By JOHN HOFHEIMER
Leader senior staff writer
The private-option healthcare alternative to Medicaid expansion passed the Senate Friday morning.
Although the bill enabling private-option health insurance for 250,000 working class Arkansans passed 24-9 in the Senate, it may be in trouble. While that vote is sufficient to pass the enabling legislation on to the House, it would not meet the three-quarters threshold to pass an appropriations bill to fund it.
The appropriations bill must be approved by 27 of the 35 senators and 75 of the 100 state representatives.
Among those voting against the bill were Senators Jane English (R-North Little Rock) and Eddie Joe Williams (R-Cabot). All Senate Democrats voted for the bill, sponsored by Sen. Jonathan Dismang (R-Searcy) and supported by the governor.
So unless three more votes can be found in the Senate, private option healthcare insurance may not pass this session.
It is possible that arms could be twisted, or that voting against the enabling legislation would give political cover to those Republicans who could claim at the next general election to have voted against the bill, while still authorizing the appropriation. Or some may be using their votes for leverage on tax cut proposals they favor.
NO HORSE TRADES
Asked Friday afternoon about the chances of passing the appropriations bill for the private option Dismang said, “I’m not going to try to handicap how folks will vote. I don’t horse trade.”
“I gave them as much information as possible. I’ve not asked for votes on this bill, we’ve discussed the impacts on the state.
“We’ll be considering the identical House bill about next week,” said state Rep. Mark Perry, D-Jacksonville. He said that there might be some senators holding out until they get a couple of bills passed they want in a tax package.
Perry said the House would consider an identical house bill HB1143 “probably next week.”
“We’re going to have a compromise on a package of tax cuts in exchange for the (private) option,” Perry said. “We’re working on that right now.”
“The biggest hurdle for this expanded insurance coverage is the passage of a bill allowing us to spend the federal money for the private option in Arkansas,” Beebe said in his weekly radio address.
“That type of appropriation measure requires 75-percent approval from both houses of the General Assembly. It is not an easy threshold to reach, and we continue to share information and work to convince more and more of our lawmakers that this is the best option for our working poor. In order to take full advantage of the money made available to us, this decision must occur in these final weeks of the legislative session.”
The bill allows the state Department of Human Services to set up a program to use federal Medicaid expansion dollars to pay for private health care coverage under the federal government’s Affordable Care Act, often called Obamacare.
A LOT OF E-MAIL
“I’ve been answering a lot of e-mail from 9 p.m. until 3 this morning,” according to Rep. Douglas House (R-North Little Rock). Private option is “the lesser of evils,” he said.
By going the private route instead of just expanding Medicaid, the state can cut out a lot of fraud, waste and cruelty. He called the existing Medicaid program “a walking disaster.”
Rural and small town hospitals — including North Metro at Jacksonville — are faced with going under unless Medicaid expansion or the private option go into effect.
“North Metro is comfortable either way,” he said. “Rural hospitals are telling us they will go bankrupt within a year,” without some sort of help, House said.
Hospitals in Searcy, Conway, Batesville, Fort Smith and Jonesboro have said that without help, they will have to merge or close.
“Obamacare is like a bad disease we’ve inherited,” he said. “Let’s make the best of a bad situation.
He said the current private-option proposal is a testimony to bipartisan cooperation. “It’s so encouraging. Gov. Beebe has been magnificent.”
“I read the proposal,” said state Rep. Patti Julian (D-North Little Rock). “It’s pretty much what you’d expect…very dry.”
She said the bill was includes a lot of definitions and authority, but no money.
“It’s up to the insurance department to set up the policies,” she said. “We’re just moving forward with the framework.”
SHRINKS MEDICAID
“I voted against the measure because of concerns about the long-term costs and because many of my constituents oppose it,” Sen. Williams said Friday.
Arkansas would be the first state in the union to propose a private option model for the uninsured. The option would provide them private health insurance rather than adding them to government Medicaid rolls.
However, rather than simply expand the Medicaid program, the Senate voted to use federal funds to pay for private health insurance for low-income families.
“The Arkansas Medicaid program will shrink because SB 1020 will transfer low-income families and others covered by government Medicaid to a private insurance carrier,” Williams said.
Meanwhile, this week, tax cut legislation advanced in both chambers of the General Assembly.
The House Committee on Revenue and Taxation advanced HB 1585 to reduce state income taxes. It would cut the state’s 7 percent income tax rate to 6.875 percent on taxable income of $44,000 and above. The 7 percent rate now applies to taxable income of $34,000 and up.
The current 6 percent rate applies to taxable income from $20,400 to $33,999 and HB 1585 would apply it to taxable incomes of $20,400 to $43,999. It would become effective for tax year 2014.
The bill would reduce state general revenue by $28.6 million in fiscal year 2014 and $57.2 million in fiscal 2015, according to the state Department of Financial Administration.
Also, the committee advanced HB 1966 to lower capital gains taxes. It would create a 70 percent exemption for any net capital gains and Arkansas-based businesses after Jan. 1, 2014.
