Arkansas Works enrollees who don't catch up on their unpaid health insurance premiums will have the money taken out of any state income tax refunds they might otherwise be owed when they file their tax returns in 2019, state officials said Monday.
The premiums of $13 a month have been charged since January to participants in the state program with incomes between 100 percent and 138 percent of the poverty level.
For an individual, that income range is $12,060 to $16,643 a year.
Out of the more than 300,000 Arkansans enrolled in the program, more than 62,000 were required to pay premiums as of early this year, state Department of Human Services spokesman Amy Webb said.
Only about 20 percent of enrollees who are required to pay premiums do so on a regular basis, she said. The others owe premiums totaling about $8 million, she said.
"Very early on we talked about this as one option to recoup funds, if individuals didn't pay their premiums," Dawn Stehle, the Human Services Department's deputy director for health and Medicaid, said in an email.
The requirement for some enrollees to pay premiums is one of several changes to Arkansas' expanded Medicaid program that took effect Jan. 1, when the program became known as Arkansas Works.
To cut costs, the state has requested federal approval to move enrollees with incomes above the poverty level off the program and impose a work requirement on some of the remaining enrollees, starting in 2018.
Federal officials had not ruled on the state's request as of Monday, Webb said.
The expansion, which took effect in 2014, extended Medicaid eligibility to adults with incomes of up to 138 percent of the poverty level.
Under the so-called private option, most Arkansas Works enrollees are covered by private insurance plans, with the state Medicaid program paying most or all of the premiums.
When an enrollee fails to make a premium payment, the state Medicaid program pays the insurance company on behalf of the enrollee, who then incurs a debt to the state, Webb said.
The department's chief counsel, David Sterling -- in a memo dated Thursday to department Director Cindy Gillespie -- noted that the terms of the waiver allow the state to attempt to collect unpaid premiums from enrollees.
The state is prohibited from employing some collection methods, such as garnishing an enrollee's wages or placing a lien on an individual's home. But "tax refund interception is not among those [methods] expressly prohibited," Sterling wrote.
Enrollees who failed to pay premiums for three or more consecutive months in 2017 will receive notices next year with information on how to pay the debt. The notice will also give the enrollees an opportunity to appeal the determination that they owe premiums and present proof of payment, he wrote.
Any outstanding debt will be turned over to the Department of Finance and Administration by Dec. 1, 2018, to be subtracted from the enrollees' 2018 state income tax refunds.
Reductions of income tax refunds are also used to collect other types of debts, such as unpaid child support, said Scott Hardin, a spokesman for the Finance and Administration Department.
He said the state won't charge interest on the unpaid premiums, and the collection method will kick in only when an enrollee would otherwise be owed a tax refund. The department won't attempt to collect the premium debt from those who owe taxes when they file their returns, he said.
Metro on 12/19/2017