LITTLE ROCK — Gov. Mike Beebe said Wednesday that expanding the state Medicaid program would be the best way to avoid cuts to nursing care for 10,000 to 15,000 senior citizens and disabled people that his administration proposed to fix the program’s projected shortfall in fiscal 2014.

“From what they tell me, Medicaid expansion would create the kind of freedom all throughout the Medicaid budget to be able to avoid that one, the worst one,” the Democratic governor said.

“But we have got to have some alternative plans because 75 percent [of the votes of 100-member House and 35-member Senate] is particularly hard to get [for the Medicaid expansion], particularly in light of what everybody has said so far,” Beebe told reporters before speaking at the Arkansas State Chamber of Commerce’s annual meeting in Little Rock.

Three-quarters of the state Legislature must approve the measure before it can begin.

Beebe declined to speculate if Republican lawmakers, who have been generally cool to the proposed Medicaid expansion, would support the proposed Medicaid expansion to avoid cuts.

Department of Human Services Director John Selig has said his department tried to minimize the damage done by the cuts, choosing areas that wouldn’t affect children and targeting programs that would cause the least amount of harm possible.

But Sen. Michael Lamoureux, R-Russellville, who will be the Senate’s leader in 2013 and 2014, said he doesn’t believe anybody “thinks we are going to throw old people out of nursing homes.”

“If they are saying, ‘Expand Medicaid or throw old people out of nursing homes,’ that’s a false starting point,” he said in an interview.

“I think we are going to look for how do we solve this. I don’t know what the answer is. But that’s not the answer.”

Lamoureux said he doesn’t believe the Medicaid expansion favored by Beebe is dead.

“I don’t think anything is dead, but I think they are talking about the Medicaid expansion as the answer to the Medicaid shortfall, and I think we have got to talk about those as two separate issues,” he said.

Selig told lawmakers on Tuesday that Arkansas will have to cut $460 million worth of services to 75,000 mostly elderly and disabled Arkansans in fiscal 2014. But he added that Arkansas could avoid the worst of the cuts by expanding its Medicaid eligibility and adding 250,000 people to its rolls with additional federal financing.

About 780,000 Arkansans are already enrolled in the Medicaid program.

The department’s proposed cuts include eliminating level 3 nursing care, which is care for people who are totally dependent on another person for mobility, feeding or using the toilet or people who need limited assistance in two of the categories.

State Medicaid Director Andy Allison said the cut would mean 10,000 to 15,000 senior citizens and disabled people would no longer have nursing care.

In preparation for the Jan. 14 session start, the Legislative Council and Joint Budget Committee on Wednesday referred the state Department of Human Services’ proposed budget for fiscal 2014 and fiscal 2015 to a subcommittee for further discussion at the request of state Sen. Jonathan Dismang, R-Searcy.

“I think we’ll absolutely have some changes to the executive recommendation on these Medicaid proposals,” Dismang said. “I am personally not happy with the recommendation to do away with third tier nursing home coverage, so we will have to find funding somewhere else, or you know, have to make cuts somewhere else.”

Dismang said he’s asked the Bureau of Legislative Research to compile a list of all services offered that are not federally required.

“Everything is on the table and that includes other agencies and programs outside of [the department],” he said.

Beebe said he would work the hardest to try to keep the cuts to level 3 nursing care from happening because “those folks don’t have any other place to go.

“We’ll just work through it, and work with the Legislature to see if we can minimize that,” he said.

House Democratic leader Greg Leding of Fayetteville said he wants to talk to Beebe and Selig about other places the cuts could occur.

“I’m sure just about every agency is going to get a hard look, but I wouldn’t be comfortable right now pointing to a particular agency,” he said.

Leding said Democrats aren’t all excited about the possibility of expanding the Medicaid program, but are willing to consider it as an option.

The department estimates that the eliminated or reduced services would save $130 million in fiscal 2014 and $189 million in fiscal 2015.

The department’s proposed cuts include:

Eliminating level 3 nursing care. According to the department this would save $42 million the first year and $101 million the second year.

Freezing participation in community based services at current levels. These services are used to keep elderly or disabled people in their homes. The move would save $4 million in each of the first two years.

Cutting the rate paid to all Medicaid providers by 3 percent and not adjusting for inflation the flat fees paid to hospitals and institutions. This would save $38 million each of the first two years, according to the department.

Eliminating all adult dental services. Ending service for the 40,000 people who used this part of Medicaid in fiscal 2012 would save $5 million each year.

Eliminating the ARHealth-Networks program, which provides health insurance to about 20,000 people who are self employed or work for small companies. It would save $6 million a year.

Requiring prior authorization for four outpatient rehabilitation services that last more than six hours per day, for a $10 million savings each year.

Requiring prior authorization to provide more than six prescription drugs to a child per month, saving $5 million each year.

Front Section, Pages 3 on 11/15/2012