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Spending cuts for Medicaid recommended

Task force urges shift in aid for disabled, mentally ill by Andy Davis | December 15, 2016 at 5:45 a.m.

The Arkansas Department of Human Services should continue moving forward with changes that will slow the growth of spending in the state's Medicaid program by an estimated $963 million over five years, according to a draft report by a legislative task force.

The draft report of the Health Reform Legislative Task Force also recommends that the state take additional steps to coordinate the Medicaid benefits provided to the developmentally disabled and mentally ill, but doesn't offer an opinion on whether those benefits should be provided through managed care.

The panel reviewed the report, prepared by The Stephen Group of Manchester, N.H., during a meeting Wednesday and is expected to vote on it today during what is expected to be the task force's final meeting.

"It looks like we've got a strong pathway to exceeding our minimum savings goals," with the possibility of saving more than $1 billion over five years under managed care, Rep. Charlie Collins, R-Fayetteville and a chairman of the task force, said after the meeting.

Department Director Cindy Gillespie called the task force "an incredibly important partner working with us in everything that we've done" since she took over the agency on March 1.

"I do feel like we have a wonderful road map, and we have a number of areas where we've not only made progress, but have really great plans to move forward and make progress," Gillespie said.

The Legislature created the task force last year to study and recommend changes to the state's Medicaid program, with a final report due by the end of this month.

Late last year, the task force endorsed Gov. Asa Hutchinson's plan to seek federal approval for changes to the state's private option Medicaid program, as well as his goal to slow the growth of spending in the traditional Medicaid program by enough to save $835 million over five years.

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The savings will be calculated by comparing actual Medicaid expenses to projections that assume a 5-percent annual growth rate.

A 5-percent growth rate would increase total Medicaid spending from $7.5 billion in the state's fiscal 2018, which starts July 1, to more than $9.1 billion in fiscal 2022, The Stephen Group estimated in the draft report.

Changes planned or in the works would reduce spending to $8.9 billion in 2022, saving the state $963 million over the five-year period, the firm estimates.

Those changes include a planned overhaul of Medicaid mental health benefits aimed at reducing the number of people who receive treatment in psychiatric hospitals; caps on speech, occupational and physical therapy for the developmentally disabled; and hiring managed care companies to provide dental benefits.

A proposal being explored by Hutchinson to hire provider-led managed-care organizations to provide Medicaid benefits for the developmentally disabled and mentally ill would save an additional $196 million over the five-year period, while hiring traditional managed care companies to provide those benefits would increase the additional savings to $321 million, according to The Stephen Group.

Metro on 12/15/2016

Print Headline: Spending cuts for Medicaid recommended


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