The bill that would create a task force to study a replacement program for Arkansas' private option would also suspend the implementation of "independence accounts" for enrollees with incomes below the poverty level.
Senate Bill 96, sponsored by Sen. Jim Hendren, R-Sulphur Springs, also would suspend efforts to move children now covered by the ARKids First B Medicaid program as well as adults now covered by the traditional Medicaid program into coverage offered through the state's insurance exchange.
The so-called independence accounts and the transition of people covered by Medicaid into exchange coverage is mandated by Act 1498 of 2013, which created the private option.
Special language passed during the Legislature's fiscal session last year also mandates that the state Department of Human Services implement the independence accounts and require enrollees with incomes of 50-100 percent of the poverty level to help pay the cost of their medical care.
The federal poverty level is $11,670 for an individual and $23,850 for a family of four.
Hendren said suspending those mandates would save taxpayer money and help the task force assess the private option's performance.
"It's hard to assess how a program's performing if it's changing," Hendren said. "This basically puts the program on pause so the task force can look at how it's performed and what if anything is going to follow it."
Hendren's bill calls for the planned changes to be suspended until Dec. 31, 2016, or until the private option is terminated, whichever comes earlier.
The task force is part of an effort announced Thursday by Gov. Asa Hutchinson to craft a plan that would replace the private option after Dec. 31, 2016, when the federal waiver authorizing the program expires.
Arkansas created the private option as a primary way to expand Medicaid coverage to adults with incomes up to 138 percent of the poverty level: $16,105 for an individual, for instance, or $32,913 for a family of four.
More than 188,000 Arkansans were covered by the program as of Nov. 30, while more than 25,000 other newly eligible adults were assigned to the traditional Medicaid program because they had health needs that were considered to be exceptional.
Hutchinson said Thursday that he will ask the Legislature to continue funding for the expanded Medicaid program through 2016, while the task force, made up of 16 legislators and Surgeon General Greg Bledsoe, studies alternatives.
The task force's recommendations would be due by the end of this year.
The independence account program started this month for the 37,000 private option enrollees with incomes above the poverty level.
It was expected to start this summer for the 60,000 enrollees with incomes between 50-100 percent of the poverty level.
The program encourages enrollees with incomes greater than 50 percent of the poverty level to make payments of up to $15 per month to help pay the cost of their medical care.
The contributions accumulate in an account, with the balance capped at $200. Enrollees who leave the private option can use the money to pay the premiums for non-Medicaid insurance plans.
Enrollees who contribute to an account in a given month don't have to pay out of pocket for their medical care for that month.
Currently, enrollees with incomes above the poverty level have copayments for some services -- $8 for a doctor's office visit, for instance. Those below the poverty level have no copayments.
Kate Luck, a spokesman for the state Department of Human Services, said suspending the implementation of the program for enrollees with incomes below the poverty level would cut the program's annual administrative costs in half, from $12 million to $6 million. The state is responsible for half of those costs, and the federal government is paying the rest.
The move also would allow officials to make sure independence accounts "work as expected" for enrollees with incomes above the poverty level and to allow the task force and department to focus on "the long-term improvement and not get bogged down with interim steps," Luck said in an email.
Sen. David Sanders, R-Little Rock and a sponsor of the law creating the private option, said he supports suspending the changes to the private option as outlined in Hendren's bill.
He wants to study the independence account program to see if it's worth the administrative cost before expanding it, he said.
He also wants to explore whether the 65,000 children covered by ARKids B could be covered under their parents' insurance policies.
"We have a law in this country that says everyone has to have coverage," Sanders said, and private coverage for children is less expensive than coverage for adults.
He added that he opposes a Human Services Department plan to move children now covered by ARKids B onto the state's Children's Health Insurance Program plan. He said he would prefer the state explore less expensive options. ARKids B covers children in families with incomes between 147 percent and 216 percent of the federal poverty level.
Hendren said he plans to present his bill to the Senate Committee on Public Health, Labor and Welfare on Monday or Wednesday. If it's approved, he said he hopes to have a vote on it in the Senate later in the week.
Metro on 01/24/2015