Trump administration grants 6-month reprieve for Arkansas Medicaid expansion

Arkansas’ Medicaid expansion will get a six-month grace period starting Jan. 1 while state officials consider a replacement for the program providing health coverage to more than 200,000 low-income residents, the state Department of Human Services announced Thursday.

The state asked the U.S. Centers for Medicare and Medicaid Services for a two-year reprieve in August after the federal agency verbally denied a five-year extension of the Arkansas Health and Opportunity for Me, or ARHOME. The current waiver for the hybrid program, which uses private insurance to cover low-income residents, expires Dec. 31.

CMS notified Human Services Secretary Janet Mann that the program will remain in effect until June 30, 2027.

Mann and Republican Gov. Sarah Huckabee Sanders expressed gratitude for the six-month grace period in a Department of Human Services news release.

“Our commitment to responsible stewardship of resources and connecting eligible Arkansans to quality health care will remain our focus,” Mann said.

The Trump administration’s rejection of renewing the expansion spawned from new guidance under last year’s federal tax and spending cut legislation known as the One Big Beautiful Bill Act. It requires the expansion program to not cost the federal government more than would be projected without the program.

“CMS will request additional information from the state needed for budget neutrality certification,” the agency wrote in Thursday’s letter to Arkansas.

In 2013, Arkansas became the first Southern state to expand Medicaid under the Affordable Care Act, but used a first-in-the-nation model that used expansion funds to purchase private insurance for those eligible.

Arkansas adopted the hybrid model as a conservative alternative to Medicaid expansion when state government was divided between a Democratic governor and a Republican Legislature.

The program has survived multiple attempts to kill it, winning reauthorization each year despite the three-fourths vote needed in the House and Senate. The program easily won reauthorization in the Legislature earlier this year.

The future of Medicaid expansion is expected to be one of the Republican-led Legislature’s top priorities in the session starting in January.

Arkansas Democrats broke Republicans’ House supermajority in Tuesday’s elections, giving Democrats more leverage in discussions of how to spend taxpayer dollars. The supermajority that had been in place since 2016 allowed Republicans to pass most budget bills along party lines with at least 75 House votes.

House Minority Leader Andrew Collins said he believes Arkansas’ Medicaid expansion program has been important for individuals and the state’s healthcare system, and it needs to continue in some form. During a virtual call with reporters about Democrats breaking the supermajority, Collins said details about what the state’s Medicaid expansion program will look like are underway and will continue during next year’s legislative session.

Collins also said the six-month extension granted by the federal government was a shorter timeframe than he expected.

“So we are going to have to work very fast and work very smart to both make sure that we have something in place and that we don’t have gaps that make life more difficult for people as they transition from ARHOME into whatever comes next,” he said.

Mann told lawmakers in August that nixing Medicaid expansion completely is not an option.

The One Big Beautiful Bill Act put in place work requirements for Medicaid expansion recipients that Arkansas will start enforcing Jan. 1. Negotiations over the future of Medicaid expansion will not impact the Department of Human Services’ implementation of the work requirements, which apply to able-bodied Arkansans between the ages of 19 and 64, Thursday’s news release states.

In October, the Department of Human Services entered a three-year, $48 million contract with the Arkansas Foundation for Medical Care to set up a customer service center that will field questions about the agency’s programs, starting with Medicaid expansion.

Deputy Editor Antoinette Grajeda contributed to this story.