We must give Gov. Hutchinson credit for searching high and low for a way to bring recalcitrant legislators in his party along for the ride to provide everyone, including the poorest Arkansans, good medical care when they get sick.
But as the governor’s own self-imposed deadline for finding a solution approaches, everything he does to salvage medical insurance for some 260,000 Arkansans at the bottom of the economic ladder seems to make matters worse or else more complicated and self-defeating.
That includes his bungled directive to cancel coverage for tens of thousands of the very poor who do not quickly give the government new up-to-date evidence of their financial straits and a string of half-baked ideas for reducing Medicaid costs and forcing people with very low incomes or their employers to bear more of the insurance costs.
But we must go back to Hutchinson’s first ringing statement about Arkansas’ health-care reform after a year of electioneering during which he gave no clue about what he would do about it. As he took office, he called the benefits from the state’s innovative way of implementing the central feature of the Affordable Care Act (aka Obamacare) “facts that we cannot deny, should not deny, and should rejoice in.” Clearly, he wanted to continue the program that his party called “the private option” and felt the state needed badly to do it for budget as well as humanitarian reasons.
Knowing that the big Republican majority in both houses of the legislature now carried enough foes of the so-called “private option” that they could kill it, he asked them to continue it for just one year. Meantime, he, health-care experts and the legislators would come up with ways to improve or replace it. What he meant, obviously, was make enough changes in the program that it could be called a Republican program, not really Obamacare, which remains immensely unpopular for its namesake if nothing else.
The biggest feature of Obamacare for Arkansas was the expansion of Medicaid to cover adults whose family incomes were so low that they could pay no part of insurance premiums—a number estimated at near 300,000.
A few Republican leaders in the 2013 legislature suggested that Arkansas exercise the option to do that, but rather than place all those people in the traditional Medicaid program, where the government pays hospitals and clinics directly for treating poor or disabled people, they proposed that the poor buy private insurance policies like most other people and government pay their premiums. Only the very sick would be covered by traditional Medicaid. Gov. Mike Beebe and the Obama administration bought the private option, and the legislature enacted it.
By January 2015, when Hutchinson took office, the program’s success was manifest: 260,00 Arkansans were covered for the first time, desperate community hospitals and the big medical institutions found themselves no longer in trouble, health-care jobs increased, disability rolls declined, the state uninsured rate fell from 22 percent (one of the nation’ highest) to 9 percent (one of the nation’s lowest), and the state treasury found itself in such clover from hundreds of millions of new federal dollars and insurance taxes that the legislature cut nearly everyone’s taxes. But the program’s future was suddenly bleaker because a number of Republicans who ran against Obama and the private option were elected to the legislature.
Playing to that crowd (who, really, could fault the strategy?), Hutchinson instructed the Department of Human Services to send form letters to everyone on the Medicaid rolls who didn’t have up-to-date income data in the files or whose income on current government data seemed to have changed a little. If they didn’t reply with solid evidence in 10 days their insurance was canceled. Hutchinson said he expected 50,000 people to be cut off, which seemed likely to mollify the foes of Medicaid at least a little.
But the agency was in such turmoil that it couldn’t process those who did get the mail and respond quickly and thousands who plainly qualified for Medicaid lost their insurance. What the governor and the agency did went far beyond what the Affordable Care Act and older Medicaid rules anticipated or allowed to assure the integrity of the program.
It was an unfortunate blunder and there doubtless will be a lawsuit that will require the state to correct it. The greater danger lies in what Hutchinson proposes to do to make the big Medicaid program palatable to enough of his party’s extremists to continue it at a special session this fall or winter or the fiscal session in January.
The high-powered corporate consultants that they hired for a million dollars to tell the state what’s wrong with the private option produced a report last week that did the opposite. Rather than placing an intolerable burden on the state’s taxpayers in 2017 and beyond when the state must start sharing Medicaid costs, the program actually will make the treasury even more flush than it has been because the federal aid and tax receipts from the Medicaid expansion will far outweigh the state’s costs. But the foes of the private option aren’t likely to be mollified.
So Hutchinson tossed out a few ideas for changing the PO that he was thinking about. Among them: Deny medical benefits to people who are out of work, force very low-income workers to get on their employer’s insurance plan if there is one and have the government pay some of the premium for them, make people who earn slightly more than poverty wages to pay premiums, make people apply for jobs or work training to qualify for medical assistance, eliminate payments to transport poor people to the hospital or doctor, force people into unpopular managed-care plans, lower Medicaid reimbursement rates (already the lowest) to doctors and hospitals, or just shift people off the private option to straight Medicaid as Obamacare originally expected.
Some of those ideas aren’t workable because they violate the law, like denying medical access to people who are out of work. The rest do little to make the program more efficient or else just add to Medicaid’s bureaucratic complexity. The governor has fresh reasons not to do that. We hope he’s inspired by better ideas. Too much depends upon it. — Ernie Dumas
