Seeking To Encourage Medicaid Expansion, Administration Considers Market-Based Options

Compromise out of desperation

The Obama administration appears ready to allow Arkansas — and a handful of other states — to pursue a market-based approach to fund health care for the poor in place of conventional Medicaid expansion under the new federal health care law.

An announcement from the U.S. Dept. of Health and Human Services spells out exactly what states need to do to qualify.

Called "premium assistance," the alternative plan would allow states to use federal Medicaid money to buy private insurance for low-income people from new state or federal health insurance exchanges created under the Affordable Care Act. HHS said it would "consider approving a limited number of premium assistance demonstrations" as a way to test how well they work in the real world.