Measures that would overhaul the mental health benefits provided by the state's Medicaid program and limit its payments for speech, occupational and physical therapy for the developmentally disabled cleared a legislative panel on Thursday.
Meeting jointly, the House and Senate public health committees also signaled their disapproval of a proposal to scrap some other mental health benefits provided by Medicaid.
The measures are part of an effort to meet Gov. Asa Hutchinson's goal of curbing the growth of Medicaid spending by enough to save at least $835 million over five years.
In the fiscal year that ends June 30, spending under the program is expected to total about $7.2 billion, with the federal government providing about 77 percent of the funds.
Under one proposal approved Thursday, the state would provide more options for providers to be reimbursed for home- and community-based mental health services, with a goal of reducing the number of Medicaid recipients who are treated in psychiatric hospitals.
The state would also hire a company to assess Medicaid recipients' needs and assign them to "tiers" based on the severity of their illness.
It would also lift a moratorium, in place since 2008, on new mental health clinics that can receive Medicaid reimbursement.
Under the other approved proposal, the state would limit reimbursement for speech, occupational and physical therapy to 90 minutes a week for each type of therapy.
Patients who need it would be able to receive additional therapy beyond that limit, but would have to obtain approval from a company hired by the state.
The mental health overhaul would save an estimated $77 million a year, while the therapy limits would save about $15.7 million, state Department of Human Services officials said.
"The only thing that saves money in mental health, or behavioral health, is providing services that are easily accessible, that are high-quality, that are targeted to a specific population, and that are provided in a home or community based setting," said Paula Stone, the assistant director for clinical systems at the department's Behavioral Health Services Division.
Both proposals drew objections from some providers and support from others.
Michael Grundy, chief executive of Living Hope Southeast, noted that the Human Services Department expects to save $51 million annually from reduced spending on inpatient psychiatric services, even though almost all admissions result from emergencies.
Living Hope Southeast operates clinics and offers school-based services in Little Rock and Hot Springs and school-based services in Monticello.
Stone said the figure is a conservative estimate based on savings in states that adopted similar measures.
Psychiatric hospitals wouldn't bear the full financial brunt of the reduction because some would be able to receive reimbursement for other services under the proposal, she said.
The committees deemed both proposals "reviewed," meaning they were approved.
If approved by the Legislative Council's Administrative Rules and Regulations Subcommittee and the full council, both proposals will take effect July 1.
In a voice vote, with no members dissenting, the committees decided not to review a proposal to eliminate Medicaid reimbursement, starting in January, to mental health care providers for "collateral interventions," which occur when a provider shares information with a patient's family members or other providers.
That proposal would also reduce the number of times per day a provider can bill for an a face-to-face "intervention" with a patient from six to eight.
The committees' action means that proposal will go to the Administrative Rules and Regulations Subcommittee with an unfavorable recommendation.
Hutchinson has set the $835 million savings goal as a way of ensuring the state will have the money to pay for its share of the expanded Medicaid program that now covers more than 324,000 people.
Saving that much money would reduce Arkansas' spending by about $50 million a year. That is the projected net cost to the state of its expanded Medicaid program in 2020, when its share of the cost for the program will reach 10 percent.
Last month, the Medicaid program limited its reimbursement for group psychotherapy after a report found it spends far more on the service than other nearby states.
Hutchinson is also exploring a plan to reduce costs by hiring provider-led organizations to provide Medicaid benefits to the developmentally disabled.
A Section on 11/18/2016