State of the state in health care: Uncertain

What’s the state of the state when it comes to health care in 2019? “Uncertain” thanks partly to two court cases, one on appeal and the other waiting to be heard.

The one on appeal was decided in December, when Texas Judge Reed O’Connor ruled Obamacare unconstitutional.

How did he come to that decision? The U.S. Supreme Court ruled in 2013 that the Affordable Care Act’s individual mandate to buy health insurance is constitutional because the penalty for not doing so is a “tax.” Congress and the president removed that penalty in December 2017. A Texas-led coalition of 20 states, including Arkansas under Attorney General Leslie Rutledge, sued saying the loss of the penalty nullified the entire law. O’Connor agreed.

However, he did not issue an injunction, and the decision is on appeal, so now we wait.

The case probably won’t provide a definitive outcome in 2019, said Dr. Joe Thompson, president and CEO of the Arkansas Center for Health Improvement. But he said, “I think it will continue unfortunately to make health care be a political football. I think it will be used by both the right and the left as a way to beat up their opponents or try to entrap their opponents on position statements that are less rational and more extreme than what the dialogue is we really need to have.”

In the other court case, nine Arkansans are suing the federal government over its granting of a waiver allowing the state to require some recipients of the Arkansas Works program to work, engage in job searching or training, improve their education levels, and/or perform community service 80 hours a month in order to keep their benefits.

The state began implementing the requirement in 2018 after receiving the waiver. As of Dec. 17, 16,932 Arkansas Works recipients have been removed from the rolls.

Arkansas Works was created in response to the same 2013 U.S. Supreme Court ruling declaring the individual mandate penalty a tax. It also said the Affordable Care Act could not force states to expand their Medicaid populations for lower-income recipients. While some Republican-leaning states chose not to expand, Arkansas sought and received a waiver letting it use that money to purchase private health insurance. As of Dec. 17, the program covered 234,385 people, for which it pays insurance premiums of $572.11 each.

The program has been controversial since its beginning. In the past, opponents have fought it by voting against funding the Department of Human Services’ Division of Medical Services, which administers it. Appropriations require a 75% vote, a high bar. While started under Democratic Gov. Mike Beebe, Republican Gov. Asa Hutchinson embraced the program after his election while adding the work requirement. He said during the 2018 campaign that the requirement was a political necessity to gain legislative support.

A federal judge hearing the case has ruled against a work requirement in Kentucky. What happens if he also rules against Arkansas, and what if that ruling happens before the Legislature funds the Division of Medical Services?

Those questions remain to be answered. Arkansas Senate President Pro Tempore Jim Hendren, R-Sulphur Springs, said the Legislature will not alter its legislative timetable based on what a court may or may not do. However, he said the program has become part of Arkansas’ health care landscape, and he would not expect “to see somebody file a bill to say, ‘Abracadabra, we go back to the way it was,’ because it’s far more complicated than that.”

Other health care-related issues will attract legislative attention. Hutchinson has called for a reorganization of state government that, among many other changes, would place state medical boards under the Department of Health. Thompson also believes legislators could file bills related to legislation in 2018 that regulated pharmacy benefit managers, which serve as middlemen between insurance companies and pharmacists. Hendren would like the state to consider doing more to increase tobacco-related revenues to better cover tobacco-related costs. He also expects legislators to consider changes in scopes of practice, telemedicine and reciprocity pertaining to medical licenses awarded outside the state.

Perhaps outside the legislative arena, Thompson said Arkansas does not have enough medical personnel certified in treating opioid addicts. As the medical community seeks to limit prescriptions, steps must be taken to prevent addicts from purchasing their drugs illicitly.

Thompson sees signs of financial duress in the medical community. In 2018, the University of Arkansas for Medical Sciences undertook a reduction in force because of budget issues. CHI St. Vincent Infirmary in December announced it was eliminating labor, delivery and neonatal intensive care services, which Thompson said is often a profitable activity for hospitals.

Regardless of what happens in the Legislature or outside it, the state of the state’s health care will remain uncertain. That’s because Arkansas’ challenges reflect larger ones across the country.

“We’re a microcosm of the nation, obviously, and the largest issue and elephant in the room is the cost of health care, particularly of drugs because that drives everything,” said Ray Hanley, president and CEO of the Arkansas Foundation for Medical Care. “That drives premiums and cost to employers, and there doesn’t seem to be much political will to deal with that, and until there is, it’s going to make everything difficult.”

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Editor’s note: This article first appeared in Talk Business & Politics State of the State 2019 magazine, which you can access here.