U.S. gives state a maybe on coverage option for poor

LITTLE ROCK — The federal government has agreed to consider a request by Gov. Mike Beebe to allow Arkansans whose income is just above the poverty level to choose private insurance on the state’s exchange instead of Medicaid if the state fully expands the $5 billion program by 250,000.

Beebe asked U.S. Health and Human Services Secretary Kathleen Sebelius during a Jan. 29 phone call if the state can be given the authority to allow people making between 100 percent and 138 percent of poverty, or between $11,170 and $15,415, to seek coverage on the exchange instead of being placed on the Medicaid rolls, said Matt DeCample,Beebe’s spokesman.

“He talked with her about the viability of doing something along the lines of Sen. [Jonathan] Dismang’s idea of giving people in that group the option,” DeCample said.

Sebelius asked Beebe to direct his staff to send details of the proposal to her staff, which they did late last week.

“They are willing to look into it,” DeCample said.

The federal government hasn’t given Beebe any indication when it might reach a decision, DeCample said. The state’s Medicaid rolls currently number about 780,000 people.

Dismang, R-Searcy, floated the idea in late January of allowing the approximately 51,000 Arkansans who earn between 100 percent and 138 percent of poverty to buy private insurance with the help of federal subsidies in the exchange.

But he had thought of the idea in the context of a “partial” Medicaid expansion to 100 percent of poverty, he said Tuesday. Beebe’s conversation with Sebelius was “news to me,” he said, although the governor had told him he would approach Sebelius about the idea.

“It’s a step in the right direction,” Dismang said Tuesday when told by the Arkansas Democrat-Gazette of Beebe’s request.

But Dismang said he wasn’t sure, even if federal officials approved, that it would be enough to attract enough GOP votes to authorize the expansion of the Medicaid rolls by 250,000 people.

“I don’t think it gets the legislative body to where it needs to be, but every bit helps,” Dismang said.

States across the country are wrestling with a 2012 ruling from the U.S. Supreme Court largely upholding the Affordable Care Act that left it to states to decide whether they would expand their Medicaid programs.

On Monday, Ohio Gov. John Kasich, a Republican, said he supported expansion. More than 20 governors, including GOP governors in New Mexico, Nevada, Arizona and North Dakota, have said they’ll support expanding Medicaid.

Dismang said that “reading between the lines” of Kasich’s statement about Ohio’s Medicaid expansion, it appears that Kasich “reached some agreement to allow more people to utilize health insurance.”

Dismang said he thought - if given the choice - people making between $11,170 and $15,415 a year would pick exchange coverage. Federal subsidies for that groupwould lower premiums to between $19 and $26 a month. Medicaid doesn’t have premiums, although some expansion deal could conceivably include cost-sharing recently allowed by the federal Health and Human Services Department.

“Most people are inclined to have private health insurance, but again, there is still a cost factor there and we need to know what it is,” Dismang said.

House Minority Leader Greg Leding, D-Fayetteville, said he wants to chew on the details of such a proposal, but sees its potential value as a political chip in the Medicaid expansion debate.

“If this is what it takes to get to full expansion, I definitely want to look at it,” Leding said.

The state Department of Human Services is willing to look at the issue, said Amy Webb, the agency’s spokesman.

“We’re definitely open to explore the issue further. We like the idea of having some flexibility,” she said.

For people who fall within the upper end of the expansion population, Webb said, the agency would work with the exchange to minimize confusion.

“Obviously, there is a potential for confusion, but we would work to make sure it’s easy to understand that they would have a choice,” Webb said.

Cindy Crone, the exchange’s planning director, said that “it’s too early to know” how exchange operations would be affected by this new group.

“This whole thing is pretty complex. Whatever it ends up being will be what we have to explain to the consumer,” Crone said.