Public Option Failure Means Medical Care Issue Shifts To State Level

"ARKids First 'B' program spending exceeds inflation, income growth."
"The long-term liabilities of the ARKids First program should be identified." Policy Foundation memos, 2006

(January 21, 2010) The public (government) option that served as the basis for various congressional proposals failed for several reasons including grass-roots opposition from taxpayers sympathetic to the Tea Party movement. The group raises the legitimate concern that increased federal medical spending will add to record budget deficits and further deterioration in the U.S. fiscal position.

The public option's failure in Washington D.C. means the medical care issue shifts to the state level in Arkansas. State Department of Human Services Director John Selig, this month, acknowledged fiscal problems identified last decade by the Policy Foundation: state medical spending rates could soon produce a Medicaid budget gap approaching $1 billion1. State legislators were surprised at the news.

True Cost of ARKids Should Be Identified

ARKids First provides health care insurance for minors. ARKids First has two parts: 'A' and 'B' programs. ARKids First-A is Medicaid for minors. ARKids First-B "is for people who make too much money to get regular Medicaid, but still do not have health insurance for their children," according to the Department of Human Services. Eligibility charts are posted at the following link:

The program was liberalized earlier this decade. Eligibility requirements were liberalized so that families earning higher incomes could enroll in the program. The state of Arkansas has never disclosed the true cost of the program to taxpayers by calculating the long-term liabilities under various eligibility scenarios using the mechanism of an independent audit.

A financial review that identifies ARKids' long-term liabilities to taxpayers would allow the Tea Party movement to play a greater role in the Arkansas policy debate, a welcome development as the medical care issue shifts to the state level.

1 Arkansas News Bureau. "DHS chief says state Medicaid funds could run out in 2012."
Jan. 14, 2010

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Journal Publications

'Regulation of financial derivatives in the U.S. code'
Derivatives Use, Trading and Regulation
(London, U.K.) Palgrave Macmillian Ltd.
February 2006
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'Deflation & Economic Growth'
(Piscataway, N.J.) Transaction Periodicals Consortium, Rutgers University
Summer 2006

Policy Foundation research on this topic cited by Arkansas Attorney General Mike Beebe (Opinion No. 2005-291)

'A review of state statutes regulating financial derivatives in the USA'
Pensions, an International Journal
(London, U.K.) Palgrave Macmillian Ltd.
Read Online