JONESBORO, AR (KAIT)- Arkansas legislators are proposing a new health coverage plan that would enroll newly eligible low income Arkansans in private insurance plans, rather than use federal money to expand Medicaid.
The State of Arkansas has received preliminary approval from the federal Department of Health and Human Services to use Medicaid expansion funding in a different way that allows for low-income Arkansans to receive health coverage using private insurance. The plan is known as the Health care Access Assurance Program Act of 2013.
"Basically having a private insurance plan that those individuals which equals about 250,000 in Arkansas and include elderly, children and those working but cant quite afford insurance, but they do qualify for Medicaid," said Sen. Paul Bookout (D-Jonesboro).
Last year, the Supreme Court made Medicaid expansion optional to the states under the Affordable Care Act. Some states decided to opt in while others hold back. But Arkansas volunteered another option.
"What we are going to do is people are going to be able to sign up for a private insurance plan, they can select which plan they want to do and the federal Medicaid money will flow to the plan that they chose," he said.
Senator Bookout said this third option was a compromise between both parties.
"The political reality is that the straight expansion of Medicaid directly was not going to get enough support in the Arkansas legislature to pass," Bookout said.
He said he gives a lot of credit to Governor Beebe for pitching this plan in Washington.
"He made a really good argument and to the federal governments credit, they are willing to give us a lot of flexibility , which was going to allow us to something other than just Medicaid."
Representative Harold Copenhaver issued a statement saying: This plan is the best option for Arkansas because it allows insurance companies to still be economically competitive. It would would still meet the requirement of the Affordable Care Act.
The coverage plan would be geared towards a new section of people that don't already qualify for Medicaid. The legislature is expected to be introduced next week. Expanding Medicaid under the Affordable Care Act could potentially add as many as 250,000 Arkansans to the roll.
"It's going to be great for Arkansas, there is going to be a lot of cost-savings involved in Healthcare. There is going to be a lot of money saved in uncompensated care," Bookout said.
Senator Bookout said the federal government would pay the full cost and the state would gradually take on a share of that cost until 2020. Then, the state would be responsible for 10 percent of the Medicaid money but if the percentage exceeds10 percent they do have the option to opt out.
"We are looking to do something that really no other state is doing but we feel like this is a positive step forward for Arkansans in a good fiscal responsible," he said.