The Department of Human Services (DHS) runs the Medicaid program in Arkansas. Medicaid and Medicare are different programs. Medicaid is a program that helps pay for medically necessary medical services for needy and low-income persons. It uses state and federal government money. Medicare is federal health insurance. It pays for medical services for aged and disabled persons.
For additional information about Medicaid in Arkansas, please visit the Arkansas Medicaid website.
Private Health Insurance for the Medicaid Expansion Population
As part of the Patient Protection and Affordable Care Act (ACA) that President Barack Obama signed into law in 2010, states now have the option to expand their Medicaid programs so that the programs provide health coverage to people making up to 138 percent of the federal poverty level. The federal government will pay 100 percent of the costs for the expansion in 2014, 2015 and 2016, and then slowly decrease the portion it pays to until it is at 90 percent federal funding and 10 percent state funding.
Arkansas Medicaid Director and health care economist Andy Allison completed a detailed analysis and overall summary of the impact of implementing the ACA with expansion and determined it would actually save the state money. There are three general reasons the state would save money: 1.) Some of the populations the Medicaid program covers today at a 70 percent federal funding/30 percent state funding rate would be 100 percent federally funded for the first three years of expansion. Eventually, that percentage would shift to 90 percent federal funding and 10 percent state funding, which remains much lower than the current funding rate; 2.) The state currently spends tens of millions of dollars on health care each year for the uninsured, also called "uncompensated care." Expansion would reduce the state's uncompensated care costs significantly; and 3.) Nearly a billion dollars in new federal money will be paid to local health providers, much of which would be subject to state income tax. The result would be millions in new state general revenue.
The potential savings is not the only benefit of expansion. Arkansas families, individuals and communities also stand to gain. About 215,000 uninsured adult Arkansans would receive health care under expansion, creating a healthier and more productive workforce. In addition, local hospitals and providers facing high uncompensated care costs will become more financially stable as they see those costs diminish. A recently-released study by the RAND Corporation shows that increased health coverage through expansion also will save an estimated 1,100 lives every year. More information on the impact of expansion on individuals, families, communities and the state can be found here.
(Feb. 26) Update: U.S. Health and Human Services Secretary Kathleen Sebelius said existing Medicaid rules allow Arkansas to place people who would fall under Medicaid expansion in the private insurance market. Governor Mike Beebe proposed this approach at a meeting with the Secretary at the request of state Legislative leaders. In addition to the benefits outlined above regarding expansion, this approach also would 1.) Reduce administrative burden and costs associated with this population because the state would not have to manage these health plans, 2.) Provide less disruption in services for people who would have moved between Medicaid and private insurance because of a change in income, and 3.) Would almost double the number of people on the exchange, making the exchange more attractive to carriers and potenially increasing competition in the health insurance market. To see the letter Medicaid Director Andy Allison sent to the Centers for Medicare and Medicaid Services detailing Arkansas's approach, go here.
(March 18) Update: Legislators and others asked DHS to analyze the impact of placing the expansion population in the private insurance market. These estimates show that the financial impact would be significantly less than expected. Since the March 18 release, DHS and its actuaries have published additional information to further explain the estimates.
(March 27) Update: DHS released a more detailed analysis showing the assumptions and dollar figures that support the estimate released earlier this month.
(April 2) Update: Governor Mike Beebe has received a letter from Health and Human Services Secretary Kathleen Sebelius expressing conceptual support for Arkansas's private option for expanding insurance coverage to the Medicaid expansion population. The letter cames less than a week after HHS released additional guidance to states about this approach.
(April 18) Update: The Health Care Independence Act and related appropriation bills have cleared both the Arkansas House and Senate, allowing the state to move forward with the private option for Medicaid expansion. Governor Beebe is set to sign the bills on Monday, April 22.
Office of Long Term Care
Below are the current services and programs offered by the Division of Medical Services. Click the name of the service for a link to additional information and related website links.