Officials propose health savings accounts, transportation limits for Arkansas Medicaid plan



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LITTLE ROCK, Arkansas — Many participants in Arkansas' compromise Medicaid expansion would be required to contribute monthly to health savings accounts and would face new limits on transportation for non-emergency services under proposals the state detailed Friday.

The Department of Human Services released its proposed changes to the state's "private option," which was created last year as an alternative to expanding Medicaid under the federal health law. The state is now collecting public comment and has scheduled two hearings next week as it prepares to submit the plan to the federal government next month.

Lawmakers earlier this year required the state to win approval for the changes by Feb. 1 in order to keep the program alive. Under the private option, Arkansas is using federal funds to purchase private insurance for thousands of low-income residents. More than 176,000 people are enrolled in the program.

Arkansas was the first state given federal approval for such a compromise approach, touted as a model for other Republican-leaning states to implement a key part of the federal health overhaul.

The biggest change proposed to the program is the creation of "independence accounts," a form of health savings accounts, for some participants in the program to help cover copayments, coinsurance and deductibles under the program, with the state contributing money it's receiving through the private option into the account as well. The state is promoting the idea as a way to encourage financial responsibility for participants, many of whom have never had insurance before the private option.

"The primary goal is centered around education and teaching individuals how health insurance works," said Suzanne Bierman, director of coordination of coverage for the state's Medicaid program.

The required monthly contributions will depend on income level, with those above 100 percent of the poverty level putting in between $10 and $25 a month. Those with incomes between 50 percent and 100 percent of the poverty level contributing $5 a month. The state will also contribute funds to the accounts.

Under the plan, participants will accrue $15 in rollover funds for each month they contribute to their accounts on time, capped at $200, which they can use to offset future premium payments or contributions to employer-sponsored insurance if their income rises and they're no longer eligible for the private option.

The accounts expand the cost-sharing that the private option requires of some participants. Currently, participants above 100 percent of poverty face some copayments and coinsurance.

The plan also calls for limiting participants to eight trips per year for non-emergency transportation, with exceptions allowed on a case-by-case basis. The private option currently doesn't place a limit on the number of times participants can receive non-emergency transportation.

The state is seeking the changes as uncertainty remains about the future of the private option. Reauthorizing the program will require a three-fourths vote in the Legislature next year.


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