LITTLE ROCK, Ark. — Arkansas’ governor and legislative leaders hope to stay focused on the next state budget when they convene this week, but uncertainty looms about whether there will be enough support to keep the state’s hybrid Medicaid expansion alive for another year.
Gov. Asa Hutchinson will kick off the start of this year’s abbreviated “fiscal” session focusing primarily on budget issues on Monday with a joint address to the House and Senate. Hutchinson, a Republican who is seeking re-election this year, said his proposed $5.6 billion budget the coming year lays the foundation for issues lawmakers will need to address when they return for next year’s session.
“The budget I’ve presented really sets the stage for everything we need to do down the road,” Hutchinson told The Associated Press in an interview last week.
That proposal projects a $64 million surplus that Hutchinson wants to set aside, with nearly $48 million going into a reserve fund that he says could help pay for tax cuts when lawmakers convene next year. The remaining surplus money would go toward highway needs.
The reserve proposal, however, faces pushback from some Democrats who say the surplus money should go toward other needs such as parole officers or the University of Arkansas for Medical Sciences, which laid off more than 200 workers last month.
“I don’t think this is responsible to suggest that we have a surplus if we are not meeting the needs of our people, and in the end that is our job,” Democratic Sen. Joyce Elliott said last month.
Three vacancies in the state Senate have left backers of the hybrid expansion short of the three-fourths support needed to approve the budget measure for Medicaid and the expansion program. Most budget bills in Arkansas require a three-fourths vote by the House and Senate to be approved. But Republican Gov. Asa Hutchinson said he remains hopeful the program can be reauthorized in the coming weeks rather than by calling lawmakers back to the Capitol after the vacant seats are filled. About 285,000 people are on the program, which uses state and federal funds to purchase private insurance for low-income residents.
The state is still waiting for the federal government to approve several restrictions it wants to add to the program, including a work requirement and a lower eligibility limit that would move 60,000 people off the program. The Trump administration said last month it would allow states to require some people who qualify for Medicaid to work to receive benefits.
“My full expectation is we’ll be able to have this pass in regular order during the fiscal session,” Hutchinson said. Hutchinson said he’s optimistic because of conversations his administration has had with lawmakers to address their concerns, but said he believed winning approval for the work requirement will help.
“I think it does make a difference in votes,” he said.
Some opponents of the program are pushing for a measure to freeze its enrollment starting in July. The Arkansas House approved a similar proposal last year, but it failed before a Senate panel. The proposal faces the hurdle of needing a two-thirds vote to even be considered in this year’s session since it’s not a budget bill.
“We’ve got to do something to help save our state budget,” said Republican Rep. Josh Miller, who proposed the enrollment freeze.
Lawmakers haven’t ruled out the possibility of taking up the Medicaid expansion budget in a special session later this year after the vacant seats are filled if the votes aren’t there. But Hutchinson and legislative leaders say they’re hopeful that won’t be necessary, or that they’d face a showdown over the program’s future.
“We got a front row seat to what a shutdown looks like…I think most people realize we don’t want that kind of governance in Arkansas,” said Senate Majority Leader Jim Hendren, who is also the governor’s nephew.
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