More than 250,000 Arkansans who make about $15,000 a year or less will be able to purchase private health insurance using federal Medicaid money under a bill that gained final legislative approval Thursday.
The Senate voted 27-5 to approve Senate Bill 1020 by Sen. Jonathan Dismang, R-Searcy - the Health Care Independence Act of 2013.
The House gave final approval to an identical bill, House Bill 1143 by Rep. John Burris, R-Harrison, on Wednesday night, enabling the state to expand its healthcare programs.
On Wednesday, legislators also gave the Department of Human Services authority to spend the hundreds of millions of dollars that will be needed to run the program.
Gov. Mike Beebe will sign the bills at 9:30 a.m. Monday in the Governor’s Conference Room of the Capitol in Little Rock. Arkansas is the first state to propose such a model.
Whether to approve the program, known at the Capitol as the “private option,” has been one of the most contentious issues of the session.
The estimated 250,000 eligible low-income Arkansans would use federal funds to purchase insurance plans from private companies in a marketplace called an exchange along with more than 200,000 Arkansans who would pay for their own insurance.
The private-option idea surfaced after the U.S. Supreme Court last June struck down part of the federal Patient Protection and Affordable Care Act and let states choose whether to extend Medicaid access to individuals who earn up to 138 percent of the federal poverty level, or $15,145 annually. The Affordable Care Act also calls for states to set up private-insurance marketplaces - called exchanges - from which people can pick their own insurance plans.
Arkansas lawmakers proposed the private option as an alternative to adding that group to Arkansas’ traditional Medicaid program, which faced a shortfall estimated at as much as $300 million at the beginning of the legislative session. That shortfall estimate has been reduced to $61 million, and leaders say it could be resolved by passing the private option, which would draw hundreds of millions of additional federal dollars to Arkansas.
Kathleen Sebelius, the secretary of the U.S. Department of Health and Human Services, said in March that Arkansas could craft its private-option model, though the federal government has not given outright permission. Sebelius has said she’ll review the precise details of the Arkansas model once it has been approved by lawmakers.
Some lawmakers dislike the private option because they’ve opposed the Affordable Care Act since the beginning. Others say they don’t want Arkansas to accept billions to implement the program and add to the federal debt.
Supporters argue that the state can recraft the Medicaid expansion provision and at the same time shield the state from some of the health-care act’s other effects. They question how the state can turn down health care for a quarter-million uninsured Arkansans - and the hundreds of millions of federal dollars that come with it.
Bill sponsors said they were driven to pass a bill in order to mitigate the effects of the Affordable Care Act.
“I think we protected the state, protected our citizens, put together a good plan that the [federal government needs] to say yes or no to, and that’s where it is,” Burris said.
Some House members said they voted for the legislation because of how some businesses would be affected if lawmakers don’t provide insurance access for the state’s low-income population.
A March 13 study by the Jackson Hewitt Tax Service estimated that some Arkansas businesses that don’t provide health insurance would be hit with $26 million to $38 million in federal penalties if their employees sought subsidized insurance in the state’s online health-insurance exchange.
Sen. Paul Bookout, D-Jonesboro, was the only Democrat named as a co-sponsor on the enabling Senate legislation.
“We’ve worked hard together and put aside party issues… and really tried to do what we’re elected to do and sent down here to do and that’s to do the right thing, and I think we did that and I’m so proud,” Bookout said. “I think once this is implemented, beginning the first of next year, in time, we’re going to see some great benefits for Arkansans and that’s what we’re supposed to be here doing.”
Democrats, who are in the minority this session for the first time in 138 years, unanimously supported the legislation. They largely let Republicans debate one another about the proposal’s merits.
Sen. Joyce Elliott, D-Little Rock, said she saw the private option as a chance for Arkansas to have the financial means to help more people.
“It just provides us with a unique opportunity to do something for the quality of life for people in this state and people who never assumed they would have any opportunity to have any kind of health coverage,” Elliott said. “This kind of puts us in the 21st century of caring about our people and acting on that caring in a way we’ve never had the opportunity to do before.”
Some Republicans had asked for more time to consider the private option. They said the weeks between learning the private option was a possibility and passage of the bills wasn’t enough time to flesh out the program. They wanted to wait to authorize spending until the federal Health and Human Services Department approves the private option in writing and offers more details about federal involvement in the program.
“The private option may be our best bet,” Rep. Richard Womack, R-Arkadelphia, said. “But the fact of the matter is nobody knows, and I could never get an answer to the question of why we can’t wait.”
Rep. David Meeks, R-Conway, said he still has concerns and will pay close attention to how the bills are implemented.
“This is not the end. This is the beginning. We are going to have to watch this thing like a hawk, we’re going to have to make sure that it’s implemented like we think it should be,” Meeks said.
The lawmaker said it’s little comfort that legislators can revisit the issue in the fiscal session next February, because the insurance coverage begins Jan. 1.
“You could potentially already have a couple hundred thousand people before we even get a chance to vote on it again, and if it’s not what we want, it’s going to be hard to say no because you’re going to have a couple hundred thousand people that are going to have health insurance. And like any government program that’s got folks on it, you don’t want to kick them off,” Meeks said.
Front Section, Pages 1 on 04/19/2013