Category Archives: Legislature

Health insurers want to raise prices. What now?

Health care, Legislature, Politics, U.S. Congress

By Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

The big news in health care this week was that most of the state’s insurers are asking for rate increases for policies purchased individually or through the state’s Arkansas Works program.

The bigger issue – rising health care costs, and the political system’s inability to address them – is not new.

The two Blue Cross providers are asking for 14.7 percent increases, while QualChoice Life and Health and QCA Health Plan are asking for increases of just under 24 percent. The state’s fifth insurance company, Ambetter, is asking for less than 10 percent and is not required to publicly disclose or justify that amount. The sixth insurance company, UnitedHealthcare, unable to make a profit, is leaving the market.

The Arkansas Insurance Department still must approve the requests. Commissioner Allen Kerr sounded skeptical in a statement released by his office.

There are many reasons for the requested hikes. I’ll summarize those given by Arkansas Blue Cross spokesperson Max Greenwood. Patients are using more health care than expected. Costs are rising, particularly for prescription drugs and catastrophic claims of more than $50,000. The Affordable Care Act’s transitional reinsurance fee, which offset higher cost enrollees, is going away.

One other factor pertains to Arkansas Works, the program formerly known as the private option that uses federal funds to purchase private insurance for lower-income Arkansans. Remember last year when we learned many people living out of state, or not living at all, were being covered? When that was more or less fixed, Blue Cross lost a population of 25,000 members whose premiums were being paid but who didn’t use much health care, especially the dead ones. So now the insurer says it has to adjust.

Of course this all happens in the context of Obamacare. Sen. Tom Cotton, Rep. French Hill and Rep. Bruce Westerman released statements calling once again for the Affordable Care Act to be repealed and replaced with patient-centered reforms.

That’s easier to say than do. Since the Affordable Care Act was signed into law more than six years ago, congressional Republicans have voted dozens of times to repeal it. Replacing it? Not so much. True, Rep. Tom Price, R-Ga., a physician, has been offering alternative bills since 2009, and Donald Trump’s website lists a framework of reforms. But the party has never coalesced behind a detailed, specific plan and then spent political capital selling it to the American people. Instead, it’s mostly just voted to repeal Obamacare knowing that, ultimately, President Obama would veto the repeal anyway.

Health care is by far the most difficult issue facing policymakers. There are many reasons, including that it’s a service Americans believe should be unlimited and cheap, which is a high standard. We need health care like we need groceries, but with food, most of us want steak but will buy canned tuna if that’s all we can afford. With health care, we all want nothing less than steak, but at canned tuna prices.

Like any other service, someone has to pay for a health care provider’s costs, and there are only three imperfect ways to do that. One is the free market approach where the consumer pays, which offers more freedom but less security and doesn’t have a clean answer when the consumer can’t afford the care. Another way is for the government to pay, which offers more security, at least initially, but less freedom. In that case, the government is deciding how life and death resources are allocated. Then there’s the third approach: Someone else pays, typically an insurance company. That method tries to strike a balance between freedom and security but gives a lot of power to a private corporation and in recent history has not effectively controlled costs.

The American health care system was a convoluted concoction of those three payment methods before Obamacare, and it still is. Prices were rising before Obamacare, and they still are. Undoubtedly, more Americans have insurance now than they did, and that’s a positive that shouldn’t be ignored. But many still are uninsured, and the big problem – cost – has not nearly been solved.

Republicans at the national level would do well to follow the example set by Republicans in Arkansas, who have done most of the creating, amending, defending and opposing of the aforementioned private option/Arkansas Works.

We can debate whether Arkansas Works is a good idea. But at least it’s a new one, with specific details that are clearly communicated and fought for.

Related: The real goal of the private option: Changing U.S. health care

Two governors: Hutchinson and Beebe

Legislature, Politics, State government

Govs. Asa Hutchinson and Mike Beebe
Govs. Asa Hutchinson and Mike Beebe
By Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

No two individuals are alike. This past week was a reminder of how that’s the case with Gov. Asa Hutchinson and his predecessor, Gov. Mike Beebe.

Hutchinson called legislators to Little Rock to raise $50 million to make the state eligible for $200 million in federal highway funds each of the next five years. His bill did that by relying largely on surplus funds and interest income, which some legislators thought was the wrong way and/or not enough. It was over in three days, and while it was probably inevitable that the governor’s bill would pass, it wasn’t always easy.

This was the second special session this spring. This first was to pass Arkansas Works, the program that uses federal Medicaid dollars to purchase private health insurance for adults with incomes up to 138 percent of the federal poverty level.

Hutchinson has been in office about 16 months and has called three special sessions. In eight years, Beebe called only three special sessions, though two were in his last 15 months in office.

That’s one big difference. Another is this past session included 15 items. That’s not particularly large by historical standards; then-Gov. Bill Clinton once called a special session with 285. However, Beebe’s three sessions combined had only 17 items.

The other big difference is in Hutchinson’s and Beebe’s approach. Beebe, who became governor after a long legislative career, didn’t call lawmakers to Little Rock until the bills were written and the votes counted. Everything was largely done behind closed doors, and then legislators voted and went home.

In contrast, during this past highway session, the actual bill wasn’t filed until legislators were arriving in Little Rock, leading Sen. Bryan King, R-Green Forest, to tell the Arkansas Democrat-Gazette, “There have been as many Bigfoot sightings in the past 20 years as there have been of the final draft of the governor’s highway bill over the last week.” The bill failed to pass the Senate Transportation Committee, which meant the sponsor, Sen. Bart Hester, R-Cave Springs, had to move it to another, friendlier one.

Eventually it passed, and Hutchinson signed it into law on the session’s third day, which is as quickly as he’s allowed under the Arkansas Constitution.

Is one governor’s approach better than the other? Let’s just say they’re different. It’s probably true that the highway session was messier under Hutchinson than it would have been under Beebe – in public. Under Beebe, the messiness would have happened earlier, in private.

You could make the case that Beebe’s way is more efficient and that Hutchinson’s is more transparent. Under Beebe, legislators came to Little Rock for very specific purposes and then left, which is good in that it meant they weren’t debating a bunch of bills that were better left for a regular session. With Hutchinson, the process was more open and visible – the debate occurring on the Senate floor and in committee hearings in addition to back rooms.

Meanwhile, the two governors have operated under different circumstances. Beebe led a Legislature that was full of not particularly committed Democrats when he entered office who were replaced by Republicans by the time he left. Hutchinson leads a fractious Republican caucus with a Democratic minority that’s trying to figure out how to assert itself. For a variety of reasons, maybe Beebe had to work things out beforehand, and maybe Hutchinson can’t.

There was some grumbling among legislators about this session’s disorganization. When I asked Hutchinson why, unlike Beebe, he didn’t have all his ducks in a row, he said lawmakers needed the pressure of a session.

“What’s the objective in life?” he asked. “Is it to accomplish significant legislative action, or is to to get things done in a cookie-cutter fashion where the outcome is known before you start? While you like to do all your homework in advance, the fact is, if I would have insisted upon, ‘Everybody sign on to the highway plan before we start,’ we’d never got it done.”

I took that as a defense of his own approach, not a criticism of Beebe’s. They govern in different circumstances, and no two individuals are alike.

Return of the Democrats?

Elections, Legislature, Politics, State government, U.S. Congress

Conner Eldridge is running as a Democrat for the U.S. Senate seat held by Republican Sen. John Boozman.
Conner Eldridge is running as a Democrat for the U.S. Senate seat held by Republican Sen. John Boozman.
By Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

The last eight years have been really bad for Arkansas Democrats. The last few months have been a little better.

Democrats controlled Arkansas politics for 140 years. As late as 2008, the party controlled five of the state’s six congressional offices, all seven statewide constitutional offices, 27 of the 35 state Senate seats, and 75 of the 100 state House seats.

But they have fallen far, fast. After President Obama’s election, Arkansas did what much of the rest of the South had already done and became a Republican state.

Now, Republicans occupy all the state’s congressional offices, all seven statewide constitutional offices, 64 state House seats and 24 state Senate seats. In the last two U.S. Senate races, Democratic incumbents won only 37 percent of the vote in 2010 and 39 percent in 2014. Almost twice as many Arkansans voted in the March 1 Republican presidential primary (410,920) as voted in the Democratic primary (221,010). Democrats could not field a candidate in three of the four congressional races and do not have enough candidates in state legislative races to win back a majority, even if they win every race they are contesting.

In 1960, New York transplant Winthrop Rockefeller hosted a “Party for Two Parties” at Winrock Farms in hopes of building the almost nonexistent Republican Party into a viable contender. At times these past eight years, I’ve wondered if we’re going to need another one of those parties.

But Arkansas Democrats have had at least three bright spots lately.

One, they’ve got a young, energetic U.S. Senate candidate, former U.S. Attorney Conner Eldridge. He’ll have a tough time unseating the Republican, Sen. John Boozman. But he’s running an aggressive campaign.

Second, the presidential race is shaping up about as well as Democrats could hope: former Arkansas first lady Hillary Clinton versus Donald Trump. He’s brought new people to the Republicans but also split the party, which will not completely unite behind him. President Obama won 37 percent of the vote in Arkansas in 2012. That’s consistent with the percentages those incumbent senators won in 2010 and 2014, so it’s not certain Clinton will do better. But at least Trump gives Democrats a target.

Finally, Democrats at the state level, who sometimes have been behaving as if they hope things will just get back to “normal,” have been acting a little more like a vigorous minority lately.

I’ll try to make this brief. In the fiscal session that just ended at the State Capitol, the big issue was Arkansas Works, the program that uses federal Medicaid dollars to purchase private health insurance for a quarter of a million Arkansans. It had passed by large majorities in a recent special session, but it fell just short of the three-fourths needed in both the House and Senate for funding during the fiscal session. Under the Arkansas Constitution, nine senators can kill funding for any program, and this time, 10 Republicans were determined to stop Arkansas Works.

However, the Arkansas Constitution also contains a provision requiring that the first item that must be passed in a session is the general appropriations, which funds expenditures such as legislators’ reimbursements. Democrats in the House decided to hold that up until Arkansas Works was passed.

After much maneuvering by Gov. Asa Hutchinson, Arkansas Works was funded. Because he practically staked his governorship on it, it’s debatable how much of an effect the Democrats’ effort had. But at the very least, it was a reminder that 35 House Democrats can throw as much of a monkey wrench in the proceedings as 10 Republican senators can.

As a party, Democrats tend to support more government activity to help lower income people, so Arkansas Works would seem to be an appropriate issue for them to fight for, or at least stand with the big guy doing the fighting. Now they are coalescing behind another issue they think is a good fit, more funding for pre-K education.

That’s a better strategy than waiting for their majority to return, which isn’t going to happen any time soon. Two parties are better than one, and if you’re going to be a minority, you might as well be a vigorous one, Rockefeller would say.

Related: How Conner Eldridge thinks he can win.

The real goal of the private option: Changing U.S. health care

Health care, Legislature, Politics, State government

CapitolBy Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

Arkansas is the land of the Hogs. When it comes to health care reform, it’s also offered itself up as a guinea pig.

Here’s why. The American health care system was a mess long before President Obama was elected. Costs were skyrocketing, and people were denied insurance based on pre-existing conditions, or they lost their insurance if they got sick. It’s long been unjust and unsustainable.

Along came the Affordable Care Act, which created Obamacare. Among its provisions was expanding Medicaid coverage for Americans with incomes up to 138 percent of the federal poverty level. Medicaid is a federal-state partnership that serves the poor, the aged and the disabled.

When the Supreme Court said states could choose if they participated in that expansion, many Republican-led states said no. In 2013, a group of Arkansas Republican legislators along with Gov. Mike Beebe’s administration instead said, “We’ll take that money, but instead of expanding Medicaid, we’ll purchase private health insurance.” The Obama administration agreed, and thus was created the “private option.”

It’s been a huge controversy that split Republicans between those who support it and those who see it as an unsustainable expansion of Obamacare.

Why would some Republicans support it? For one, a quarter of a million Arkansans now have health insurance because of it. Taking it away would be a state-changing event – for them, of course, but also for hospitals who would have to provide a lot of free care, and for the state, which would lose a lot of federal government money.

However, there’s another reason some Republicans support the idea: They’re trying to reform the entire health care system – which, as noted previously, has been messed up a long time.

Many Republicans have long advocated a “premium assistance” model for certain needy populations – basically, giving them money for insurance instead of putting them on a government program. But as state Sen. David Sanders, R-Little Rock, explained, the idea hasn’t been tried. If they could demonstrate in Arkansas that the idea could work, then they could change the entire national health care system starting in Arkansas.

What have been the results? There are more people on the program than were anticipated, and it hasn’t been managed well by the Department of Human Services. Coverage has been bought with taxpayer dollars for people without Arkansas addresses or, in some cases, a pulse. But a lot of poor people are covered, hospitals are saving money on uncompensated care, and costs per beneficiary have been lower than expected. The addition of a quarter of a million poor people to the insurance market has attracted providers to Arkansas, increasing competition and the choices available to us all.

As the experiment has continued, new elements have been included. Supporters hope to help people transition into self-sufficiency rather than trapping them in a big government program.
Hutchinson’s Arkansas Works program, which is the private option with a new name and some new wrinkles, includes work training referrals and a $19 per month contribution from better-off beneficiaries. He’d like to do more, but the Obama administration won’t let him. But next year, there will be a new administration.

So Arkansas has offered itself up as sort of the guinea pig in this experiment to see if the premium assistance model works. Since then, a number of other states have followed Arkansas’ lead and tried their own experiments. During hearings this past year, Arkansas legislators heard about some of those results, which could lead to changes here. States are the laboratories of democracy, and laboratories work best when they share what they learn.

Lawmakers hope the changes Arkansas has demonstrated could have other far-reaching effects. Sanders thinks the premium assistance model could be used effectively with the Veterans Administration – which, goodness knows, needs help. Rep. Charlie Collins, R-Fayetteville, thinks that, long-term, the model would work even for the biggest government health care program, Medicare.

There are those who say none of this will fix the health care system. Opponents from the right say government messes everything up. Opponents on the left say health care should not be a profit-earning enterprise, so the United States should do as other Western countries have done and just put the government in charge of paying the bills.

Sanders said something on which everyone should agree: This is an ongoing process. Health care isn’t going to be reformed. It’s going to be reforming, always. It must be.

Related: The debt, the private option and the painter