{"id":22706,"date":"2021-02-17T05:08:27","date_gmt":"2021-02-17T05:08:27","guid":{"rendered":"http:\/\/arknews.org\/?p=22706"},"modified":"2021-08-28T11:21:15","modified_gmt":"2021-08-28T16:21:15","slug":"after-biden-nixes-work-requirements-arkansas-explores-new-path-forward-for-medicaid-expansion","status":"publish","type":"post","link":"https:\/\/arknews.org\/index.php\/2021\/02\/17\/after-biden-nixes-work-requirements-arkansas-explores-new-path-forward-for-medicaid-expansion\/","title":{"rendered":"After Biden nixes work requirements, Arkansas explores new path forward for Medicaid expansion"},"content":{"rendered":"

Arkansas will not request a continuation of its controversial \u201cwork requirements\u201d policy when it applies for federal approval to renew Arkansas Works, the state\u2019s Medicaid expansion program, according to a spokesperson for the state Department of Human Services.<\/span><\/p>\n

But in a proposal floated by DHS in recent weeks to Arkansas lawmakers, the state may request to shift to a new work \u201cincentive\u201d program. Those who participated would be able to enroll in private health insurance plans on the Arkansas Health Insurance Marketplace; those who did not would instead be covered directly by the Medicaid program.<\/span><\/p>\n

The state\u2019s Medicaid work requirements program, the first of its kind to be implemented anywhere in the nation, has been suspended since a federal judge halted the policy in March 2019. <\/span>The U.S. Supreme Court is scheduled to hear oral arguments in an appeal of that case next month.<\/span> But regardless of the outcome, the Biden administration informed states on Friday<\/a> that it will no longer allow Medicaid work requirements.<\/span><\/p>\n

\u201cIt\u2019s not a surprise that the Biden administration has changed the policy from the Trump administration,\u201d said Governor Hutchinson, who has long trumpeted work requirements as a key component of Arkansas Works. He said his administration was working closely with legislators on a proposal to continue the Medicaid expansion program with \u201csome new elements that will help in heath care outcomes but also in terms of responsibility for the recipients. We\u2019ll have to do that in a way that will get approved by the Biden administration. That\u2019s a work in progress.\u201d<\/span><\/p>\n

Work requirements were widely viewed as an important political tool for gaining Republican support in the legislature to continue the Medicaid expansion program. But despite the Biden administration nixing the policy, Senate President Pro Tempore Jimmy Hickey (R-Texarkana) said that he anticipated the legislature will re-authorize the Medicaid expansion in some form. Hickey supported the work requirements, but losing the policy was not a deal-breaker, he said.<\/span><\/p>\n

While continued coverage for more than 300,000 low-income Arkansans appears secure, that still leaves the question of how the program will be designed. Currently, under the state\u2019s unusual version of Medicaid expansion, most beneficiaries are covered by private plans. Some longtime opponents of Medicaid expansion are now backing a measure to maintain coverage but use fee-for-service Medicaid instead.<\/span><\/p>\n

\u201cI\u2019ve been adamantly opposed to Medicaid expansion from the get-go but at some point in time, you\u2019ve got to realize you\u2019ve lost that battle,\u201d Rep. Josh Miller (R-Heber Springs) said. \u201cUnless Congress changes something, Medicaid expansion is here to stay in Arkansas. If we\u2019re gonna do it, let\u2019s do it the most fair and economical way possible.\u201d<\/span><\/p>\n

DHS spokesperson Amy Webb confirmed that the agency has presented a new proposal in private meetings with lawmakers to use the private Marketplace plans as an enticement to encourage work, education and related activities. The proposal, part of a slate of new policies for Medicaid expansion dubbed \u201cARHome,\u201d would offer a carrot instead of a stick. Webb said that discussions about the policy were ongoing and fluid. \u201cAt this point, they are just drafts, nothing\u2019s final,\u201d she said.\u00a0<\/span><\/p>\n

In 2018, the Trump administration granted a waiver of federal Medicaid rules to allow the work requirements program in Arkansas. Beneficiaries were required to report their hours worked each month to DHS; if they were not working, they could instead report participation in job training programs, job searches or certain approved volunteer activities. If beneficiaries failed to comply, they would be kicked out of the program and lose coverage. Over the course of 5 months, more than 18,000 Arkansans lost their health insurance due to the policy before it was halted by the federal courts.<\/span><\/p>\n

Under the new proposal, no one would lose coverage altogether. Instead, beneficiaries \u201cengaging in work, education, or other activities that will lead to long-term economic independence\u201d would \u201cearn the incentive\u201d of a private plan, according to a DHS document about the plan shared with lawmakers. The theory behind the incentive is that beneficiaries will prefer a private plan because it could offer better access to more health care providers than Medicaid (some providers do not accept patients on Medicaid because the program reimburses them at significantly lower rates than the private plans).<\/span><\/p>\n

The use of private plans as the incentive is outlined in PowerPoint presentations that DHS has given to lawmakers, but Webb said that approach was subject to change. The ultimate design of the proposal could take a different form, she said.<\/span><\/p>\n

\u201cWe have been presenting ideas, proposals, and options to lawmakers,\u201d Webb said. \u201cWe\u2019re not looking to put a work requirement in but we are looking at how we can use work and education \u2014 and other things that would help move people out of poverty and improve their economic independence \u2014 as incentives.\u201d<\/span><\/p>\n

The Private Option and the Arkansas Medicaid expansion<\/h3>\n

As presented, the ARHome proposal would represent a major shift to the state\u2019s unique approach to Medicaid expansion, often referred to as the \u201cPrivate Option.\u201d<\/span><\/p>\n

The Affordable Care Act, passed under the Obama administration, expanded Medicaid eligibility to adults who make less than 138 percent of the federal poverty level (an annual income of $17,774 for an individual or $36,570 for a family of four). But a ruling by the Supreme Court offered states a choice about whether or not to expand the program.\u00a0<\/span><\/p>\n

After a protracted legislative fight, Arkansas moved forward with Medicaid expansion in 2014 via the Private Option, enacted in part to secure the support of Republican legislators. The policy required a waiver of Medicaid rules, which was approved by the Obama administration. Instead of expanding coverage using the state\u2019s traditional Medicaid program, which pays medical providers directly for services (\u201cfee-for-service\u201d), the Private Option used Medicaid expansion funds to purchase private health insurance plans on the Marketplace for eligible low-income Arkansans.<\/span><\/p>\n

The program, later renamed Arkansas Works, has undergone a series of alterations in the years since it was first implemented, but it has retained this feature: Nearly all beneficiaries are covered by private plans (the ten percent of beneficiaries with the highest medical needs are instead covered by the traditional, fee-for-service Medicaid program).<\/span><\/p>\n

Under the ARHome option presented to some lawmakers in recent weeks, this unusual feature of the program would instead be incorporated into a new reward program for work, education or other activities. In practice, that would mean a larger group of beneficiaries would wind up in traditional, fee-for-service Medicaid.<\/span><\/p>\n

Rep. Deborah Ferguson (D-West Memphis), vice-chair of the House Public Health committee, who has been briefed on the proposal, expressed skepticism that Medicaid beneficiaries would be motivated by a private plan. \u201cThere is no incentive on the patient side,\u201d she said.\u00a0<\/span><\/p>\n

Ferguson also worried that there wouldn\u2019t be sufficient outreach or support services in place. She pointed out that the monthly reporting obligation under the old work requirements program had very low participation. Most beneficiaries were exempt from reporting their hours; among those required to report, <\/span>only a small fraction did<\/span><\/a>, despite the threat of losing coverage. (Even <\/span>among beneficiaries who were working,<\/span><\/a> many <\/span>had no idea there was a work requirement at all<\/span><\/a> or <\/span>had trouble navigating the system<\/span><\/a> to report hours.)<\/span><\/p>\n

\u201cIf last time is any indication,\u201d she said, few would participate in the incentives program. \u201cAnd the ramifications were much worse then \u2014 you got kicked off health care altogether.\u201d<\/span><\/p>\n

Legislative approval<\/h3>\n

The annual appropriation bill that includes the Medicaid expansion program requires a 75% majority in both chambers of the legislature for approval. That has led to <\/span>nail-biting drama<\/span><\/a> in past years. But the consensus at the Capitol is that the continuation of Medicaid expansion in some form will pass this year with relative ease, said Sen. Jim Hendren (R-Gravette), who chaired a Health Reform Legislative Task Force that recommended the continuation of the program under Arkansas Works in 2016.<\/span><\/p>\n

Hendren supported the work requirements, but losing that element shouldn\u2019t kill the program, he said. Particularly in the midst of a pandemic, Hendren said, there isn\u2019t an appetite even among previous opponents of Medicaid expansion to fight to end the program altogether.<\/span><\/p>\n

\u201cRight now, the argument is more about the method of Medicaid expansion, rather than the existence of Medicaid expansion,\u201d Hendren said. \u201cWhich is really quite a transformation.\u201d<\/span><\/p>\n

Hendren views Arkansas Works as a success and supports continuing the use of private plans in the program. But some right-wing lawmakers who fiercely opposed the Medicaid expansion in past legislative sessions are now pushing to move the entire program to cover people directly by Medicaid. <\/span>A bill filed<\/span><\/a> by Rep. Miller would maintain coverage for the eligible population via fee-for-service Medicaid but do away with the Private Option mechanism that covers people via private plans.<\/span><\/p>\n

Why would longtime opponents of Medicaid expansion like Miller push this change? They believe that it would save the state and the federal government a significant amount of money. Buying a private plan costs more than covering someone with Medicaid, Miller said. The Private Option, he argued, uses taxpayer money to bolster profits for insurance companies.<\/span><\/p>\n

If the state is going to cover low-income adults, it should do so in a more cost-effective way, he said, paying the same reimbursement rates to providers that are used to cover other beneficiaries in the pre-expansion Medicaid program, such as disabled Arkansans.<\/span><\/p>\n

Miller recognizes the irony that a self-described \u201craw-boned, conservative, Republican redneck from Cleburne County\u201d is now proposing that Arkansas shift from the GOP-backed Private Option to the traditional Medicaid expansion program as outlined in President Obama\u2019s Affordable Care Act. \u201cBut I strongly believe that Arkansas is messing up by continuing to do it this way,\u201d he said. \u201cWe\u2019ve wasted a lot of the taxpayers\u2019 money in the last seven years. We\u2019re the only state in the union that does [the Private Option]. Is that because we\u2019re so much smarter than all the other states? I don\u2019t think that\u2019s the case.\u201d Asked about the new DHS proposal, Miller said that he would not support any version of the program that continued to pay for private Marketplace plans.<\/span><\/p>\n

Economic impacts<\/h3>\n

The federal government pays for 90% of the costs of insuring the Medicaid expansion population, with the state picking up the rest of the tab.<\/span><\/p>\n

DHS projects that insuring beneficiaries with fee-for-service Medicaid, which reimburses providers at lower rates, would cost less than paying for private plans, which reimburse at the same commercial rates as other plans on the Marketplace. (This represents an about-face from the state\u2019s rationale for the Private Option in 2013; the federal government approved the original waiver under an agreement that claimed costs would be equivalent between the Private Option and traditional Medicaid expansion.)<\/span><\/p>\n

However, DHS also projects that the additional federal money coming in from the Private Option component of the program has an outsized economic impact on the state, including a boost for struggling rural hospitals.<\/span><\/p>\n

\u201cWe\u2019re looking at the big economic picture when we make this proposal,\u201d said Webb, the DHS spokesperson.<\/span><\/p>\n

Moving everyone covered by the current Arkansas Works program to fee-for-service Medicaid, as under Miller\u2019s bill, would significantly reduce federal and state Medicaid spending, DHS projects \u2014 by nearly $4 billion altogether over the next five years. But keeping the private plans in place would also bring in certain tax revenues for the state, offsetting some of the additional state costs, according to the DHS projections. All told, those factors could even make sticking with the Private Option a net gain for the state budget versus switching to Miller\u2019s plan.<\/span><\/p>\n

For backers of keeping the Private Option in place, the additional federal spending is a feature, not a bug, because it means more funding flowing into the state and its health care system. \u201cI think the Private Option has been extremely successful, and you have to consider the whole macroeconomic impact,\u201d Ferguson said.<\/span><\/p>\n

The higher reimbursements offered by private plans are a boon to providers and hospitals in the state, Ferguson said, and could be a determining factor for the survival of rural hospitals. Those higher reimbursements could also lead to better access to more health care providers for beneficiaries, she said. And adding so many people to the Health Insurance Marketplace, Ferguson argued, helps to stabilize that market and keep premiums lower for individuals using the Marketplace to shop for private health insurance plans.<\/span><\/p>\n

The ARHome plan could be an effort not just to incorporate remnants of work encouragement in the wake of Biden forbidding requirements, but also to split the difference between spending critics like Miller and supporters of keeping the Private Option element in place like Ferguson. State and federal Medicaid spending would be lower under ARHome than under the current Arkansas Works program, but DHS projects that the plan would still bring $3 billion more in federal spending into the state than Miller\u2019s plan. A slide presented to lawmakers explains, \u201cARHome is designed to slow spending growth while maintaining tax revenues and federal funding.\u201d<\/span><\/p>\n

\u201cWe know that $3 billion in federal spending has a positive economic impact on the state, and we want to look at that as well as the costs,\u201d Webb said.<\/span><\/p>\n

Arkansas Works to ARHome?<\/h3>\n

The federal waiver agreement for Arkansas Works expires at the end of this year. Hickey, who supports the general framework of ARHome, said that a bill to enact the DHS plan for a new Medicaid expansion waiver could be filed as soon as the end of next week.<\/span><\/p>\n

In addition to the idea of using private plans as an incentive for work and related activities, DHS has presented lawmakers with other potential options for the ARHome proposal. Possibilities include an increase in cost-sharing charged to beneficiaries, potentially up to 5% percent of their family income; mechanisms to cap the cost growth of private plans used for the Medicaid expansion; and new initiatives for rural health care, maternal and infant health, behavioral health and chronic disease. Once it secures legislative approval for a path forward, DHS plans to send a request for a new waiver to the Biden administration by this summer.<\/span><\/p>\n

Sen. Bob Ballinger (R-Ozark), once one of the most vocal opponents of expanding Medicaid in the state, said that it is unrealistic to unwind a program providing coverage for hundreds of thousands of Arkansans now that it has been in place for more than seven years. He anticipates supporting its continuation this legislative session. He said that he was open to moving toward a fee-for-service Medicaid model like in Miller\u2019s bill, but was generally inclined to continue the use of private plans because of the economic benefits for hospitals, providers and the insurance market.\u00a0<\/span><\/p>\n

Ballinger had not yet heard about the hybrid proposal to use private plans as an incentive for work or education, but expressed some skepticism.\u00a0<\/span><\/p>\n

\u201cI don\u2019t really know what kind of incentive that is for the average person who\u2019s wanting to get their health care coverage,\u201d Ballinger said. He also worried about the bureaucratic complexity of such a program that moved people between Medicaid and private health plans. \u201cWhen you get people switching back and forth, that\u2019d be a problem,\u201d he said. \u201cIt sounds like a lot of my constituents could be getting booted off, looking for ways to get back on, and get caught in the system.\u201d<\/span><\/p>\n

As for work requirements, Ballinger said that broad support for the policy remained in the legislature. He said that it may well be taken up again if a future president gave the okay.\u00a0<\/span><\/p>\n

Whether that option will be on the table could depend on the Supreme Court. If the work requirements case moves forward, the Court is expected to rule by June, but <\/span>the future of the case is uncertain.\u00a0<\/span><\/a><\/p>\n

The Biden administration might argue that the case is now moot, because it is no longer allowing the policy. However, last-minute agreements<\/a> signed by the Trump administration and officials in certain states, including Arkansas, <\/span>could slow down the process<\/span><\/a> for the Biden administration to officially withdraw the waiver for work requirements, giving the Supreme Court time to rule on the case. A ruling from the Court could set a precedent that would ease the path for a future administration to grant work requirements, even if the Biden administration does not.\u00a0<\/span><\/p>\n

Critics have <\/span>questioned the legality<\/span><\/a> of those agreements, and the Biden administration sent letters to states rescinding them. Would Governor Hutchinson challenge an effort by the Biden administration to withdraw the waiver on a more expedited basis? The governor referred the question to DHS. \u201c<\/span>We received the letter from [the federal Centers for Medicare and Medicaid Services] late Friday and are reviewing it as well as reviewing our options moving forward,\u201d Webb said.<\/span><\/p>\n

This reporting is courtesy of <\/span><\/i>the Arkansas Nonprofit News Network<\/span><\/i><\/a>, an independent, nonpartisan news project dedicated to producing journalism that matters to Arkansans.<\/span><\/i><\/p>\n","protected":false},"excerpt":{"rendered":"

Arkansas will not request a continuation of its controversial \u201cwork requirements\u201d policy when it applies for federal approval to renew Arkansas Works, the state\u2019s Medicaid expansion program, according to a spokesperson for the state Department of Human Services. But in a proposal floated by DHS in recent weeks to Arkansas lawmakers, the state may request […]<\/p>\n","protected":false},"author":6,"featured_media":22707,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[22,111],"tags":[195,113,71,321,16,304,320,118,114],"class_list":["post-22706","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-arkansas-general-assembly","category-health-care","tag-arkansas-department-of-human-services","tag-arkansas-works","tag-bob-ballinger","tag-deborah-ferguson","tag-jim-hendren","tag-jimmy-hickey","tag-josh-miller","tag-medicaid-expansion","tag-private-option"],"yoast_head":"\nAfter Biden nixes work requirements, Arkansas explores new path forward for Medicaid expansion - Arkansas Nonprofit News Network<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/arknews.org\/index.php\/2021\/02\/17\/after-biden-nixes-work-requirements-arkansas-explores-new-path-forward-for-medicaid-expansion\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"After Biden nixes work requirements, Arkansas explores new path forward for Medicaid expansion - Arkansas Nonprofit News Network\" \/>\n<meta property=\"og:description\" content=\"Arkansas will not request a continuation of its controversial \u201cwork requirements\u201d policy when it applies for federal approval to renew Arkansas Works, the state\u2019s Medicaid expansion program, according to a spokesperson for the state Department of Human Services. 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Politico wrote that his \\u201creporting for the Arkansas Times on his state\\u2019s unusual Medicaid expansion approach set the tone of a national conversation.\\\" He was named to the Washington Post's 2015 list of best state political reporters. 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Politico wrote that his \u201creporting for the Arkansas Times on his state\u2019s unusual Medicaid expansion approach set the tone of a national conversation.\" He was named to the Washington Post's 2015 list of best state political reporters. 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