Friday, March 1, 2013

Fwd: qotd: HHS approves private plans for Arkansas Medicaid patients

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-------- Original Message --------
Subject: qotd: HHS approves private plans for Arkansas Medicaid patients
Date: Fri, 1 Mar 2013 11:14:11 -0800
From: Don McCanne <>
To: Quote-of-the-Day <>

The Washington Post
February 28, 2013
Arkansas's unusual plan to expand Medicaid
By Sarah Kliff

The Medicaid expansion has emboldened Republican governors to strike all
sorts of deals with the Obama administration. They're willing to make
the program larger, the thinking tends to go, only if they can make it
more conservative in the process.

The most interesting deal though may be coming out of a state with a
Democratic governor: Arkansas. There, Gov. Mike Beebe must get 75
percent of his legislature to sign off on any funds necessary for the
Medicaid expansion — a tough sell when Republicans control both the
state House and Senate.

What the legislature could be sold on, they told the governor, was this:
Using billions in federal Medicaid dollars to buy private health
insurance coverage for the state's lowest income populations.

To the surprise of many — Beebe included — Health and Human Services has
given that plan the go-ahead.

Keep in mind, this is really different from what Florida did. There,
Gov. Rick Scott received a waiver to move nearly all of the state
Medicaid recipients into a Medicaid health plan, run by a private
company, to manage their care.

What Arkansas is doing is using Medicaid dollars and sending people to
the private health insurance exchanges, where they will shop for a plan
like millions of other Americans expected to receive subsidies.

A private insurance plan tends to be more expensive than Medicaid. The
Congressional Budget Office estimates the difference between the two,
for an individual, is $3,000.

Right now, that doesn't matter for Arkansas: The federal government will
pay 100 percent of the costs for the Medicaid expansion up until 2017.
But after that, the match drops to 10 percent — and then the price tag
for coverage does have an effect on the Arkansas budget.

I asked (Beebe spokesman Matt) DeCample why buy the more expensive
health plans, which will ultimately cost their state, and the federal
government, more money.

"These policies are going to be pricier than strictly through Medicaid
expansion," he replied, "But this is the kind of option that our
legislature asked us to look for. Our primary hope is that, we can do
this, and this is one way to pursue it."

Comment: Did I get this right? Health and Human Services has granted
Arkansas a waiver to allow Medicaid dollars to be used to purchase
private health plans in the state insurance exchange, even though they
are much more expensive (and have more limited benefits than Medicaid).
And they are doing this only so that state legislators can brag about
using private insurers for a public program.


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