Asa's Plan for Arkansas? Keep Obamacare's Medicaid Expansion Forever

(Photo by Win McNamee/Getty Images on Forbes.com)

by Jonathan Ingram and Josh Archambault, Forbes.com: . . . Governor Asa Hutchinson (R-Arkansas) announced his position on the state’s Obamacare Medicaid expansion. Gov. Hutchinson gave a speech at UAMS . . . Governor Hutchinson said he will let the Private Option waiver expire in two years and setup a task force to study Medicaid reform during that time. That could be seen as a small victory for taxpayers. After all, the GAO has reported that the Private Option-style approach is nearly $1 billion more expensive than traditional Medicaid expansion. But in the end, it’s a line without a hook.

Hutchinson said his administration, with the help of the task force, will come up with a new “alternative coverage model” to continue the Obamacare expansion. This means – absent any changes to the proposal – the state’s expansion will never go away, leaving taxpayers on the hook and hundreds of thousands of Arkansans dependent on government.

Do Nothing, Part 1: Keep the “Private Option” For Two More Years
The first major component of Hutchinson’s plan is to continue the “Private Option” waiver until December 31, 2016. But the waiver – which didn’t create the expansion, but simply gives Arkansas permission to place Medicaid expansion enrollees into Obamacare exchange plans – is set to expire automatically on December 31, 2016. In real terms, the plan changes nothing about the Private Option.

By continuing the program for another two years, Gov. Hutchinson and the legislature would also guarantee Obamacare lobbyists two more years to entrench, making future repeal even more difficult.

Do Nothing, Part 2: Keep Medicaid Expansion Forever
While Gov. Hutchinson said he would let the Private Option waiver expire in 2016, he never promised to actually repeal the Medicaid expansion. In fact, the entire purpose of his recommended “task force” is to design an “alternative coverage model” for Medicaid expansion enrollees.

Simply rebranding Medicaid isn’t a solution. Voters didn’t sweep Republican legislators into their largest majorities since Reconstruction on the promise of changing how Medicaid expansion is implemented. They swept them into office to repeal the expansion altogether.

Obama Administration Thanks Hutchinson For Protecting Medicaid Expansion
Gov. Hutchinson has been having closed-door meetings with the Obama administration on what to do with Arkansas’s Medicaid expansion program. In his remarks today, Hutchinson said he is very encouraged that HHS has demonstrated a willingness to work with Arkansas – a similar refrain to what conservatives were told in 2013 before the Medicaid expansion was rammed through the legislature.

Gov. Hutchinson read aloud from a letter penned by HHS Secretary Burwell. What did Obama’s top Medicaid official write?

Secretary Burwell wrote that she was, “pleased to learn of [Hutchinson’s] commitment … to coverage for the newly covered adults beyond the current three year term” of the Private Option waiver.

As the letter indicates, the Obama administration is thrilled that Gov. Hutchinson and legislators could forego a historic opportunity to start unwinding Obamacare. And they’re eager to help him save the Medicaid expansion, however they can.

Hutchinson’s Plan Creates More Division
In his speech, Gov. Hutchinson expressed prudent concern that the Private Option Medicaid expansion has “divided the state and dominated the debate.” He’s right. But his proposal does nothing to bridge that divide. Instead, it will perpetuate the division.

By protecting the “private” component of the Private Option for two years and keeping Medicaid expansion forever, Hutchinson is setting the stage for the same brutal fights that have dominated legislative sessions during the past two years.

A new crop of legislators were sent to Little Rock on the promise of repealing the Medicaid expansion disaster. It will be a tough task for Hutchinson to ask those legislators to vote for a plan that does the exact opposite, breaking explicit promises they made to their constituents.

If Gov. Hutchinson wants his first major act as governor to waste political capital in an effort to save Obamacare’s Medicaid expansion, that’s his decision. But if Medicaid expansion has divided the state and if Hutchinson is truly committed to healing the rift, the only real solution is to repeal it completely and immediately.
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Jonathan Ingram ( @ingramlaw) is research director and Josh Archambault ( @JoshArchambault) is a senior fellow at the Foundation for Government Accountability.

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