Democratic Gov. Mike Beebe on Tuesday disputed Republican gubernatorial candidate Asa Hutchinson’s claim that there is “a lot of fuzziness” about the potential effect on Beebe’s proposed $5 billion budget if the Republican-controlled Legislature doesn’t reauthorize the use of federal funds to purchase private health insurance for poor Arkansans.
Hutchinson countered that his comments reflected the uncertainty about the future of the private option and the potential effect on the state budget, and weren’t intended to criticize the governor.
Beebe has repeatedly warned there would be about an $89 million hole in his proposed general revenue state budget for fiscal 2015 if the Legislature declines to authorize the use of $915 million in federal funds for the private option in fiscal 2015.
Asked about the possible budget ramifications if the Legislature doesn’t reauthorize funding for the private option in the fiscal session starting Feb. 10, Hutchinson said at the Arkansas Sheriffs Association’s winter conference Monday that “it is a concern. I think the numbers are very, very loose, and we’ve tried to dig deep into those and it’s hard to put a figure on exactly the budget impact if the private option is not approved.”
He subsequently told reporters Monday that “it’s really important that the Legislature continue to probe very deeply on the impact. I think there’s a lot of fuzziness on what may or may not happen, and I know they’re working hard and trying to figure out exactly the budget impact - part of it’s short-term but also long-term. These are the same questions that I’m asking, and I’m probing in and working with some of our legislators as to what’s the right thing to do when it comes up in just a couple of weeks [in the fiscal session starting Feb. 10].” He said he wants to get answers to some questions before taking a stance on future funding for the private option.
Speaking before the sheriffs association Tuesday, Beebe noted that he’s appeared in a television commercial for Democratic gubernatorial candidate Mike Ross and has said that he’s going to vote for Ross in the general election.
“But I have refrained from saying anything negative about any of the other candidates,” the governor said. “I think that is probably a better approach. Mr. Hutchinson is a smart guy, and he and I have had a cordial relationship.”
But Beebe, who defeated Hutchinson in the 2006 gubernatorial race, said there are two explanations for Hutchinson’s comments about fuzziness in Beebe’s proposed budget.
“Either it’s political and I understand that. In a political year, you make political statements. Or he doesn’t understand. I am not sure which,” the governor said.
Beebe said he’s being “real nice right now about this.
“But the budget ain’t fuzzy. The budget is real. The consequences are real, and you all are knee-deep in those consequences and it directly affects you,” Beebe told the sheriffs and other officials.
“It is important if people start questioning my policies and my numbers to try to set the record straight on what they are in as positive and nice and professional manner as I positively can, so I am going to try it this way first positively and professionally and nice,” he said.
Beebe said his proposed budget conservatively estimates that the state will save $85 million to $90 million in general revenue in fiscal 2015 by using federal funds to pay for the private option. The savings result from uncompensated-care costs that the state no longer expects to cover and transferring about 100,000 people from the state’s traditional Medicaid program to the private option, he said.
“The General Assembly felt like if we are going to save $85 million, let’s give it back to taxpayers, and they did in a form of a variety of tax cuts” that were signed into law last year, Beebe said.
Beebe said he’s proposed using part of the increased state general revenue to open more than 300 prison beds and “paying counties money that we owe them” for county jail reimbursement, “so you got a big interest in the private option whether you want to have a big interest in the private option or not.”
In a telephone interview, Hutchinson said Beebe hasbeen gracious and invited him to meet with state Department of Finance and Administration officials, and he plans to take Beebe up on that offer.
He said the state has enrolled more than 90,000 people in the private option and estimated about 250,000 are eligible for the program. Hutchinson said he wonders about the budget implications of falling short of the estimate both in the short and long run.
“I don’t have clear answers,” said Hutchinson, a former 3rd District congressman and former federal Homeland Security undersecretary.
He said Beebe “might know the answers to the questions. I don’t meet with [Finance Department officials] each day…. I want to do my own analysis.”
State Rep. Debra Hobbs of Rogers and businessman Curtis Coleman of Little Rock are vying with Hutchinson for the Republican gubernatorial nomination. Ross of Little Rock, a former 4th District congressman and state senator, is the only announced Democratic gubernatorial candidate.
Ross has said he supports continued funding for the private option, while Coleman and Hobbs have said they oppose it.
The expansion of Arkansas’ Medicaid program, authorized by the federal government and approved by the state Legislature last year, extended eligibility to adults with incomes of up to 138 percent of the poverty level - $15,860 for an individual or $32,500 for a family of four. Under Arkansas’ private option, most recipients can sign up for private plans on the state’s health-insurance exchange and have the premiums paid by Medicaid.
After meeting Tuesday morning with Beebe, state Rep. John Hutchison, R-Harrisburg, who voted to fund the private program last year, said he plans to vote “no” on funding the program in the fiscal session. He declined to say why he is changing his vote.
Seventy-five votes are required in the 100-member House to approve funding, and the measure cleared with 77 votes last year. Twenty-seven votes are required in the 35-member Senate to approve funding, and the appropriation cleared with 28 votes last year. But state Sen. Missy Irvin, R-Mountain View, who voted for the funding last year, and newly elected John Cooper, R-Jonesboro, have said they will vote against funding the program.
Cooper, who was elected Jan. 14 to fill a vacancy created by the resignation of a private-option supporter, was sworn into office Tuesday.
Arkansas, Pages 9 on 01/29/2014