- Associated Press - Monday, March 7, 2016

LITTLE ROCK, Ark. (AP) - A legislative panel on Monday endorsed Gov. Asa Hutchinson’s plan to keep Arkansas’ hybrid Medicaid expansion, but it deadlocked on his proposal to have private companies manage some of the state’s services for the mentally ill and developmentally disabled.

The Health Reform Legislative Task Force recommended lawmakers consider Hutchinson’s proposal to keep and rework the state’s “private option,” which uses federal funds to purchase private insurance for low-income residents. Hutchinson, a Republican, has proposed renaming the program “Arkansas Works” and adding new restrictions on its eligibility and benefits.

“I think it got a resounding yes vote,” Republican Rep. Charlie Collins of Fayetteville, who co-chairs the panel, told reporters. “Getting 11 votes on the yes side out of this task force was a strong signal to the Legislature.”

The panel’s resolution requested Hutchinson present the legislation he wants considered during next month’s special session and said ending the hybrid expansion would result in “substantial” costs for the state. Consultants earlier Monday estimated that dropping the expanded could cost the state as much as $757 million over the next five years, due to increased Medicaid costs and loss in tax revenue connected to the program.

More than 250,000 people are on the program, which was crafted as an alternative to expanding Medicaid under the federal health law.

The hybrid expansion has sharply divided Republicans, who control both chambers of the Legislature.

“I think what is happening we’re looking at a problem and saying ‘how can we immediately take care of this?’ but not looking at what’s ahead and how what we’re doing might create a bigger problem,” said Republican Sen. Cecile Bledsoe, who voted against the program Monday.

The vote was the latest boost for Hutchinson after several Republican supporters of the hybrid expansion survived primary challenges in last week’s primary.

But the future of Hutchinson’s plan to move portions of the state’s Medicaid program to managed care appeared less certain. The proposal received eight votes on the 16-member panel, while a competing plan received seven votes. Hutchinson has proposed the changes to cut costs in the Medicaid program when the state begins paying for a portion of the expanded population next year.

Hutchinson said he was pleased his expansion plan won support and was optimistic it would be approved by the Legislature. He said he planned to work with lawmakers on the managed care proposal.

“In regards to the savings, there was significant support for my plan on savings of the overall Medicaid budget, and I look forward to working with the legislature to finalize the best approach for Arkansas,” he said in a statement

Lawmakers said the vote showed the bigger fight may be over the managed care proposal than the expansion’s future.

“To reform a $5 billion program is going to be divisive,” said Republican Sen. Jim Hendren, the panel’s co-chairman.

The top Democrat in the Senate criticized Hutchinson for pushing for the managed care model and warned it could jeopardize support for the expanded Medicaid coverage.

“The unintended consequence of this is now I think some people who were pretty solid Arkansas Works people now have questioned it because of the issue of managed care,” said Senate Minority Leader Keith Ingram, a Democrat from West Memphis.

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Follow Andrew DeMillo on Twitter at www.twitter.com/ademillo

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