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Analysis: Hutchinson's plan keep Medicaid expansion is tough sell for both sides of debate


LITTLE ROCK, Arkansas — Gov. Asa Hutchinson's plan to keep Arkansas' hybrid Medicaid expansion if the state can impose new limits finally answers a question the Republican has faced since before he took office. Now there's a bigger question: Can he win over lawmakers on both sides of the debate, not to mention the federal officials who would have to approve those limits?

Hutchinson last week laid out several changes he'd like to see if the state will keep the "private option" Medicaid expansion that provides health insurance to 200,000 low-income residents. It was the strongest endorsement he's given for a program that relies on a key part of the federal health law he and other Republicans have regularly derided as Obamacare.

"I will accept the continued expansion dollars from the federal government if we can achieve the (federal waivers) that are needed," Hutchinson told a task force looking at the program's future. "These are the requirements that we need to accomplish our objectives, reinforce our values and to afford our future. Business as usual is not acceptable."

Hutchinson's announcement comes after months of hedging on the future of the private option, in which the state uses federal funds to purchase private insurance for the poor. Lawmakers in February continued the program another year at Hutchinson's behest, while a task force looks at the future of the program.

"I think it moves us on down the road in starting to put together a plan," said Republican Sen. Jim Hendren of Gravette, the co-chairman of the task force who is also the governor's nephew. "Now we have to see if it's a plan that can get (lawmaker) support, and whether it's a plan the federal government would accept."

Both pose their own set of challenges.

Hutchinson's recommendations — which include limiting the private option to working individuals, eliminating non-emergency transportation and cutting more than $50 million from Medicaid's costs each year — appear aimed primarily at those within his party who have opposed the private option and portrayed it as an embrace of the federal health law they'd like to see repealed.

But it's unclear whether those changes will be enough to win over critics of the plan, many of whom have used their private option opposition as a rallying cry in Republican primaries.

"I really just see it as trying to make it palatable and try and claim it's conservative," said Republican Sen. Bryan King of Green Forest, who has been one of the most outspoken opponents of the program.

At the same time, Hutchinson is pursuing changes that could jeopardize the solid Democratic support the private option has received since its inception two years ago. Top Democratic leaders have tempered their enthusiasm for Hutchinson's support to keep the expansion alive with questions about key elements of his plan cutting the program's benefits and eligibility.

They've also raised concerns about how Hutchinson wants to find "cost savings" in the program, with the governor floating managed care and reimbursement cuts as possibilities.

"Absolutely we've got some concerns," said House Minority Leader Rep. Eddie Armstrong, a Democrat from North Little Rock. "It's not a matter of can he get it done, it's a matter of how we get it done."

It's also a matter of how much the flexibility Obama administration is willing to give. Most of the changes Hutchinson is seeking to the program would require a waiver from the federal government. Hutchinson said he hasn't gotten specific assurances from the U.S. Department and Health and Human Services about his ideas, other than officials will keep an open mind.

"As soon as get some indication on direction from (lawmakers), I'll be knocking on the secretary's door again," he said.

Whether the ideas he presents at that time resemble the plan laid out last week remains to be seen, as Hutchinson suggested in his speech to lawmakers.

"Sometimes as governor you need to put some ideas out there that can be shot at," Hutchinson said.

Now Hutchinson gets to find out whether those ideas will face friendly or enemy fire.

Andrew DeMillo has covered Arkansas government and politics for The Associated Press since 2005. Follow him on Twitter at http://www.twitter.com/ademillo

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