Arksansas GOP sees benefits of expanding Medicaid (will SC pay attention?)

August 26, 2014

Arkansas disability claims fall 19% after Medicaid expansion
By Paul Demko

The number of Arkansas residents signing up for federal disability benefits has dropped 19% since October 2013, which some state officials are attributing to expanded Medicaid eligibility.

First-time applicants decreased from 17,497 to 14,160 through Tuesday, according to the state’s Social Security determination agency.

Arkansas is providing subsidies to individuals with incomes up to 138% of the federal poverty threshold to purchase private health plans through the exchange, a model of expansion that several other Republican-controlled states are following. More than 190,000 Arkansas residents qualified for the expanded coverage through the end of July.

State Sen. Jonathan Dismang, a Republican who was one of the architects of the “private option” plan, said that he and his colleagues had hoped that expanding Medicaid would reduce the disability rolls. “It’s too early to say with any certainty that that’s the case,” Dismang said. “I think that there’s an indication that there has been an impact.”

Nationwide, 8.4 million individuals receive Supplemental Security Income benefits. That’s up 20% from 7 million a decade ago, according to the U.S. Social Security Administration. In most states, those who qualify for SSI may be automatically eligible for Medicaid benefits, too. There has not, however, been an overall dip in SSI enrollments nationwide; the number of beneficiaries has held steady over the last year.

If Arkansas residents are indeed forgoing disability benefits because they can get healthcare coverage through Medicaid, it would have positive financial ramifications for the state’s budget. That’s because the federal government only picks up about 70% of the tab for healthcare coverage when individuals enroll through the disability program, as opposed to 100% for Medicaid under the Patient Protection and Affordable Care Act through 2016.

Arkansas also seemingly received some welcome news about 2015 premiums for exchange plans. In proposed rates mistakenly posted by the Arkansas Insurance Department (and subsequently pulled down), premiums would decrease by an average of 2%, according to Gov. Mike Beebe’s office. That includes flat premiums proposed by Arkansas Blue Cross and Blue Shield, which captured the largest share of the market. The other two insurers that signed up a significant number of exchange customers, Celtic Insurance Co. and QCA Health Plan, proposed a 12% decrease and a 5% increase in premiums respectively.

Competition is also expected to increase in 2015. All three of those carriers will be offering plans statewide, whereas only Blue Cross and Blue Shield plans were available in all regions of the state during the first open-enrollment period. Under state law, exchange customers must have a choice between plans from at least two carriers.

“We do have a better competitive environment in 2015,” said state Sen. David Sanders, a Republican who is another key supporter of the private option. “This is certainly encouraging news.”

Arkansas has seen the steepest drop in the uninsured rate in the country, according to Gallup, dropping to 12.4% at the end of June from 22.5% before the exchange opened for business.

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