Razorback Legislators set record straight about Arkansas' failed Medicaid expansion

By Joe Farrer and Bryan King

For the Deseret News

Published: Sunday, June 22 2014 12:00 a.m. MDT

Arkansas Gov. Mike Beebe talks to reporters after speakiing to members of the Delta Grassroots Caucus in Little Rock, Ark., Thursday, June 12, 2014. Beebe said he remains cautiously optimistic that Arkansas will keep its compromise Medicaid expansion alive next year despite the defeat of a legislator who helped design the program.

Danny Johnston, Associated Press

Enlarge photo»

As members of the Arkansas Legislature, we’d like to counter what our colleague, Sen. David Sanders, has said in an effort to convince Utah to implement Arkansas’ failed Medicaid expansion program (“Arkansas alternative to Medicaid expansion succeeding,” May 23). Given Sen. Sanders’ distinction as the architect of the so-called “Private Option” used to implement ObamaCare’s Medicaid expansion, it is unsurprising he would try to get Utah to follow suit.

Sen. Sanders claims that his “Private Option” plan meets the goal of insurance market competition. However, he fails to disclose that in nearly two-thirds of Arkansas counties, the only “competition” is Blue Cross Blue Shield competing against itself. While three carriers are expected to participate in the ObamaCare exchange next year, our state’s insurance department expected three to four carriers to participate all along, long before the “Private Option” was ever devised—it had nothing to do with Sen. Sanders’ “Private Option.”

But even those plans won’t really compete. They must all offer the same Medicaid benefits to the same Medicaid population and must cover the same Medicaid services with the same Medicaid cost-sharing. They can’t compete on value or on price. What is left for them to compete on, other than brand recognition? Competition is a good thing. It’s too bad that the “Private Option” doesn’t really have any.

Sen. Sanders also claims Arkansas hospitals have seen a 30% reduction in uncompensated care. Yet he fails to mention the source for his claims. He bases his argument that the “Private Option” reduces uncompensated hospital care on an informal survey of only half of Arkansas’ hospitals, which did not measure any uncompensated care at all, let alone for the ObamaCare’s Medicaid expansion population. Instead, the informal survey only measured hospital visits and admissions, not whether the visits were paid for by patients, covered by uncompensated charity care policies or written off as bad debt.

Some of the surveyed hospitals saw reductions in the number of ER visits and admissions – among all patients, including the uninsured – while others saw those numbers rise. In addition to serving in the Arkansas House, one of the authors works as director of therapy services at North Metro Medical Center, a small hospital in central Arkansas. While the hospital did not participate in the survey, the numbers are too small and the timeframe too short to make any realistic conclusions about what is happening regarding uncompensated care costs. With hospitals’ accounts receivable waiting times averaging 45 to 90 days for bills to be paid, it’s difficult to imagine a mere 90 days of data providing any conclusive evidence.

Cherry picking participants in an unscientific survey is an irresponsible way to assess public policy. But even if Sen. Sanders were accurately representing this informal survey, there’s no indication that any reduction in uncompensated care will be a lasting benefit. After all, other states that have implemented Medicaid expansions to able-bodied adults have seen uncompensated care increase in the years following expansion.

Sen. Sanders believes the ObamaCare “Private Option” Medicaid expansion has been a success for Arkansas. Other than the fact that Sen. Sanders devised it, it’s hard to see how he can draw that conclusion. The program has less personal responsibility than traditional Medicaid allows. Medical providers are already prioritizing these able-bodied adults over the truly needy patients stuck in a broken, unreformed Medicaid program. In most counties, the promised “competition” is a single carrier competing against itself. Costs are on the rise and already nearly 15% higher than expected. And last, but certainly not least, far more people have signed up than “Private Option” supporters projected.

If running over budget, making access worse for the most vulnerable and trapping hundreds of thousands of able-bodied adults into a system of government dependency is success, we hate to imagine what failure looks like.

Bryan King represents District 5 in the Arkansas State Senate. Joe Farrer represents District 44 in the Arkansas House of Representatives.

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