restrict private-market coverage to working people and make the income requirement adjustable rather than offering private-market coverage to all whose income is 0-138% of the federal poverty level. People whose income level is below the new cutoff would be enrolled in traditional Medicaid.
“As governor, I will accept the continued expansion dollars from the federal government if we can achieve the (Medicaid) waivers that are needed,” Hutchinson said at the task force meeting.
