Governor Discusses Cuba, Health Reform; Outlines DHS Director Criteria

Gov. Asa Hutchinson reflected on his recent trade trip to Cuba, takeaways from a major health reform report released this week, and criteria for replacing departing Human Services director John Selig.

Appearing on this week’s edition of Talk Business & Politics with Roby Brock, Hutchinson said he’ll turn first to the private business sector to replace Selig, who announced he’d leave the top Department of Human Services post by the end of this year.

“I’m going to look in the private sector for people with business backgrounds. The most important thing about a new director of DHS is that they understand business process, they understand managing people [and] very technical IT projects. So it’s a management experience I’m looking for. It would be a bonus if they had a background in children’s services or youth services and Medicaid. But most importantly, we need someone who understands business management practices,” said Hutchinson, who also indicated he’d look in Arkansas first but wouldn’t preclude a national search.

Hutchinson also commented on The Stephen Group report that indicated changes were needed to the state’s Medicaid program to sustain it in the long run. The 350-page document also said that the private option should continue – with changes – in part due to the $438 million positive impact it has on the Arkansas budget.

The governor said that The Stephen Group’s report revelation that thousands of Medicaid or private option recipients had out-of-state addresses or were deceased validated his efforts to strengthen income verification.

“We were not getting responses from some people and all of a sudden, we understand why. Tens of thousands of them have out-of-state addresses,” he said.

The Stephen Group report found that the Arkansas Medicaid system is paying for benefits for 42,891 beneficiaries whose best address according to a LexisNexis search is out of state. That’s almost 16% of beneficiaries.

Meanwhile, 3,543 traditional Medicaid recipients and 3,210 private option recipients have no record of ever living in Arkansas. Report author John Stephen told legislators that it’s possible some enrollees whose addresses are out of state actually do live in Arkansas.

“Clearly it points up the absolute need for program integrity for making sure we do the eligibility verification. What we’ve got to do is do it on a rolling basis and not on an annual basis – we’ve got to develop those systems for it,” Hutchinson said, adding that seven new positions would be placed in DHS and the Office of Medicaid Inspector General in the area of program integrity.

CUBA TRIP
The governor relayed his observations on his recent trade mission to Cuba, urging caution on moving forward with the tiny communist island.

“Everybody told me it would be a throwback to the ’50’s and it was. I was thinking of that in terms of their development and their old cars,” Hutchinson said. “But actually it was a throwback to the ’50’s in terms of the dialogue with government officials.”

“They are still in their mind-set – the senior officials – back in the revolution, back in the centralized government,” he added. “That really struck me that while we need to make progress on loosening the economic sanctions and the embargo, they also need to make improvements in working with the private sector that will encourage investment there.”

Hutchinson noted that there should be no urgency in rushing trade in order to ensure Cuba lays a foundation for more capitalistic reforms. He said loosening travel restrictions and increasing credit are the first two steps to making that happen. He also said that Cuba could prove its intentions through some early smaller trade deals that may result from the trip.

“They need to have a better working relationship with the private sector and we need to see the reality on the ground as to what they intend to do and how they’re going to treat private investment. Let’s open it up for the agricultural sales and we’re going to learn a lot,” Hutchinson said.

As for what’s next, Hutchinson said there will be follow-up meetings between Cuban officials, the Arkansas Economic Development Commission and the Arkansas Agriculture Department. He said the Arkansas Farm Bureau was planning on hosting visitors from Cuba in state and that the University of Arkansas was preparing for an exchange with leaders from the University of Havana.

The governor also discussed late-breaking news on Friday that a Pulaski County circuit judge halted state executions while death row inmates file an appeal. And, as a former Congressman, Hutchinson shared his thoughts on the turmoil in Congress over the House Speaker’s situation. Watch his full interview below.