Two Arkansas lawmakers said Thursday that they want an independent assessment of the cost of the state's expanded Medicaid program.

At a news conference at the state Capitol, Sen. Bryan King, R-Green Forest, and Rep. Joe Farrer, R-Austin, said Optumas, an actuarial consulting firm based in Scottsdale, Ariz., estimated in March 2013 that the monthly cost of providing coverage under the so-called private option would be about $437 per enrollee this fiscal year, which ends June 30.

For next fiscal year, the firm estimated the monthly, per enrollee cost at $466.

The firm later raised its projection of the cost to $477.63 for this calendar year and $500.08 for calendar year 2015.

As of last month, the average monthly per-enrollee cost of the private option had been about $494 since coverage under the program started Jan. 1, according to the Human Services Department.

King and Farrer, both opponents of the expansion of the state's Medicaid program, contended that, with more than 120,000 people enrolled in the private option so far, the state is on track to exceed the original estimated cost for this year by more than $100 million.

They said they want to know what the higher-than-projected spending will mean for the state in 2017 and beyond, when the state will have to pay a portion of the program's cost.

"We need another analysis of this," King said.

He took turns with Farrer holding a sign that read: "$100,000,000 over budget."

"I don't feel like the message is getting out there about the financial problems of the private option," King said.

He said he plans to request a study next month at a meeting of either the Legislative Council or Legislative Joint Auditing Committee, of which he is a chairman. He said he didn't know how much it would cost but added that an organization might be willing to do it without charge.

Sen. David Sanders, R-Little Rock and a sponsor of the legislation creating the private option, called the request for a study a "cheap political stunt."

"All they're concerned about right now is holding up signs and making grossly overstated claims and criticisms in the middle of a primary election cycle," Sanders said.

The expansion of the Medicaid program extended eligibility to adults with incomes of up to 138 percent of the poverty level: $16,105 for an individual, for instance, or $32,913 for a family of four.

Under the private option, most people who qualify receive coverage through private plans on the state's insurance exchange, with the Medicaid program paying the premiums.

In addition, 16,783 newly eligible adults had been assigned to the traditional Medicaid program as of March 31 because they were considered to have exceptional health needs.

The terms of the federal wavier authorizing the private option use Optumas' revised projections to establish a cap on spending during a three-year demonstration period.

The federal government will pay the full cost of providing coverage under the private option as long as the state's spending is below the cap. If the spending exceeds the cap, the state will owe the difference to the federal government at the end of the three years.

However, the wavier allows the state to revise the projected monthly per-enrollee cost if it has information indicating that its projections "may underestimate the actual costs."

Optumas said in a report last month that its original estimates, calculated using Medicaid claims data from July 1, 2009, through June 30, 2012, among other sources of information, were revised after insurance companies filed their proposed premiums last summer.

It said costs have been above its revised projections because the average age of enrollees has been about 39, compared with the firm's estimate of 37.

Aside from higher in premiums associated with the higher average age, costs for the program have been below the revised estimate, Optumas said.

Human Services Department spokesman Amy Webb has said the state will seek an increase in the cap for this year based on the higher age of enrollees.

She said Tuesday that those who have enrolled recently have been younger, resulting in a slight drop of about 23 cents in the average premium paid under the program for May compared with April.

According to Optumas' March 2013 estimates, the cost to the federal government of covering the newly eligible adults will be almost $1.5 billion in the fiscal year that starts July 1.

The firm predicted that increased premium tax revenue, tax revenue generated by increased economic activity associated with federal spending, decreased savings on medical care for the uninsured and other savings will more than offset the state's share of the program until fiscal 2021, when the net cost to the state would be $8.9 million.

Webb said the Human Services Department would cooperate with an outside review of the program, but doesn't think the money for it should come from the department's budget.

Referring to the projections by Optumas, she said: "we've had an independent analysis already that we're quite confident in, and they've already said that our budget is on target."

Metro on 05/09/2014