State Senate OKs 'private option' Medicaid plan, task force

FILE — Sen. Linda Collins-Smith, R-Pocahontas, listens to testimony at a meeting of the Senate Committee on Public Health, Welfare, and Labor at the state Capitol in Little Rock on Wednesday, Jan. 28, 2015.

LITTLE ROCK — The Arkansas Senate voted Thursday to continue the state's compromise Medicaid expansion another year and create a task force to look at alternatives for the hundreds of thousands of people receiving coverage through the first-in-the-nation initiative.

By a 29-2 vote, the Senate decided to continue the "private option" through June 30, 2016. Crafted two years ago as an alternative to expanding Medicaid under the federal health law, the program uses federal funds to purchase private insurance for low-income residents.

The Senate also approved creating a 16-member task force to look at alternatives for covering the more than 213,000 people on the program and longer-term changes to the state's Medicaid system. The task force bill passed on a 27-7 vote.

Republican Gov. Asa Hutchinson proposed creating the task force last week as he called on lawmakers to continue the private option through the end of next year. Both proposals now head to the House. The top Republican in the Senate said the plan gives lawmakers time to find common ground on health care.

"The work's not over, but at least we have some stability for a time to work in a stable environment," Senate Majority Leader Jim Hendren, R-Gravette, said after the vote.

Hutchinson's plan would keep the current private option approach in place while the federal government pays the full cost. If the state keeps the private option or some other form of Medicaid expansion after next year, it would be required to pay 5 percent of the expansion's cost in 2017 and 10 percent by 2020. The estimated cost to the state when it begins paying for 10 percent is nearly $222 million.

The task force is required to issue its recommendations by the end of the year.

Sen. David Johnson of Little Rock, the only Democrat to vote against the task force measure, said he was opposed to language in the bill that referred to terminating the private option.

"I think a transformation of the private option is inevitable," Johnson said. "I think the question is what the timeline for that transition should be, and this bill puts us on a tight timeline with unnecessary language."

The legislation reauthorizing the private option needs at least three-fourths support in the House and Senate, a hurdle lawmakers barely cleared last year. The program has sharply divided Republicans who control the Legislature and who have made gains in Arkansas primarily by running against President Barack Obama's health overhaul, which includes Medicaid expansion.

The two lawmakers opposing both bills were freshman Republican senators — Linda Collins-Smith of Pocahontas and Scott Flippo of Bull Shoals — who were elected on vows to end the program.

"I see this as a path to extend it to 2017, to keep the same toxic bill that's been tweaked a little bit but not ended," said Collins-Smith, who had proposed ending the program by Dec. 31.

But the measures won the support of outspoken private option opponents. Sen. John Cooper, who ran on a campaign to end the private option, said he didn't believe an immediate repeal was realistic and saw the governor's approach as a way to phase out the program.

"I see an exit strategy now," Cooper, R-Jonesboro, said.

If reauthorized, the program would face another vote about its future next year, since the Arkansas Constitution requires the state to budget on an annual basis.

Read Friday’s Arkansas Democrat-Gazette for full details.

House panel rejects 'private option' proposal

A House panel has rejected an attempt to repeal Arkansas' compromise Medicaid expansion later this year.

The proposal to end Arkansas' "private option" on Dec. 31 failed Thursday before the House Public Health, Welfare and Labor Committee on an 8-10 vote. The private option uses federal money to purchase private insurance for the poor.

Opponents expressed concerns about the impact of Republican Rep. Donnie Copeland's proposal. Copeland says his bill would have saved the state money. He said he plans to tweak the proposal and run it again.