AP News

Arkansas moves forward on health overhaul


LITTLE ROCK, Ark. (AP) — Arkansas officials say the state is moving forward with implementing parts of the federal health care law after an election that provided clarity on the federal level but uncertainty in the state Legislature about the political future of the controversial legislation.

President Barack Obama's re-election on Tuesday night came in the same election where Republicans won control of both chambers of the state Legislature partly based on opposition to his federal health care overhaul. Officials with Gov. Mike Beebe's administration say the election at the national level provides some certainty on the future of the law as it takes effect in the state.

The next step for Arkansas comes this week, when Beebe is expected to formally tell Obama administration officials that the state plans on partnering with the federal government on setting up a health insurance exchange, in which millions of households and small businesses will shop for private coverage. A spokesman for Beebe's office said the governor planned to notify the U.S. Department of Health and Human Services by the end of the week.

The partnership option allows states to handle consumer relations and oversight of health plans, while the federal government does the heavy lifting, taking care of enrollment, and figuring out any taxpayer help that consumers may be entitled to. Beebe had opted for the partnership model after Republicans last year opposed efforts for the state to set up its own exchange.

"We will pursue the next best thing we can to maintain as much state input as possible," Beebe spokesman Matt DeCample said.

Arkansas has already received $27.7 million in grants from the federal government for planning for the exchange partnership, including an $18.6 million grant that's still pending approval from state lawmakers, according to Cynthia Crone, who leads the Insurance Department's Health Benefits Exchange Partnership division.

Crone said the presidential election may help in making the case to lawmakers who wanted to wait and see whether Obama would remain in office before moving forward on the exchange partnership, which allows the state to have some say in its setup.

The bigger question looming for the state is whether lawmakers will support an expansion of Medicaid's eligibility under the federal health care law. Beebe has said he supports the expansion, which would add about 250,000 people to the state's Medicaid rolls, but noted that it'll take the support of 3/4th of the House and Senate. With Republicans who are opposed or hesitant about the idea, that may be too high of a vote threshold in the GOP-controlled Legislature next year.

If approved, the expansion would offer coverage to everyone making up to 138 percent of the federal poverty level. That works out to about $15,400 for an individual or $30,650 for a family of four. Most of those who would be added to the Medicaid rolls are low-income adults without children.

Beebe has said that the election doesn't change his agenda, including the Medicaid expansion, and noted that winning support for it was an uphill challenge even before Republicans won control of the state Legislature.

Republicans have said an expansion may be possible in exchange for reforms to the program, but many GOP lawmakers are all but declaring the issue dead in next year's session.

"Based on the rhetoric that's been used to date, I don't buy what they're selling," said Sen. Jason Rapert, R-Conway.

Department of Human Services Director John Selig said he's looking at options that could be part of a compromise for legislative approval of the expansion, including requiring co-pays for some of the new enrollees. Selig also said the department is exploring whether the federal government has softened its stance on whether states can opt for a more limited expansion of Medicaid. Some Republican lawmakers have floated the possibility of a smaller expansion.

"We are open to really talking about anything that seems to make sense and helps us get to yes on something that's good for the citizens of Arkansas," Selig said.

Under the law, the federal government agreed to pay the full tab for the Medicaid expansion when it begins in 2014. After three years, states must pay a gradually increasing share that tops out at 10 percent of the cost. When it upheld the health care law back in June, the Supreme Court said the federal government could not take away states' existing federal Medicaid dollars if they refused to widen eligibility.

The direction of the discussion on Medicaid expansion could become clearer on Tuesday, when DHS is scheduled to present its proposed budget for next year. Selig said he planned to have an updated number on the program's shortfall, currently projected to be $358 million.

Republicans have pointed to the expected deficit as another reason to oppose the expansion, though DHS has estimated the state would see a net savings if it expanded eligibility. Incoming Senate President Michael Lamoureux, R-Russellville, said last week he'd prefer for the Legislature to address the shortfall before taking up the expansion issue.

"It seems like you need to deal with the matter at hand before you start talking about the way you wish things were," he said. "I'm not saying it has to be one first completely and then the other, but it does need our immediate attention."

Supporters of the expansion say they're not prepared to declare it dead, and hope the arguments in favor of it would outweigh campaign rhetoric surrounding the federal health care law.

"This is one of those cases where I think it's really important for people to recognize there are really good reasons for campaigning one way and sometimes having to govern another," said Sen. Joyce Elliott, D-Little Rock. "This is one of them."

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Andrew DeMillo can be reached at www.twitter.com/ademillo


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