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Beebe, Legislative leaders discuss upcoming session

story by Roby Brock, a TCW content partner and owner of Talk Business
roby@talkbusiness.net 

A confident, comfortable and cooperative Gov. Mike Beebe (D) said he expects his final regular legislative session to be “just fine” despite Republican majorities in both chambers of the legislature.

“I haven’t heard anything that gives me real concern,” said Beebe, noting that Republicans have largely said they support the cornerstones of his agenda: education and economic development.

Beebe, who will be term-limited in 2014, spoke with reporters at an Associated Press Managing Editors forum at the state capitol. Also speaking during the event were Sen. Michael Lamoureux, R-Russellville, and Rep. Davy Carter, R-Cabot. Lamoureux is the incoming Senate President, and Carter is the incoming House Speaker.

Beebe said he has a great respect for the Arkansas legislative branch and the two GOP leaders – Lamoureux and Carter – who will head the 89th General Assembly next week.

MEDICAID
On the big issue of Medicaid cuts and potential expansion, Beebe said he’s open to solutions being discussed by lawmakers, which includes more surplus spending, potential service reforms, and possible federal funding.

Beebe has proposed using some surplus money to close the funding gap as well as about $139 million in cuts to services that would affect nursing homes, small businesses, and dental care for citizens.

Lawmakers have suggested that a legislative plan that formulates a state-specific Medicaid solution – an “Arkansas plan” – could be sold to the feds by Beebe in an effort to find an answer that includes some sort of waiver or waivers.

“I don’t think the request of the leadership from the General Assembly. ... I don’t think it’s an unreasonable request on their part,” Beebe said.

Beebe said he’s not sure what sway he might hold with federal regulators on the issue, but he’s open to the prospect.

“I don’t have a magic wand,” he said.

He noted that the only caveat he’d hold out is that he would not support an “Arkansas plan” that was inconsistent with his philosophy in some way. He used drug testing that was punitive not rehabilitative as a possible objection.

Beebe said there would be a couple of “project” surprises in his legislative package that he’ll propose to the General Assembly next week. He did not offer specifics, but said they would not depart from current policy.

‘NOT GOING TO THROW PEOPLE OUT’
Carter and Lamoureux (R) say they favor using existing surplus funds and projected revenue growth to shore up a projected $350 million Medicaid shortfall.

“Cuts aren’t the starting point,” Carter told reporters at an Associated Press Managing Editors forum at the state capitol.

“We’re not going to throw people out of a nursing home,” Lamoureux added.

The two leaders of the General Assembly stressed that the Medicaid shortfall and possible expansion of the program under the guise of the federal health care law would be the overriding issue of the session, which starts next week.

“That issue is going to drive almost every other monetary issue,” said Carter. “It’s the big elephant in the room.”

Neither leader is convinced that a Medicaid expansion – which the federal government has said is an “all or nothing” offer – will offer a solution to the state’s problems.

Lamoureux said he felt when the session started and legislators could spend more time debating pros and cons, he felt a compromise would emerge. He also said that the learning curve for members was evolving.

“When I meet with outside [health care] groups, I feel like I learn something new, I feel like I learn something I should have known six months ago,” said Lamoureux.

MEDICAID ‘MATH’ CONCERN
Carter said he had concerns about an expansion increasing the state’s population to being one-third supported by Medicaid.

“I’m not sold on it yet,” he said. “I’m focused solely on the math.”

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The math may be more difficult with the federal government’s interpretation that states must fully engage in Medicaid expansion, not grow the program incrementally.

“All or nothing takes away the ability to negotiate something,” Lamoureux said.

He expounded on some conservative reforms he felt members would push for, such as scaling back on services, drug testing, and co-pays for Medicaid users.

Both leaders said that there would still be discussion and potential for tax cuts, even with the Medicaid debate.
Lamoureux said a sales tax break on energy for manufacturers and a tax break on parts taxed for plant expansions would be debated. Carter has led an effort to look at reforming the state income tax.

Beebe has proposed further reducing the grocery tax, which could cost about $70 million from the state coffers.

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