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Medicaid, Highway Funding Debate to Dominate Session

by Sydne Tursky

Arkansas state legislators agree: Medicaid and highway funding will be the primary issues of focus during the upcoming fiscal session of the Arkansas General Assembly.

The session will convene Feb. 12 to approve the state budget for fiscal year 2019, which begins July 1. Gov. Asa Hutchinson has proposed a $5.6 billion budget.

“No question, the top issue is going to be health care, Arkansas Works,” Sen. Keith Ingram, D-West Memphis, said.

Arkansas Works is a Medicaid expansion program that buys private health insurance for eligible individuals making 138 percent or less of the federal poverty level. The program is up for reauthorization and potential modification this year. Proposed changes include a work requirement for eligibility and an enrollment cap, Rep. Bob Ballinger, R-Berryville, said.

There is also an effort to lessen enrollment by making the program available only for people who make 100 percent of the federal poverty level or less.

Reauthorization and modification of Arkansas Works will happen as part of the Department of Human Services appropriations bill, but there is some concern over whether the DHS bill will pass, Ballinger said. If it doesn’t, the assembly will have to reconvene for a special session to debate and approve it.

According to Ballinger, deciding the future of Arkansas Works is difficult because of the uncertainty surrounding the Affordable Care Act at the federal level, especially since Congress tried repeatedly to repeal the health care bill last year.

Rep. Charles Blake, D-Little Rock, anticipates Medicaid funding debates to include discussion of medication costs.

Arkansas pharmacists say approximately one-third of their customers are part of the Medicaid expansion, Blake said. Medicaid is paying less for those customers’ medications than the pharmacy pays to buy them, so pharmacists have complained that they are losing money on those customers.

According to Blake, stabilizing medication costs could help solve this problem.

Another major issue certain to be addressed is highway funding, and both Republicans and Democrats agree Arkansas is in need of a long-term solution for roads, sooner rather than later.

“We’ve got to do something to address our deteriorating roads. It’s just going to cost us more and more,” Ingram said. “It hasn’t been a priority of the governor’s, so I hope we can come up with some plan, because infrastructure is, for Arkansas, one of the keys to economic development. The half-cent [tax] that was passed in 2012 will be running out in 2022, and we [can’t] just keep kicking this can down the road.”

Last year, the legislature came up with several ideas for highway funding, like a casino measure, that never came to fruition because they were widely unpopular, said Rep. Bruce Cozart, R-Hot Springs.

Gov. Hutchinson has previously said he is opposed to any plans to divert general revenue funds to highway improvement and has proposed that a portion of surplus funds from fiscal year 2019 be allocated for highway construction.

“It’s always next year with Gov. Hutchinson and highways,” said Sen. Bryan King, R-Green Forest.

According to Ingram, Arkansas ended fiscal year 2017 with a $15.7 million surplus, down significantly from previous years when the surplus was closer to $200 million.

Both Ingram and King expressed concern over the smaller surplus, saying the state did not suffer any natural disasters or other crises last year that would have led to such a diminished fund. But the lesser surplus is mostly attributable to the $150 million in tax cuts championed by the governor, said Cozart.

In Hutchinson’s proposed 2019 budget, a portion of the projected $64 million surplus will be set aside in a reserve fund to be used in case of an economic downturn or natural disaster.

Other issues likely to be debated during the session include prison and parole officer funding and online sales taxes.

According to Ingram, Hutchinson asked for increased prison funding to help with overcrowding and inmate violence, and Democrats plan to fight for funding for more parole officers to properly oversee parolees.

“I think there’s no question that we need additional probation officers,” Ingram said. “In the long run, that will save the state money, because if we have the proper number of probation officers, then statistics show it will lower the rate of recidivism and keep them out of prison.”

Blake expects lawmakers to have a conversation about online sales taxes during the session. Online businesses based outside of the state are not required by law to collect state sales taxes from Arkansas shoppers. According to Blake, local businesses are hurt as a result of people buying online to avoid paying the sales tax.

Discussions may be complicated by the fact that the Senate is missing three members, Ballinger said. One missing member is Sen. Jake Files, R-Fort Smith, who resigned Jan. 30 after pleading guilty to fraud charges.

“The leaders are telling us that it’s going to be a pretty straightforward and quiet session, but I know better than that,” said Blake.

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