Carter: May be no fix for struggling rural hospitals


LITTLE ROCK — Arkansas’ House speaker-elect said Friday there may not be a fix for struggling rural hospitals that are backing Medicaid expansion as a way to help keep their doors open.

Rep. Davy Carter of Cabot, a Republican who will lead the first GOP-majority state House since the end of the Civil War, also said he believes term limits “don’t work” and that his decision to resign as division president of Centennial Bank had nothing to do with running for governor in 2014, something he said he is not even thinking about.

Speaking as a guest lecturer at the University of Arkansas School of Public Service, Carter said he is not convinced that Arkansas should expand Medicaid under the federal Affordable Care Act to include people earning up to 138 percent of the federal poverty level, an option that hospitals say would help them address the problem of uncompensated care.

Carter said he knows that hospitals “aren’t blowing smoke up our rear when they tell us that they’re struggling financially”’ and called the problem “grave.”

“Now I don’t know how else to say this, but I’m just a straight shooter. I don’t know that the state has an answer to that problem,” he said. “I don’t know that it can be fixed.”

The federal government would pay the full cost of the expansion for the first three years, after which the state’s share would gradually increase to 10 percent.

“This … three-year expansion money in the short time may provide some breathing room, but in the long term that’s not the answer,” Carter said. “They’re still losing 18 cents on the dollar. It doesn’t work. The math doesn’t work.”

Paul Cunningham, senior vice president of the Arkansas Hospital Association, which supports the expansion, said later that Carter is correct that Medicaid expansion is not “a panacea,” but he said it would be far better than doing nothing.

Cunningham said Medicaid would reimburse hospitals only about 80 percent of the cost to treat patients who would be covered under the expansion, so hospitals would continue to lose money. But if those same patients obtained treatment and had no Medicaid coverage, they typically would be able to pay only about 20 percent of the cost, he said.

The association has estimated that by 2014 hospitals statewide could be losing $450 million a year to uncompensated care, but that the loss could be about $200 million lower with the expansion.

“If you can keep that uncompensated level from growing exponentially like it has, then you can provide hospitals with an option of at least continuing to offer services in their community,” Cunningham said.

In answer to a question from the audience about term limits, Carter said they are not working.

“It looks pretty self-serving for a guy like me standing here telling you that, but that’s the truth. They don’t work,” said Carter, who is in his third — and because of term limits, final — House term.

Carter said it is “absolutely impossible” for a person to be elected in November and become an expert on every aspect of state government by the time a session starts in January.

“Right about the time when you get ready to leave you start understanding how the world goes around, and it’s a disservice to the citizens of the state,” he said.

Carter said he believes there should be some form of term limits, but the current ones — limiting lawmakers to three two-year terms in the House and two four-year terms in the Senate — are too short.

Carter announced Thursday that he was stepping down from his position at Centennial Bank, leading some to speculate that he may considering a run for governor in 2014. He told reporters after Thursday’s talk that he stepped down because “the speaker’s position is more than a full-time job.”

Carter said he will remain on the bank’s board and will continue to receive the same stipend that other board members receive.

Asked if he is considering a gubernatorial bid, Carter said, “I am so far not thinking about that. There’s too many things that need to be dealt with over the next three or four months.”

So far, Asa Hutchinson, a former federal prosecutor, congressman and high-ranking official in the George W. Bush administration, is the only Republican to announce plans to run for governor in 2014. The only Democrat who has declared intentions to run is Attorney General Dustin McDaniel.