Blue Cross CEO touts legislative wins, watching federal Medicaid changes

Arkansas Blue Cross Blue Shield CEO Curtis Barnett points to two major victories from the state’s regular session: maternal health improvements and continuing Medicaid expansion.

In an interview on this week’s Talk Business & Politics, the leader of the state’s largest health insurance provider said the governor and legislative leaders deserve credit for addressing women’s health as it relates to pregnancies and child births.

“The Healthy Moms, Healthy Babies Act that Governor Sanders, Senator [Missy] Irvin, and Representative [Aaron] Pilkington spearheaded – that work represents transformational change for our state around maternal healthcare and the improvements that are needed and the improvements that can be made with that,” he said. “It also shows what we can do as a state when multiple stakeholders come together and really focus on an issue and really work on how to move the dial in that area. That’s clearly one of the most positive things that happened.”

Barnett said Medicaid expansion, which has been in place for nearly a decade in Arkansas, has been crucial to providing insurance for more Arkansans and stabilizing insurance markets that – despite volatility – would be in worse condition if not for the program.

“I think the second [impact] is really around the Medicaid expansion and reauthorization of the Medicaid expansion program. Going forward, not only does that take care of 240,000 Arkansans who are in need of health insurance coverage, but also the way that we did it, the structure, we’ve continued to work to tie the exchange market, the individual marketplace to the Medicaid expansion population as well,” he said.

“I think that’s been very critical for our state. It’s benefited us for the past 10 years or so. It’s helped stabilize both programs, having them together in that certain way, and it’s stability that we’ve needed. We’ve got some of the lowest individual health insurance rates in the country. We’ve had less volatility than a lot of states have seen. So that stability has really paid off in a big way, and I think that stability is going to become even more important.”

Arkansas is looking to tie a work requirement to its Medicaid expansion benefits. It should receive that authorization from a friendly Trump administration, but a legal challenge will likely be forthcoming if that happens.

Barnett is particularly concerned with potential Medicaid cuts at the federal level. Congress has passed a budget bill that calls for more than $1 trillion in cuts over the next 10 years. Congressional budget observers contend that $770-$880 billion of those cuts may have to come through the federal Medicaid program. Barnett is watching for the next move from D.C. before reacting.

“I think we all need to recognize that Medicaid is 20%-25% of U.S. healthcare spending. 40% of children, 40% of births nationally are covered by Medicaid. Through our maternal healthcare work that we’ve done in Arkansas, we know that half of all births in our state are Medicaid,” he said.

“I think we have to recognize that there are big changes coming to that program,” Barnett added. “It is going to have a ripple effect in all the other markets as well. One of the things that insurers like Arkansas Blue Cross and large self-funded health plans have been under a lot of pressure, especially this last session, about is how can we increase reimbursement to providers to make up for low reimbursements that they get from government programs. That pressure is only going to intensify if we see the kind of Medicaid changes that are being proposed right now, and the commercial markets can’t take any more pressure. This past year, we had 125 small groups – those are groups that are 50 employees and below – who dropped coverage altogether because of cost. That market, the commercial market, is already under significant strain and we don’t need to further strain it going forward.”

You can watch Barnett’s full interview in the video below.