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Official: State-based exchange will give Arkansas flexibility to pursue Medicaid changes

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LITTLE ROCK, Arkansas — Arkansas' move toward setting up its own health insurance exchange will give the state more flexibility as it looks at overhauling its Medicaid program for the poor, the director of the board setting up the exchange told legislators Monday.

There are still plenty of benefits to Arkansas establishing its own, Arkansas Health Insurance Marketplace Executive Director Cheryl Smith Gardner told lawmakers, even though the U.S. Supreme Court ruled that health insurance subsidies could be paid through exchanges set up by the federal government.

"If the state was really happy with Medicaid as it is today and didn't want to make any changes to it, didn't want to innovate, didn't want to reform, then go with the...federal exchange, because that's exactly what you'll get," Gardner told the marketplace's oversight committee.

Gardner's comments come as a legislative task force is looking at the future of the state's "private option" Medicaid expansion, which uses federal funds to purchase private insurance for low-income residents. The panel is also looking at broader changes to the state's Medicaid program, which Gardner said a federally-run exchange would not be able to accommodate.

"Frankly, if Arkansas is planning on doing any kind of Medicaid reform, any kind of health system reform, you will spend maximum dollars if you decide to go to the federal marketplace," she said.

Arkansas is currently relying on the federal exchange, but was given conditional approval earlier this month to transition to a state exchange. The state is using a nearly $100 million federal grant to set up the exchange, which is expected to be set up for individual consumers in 2017. More than 57,000 Arkansas consumers are receiving tax credits to purchase insurance through the exchange.

A law enacted earlier this year would have required the Legislature to decide whether to continue with the state exchange if the Obama administration lost the case before the high court.


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