Thursday, July 20, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – Arkansas will hold its annual sales tax holiday on Saturday, August 5, and Sunday, August 6.
Clothing and footwear that cost less than $100 per item will qualify for the exemption. However, if you buy an item that costs more than $100 you must pay the state and local sales taxes on the entire amount.
Accessories costing less than $50 qualify for the exemption.  Examples include wallets, watches, jewelry, sun glasses, handbags, cosmetics, briefcases, hair notions, wigs and hair pieces.
Here’s an example provided by the Department of Finance and Administration: a person buys two shirts for $50 each, a pair of jeans for $75 and a pair of shoes for $125.  The sales tax will only be collected on the shoes.  Even though the total price of the shirts and the jeans added up to $175, no sales tax will be collected on them because each individual item cost less than $100.
School supplies also qualify, including binders, book bags, calculators, tape, paper, pencils, scissors, notebooks, folders and glue.
Textbooks, reference books, maps, globes and workbooks will be exempt from sales taxes.  Also exempt from the sales tax will be art supplies needed for art class, such as clay and glazes, paint, brushes and drawing pads.
Bathing suits and beach wear will be exempt as long as they cost less than $100 per item. Diapers and disposable diapers will not be taxed.  Boots, including steel-toed boots, slippers, sneakers and sandals will be exempt from the sales tax as well.
Not exempt from the sales tax are sporting goods, such as cleats and spikes worn by baseball, soccer and football players.  Recreational items such as skates, shoulder pads, shin guards and ski boots will be taxed.  
Computers, software and computer equipment are not exempt and you will have to pay sales taxes if you purchase those items on the holiday.
Act 757 provides that the sales tax holiday will be the first weekend of August every year.  All retail stores are required to participate and may not legally collect any state or local sales taxes on qualified items during the tax holiday.
The legislature created the sales tax holiday by approving Act 757 of 2011.  One of the goals of the act is to help families with children in school, which is why it is commonly known as the “Back to School” sales tax holiday.  
However, everyone benefits from the holiday, whether or not they have children in school.
Highway Construction
            State highway officials opened bids for 57 projects that totaled $139.4 million. Contracts will be awarded only after each bid is carefully reviewed.
            One project accounts for almost half of the total. A low bid of $67.7 million was submitted for rebuilding the Pine Bluff bypass, which is a 10.4 mile section of Interstate 530 that makes an arc on the south side of the city.
            Another major project is to resurface 61 miles of Highway 64 in White, Woodruff and Cross Counties. The low bid was for $19.1 million.

Thursday, July 13, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – Last year 384 Arkansas residents died from an overdose of prescription painkillers.
That is an increase of one person over the previous year, when 383 people died from an overdose of opioid pain medication. In 2014 there were 356 deaths in Arkansas due to opioid overdoses.
The Senate Committee on Public Health, Welfare and Labor heard a report from the state Health Department on the effectiveness of recently enacted laws designed to curb the alarming surge in abuse of painkillers over the past ten years.
Opioids are the most widely prescribed type of drug in Arkansas. For example, last year 236 million pills were sold in the state, compared to 102 million depressants and 712,000 stimulants.
A Health Department official told the committee that the number of opioids sold in Arkansas in 2016 was enough for every man, woman and child in the state to have taken 80 pills.
Another way of looking at the prevalence of opioid sales is to consider that for every adult over the age of 25 in Arkansas, a prescription for opioids was written.
In the past few years the legislature has enacted a series of laws to address the crisis in abuse of prescription drugs, including Acts 1208, 901, 1114, 1222 and 895 of 2015, Act 1331 of 2013 and Act 304 of 2011.
Act 304 established the prescription drug monitoring program to combat the illegal trade of prescriptions. Act 1331 prevents “doctor shopping,” a practice in which drug abusers go to numerous physicians to obtain prescriptions.
The other laws modify the drug monitoring program, for example, by allowing access to law enforcement officials and licensing boards.
According to the Health Department, the new laws have been effective in reducing “doctor shopping” by half. The number of drug users who went to at least seven physicians or at least seven pharmacies in 2016 was half the number who did so in 2015.
The problem is getting worse, however. The rate of drug-related injuries and deaths due to overdoses has more than doubled since 2000, increasing from 5.1 per 100,000 people to 13.4 per 100,000 people.
The epidemic is not only a challenge for law enforcement and drug abuse treatment programs, it is a strain on the resources of social service agencies. Specifically, it has affected foster care and child welfare programs because the spiraling abuse of opioid prescriptions has resulted in growing numbers of children being removed from their homes.
In 2015 drug or alcohol abuse by the parents was the reason given for removing children from their families in 34.4 percent of all child abuse and neglect cases nationwide. That compares to 18.5 percent in 2000.
In certain areas the problem is even worse. In Ohio last year, drug abuse was the reason cited in more than half of the cases in which a child was removed from his or her family.
Experts are learning that due to the potency of opioids, the recovery period from addiction is longer than it is for cocaine and meth, and the possibilities of a relapse are greater.
When addicted parents spend longer periods in rehab, their children must spend longer periods in foster care. That adds strain to the already over-burdened foster care system.

Thursday, July 6, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – Thanks to conservative budgeting and a rebound in consumer spending, the state ended Fiscal Year 2017 with a surplus of $15.7 million.
            Individuals and businesses were spending more, so sales taxes were strong at the end of the fiscal year. Employment figures were strong, which meant that Arkansans were paying income taxes.
            The strong finish to the fiscal year is an abrupt turnaround from late April, when state agencies were notified they had to trim about $70 million from their spending plans due to concerns about a slowdown in revenue. Arkansas operates under a balanced budget law, therefore agencies must reduce spending when revenues fall off.
            Because of the strong finish to the fiscal year, all but $10 million of April’s budget cuts were restored.
            At the end of the fiscal year, the state spent about $5.35 billion in net general revenue. That is about $19 million less than the previous year.
            In Fiscal Year 2017, which ended on June 30, Arkansas collected $2.337 billion in sales taxes. That is an increase of 2.1 percent over the previous year. The state sales tax rate is 6.5 percent and went unchanged from 2016 to 2017. That means the 2.1 percent increase in sales tax revenue represents growth in spending by consumers and businesses. Cities and counties also collect sales taxes, but the revenue from those collections is not part of the state’s final report on Fiscal Year 2017.
            Income tax collections for the fiscal year totaled $3.2 billion. That is 2.1 percent above the previous year.
            Corporate income tax collections were $434 million, which was almost 11 percent below the previous fiscal year.
Corporate income tax collections traditionally are volatile and hard to gauge because of the timing of moves that corporations make in order to take advantage of state and federal tax laws. 
In spite of the difficulty of predicting corporate activity, the $434 million in corporate income taxes collected was 1.1 percent above what budget officials had forecast.
            Public schools receive the largest portion of state taxes. They are budgeted to get $2.19 billion this year. The Department of Human Services (DHS) administers Medicaid, the food stamp program, drug and alcohol abuse centers, treatment of people with disabilities and long term care for senior citizens. DHS will get about $1.55 billion of state taxes this year and even more from federal taxes.
            The operation of prisons will cost the state more than $341 million. Parole, probation and work release will cost an additional $79 million. The state distributes about $700 million a year to colleges and universities. 
            According to the National Conference of State Legislatures, 22 states had to adjust spending this fiscal year to meet budget shortfalls. The financial status of most states is stable, but a majority of states report their main challenge is to meet a growing demand for services at the same time that their revenue stream is flat.
            States whose economies rely on energy sources, such as oil and gas, are dealing with flat revenue caused by relatively low energy prices. Low commodity prices are a concern in states that depend heavily on agriculture. The uncertain future of Medicaid is a source of concern for many governors and state budget officials.      

Thursday, June 22, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – The Senate and House Education Committees have begun work on the next adequacy determination for public schools.
            Funding levels for this year and next year have already been set, which means that the legislative adequacy study now underway is going to determine school funding levels for fiscal years 2020 and 2021.
            The adequacy study includes visits to selected schools across Arkansas, as well as surveys of superintendents, principals and teachers. It also includes data from the Arkansas Public School Computer Network, which keeps records on student achievement, school finances and facilities.
            By November 1, the Education Committees will decide whether current adequacy funding levels need to be amended. If so, those changes would be considered in the 2018 fiscal session. A final report will be due by November 1, 2018, for consideration by the legislature in the next regular session in 2019.
            Determining an adequate level of school funding is at the top of the legislatures’ priorities every year. In 2002 the Arkansas Supreme Court ruled that school funding did not comply with mandates in the state Constitution that every child should receive an adequate education.
The court’s ruling cited “abysmal” rankings in national rankings of schools, the tremendous need for remediation by college freshmen, wide disparities of teacher salaries within the state, lack of opportunities for special needs children and children in high poverty areas and a failure to address the needs of schools in high growth areas. The court clarified that it was the responsibility of state government to ensure the adequacy of education across Arkansas.
In a lengthy special session and in subsequent regular sessions, the legislature adopted more rigorous standards and dramatically increased funding for yearly operations of schools and to improve school equipment and facilities.
In 2007 the Supreme Court ruled that the legislature’s actions complied with constitutional mandates on education. Since then Arkansas has moved up in national assessments of public schools, has increased the percentage of adults who graduate from high school and increased teacher salaries.
The school funding lawsuit that prompted the Supreme Court’s rulings was known as the Lake View case. The Lake View School District was a small, rural district in eastern Arkansas that has since been consolidated with Barton-Lexa, a neighboring district.
The adequacy report will be the cornerstone for writing the state budget, because one outcome of the Lake View case is that schools must be funded first. Also, school funding is protected from budget cuts during periods of economic stagnation.
The Education Committees’ funding recommendations for adequacy will serve as a basis for the governor’s proposed budget for education. Adequate funding levels must be based on evidence of the needs of school districts, and not based on the amount of money available after political give-and-take among the various state agencies that are financed by the state.
About 44 percent of Arkansas tax revenue goes to education from kindergarten through grade 12. State appropriations account for roughly half of the school districts’ revenue, with local property taxes generating about 40 percent and federal funding about 10 percent.
The total of state and local foundation funding in Arkansas is about $3 billion, which this year amounts to $6,646 per student. Additional funding is allotted to schools for students with special needs.

Thursday, June 15, 2017

Week In Review


            LITTLE ROCK – Legislators are moving ahead with a financing plan that allows an additional 500 people with developmental disabilities to move off a waiting list and get services that will help them live more independently.
            During this year’s regular session lawmakers approved Act 50 and Act 775, both designed to help people with development disabilities. Act 50 allows $8.7 million from a state settlement with tobacco companies to be used to match about $20 million in federal funding. The funds will help 500 people get services. The waiting list now has about 3,000 people on it.
Act 775 is a more comprehensive change to the overall system of paying for services, with the intent of eliminating excessive and unnecessary costs. The act creates a Provider-led Managed Care system.
Usually providers are non-profit organizations that receive Medicaid reimbursements for treating and caring for people. The state provides about 30 percent of the cost of care and the federal government provides 70 percent.
            Besides reimbursing private providers for home and community services, state government also operates long term care residential facilities for people with the most severe developmental disabilities. They’re called Human Development Centers and they are at Arkadelphia, Booneville, Conway, Jonesboro and Warren.
            Arkansas tries to provide a balanced array of services across a spectrum that includes institutional care for people with the most severe disabilities, as well as appropriate levels of support for people who want to live with their families or in a group home.
            Under the model created by Act 775, providers will become responsible for the care and treatment of about 30,000 Arkansas residents whose medical needs drive up Medicaid spending.        Under Act 775 care-giving organizations will be allowed to form what will be known as a Provider-led Arkansas Shared Savings Entity, or PASSE. They will assume the risks and share in the cost savings of treating people whose medical needs are expensive. Those categories include mental illness, substance abuse and disabilities.
            One goal is to lower costs by eliminating gaps in care, thus reducing the number of cases in which acute and emergency care is necessary.
            According to a consultant hired by the legislature, the majority of Medicaid spending is for the elderly, people with disabilities and people with mental illness. For example, Medicaid serves more than 450,000 Arkansans over the age of 65.
            According to the consultant, the Human Development Centers care for about 925 people with developmental disabilities at an annual cost of $159 million. The state provides support services to another 4,200 people with developmental disabilities to help them live in their home communities, at an annual cost of $197 million.
            Last year the state and federal governments spent more than $6.5 billion on the Arkansas Medicaid program, according to the Department of Human Services, which administers it.
Legislators are pursuing another strategy for holding down total Medicaid costs, which is to rely on independent assessments of the medical needs of people who apply for services.
More than 12,300 providers participate in Arkansas Medicaid. They include physicians, pharmacists, dentists, hospitals, vision care providers, medical equipment companies, various types of therapists and nurse practitioners.

Friday, June 9, 2017

Week In Review

State Capitol Week in Review
June 9, 2017
            LITTLE ROCK – The Highway Commission voted to begin an effort to put a proposal on next year’s ballot, so that Arkansas voters can decide whether to increase spending on highway and bridge improvements.
            The vote was 5-to-0. The details will be worked out during future meetings and the Commission expressed hopes that a final plan would be ready by October. After the substance of a highway program is finalized, supporters of the initiative can begin collecting signatures.
            The governor has said that voters should have an opportunity to vote on a highway plan. During the 2017 regular session earlier this year, a bill to put a highway program on the ballot failed in the House of Representatives.
            In statewide elections in 2011 and again in 2012, Arkansas voters approved major highway programs. In 2011 voters approved the Interstate Rehabilitation Program, which authorized the issuance of $575 million in bonds that the Highway Commission used to match federal funding to pay for more than $1 billion in highway improvements.
            In 2012, voters approved a half-cent sales tax, which will last until 2023, to finance the Connecting Arkansas Plan. It will pay for $1.8 billion in road and bridge projects.
            The bill that failed in the House of Representatives would have allowed voters to decide whether to levy a 6.5 percent sales tax on wholesale fuel, to authorize a bond issue. The plan would have financed a highway program of about $200 million a year.
            In a special session last year the legislature voted to dedicate 25 percent of each year’s budget surplus to the Highway Department. Legislators also approved some transfers of funds within state government to increase highway funding by about $50 million a year without raising any taxes.
            The Highway Commission did not decide whether to promote an initiated act, which will require 67,887 signatures of registered voters in order to be placed on the 2018 ballot, or a constitutional amendment, which will require 84,859 signatures. Those signatures must be submitted to the Secretary of State for verification by July of 2018, in order for the measure to be on the ballot in November of 2018.
            In the coming months, highway officials will work with business leaders, economic developers, contractors, truckers, elected officials and consultants to determine the size and scope of the highway proposal. They also will determine the funding mechanism, with an eye towards choosing the method that is most likely to be approved by Arkansas voters.
            The head the Arkansas Trucking Association said that the group would prefer a simple increase in motor fuels taxes. A penny a gallon increase would generate about $14 million a year in additional revenue for the state Highway Department. However, some highway officials questioned whether the public would approve an increase in gasoline taxes.
            In recent years, efforts to transfer general revenue to the highway department have failed. State general revenue collections pay for education, prisons, health care and numerous other services provided by state agencies. 
Highway funding is generated by user fees and gas taxes, and is considered special revenue because it is dedicated solely to the Highway Department.
             A significant part of the effort will be to inform voters how much the plan would cost, and where the money would be spent. Voters in rural areas would be reluctant to pay for improvements to highways in urban areas. 
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Thursday, May 25, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – The state Higher Education Coordinating Board began work on a new funding formula for colleges and universities, based on legislation enacted during this years’ regular session.
            Act 148 of 2017 directs to board to adopt a funding formula based on productivity measures such as the number of students who complete their degree requirements. The previous formula was based more on enrollment. 
The new formula also takes into account factors like affordability. For example, under the new formula colleges and universities will have an incentive to help students graduate on time. When students take five, six or seven years to complete their degree requirements the final cost of their education is much greater and they are likely to have a much heavier loan to pay off.
Also, institutions will be encouraged to help students complete their degree requirements more efficiently. For example, if the requirement for an associate’s degree is 60 hours and a student ends up taking 66 hours in order to satisfy those requirements, it will cost more. Similarly, a student who earns a university degree by completing 120 hours will spend less than a student who takes 126 or 132 hours.
One reason that students take more than the required number of hours is that they change majors in midstream. That happens if they choose a major for which they are not academically prepared, or if they choose a major unadvisedly during their first semester as a freshman and later change their mind.
Two-year colleges would be rewarded in the funding formula for the number of students who transfer to a four-year university with 30 credit hours in core courses. 
For years the legislature has worked to make it easier for students to keep the credits they have earned when they transfer from one institution to another. 
In 2007 the legislature approved Act 472 requiring colleges and universities to inform students at registration if a course would be transferable to other state-supported colleges and universities. 
In 2009 the legislature passed Act 182 creating a set of fully transferable credit hours from two-year colleges to four-year universities. The purpose was to eliminate obstacles to the transfer of credits by requiring four-year universities to accept all hours earned under the new system. The state Higher Education Coordinating Board determined which courses would be fully transferable.
Also in 2009 the legislature approved Act 964 to study the affordability of higher education at Arkansas public colleges and universities.
Several bills enacted in 2007 sought to hold down the sky-rocketing cost of text books.
There are more steps that higher education officials and legislators must take before the new funding formula receives its final approval. Those steps include a public comment period.
Institutions will receive incentives for educating non-traditional older students and students from under-served areas. On the other hand, the new formula is designed to prevent them from lowering academic standards in order to make it easier for students to earn a degree.
According to the formula, completion of students’ educational goals should be the highest priority for each of the state’s 10 public universities and 22 colleges.

Thursday, May 18, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK –The state Board of Education will consider raising the cap on the number of students who can enroll in the Arkansas Virtual Academy.
            The academy has received preliminary approval for a higher cap from the Charter Authorizing Panel and the next step is for the request to go before the state Board. If the Board of Education approves, the online school’s enrollment cap would increase from 2,000 to 3,000 students.
            There are two state-approved online schools in Arkansas - the Virtual Academy and the Arkansas Connections Academy, whose enrollment cap also is 3,000 students.
            Charter schools are financed by state tax revenue. They operate under a contract with the state that waives some of the regulations and policies that govern traditional public schools. Besides the two online schools, Arkansas also has approved 24 “open enrollment” charter schools run by non-profit organizations. Open enrollment charters can also be operated by institutions of higher education.
            Arkansas also has 28 “district conversion” charter schools, which are run by school districts. There are 238 public school districts in Arkansas that operate 1,064 schools from kindergarten through grade 12. Of those, 547 are elementary schools, 219 are middle schools or junior high schools and 298 are high schools.
They employ 32,818 certified teachers and their total enrollment this school year is 477,268 students. About 63 percent of Arkansas public school students qualify for free or reduced-price lunches because their families’ yearly income is below certain poverty thresholds.
            The next meeting of the state Board of Education will be June 8 and 9.

Scrap Metal Sales
            In 2009 the legislature approved Act 390 to strengthen enforcement of laws against the theft of scrap metal. Copper and other metals had become valuable enough that there was a spike in thefts of pipes and cables from outdoor air conditioning units, as well as from electrical power stations and cable TV and telephone lines. Act 390 makes it a Class D felony to destroy gas, electric and cable lines, air conditioning units and farm equipment in order to steal metal.
            Dealers who buy scrap metal are required to record indentifying characteristics of their clients, including copies of their ID cards or drivers’ licenses, the license plates of their vehicles and a digital photo and thumb print of the person selling the scrap metal.
            The Review Subcommittee of the Legislative Council, without debate, reviewed two contracts with private firms to enhance the computer capacity of the Arkansas Crime Information Center. ACIC maintains the computer system for keeping up with sales of scrap metal, as mandated in Act 390 of 2009.
            ACIC operates computers that law enforcement agencies can access to search for criminal histories and crime statistics.
Human Development Centers
            The subcommittee also reviewed a series of contracts that Human Development Centers around the state have signed with providers of services like physical and occupational therapy.
            Arkansas operates five centers that care for people with developmental disabilities. The center in Arkadelphia has space for 134 people, the one in Booneville for 145 people, the one in Conway for 484 people, the one in Jonesboro for 120 people and the one in Warren for 104 people.

Thursday, May 11, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – Acts 78 and 79 of 2017 created the Arkansas Tax Reform and Relief Legislative Task Force. The leaders of the Senate and House have appointed the panel’s membership.
            There will be eight senators and eight representatives on the task force, which is charged with recommending changes to the state tax code for lawmakers to consider during the 2019 regular session.
Acts 78 and 79 are identical versions of a tax relief measure. One version originated in the Senate and the other one in the House of Representatives.
According to the acts, the recommended legislation should modernize and simplify the Arkansas tax code, while making it fairer for all individuals and businesses that pay taxes in Arkansas. Also, the changes should make Arkansas more competitive economically with other states and should provide incentives for job creation.
By December 1, 2017, the task force shall issue a preliminary report. Its final written report is to be released by September 1, 2018.
            Acts 78 and 79 also reduce individual income taxes for more than 1.3 million low-income residents. When they take full effect they will save Arkansas families more than $50 million a year. The largest tax cut a single taxpayer will receive is $156 and for a married couple the saving will be $312 each year.
            All individuals earning less than $21,000 will see lower income taxes. Those making less than $4,300, an estimated 120,000 Arkansas residents, will be taken off the rolls completely.
            The tax cuts in Acts 78 and 79 will take effect in 2019.
            Other tax cuts enacted this year include Act 141, which will completely exempt military retirement from state income taxes and will save about 29,000 retired Arkansas veterans more than $13.4 million a year.
            Act 465 exempts sales taxes for manufacturers when they purchase equipment for repairs and replacement of parts. It sunsets an existing tax incentive program known as InvestArk. 
The tax exemption will be phased in. In Fiscal Year 2020 the savings to Arkansas manufacturers will be only $230,000, but they will then begin to increase sharply. By 2023 the savings for Arkansas manufacturers will be more than $12.3 million a year.
            The legislature lowered income taxes in 2015 by more than $100 million a year with the passage of Act 22. It reduces individual income taxes for middle class families whose annual income is between $21,000 and $75,000.
            Act 1173 of 2015 lowers the state income tax on capital gains, and now saves Arkansas taxpayers almost $12 million a year.
AG Seeks More Tools to Prosecute Medicaid Abuse and Neglect
            The Arkansas attorney general is one of 38 nationwide who have officially asked federal authorities for greater powers to investigate and prosecute Medicaid abuse and neglect.
            The criminal cases usually involve health care workers taking money to which they are not entitled, by swindling it from an elderly Medicaid recipient. The financial fraud is often accompanied by physical abuse and neglect of the elderly person’s need for nutrition and hygiene.
            The attorneys general want to repeal outdated limitations on their authority to fight Medicaid fraud, not only in institutions but also in the homes of Medicaid recipients. The Arkansas attorney general opened 112 criminal cases of Medicaid fraud last year.

Friday, May 5, 2017

Thoughts on the Special Session - SB3

State Capitol Week in Review
From Senator Larry Teague
May 5, 2017
LITTLE ROCK – The legislature completed a three-day special session after approving the governor’s proposal to limit eligibility in the Arkansas Works health coverage program.
Senate Bill 3 would reduce income limits for eligibility in Arkansas Works, which now provides health coverage to about 320,000 Arkansas residents whose incomes are beneath 138 percent of the federal poverty level. The governor said that he was confident federal officials would approve the new income threshold in SB 3, which would reduce eligibility to people with incomes less than 100 percent of the poverty level and which would remove about 60,000 Arkansans from Arkansas Works.
Senator Larry Teague of Nashville was among nine senators who voted against the bill. Opponents of SB 3 included the most conservative members of both political parties, and included many representatives of rural areas.
“The bill had provisions I agree with, such as the requirement that a recipient get a job or take job training in order to qualify for benefits,” Teague said. “In that respect it brought Medicaid expansion in line with existing requirements for becoming eligible for food stamps and welfare.”
“Another provision I like promotes more personal responsibility on the part of Medicaid recipients, because it requires them to pay two percent of their premiums, up to $19 a month,” Teague said. “Although the monthly payments are minimal, for most people they’re an incentive to adopt a healthier lifestyle.”
“However, there are a lot of moving parts in the bill, and ultimately the financial threat to rural hospitals was too great to ignore because of the 60,000 people who will be taken off Arkansas Works,” Teague said. “They may eventually qualify for a different type of health insurance through the federal exchange, but in our experience we can be fairly certain that a large percentage of them will not have any health insurance for an extended period of time.”
“Their lack of health insurance doesn’t change the fact that hospitals have a legal and moral obligation to treat sick people who show up at their door. We know what happens because we lived through it for decades. When people without money or insurance rely on hospital emergency rooms as their primary care provider, hospitals have to write off millions of dollars in unreimbursed care. For small hospitals in rural areas that can begin a financial death spiral. It certainly has happened that way in the past, before we implemented Arkansas Works,” Teague said.
“Apart from the loss of medical care, which can be life-threatening to the elderly and to people with chronic conditions, losing a hospital has negative economic effects throughout the entire community,” Teague said.
“A town that loses its hospital can give up trying to recruit new industry, because there is no corporate executive who will locate a plant there. And if that town has an existing industry, like a poultry processing plant, its management will not expand because of the lack of a hospital and the lack of medical coverage that entails,” Teague said. “Any expansion will take place at one of its plants in other states.”
“I wish that the sponsors of SB 3 had broken the bill down into its separate parts so that I could have voted for the parts I like, but that was their strategic decision to make. In the end, I had to vote against the bill because I truly believe it will harm rural hospitals and rural communities,” Teague said.