Legislators hear report on Arkansas Medicaid reform plans

Editor’s note: Roby Brock, with our content partner Talk Business, wrote this report. He can be reached at [email protected]

Right out of the gate, members of the Joint Public Health Committee asked for an update on the state’s efforts to reform its soon-to-be-troubled Medicaid program.

They received few details but a promise of a date to report progress.

John Selig, director of the Arkansas Dept. of Human Services, said a meeting is scheduled next Thursday with several stakeholders in the state Medicaid system to advance discussions. He also said that by mid-July or earlier his agency would outline "initial priorities" tied to the reform effort. Those priority areas include wellness and prevention, clinical medical care, home-based health programs and long-term care.

"We think we’re making good progress — it’s a big endeavor," Selig told committee members.

The Beebe administration received a green light from federal regulators to pursue changes to its Medicaid program, which could be facing an $87 million shortfall within two years.

"Our budget is okay this year and next year, but after that we have some challenges," Selig emphasized.

Gov. Beebe is wanting to move the state away from a "fee-for-services" model and create "medical homes," which would stress more comprehensive health care treatments versus the battery of tests and referrals now deployed throughout the system.

As the "initial priorities" are identified, Selig told committee members that he expects to create working groups to identify concerns, seek solutions and ultimately work toward potential regulatory or legislative changes to address the administration’s reform effort.

Senate Public Health Chairman Percy Malone, D-Arkadelphia, asked if a "plan" has already been crafted, in reference to the federal Department of Health and Human Services and Centers for Medicare and Medicaid Services (CMS) agreement to allow the state to pursue changes.

"I don’t have a plan. What they (CMS) like is the ‘concept’ of moving away from ‘fee-for-service’ and streamlining the system," said Selig. "CMS has not given a green light, but is encouraging of reform to the system."

He also said that response from the private sector, such as hospitals, doctors and insurance companies, has been strong.

Arkansas would be the first state to have a comprehensive overhaul of its Medicaid program if its efforts are implemented. Selig said Medicaid reform is a topic of discussion in every state and that "pieces" of reform have been done in other places.

"To this scale, no state has done this to the extent we’re talking about doing it," he said.

State Sen. Randy Laverty, D-Jasper, asked if Selig knew enough at this juncture to know if savings will occur. He also asked if reform efforts could be a deterrent to recruiting physicians to Arkansas.

"We won’t pursue this if we don’t think it will provide some savings and keep our providers," Selig replied. "We’re not going to do it if it harms our system."

Sen. Missy Irvin, R-Mountain View, asked if the possibility of payments could be slowed down under potential reforms. Selig said he did not expect a change in payment speed to providers, but he did not say if payments would be reduced — a potential key to savings.

Chairman Malone told members he expects to create a subcommittee to deal with the Medicaid reform issue to allow for more in-depth questions by legislators.