State's budget, expanded Medicaid unsettled as session wanes

Legislative leaders said Wednesday that they hope to wrap up this year's fiscal session by the end of next week, but lawmakers' to-do list includes approving an appropriation for the Medicaid expansion program for the coming fiscal year and completing negotiations on the state's proposed revenue budget.

As to the Medicaid program, one senator said he expects to meet Monday in Little Rock as part of a group of senators with an administrator from the U.S. Centers for Medicare and Medicaid Services.

Whatever that official from President Donald Trump's administration says could prove crucial to clearing a path to end the fiscal session.

A spokesman for Gov. Asa Hutchinson referred a question about whether Seema Verma, administrator of the U.S. Centers for Medicare and Medicaid Services, will be in Little Rock on Monday to a spokesman for the federal agency. That federal agency spokesman didn't reply to a written question by Wednesday afternoon.

The state is seeking a waiver from the Trump administration so it can impose a work requirement on many of its 280,000 enrollees in the Medicaid expansion, called Arkansas Works. The state also seeks permission to reduce the program eligibility threshold from 138 percent of the poverty level to 100 percent.

That latter step is projected to cut about 60,000 people from the health insurance program. This year, the income cutoff of 138 percent of the poverty level is $16,753 for an individual or $34,638 for a family of four.

Hutchinson, a Republican, has said he hopes the federal government approves the work requirement for Arkansas Works by the end of this fiscal session.

Sen. Gary Stubblefield, R-Branch, said some senators plan to meet Monday with Verma or her assistant director because they want to learn more about the state's proposed work requirement for Medicaid expansion enrollees.

Stubblefield is among several state senators who have said they're undecided on whether to vote for the appropriation for the state Department of Human Services' Medical Services Division. The appropriation includes spending authority for Arkansas Works in fiscal 2019, which starts July 1.

The appropriation is Senate Bill 30, which would grant $8.2 billion in spending authority to the Medical Services Division. The bill is in the Joint Budget Committee. Arkansas Works is projected by the department to cost $135.6 million in state funds and about $1.95 billion in federal funds in fiscal 2019. The state is required to pay 6 percent of the cost of the program this year, 7 percent next year and 10 percent in 2020 under federal law.

Twenty-seven votes are required in the Senate for approval of appropriation measures, but the Senate has 32 members with three vacancies. The 100-seat House has one vacancy.

It's been difficult to get a three-fourths vote in the House and the Senate each year since the Medicaid expansion was authorized in 2013 by the Republican-controlled Legislature and then-Gov. Mike Beebe, a Democrat. That's because the Medicaid expansion has deeply divided Republicans.

Stubblefield said he wants to meet with the administrator from the Centers for Medicare and Medicaid Services in part because "I want to confirm that and make sure that somebody is not going to be able to keep their [health insurance] policy without having to at least go to school, work so many hours or get job training, at least get job training.

"I want to make sure that is in writing," he said.

Hutchinson spokesman J.R. Davis said the proposed work requirement does what Stubblefield wants, because many Arkansas Works enrollees will be required to work, volunteer, go through work training or attend school 20 hours a week.

Stubblefield said he also wants to make sure that Arkansas' proposed work requirement is as tough as the one in Kentucky.

Davis said Arkansas' proposal is more restrictive than those in other states because, the proposal says, an enrollee removed for failing to comply with the work requirement wouldn't be able to get back in the program until the next calendar year.

Sens. Ron Caldwell, R-Wynne, and Scott Flippo, R-Mountain Home, said they're also among several senators who haven't made up their minds on their vote on the Medical Services Division's appropriation. They also want more information before deciding how they'll vote.

"We have been saying since the beginning of the session that we are hopeful that the Trump administration would approve some parts of the waiver prior to the end of the fiscal session," Senate Republican leader Jim Hendren of Sulphur Springs said Wednesday.

"I think we will be hearing something next week that will hopefully make people understand that we're moving in the right direction, and give them the comfort that they need," he said.

"We'll see if it is enough. If not, we'll deal with it," said Hendren, whose uncle is Hutchinson.

Hendren said he doesn't have 27 committed votes in the Senate for the Medical Services Division appropriation.

"I guess I'm an optimist. I'm still confident that we'll get there. I just can't imagine us finishing a fiscal year without a budget, and I would hope that we would not have to come back [in a special session] and do it and that we can get it done next week," he said.

"There are still some people who haven't committed and still have some questions that want to be answered," Hendren said. "I think [the vote] will be close, but I'm still optimistic."

Senate President Pro Tempore Jonathan Dismang, R-Searcy, said he hasn't done a vote count on the Medical Services Division's appropriation.

"There is some interest in the waiver and what the feds are going to do. That's kind of what they are waiting on right now," he said. He said he assumes the Senate will vote on the appropriation early next week.

Dismang said work has started on negotiating with the governor on the proposed Revenue Stabilization Act for fiscal 2019. The act, passed each fiscal year, sets spending priorities for state government.

The president pro tempore said members would receive information this week and early next week.

Sen. Larry Teague, D-Nashville, said the proposed Revenue Stabilization Act probably will be placed on the desks of lawmakers Monday.

The proposed budget "will be basically what the governor proposed, I think," said Teague, who is a co-chairman of the Joint Budget Committee.

The committee's other co-chairman, Rep. Lane Jean, R-Magnolia, said, "There may be a little tweaking on the Medicaid [budget], depending on what happens Monday."

Hutchinson has proposed a $172.8 million increase in the general revenue budget to $5.62 billion in fiscal 2019 with most of the increase going to the state Department of Human Services. He's also proposed setting aside $64 million in general revenue that he considers to be surplus.

He wants to place $48 million of the surplus in a restricted reserve fund to be used in an economic downturn and to help finance future tax cuts. Another $16 million of the surplus would help match federal highway dollars.

The Legislature is expected to meet in special session right after the fiscal session ends.

Dismang said he expects the special session that Hutchinson calls to begin on Monday or Tuesday after the fiscal session ends.

Today is the 18th day of the fiscal session. The previous four fiscal sessions ranged from 25 days in 2010 to 38 days in 2014.

A Section on 03/01/2018