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Arkansas Medicaid Fight All About The Math, Governor Says

Arkansas Gov. Mike Beebe says his strategy to win over state lawmakers skeptical about continuing the state’s Medicaid expansion is to show them the money.

“It’s arithmetic, it’s not even math,” Beebe said Monday at a media briefing sponsored by Kaiser Health News and Health Affairs. The Democratic governor said if the Arkansas legislature opts against going forward with the expansion, it would leave an $86 million hole in the state budget, and cost the state’s hospitals and employers tens of millions of dollars.

Arkansas is front and center in the national debate over Medicaid. The health law called for all states to expand their programs to anyone earning up to 138 percent of the federal poverty level, which is about $15,856 for an individual and $32,500 for a family of four. But the Supreme Court made the expansion optional, which has led to bitter fights in state legislatures and prodded some states to negotiate with the Obama administration about terms of the expansion.

Arkansas was the first to win federal approval for a strategy known as the private option. It uses federal Medicaid funds from the health law to buy private health coverage for residents who qualify for  the expansion, rather than putting them in the state’s traditional Medicaid program.

The legislature approved the funding last year for the current fiscal year, but members of the House have balked at continuing the private option when the new state budget begins in July 1. Under the state constitution, the state needs 75 percent lawmaker approval for all spending bills.

The Arkansas House will try again this week to pass funding for the Medicaid expansion beyond June 30. Last week, the 100-member House fell about five votes short of the 75 votes needed.  The state Senate approved the funding measure last week.

About 100,000 low-income people are getting coverage under the state’s Medicaid expansion, which began Jan.1. They would lose that coverage if the state does not reauthorize the spending.

The state’s private option strategy has drawn interest from Republican lawmakers in other states, who see it as a way to take the federal expansion money without enlarging their state program. Pennsylvania last week became the latest state to seek federal approval for a private option, although lawmakers in Tennessee, Utah and Florida are also looking at the idea.

Beebe, in Washington for the National Governors Association meeting, said several governors have asked him about the private option.

Both houses in the Arkansas legislature are controlled by Republicans, who are opposed to Obamacare.

“The strategy is to tell them the truth,” Beebe said, adding that he remains hopeful he will be able to get the handful of votes he still needs in the state House.

He said more reluctant governors are slowly coming around on need to expand Medicaid. “A lot of them have awakened to … the arithmetic and the logic of it.”

Beebe said he would not favor shutting down the state government as a negotiating ploy to get the state to expand Medicaid. And he doesn’t plan to give any political favors to cajole individual lawmakers to approve it. “It’s not fair to make deals at the 11th hour unless it benefits the whole state,” he said.

He added that if the state does not continue the private option, it will dramatically reduce the number of people in the state’s Obamacare insurance exchange, which could lead some insurers to pull out and remaining ones to raise premiums next year. “It will have a devastating effect on the exchange prices,” he said.