Arkansas Senate Committee Clears Bill Ending Medicaid Assets Test

A state Senate committee on Feb. 14 passed a bill that would eliminate Arkansas' assets test for determining Medicaid eligibility, the Arkansas Democrat-Gazette reports. Under the state's current policy, the asset limit for Medicaid eligibility varies on the size of the family and excludes assets such as a home, household and personal goods, student loans, up to $1,500 equity in one vehicle and one burial plot per family member. Speaking before the Senate's Public Health, Welfare, and Labor Committee, state Sen. Jon Fitch (D), sponsor of SB 362, noted that eliminating the assets test could help the state's farmers, who have money tied up in assets such as agricultural machinery and land, but for whom recent agricultural difficulties have made low incomes "pretty much a given." Fitch asked, "Should we force (parents) to get rid of all their assets to take care of their children? It's absurd." State Rep. Gary Biggs (D), House sponsor of the bill, has suggested a compromise, which would retain the test for Medicaid eligibility but require the state Department of Human Services to raise the assets limit. According to the Democrat-Gazette, the limit has not been adjusted for inflation since 1987. But state Medicaid Director Ray Hanley has defended the assets test and expressed concern that neither SB 362 nor Biggs' suggested compromise is financially feasible. Hanley has argued that children whose parents do not qualify for Medicaid are still eligible for coverage under the ARKids First program, which offers fewer medical services and requires a copayment but which also allows for a higher family income. While removing the assets test would make more people eligible for Medicaid, Hanley estimated that SB 362 would cost between $600,000 and $1 million in 2002, expenditures that could double by 2003 due to Medicaid enrollment increases. Gov. Mike Huckabee also has endorsed the assets test, saying he did not want individuals with "fancy boats" to receive Medicaid coverage (Blomely, Arkansas Democrat-Gazette, 2/15). To view SB 362, go to http://www.arkleg.state.ar.us/2001/scripts/ablr/bills/bills4a.asp?viewbill=SB and enter 362 into both search boxes. Note: The bill appears in PDF format.