Private option till '17 clears Senate by 29-2

Medicaid study also OK’d, sent to House

Sens. Larry Teague (left), D-Nashville, and Jim Hendren, R-Sulphur Springs, talk Thursday after the Senate approved Hendren’s bill for a task force to recommend changes in the state Medicaid program.
Sens. Larry Teague (left), D-Nashville, and Jim Hendren, R-Sulphur Springs, talk Thursday after the Senate approved Hendren’s bill for a task force to recommend changes in the state Medicaid program.

Correction: State Sen. Cecile Bledsoe, R-Rogers, voted to reauthorize funding for the private option. This story misspelled Sen. Bledsoe’s first name.

A bill reauthorizing the use of federal dollars for the state's private-option program sailed through the state Senate on Thursday.




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Arkansas Democrat-Gazette

Sen. David Sanders (left), R-Little Rock, and Senate Pro Tempore Jonathan Dismang of Searcy confer Thursday in the Senate.

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AP

“It was a good day,” Gov. Asa Hutchinson said Thursday after the Senate overwhelmingly passed his plan reauthorizing the state’s private-option program through 2016, adding that he hoped the House will follow suit.

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AP

In this photo taken Jan. 28, 2015, Sen. John Cooper, R-Jonesboro, speaks at a meeting of the Senate Committee on Public Health, Welfare, and Labor at the Arkansas state Capitol in Little Rock, Ark. Cooper, who ran on a campaign to end the private option, said after a Senate vote Thursday, Jan. 29, 2015, he didn't believe an immediate repeal was realistic and saw the governor's approach as a way to phase out the program.

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AP

In this photo taken Jan. 28, 2015, Sen. Scott Flippo, R-Bull Shoals speaks at a meeting of the Senate Committee on Public Health, Welfare, and Labor at the Arkansas state Capitol in Little Rock, Ark. Flippo opposed two Medicaid-related bills that passed in the Senate Thursday, Jan. 29.

The 29-2 vote came immediately after the Senate approved a bill creating a legislative task force to recommend changes throughout the state's Medicaid program.

The legislative task force would also suggest an alternative program to replace the private option.

Under the current program, the state uses federal Medicaid dollars to purchase private health insurance for low-income Arkansans.

"It was a good day," said Republican Gov. Asa Hutchinson, who last week urged the Republican-controlled Legislature to continue the private option through 2016 and to create the legislative task force.

"I'm really gratified and encouraged by the action of the Senate ... and by doing it with a broad coalition of people. It really expressed the sense that there is a unity and some momentum for this solution," Hutchinson said. "We hope we can keep it on track and that the House will respond in a similar fashion."

Legislation sponsored by Sen. Linda Collins-Smith that would have ended the program this year failed in committee Wednesday.

The bills cleared the Senate on Thursday with votes to spare because lawmakers trust Hutchinson's leadership, said Senate President Pro Tempore Jonathan Dismang, R-Searcy, said.

"I think that it reflects the work of the governor so far and his assurances that everybody is going to have a chance to come to the table and have a discussion, not just on the private option, but Medicaid as a whole," said Dismang, who is one of three legislative architects of the private option.

But Collins-Smith, a Pocahontas Republican, said she expects "a political fallout" for Republicans, who campaigned against the private option and then voted to fund it again.

Authorized under the federal 2010 Patient Protection and Affordable Care Act and approved by the Legislature in 2013, the expansion of the state's Medicaid program extended eligibility to adults with incomes of 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 223,000 newly eligible adults had been approved for coverage as of Nov. 30. That included more than 188,000 who were enrolled in private, Medicaid-funded plans on Arkansas' federally operated health insurance exchange; more than 25,000 who were assigned to the traditional Medicaid program because they were considered to have exceptional health needs; and more than 10,000 who had not yet completed enrollment.

The state will have to pick up 5 percent of the private option's cost starting in 2017, and its share of the bill will gradually increase ultimately 10 percent in 2020, when Gov. Asa Hutchinson said it will cost the state more than $200 million a year.

Thursday's vote to continue federal funding of the private option lacked the drama of past private-option votes.

With no debate, the Senate voted 29-2 to approve Senate Bill 101 -- the $8 billion appropriation for the state Department of Human Services's Medical Services Division in fiscal 2016 that includes a $1.99 billion appropriation for the private option. The private option's expenses are projected to be $1.62 billion in fiscal 2016, said department spokesman Amy Webb.

SB101 cleared the Senate with two more votes than the 27 required for approval in the 34-member Senate.

During 2013 and 2014, the Legislature barely authorized federal funding for the program with the required three-fourths vote in the House and Senate. The program deeply divided Republicans; Hutchinson last week called the term private option "politically toxic."

But six Republican senators who voted against private option funding last year supported it this time -- a week after Hutchinson said he wants to end the program on Dec. 31, 2016.

They are Sens. Jim Hendren of Sulphur Springs, Alan Clark of Lonsdale, Cecil Bledsoe of Rogers, John Cooper of Jonesboro, Bart Hester of Cave Springs, and Missy Irvin of Mountain View.

"I think that this is the only way out of a bad situation," said Cooper, who was elected to the Senate in a special election in January 2014 as a staunch opponent of the private option.

"I don't believe just outright defunding is the way to go because of the havoc it would create. I do look at the governor's plan for the next year or so, or however this lasts, to be the proper exit strategy for some of the problems we have with it," said Cooper.

He said his stance to continue funding for the program already is drawing criticism from some constituents who "only see one thing and that is immediate repeal [of the private option]."

"It's been a long time since I thought immediate repeal was actually workable. There was a time when I probably thought that,and there was a time when that was probably do-able. I don't think it is now," Cooper acknowledged. "We have a path forward that takes care of what we need to take [care] of as far as taking care of the people that is on there and giving them a path forward in health care."

Retired teacher and conservative activist Debbie Pelley of Jonesboro said later that "we were terribly disappointed and shocked at Cooper's vote."

"His whole campaign was run on repealing the private option. Senators opposed to the private option came and campaigned for Cooper, and Cooper himself campaigned for legislators around the state that ran their campaigns based on repealing the private option," Pelley said in a written statement.

Irvin, who voted for funding the private option in 2013 before voting against funding it in 2014, said she voted to reauthorize funding this time because it would be irresponsible for the state to stop paying hospitals, doctors and other health care providers for the services that they provide through the Medicaid program.

Sen. Scott Flippo, R-Mountain Home, and Collins-Smith voted against SB101 to reauthorize funding for the private option. Sens. Bryan King, R-Green Forest; Terry Rice, R-Waldron; and Gary Stubblefield, R-Branch, who have voted against funding the private option in the past, didn't vote on it.

"The people overall hate this policy," Collins-Smith told reporters afterward.

"They think it's bad. ... We have seen political fallout for people that said one thing and did another. They have to deal with their vote. ... Do I think there is going to be political fallout? I expect there will be," she said.

Earlier, the Senate voted 27-7 to approve SB96 by Hendren to create the 16-member Arkansas Health Reform Legislative Task Force to recommend changes to the state's Medicaid program, including an "an alternative healthcare coverage model and legislative framework to ensure the continued availability of healthcare services for vulnerable populations" covered by the private option.

Joining Collins-Smith in voting no were Flippo, King, Rice, Stubblefield, Blake Johnson, R-Corning, and David Johnson, D-Little Rock.

Under SB96, the task force's 16 voting members would include five members appointed by Dismang and five appointed by House Speaker Jeremy Gillam, R-Judsonia. Also on the task force would be House Republican leader Ken Bragg of Sheridan, House Democratic leader Eddie Armstrong of North Little Rock and Senate Democratic leader Keith Ingram of West Memphis as well as Dismang, Gillam and Hendren or their designees. State Surgeon General Greg Bledsoe would be a nonvoting member.

It would be required to file a written report with the governor and legislative leaders by year's end.

SB96 states that "under no circumstances may Medicaid eligibility be extended past Dec. 31, 2016, for the current Medicaid expansion population" under the private option "without express legislative approval through a proper enactment of law by the General Assembly."

By retaining the private option through the end of 2016, Hendren told senators, "we will have a much better ability to negotiate long-term cost savings, particularly on the traditional Medicaid program, [with the Obama administration] if they see us as a willing partner and ... willing to negotiate in good faith."

But Democrat Johnson said he voted against SB96 because "there was language in that bill about an absolute termination of the private option [and] I thought that was premature and unnecessary. That puts us on a tight timeline and limits possibly our options."

In other action, the House Public Health, Welfare and Labor Committee declined to recommend approval of House Bill 1181 by Rep. Donnie Copeland, R-North Little Rock, that would freeze enrollment in the private option as of July 1 and allow for temporary health insurance coverage for those already enrolled in the program through Dec. 31.

Eight committee members supported the bill, 10 opposed it and two abstained.

Afterward, Copeland said he would bring his bill back before the committee with some changes.

"I probably ticked a couple of people off with the roll call, but I think people needed to state where they are," he said.

Gillam said he expects the House to consider and approve SB101 and SB96 next week.

Rep. Laurie Rushing, R-Hot Springs, chairman of the 41-member House Freshman Caucus, said, "There was a big majority of the freshman class that did run against the private option."

But she said she's not sure there will be enough votes of no to block funding for the private option in fiscal 2016.

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