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The limits of the Arkansas option

I’ve mentioned the Arkansas option for expanding Medicaid several times, under which the state uses Medicaid money to buy private health insurance for those who would be eligible for Medicaid under the Affordable Care Act. It’s not my preferred solution, but it has some merits and would certainly be better than doing nothing. However, while the federal government has shown a great deal of flexibility in allowing an arrangement like this and like what is on the table in Florida if their legislature doesn’t deep-six it, that flexibility has its limits, as the state of Tennessee found out.

It’s constitutional – deal with it

Tennessee wanted to pursue a plan like that of Arkansas, one where it would use the Medicaid expansion dollars to buy private insurance coverage. And while Arkansas received a preliminary go-ahead from HHS, Gov. Bill Haslam had a quite different experience: He says that Health and Human Services would not support his plan to expand Medicaid and, as a result, he will not move forward.

“As a result of the lack of clarity from HHS,” his office said in a late Wednesday statement, “the governor will not ask the General Assembly for approval to accept the Medicaid expansion federal funds as he continues to work for the flexibility needed to implement his plan.”

Haslam told local reporters that the Obama administration didn’t reject the entire proposal. “Of our request to Medicaid,” he said, “we got one or two yes’s, one or two no’s, and a whole lot of I don’t knows.”

[…]

But some of the other points in the Tennessee proposal might have raised eyebrows in the Hubert Humphrey Building. The governor proposed “co-pays for those who can afford to pay something.” As for what that would mean in practice, Andy Sher at the Chattanoga Times Free Press reports that the governor wanted Medicaid beneficiaries to pay the same cost-sharing as other exchange enrollees.

Medicaid experts I’ve spoken with have made it clear that such an approach wouldn’t fly: Even if they receive private coverage, the Medicaid agency would need to ensure they aren’t spending more out of pocket than they would in the public plan.

Officials in Arkansas agree with this interpretation, too. “Medicaid definitely has strict rules for people below the poverty line and then they issued some new rules this year, for people above the poverty line,” Arkansas Medicaid spokeswoman Amy Webb told me last month. “We still believe those apply, and we intend to follow those.”

I bring this up because while there has been some talk about the “Arkansas solution” among Texas Republicans, what they’re really talking about is more akin to the Tennessee proposal. Specifically, “copays, deductibles and premium payments on a sliding scale for poor patients, using asset testing to ensure services are going to people who truly need them” are among the items Rick Perry and his ideological cohorts are demanding. The shell bill filed by Rep. John Zerwas that would direct HHSC to negotiate with the Obama administration over a “Texas solution” includes this language, though it’s not clear to me if it’s an option or a requirement. If it’s the latter, I think we now know how these negotiations are going to go.

The point I’m trying to make here is that we need to pay attention to the contents of HB 3791 and listen carefully to what people like Rep. Garnet Coleman have to say about it. If the final bill includes demands for things that the feds have already categorically rejected, then we need to be aware of that up front. Because if it does contain such a requirement, then we need to be prepared for when Rick Perry claims that he “tried” to negotiate with the Obama administration but they were too inflexible and unwilling to compromise so we can call it out for the BS that it is. If Texas negotiates in good faith, the feds have shown that they can be very accommodating. If not, we shouldn’t be surprised when the negotiations fail, and we shouldn’t let the state claim that they made a legitimate effort. Perry and his cronies have made it abundantly clear that they really, really don’t want to expand Medicaid. We should take them at their word and not be distracted by side issues.

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  1. […] I mention that Perry would make bogus claims about the feds not negotiating in good faith? Why yes, I did. It’s really very simple – Perry, Dewhurst, Abbott, Cornyn, Cruz, the poo-flinging […]

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