State Capitol Week in Review
LITTLE ROCK – With the eyes of the nation watching intently, the Arkansas Senate approved legislation to expand health insurance coverage to 250,000 adults.
Arkansas would be the first state in the union to adopt a “private option” model for implementing the expansion of health care under the federal Affordable Care Act (ACA).
The federal health care act has generated heated controversy since it was debated at length and enacted by Congress. It was a politically charged campaign issue in Arkansas and across the country in 2012 and it was a hotly contested legal issue as opponents challenged its implementation all the way to the U.S. Supreme Court.
The Supreme Court upheld most of the provisions of the federal law, including one that mandates that everyone purchase health insurance. Poor people will get a subsidy from the federal government to help them pay for insurance. In its ruling, the Supreme Court allowed states the option of whether or not to expand their Medicaid programs.
When the 2013 legislative began, the governor initially proposed to expand the Arkansas Medicaid program through the same formula many other states have followed - by adding more people to the list of eligible recipients.
In this case, they would be working adults whose yearly incomes are less than 138 percent of the federal poverty level. The governor’s proposal would have set Arkansas against the trend of other Southern states, many of which have indicated they will reject Medicaid expansion.
However, the Arkansas Senate chose a different approach. It is not an outright rejection, but neither is it unqualified acceptance of Medicaid expansion. Rather than simply expand the Medicaid program, the Arkansas Senate voted to use federal funds to pay for private health insurance that low-income families will have to purchase anyway under the federal ACA.
With this method, the Arkansas Medicaid program is likely to get smaller because SB 1020 will transfer low-income families’ health coverage from Medicaid to a private insurance carrier.
The measure is SB 1020, the Health Care Independence Act of 2013. The Senate approved it by a vote of 24-to-9. Another vote will come in the final few days of the legislative session, when an appropriation to fund SB 1020 is considered in separate legislation.
Appropriations require a 75 percent majority for passage, which in the Senate means 27 votes are needed.
Tax cuts will share the spotlight as the session winds down. Senate leadership is working on a package of bills to reduce state taxes by $100 million a year. Bills that have been progressing through the legislature would lower individual income taxes, income taxes paid by active duty military personnel, capital gains taxes, sales taxes on manufacturers’ utility bills, corporate income taxes and sales taxes paid by farms and agricultural businesses.
Another close vote is expected in the House on legislation that would authorize the state to issue $125 million in bonds to help finance a steel mill in eastern Arkansas. It would employ 525 workers with average salaries above $70,000 a year.
If enacted, the legislation would mark the first time Arkansas has used economic development bonds for a so-called superproject, under the terms of Amendment 82 to the state Constitution.
The amendment was referred to the ballot by the legislature in 2003 and approved by Arkansas voters in a 2004 statewide election.
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