Post-election, what will happen to the Arkansas Medicaid alternative?

March 18th, 2015

While sweeping Republican wins in the House and Senate will most certainly mean headaches for Affordable Care Act implementation, it could also spell trouble for state-level healthcare initiatives such as Medicaid.

In addition to federal government majorities, Republicans now control both chambers of legislatures in 29 states. Republicans gained two governorships for a total of 31, and five Republican gubernatorial re-elections mean that the change for Medicaid expansion in Georgia, Florida, Wisconsin, Kansas, and Maine are all but dead.

In particular, the Arkansas Medicaid experiment is in jeopardy. The so-called Private Option plan was crafted with bipartisan support in the Arkansas legislature and outgoing Democrat Gov. Mike Beebe, and implemented in 2013. The plan uses federal Medicaid funds from the ACA for qualified low-income Arkansas residents to purchase private health insurance. Enrollees get the benefit of a greater network of physicians and hospitals, while hospitals and doctors receive greater compensation for care than through traditional Medicaid. The plan has more than 200,000 enrollees, and has been studied by other states for possible adoption.

But the plan has its share of detractors. Conservative opponents who oppose any Medicaid expansion campaigned to put an end to the plan. Republican Governor-elect Asa Hutchinson has not taken an official position on the plan beyond saying he will assess the costs and benefits. Continuing funding for the program will be an uphill battle, as 75% majority of the legislature is needed for annual reauthorization. After this election, the votes aren’t there for a “simple continuation” of the program, says Republican state Sen. David Sanders, who is also a co-sponsor of the plan.

It could be disastrous for a state that has had success with the plan to decide to discontinue funding. In addition to costing the state millions of dollars, physicians and hospitals will lose money due to less compensated care. And the backlash from more than 200,000 residents who would suddenly find themselves without health coverage could spell electoral doom for lawmakers.