Georgia could be next state to expand Medicaid private option

Georgia lawmakers may expand Medicaid to more than 500,000 state residents using the "private option" Medicaid expansion that Arkansas pioneered, reported the Atlanta Journal-Constitution.

Georgia's uninsured rate sits just above 19 percent, second only to Texas, at a time when other states have watched their rates drop significantly. In just the last year, Arkansas has reduced its uninsured rate from 23 percent to 12 percent by enrolling more than 233,000 people, while the number of uninsured patients visiting hospital emergency departments decreased by more than 33 percent in six months.

Most of that success is due to Arkansas using its federal Medicaid expansion funds to pay private insurers to administer its program. Private insurers have a strong incentive to keep their members healthy and avoid paying for costly medical care.

"The private sector, in theory, is more efficient," John Selig, head of the Arkansas Department of Human Services, told the Journal-Constitution. "That's part of what we're testing. Are they more efficient? Can they keep costs down?"

The private option also has benefited the entire insurance market because the expansion population is healthier and younger than individuals buying coverage through health insurance exchanges, Selig added.

As a result of the risk diversification, exchange premiums in Arkansas decreased by 2 percent for 2015. Diversificatio also attracted more insurers to the state; five insurance companies sell plans statewide, compared to one company before.

"The entire market is benefiting because we brought healthy lives into the market," Selig said. "That's a pretty big impact for a little state like Arkansas."

Georgia isn't the only conservative state mulling over the private option. Several other red states, including Alabama, Tennessee and Wyoming, are considering options to expand Medicaid, especially if the expansion includes certain eligibility requirements, FierceHealthPayer previously reported.

To learn more:
- read the Atlanta Journal-Constitution article