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Arkansas Medicaid rolls top 317,000 in August

Month’s enrollment 9,400 in state by Andy Davis | September 23, 2016 at 5:45 a.m.

More than 9,400 Arkansans completed enrollment in the state's expanded Medicaid program last month, raising the total to more than 317,000, according to numbers released Thursday by the state Department of Human Services.

The enrollment total as of Aug. 31 included 294,246 Arkansans who were enrolled in the state's so-called private option and 23,043 who were assigned to the traditional, fee-for-service Medicaid program because their health needs were considered to be exceptional.

The total number of Arkansans covered by the expanded Medicaid program as of Aug. 31 was likely even higher because the figures released Thursday didn't include people who had been approved for coverage and were being covered under the fee-for-service Medicaid program because they had not completed enrollment.

For example, figures released by the Human Services Department in June showed that as of April 30, more than 292,000 Arkansans had been approved for coverage under expanded Medicaid, but only about 283,000 had completed enrollment.

"We're looking constantly at the numbers and the costs, and I think what they speak to is the importance of reform," Gov. Asa Hutchinson said Thursday.

In a letter to Hutchinson on Thursday, Department of Human Services Director Cindy Gillespie said an effort to clear out a backlog of pending applications contributed to the growth in private-option enrollment.

The enrollment figures are being watched because Arkansas will have to start paying a portion of the cost of the expanded Medicaid program for the first time next year.

The state's share will start at 5 percent in 2017 and increase every year until it reaches 10 percent in 2010. The federal government will pay the rest of the cost.

The state has budgeted $1.7 billion for the expanded program during the fiscal year that ends June 30, including $43 million in state funds.

When Arkansas expanded Medicaid eligibility in 2014 to adults with incomes of up to 138 percent of the poverty level, state officials predicted about 250,000 Arkansans would qualify.

In an application in June to extend the federal waiver authorizing the private option, state officials projected about 272,000 Arkansans would enroll by 2021.

Hutchinson attributed some of the enrollment growth to employers shifting low-income workers from job-based coverage onto Medicaid.

He said he hopes to discourage that through Arkansas Works, a program that, if approved by the federal government, will give subsidies to participating small businesses that cover low-income workers.

In a Sept. 15 letter, Hutchinson asked Gillespie to develop projections on the cost of the Medicaid program over the next five years by Oct. 15.

He also directed her to lead an effort with Insurance Commissioner Allen Kerr and Arkansas Health Insurance Marketplace Director Cheryl Gardner to develop a plan for the "long-term sustainability" of Medicaid, including the traditional program and expanded parts of the program.

Hutchinson's letter set a May 30 deadline for the plan, which should account for the rising cost of insurance on the state's health insurance exchange.

While a legislative task force is also exploring possible changes to the Medicaid program, Hutchinson said Thursday that the interagency effort will be "much more broad" than the cost-cutting measures being considered by lawmakers.

"It's looking very deep into the system as to whether we need to have additional reforms," Hutchinson said.

That includes work requirements that he hopes will be allowed under the next U.S. president and "flexibility for continually monitoring" the eligibility of Medicaid recipients, he said.

Created by the Legislature last year, the Health Reform Legislative Task Force in December endorsed a goal by Hutchinson to reduce the growth of spending in the traditional Medicaid program by $835 million over five years.

Sen. Jim Hendren, R-Sulphur Springs and a chairman of the task force, said he expects the Legislature during next year's session to take up cost-cutting options that the task force will recommend by the end of this year.

The session will likely include a continuation of the debate over whether to hire managed care companies to reduce the cost of Medicaid benefits for the mentally ill and disabled, he said.

"To try to trim several hundred million out of any program over the next four or five years isn't going to be easy, but it needs to be done," said Hendren, who is Hutchinson's nephew.

In the meantime, the Human Services Department is preparing an overhaul of the rules for high-cost Medicaid programs benefiting the mentally ill and disabled.

Hutchinson said in the letter to Gillespie that it's "critical" that those changes are approved by the Legislature this fall and take effect in July 2017.

The income cutoff for eligibility under expanded Medicaid varies by household size. For instance, an individual could make up to $16,394, while parents with two children could earn up to a combined $33,534.

Under the private option, most people who enroll in the expanded Medicaid program receive the coverage through private plans sold on the state's insurance exchange. The Medicaid program pays the premium and provides additional subsidies to reduce or eliminate the enrollees' out-of-pocket costs for medical care.

According to the figures released Thursday, the average payment to insurance companies last month was $480.62 per enrollee, down from $481.35 in July.

In addition to subsidizing job-based coverage, the Arkansas Works program would charge premiums of about $13 a month to certain enrollees, refer enrollees to work training programs and offer dental coverage as an incentive to enrollees who visit a primary-care doctor.

Enrollees who are charged premiums would also have to pay the premiums to qualify for dental coverage.

A Section on 09/23/2016

Print Headline: Medicaid rolls top 317,000 in August

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