Gov. Hutchinson: Fund Private Option Through 2016, Will Form Task Force For Larger Reforms

Gov. Asa Hutchinson delivered a major health care policy speech at UAMS on Thursday (Jan. 22) and called on the state Legislature to renew funding for the private option through Dec. 31, 2016. He also asked lawmakers to form a task force to study the issue of health care reform and to develop long-term solutions.

Saying it was “time to close this chapter and start a new one,” Hutchinson said the debate over private option funding could not occur year after year and provide stability for the state’s health care community and citizens, particularly those on the private option.

Hutchinson’s speech to a roomful of health care professionals, lobbyists, interested parties, and the press was organized into four major topics.

He talked about the benefits of the private option and health care reform efforts to the state, the costs tied to the program for the state of Arkansas, a profile of the types of individuals participating in the private option, and “where we go from here.”

“The phrase ‘private option’ is politically toxic,” Hutchinson said, in outlining his reasoning for ending the program by December 2016.

He said the core question in deciding how he wanted to approach its fate was, “Do the benefits that we recognize exist outweigh the costs?”

Hutchinson also acknowledged the nearly 200,000 Arkansans who are on the private option and the groups supporting the health care plan, “The human side tugs at our heart strings and is rightfully part of the debate.”

Stating he had opposed the Affordable Care Act, which led to the private option, Hutchinson said after the U.S. Supreme Court ruling on the issue in June 2012, “I lost that debate.”

Hutchinson suggested that the private option has led to a 47% drop in uninsured patients at Arkansas hospitals. He also noted that the number of uninsured Arkansans has fallen 10% since the program’s implementation. Arkansas has also been able to shift more state Medicaid costs from state funds to federal funds allowing the state to not spend $88 million on traditional Medicaid.

Still, he said, “legitimate questions remain” and it is “still taxpayer money.”

Hutchinson outlined four guiding principles for what he hopes will be a larger health care debate. He said he wanted the task force, which would be created and defined by state legislators, to complete its work by the end of 2015.

Speaking to reporters following his speech, Hutchinson said since the state Legislature will ultimately vote on recommendations for a new health care vision for the state, he wanted the task force to be “legislatively driven.” He added that he hoped his Surgeon General, Greg Bledsoe, would be on the panel and he hinted that other stakeholders in the health care profession should be included.

The guiding principles he advocated for the task force to follow were:

• More emphasis on work and responsibility;
• Incentives for preventive care and people’s need to own more responsibility for their health care participation;
• Cost controls to the state and health care community;
• And the need for greater flexibility from the federal government at the state level.

He underscored his emphasis for more federal flexibility, by reading excerpts of a letter from Secretary of Health and Human Services Sylvia Burwell, who said she would “commit to work with you on ‘a potential broad block of changes’.”

“You expressed particular interest in promoting prevention and health behaviors and supporting small businesses interested in covering their employees. And, understandably, you want to minimize the costs of Medicaid to Arkansas taxpayers. These are reasonable and achievable objectives, and I can assure you of our openness to new ideas as you consider how to pursue these interests,” Burwell said. “We also understand your desire to encourage employment, and we commit to work with you on how you might achieve this objective while ensuring access to health coverage for eligible individuals.”

Hutchinson also told reporters he did not expect to press for new waivers while the task force conducts its work. “If something is already in the works, it’s possible,” Hutchinson said. “That’s not the design.”