Letter Shows Federal Support For Arkansas' 'Private Option' Continues

Apr 2, 2013

Governor Mike Beebe speaking to reporters about a letter of approval from Health and Human Services Secretary Kathleen Sebelius.
Credit Nathan Vandiver / KUAR

Arkansas has received written approval from the Department of Health and Human Services to forge a new plan to expand health insurance in the state. 

Governor Mike Beebe released a letter from HHS Secretary Kathleen Sebelius Tuesday that said the state should move forward on its loose plan to expand private health insurance coverage with federal money available through the Affordable Care Act.

Our content partner TalkBusiness Arkansas has posted the full letter.

"We will work with you on this innovative approach for Arkansas," Sebelius wrote referencing a March 13 memo submitted by the state to HHS outlining seven benefits of the state's tentative plan which included increased reimbursement payments for healthcare providers, improved continuity of coverage and the option to require co-payments for certain types of services.

Beebe called it a step forward.

“It’s a great letter, it’s what we asked for,” Beebe told reporters.

However the letter is not pre-approval for Arkansas to provide insurance through private exchanges to those in the state making up to 138 percent of the federal poverty level.

"The only way that you're going to get anything final is when they see a final bill, which can't happen until we pass one here," Beebe said.

It will take a 75 percent majority of both the Arkansas House and Senate to fully implement an insurance expansion under the federal law because the state will have to appropriate money received from the federal government. Appropriation bills require a 75 percent majority vote.

Support of the plan is growing after legislative leaders, including Speaker of the House Davy Carter, R-Cabot, and Senate President Michael Lamoureux, R-Russelleville, voiced support for it at the beginning of the week.

“It is a good thing, we have taken what was a horrible hand and turned it into something that the entire country is watching,” Carter said.

Lawmakers amended legislation Tuesday afternoon that would enable the expansion. Sen. Jonathan Dismang, R-Beebe, and Rep. John Burris, R-Harrison, are proposing bills for "Private Option" expansion.

Dismang's amendment calls the bill the "Health Care Independence Act of 2013." It calls for the state Department of Human Services to "utilize a private insurance option for low-risk adults," increase private health insurance options while decreasing government options like Medicaid and place decisions regarding the operation of such a plan with the state rather than the federal government.

The bill also contains a provision requiring enrollees of the program to acknowledge that it is not a guaranteed entitlement. It is scheduled for a hearing in the Senate Public Health, Welfare and Labor Committee Wednesday at 10 a.m.