Private Option Amendments Advance In Legislature

Feb 13, 2014

The Joint Budget Committee on Thursday
Credit Chris Hickey / KUAR News

Changes to the Private Option are making their way through the Arkansas legislature.  On Thursday, the Joint Budget Committee approved new language in the program’s fiscal bill.  It involves the state seeking federal approval for establishing Health Savings Accounts, increasing the number of adults who must share health costs and tweaking how much non-emergency transportation will be provided to people enrolled in the private option. At the meeting, State Representative John Burris said there would be a hard deadline for attaining approval.

“We will have input beginning in August, and then a final submission in September,” said Burris. “If there’s no approval by September, according to all the terms and conditions of the law, the drawdown begins, with an absolute cutoff date of February 1st”

Burris indicated that he’s confident the federal government will support the plans, but said the private option would end if they aren’t approved.

“The give on the flipside is that there is a window to fix. But that window is just a situation that none of us want to wind up in,” he said, noting it was “responsible.”

While questioning Burris on the amendments, State Representative Hank Wilkins explored the possibility of Arkansas not getting the federal waivers, potentially leaving the legislature with a big problem.

"Don’t you think a March 1 date would be better than a February 1 date?” asked Wilkins

“It depends on your perspective,” Burris replied.

“In terms of time of letting the legislature address the issue, two weeks?” said Wilkins, pointing out that lawmakers normally begin convening in the second half of January in odd numbered years.

“I think my intent with this and I think the legislature’ intent was to create a situation where there was an incentive for the federal government to agree with us,” Burris said.

Under Burris’s amendment, Arkansas would seek federal approval to apply greater cost-sharing among enrollees. Right now, private option participants living at 100-138 percent of the Federal Poverty level must pay for part of their health coverage. The state is preparing to extend that requirement down to people living at 50 percent and up.

Arkansas is also formulating a plan to create Health Savings Accounts for private option enrollees. Both the cost sharing and the Health Savings Account plans were written into the original legislation passed last spring. Burris said implementing those changes were intended to be part of the “phase two” of the rollout. The new amendments approved on Thursday imposed strict deadlines and triggers for rescinding the private option altogether.

Requirements for providing Non-Emergency Transportation to enrollees would also be affected, though it isn’t yet certain how. Burris said officials at the Department of Human Services are still working out what kind of waiver they’ll seek from the feds of the transportation issue. Arkansas is following Iowa (which implemented a Medicaid expansion plan similar to that of Arkansas’s private option) in seeking a waiver on non-emrgency transit.

State Senator Stephanie Flowers of Pine Bluff questioned Department of Human Service Director John Selig about that program, asking if it was already in place around the state. Selig replied that it was and that the DHS hires contractors to provide the transportation. Flowers mentioned the Area Agency of Aging in her district, saying “they depend on that money” through contracting with DHS.

Flowers was the only Democrat to vote against Burris's amendment in committee, joining a handful of Republican lawmakers who appear committed to stop funding the private option. Nate Bell’s amendment to cease funding for all promotional aspects of the program and the health insurance exchange also advanced as part of the DHS Division of Medical Services budget bills. House and Senate leaders say the funding bills for the private option could go up for a vote next week.