DHS Director: No Plan B If Private Option Not Renewed

The director of the state agency overseeing implementation of the private option told lawmakers that there is no Plan B if funding for the Medicaid expansion-funded program is not reauthorized.

Last year, a bipartisan group of state lawmakers, led by Republicans, and Gov. Mike Beebe (D) passed the innovative plan that allowed Arkansas health officials to steer Medicaid expansion funds from the Affordable Care Act into private health insurance plans. The funding for the private option narrowly passed both chambers of the Arkansas General Assembly in 2013 and is expected to come up for renewal funding in February 2014.

In the past week, a State Senator-elect and a State Senator who previously voted for the private option have declared their opposition to the program, meaning there are not likely enough votes in the 35-member Senate to support renewed funding. Spending bills require a three-fourths supermajority in both chambers and with Sen.-elect John Cooper (R-Jonesboro) and Sen. Missy Irvin (R-Mountain View) opposing the program, funding is in jeopardy going into February’s fiscal session.

From John Lyon with our content partner, the Arkansas News Bureau:

The state Department of Human Services does not have a contingency plan in case the Legislature decides not to reauthorize the private option, DHS Director John Selig said Tuesday.

Selig told the Joint Budget Committee the agency will ask lawmakers to approve the appropriation of $915 million in federal funding for the private option during the fiscal session that begins Feb. 10, which would require a three-fourths vote of both chambers.

“The state budget was built on the assumption of the private option being in place, so if it goes away, you start with the governor and (the Department of Finance and Administration) and the Legislature saying, ‘OK, what do we want to fund and not fund?’” Selig told reporters after Tuesday’s Joint Budget Committee hearing. “We don’t have a Plan B because we don’t know how much funding we have and how much savings we have until they’ve made some decisions.”

Selig also told the panel that it may not be possible for certain people to go back to Medicaid from the private option. He said about 20,000 Arkansans previously were participating in the ARHealthNetworks program, but the program is being discontinued and may be impossible to revive because it offered very limited coverage and was only permitted by a federal waiver.

To date, nearly 80,000 Arkansans have signed up for the private option and an estimated 59,000 were enrolled as of Jan. 1, 2014, according to state health officials.

On Tuesday, Talk Business and Hendrix College released a survey that shows 47.5% of Arkansans think funding for the private option should continue. About 32.5% say funding the program should end and 20% were undecided. The poll, conducted statewide among 520 likely voters, has a margin of error of +/- 4.3%.