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Arkansas lawmakers vote to fund state's alternative to Obamacare

By Steve Barnes

LITTLE ROCK, Arkansas (Reuters) - The Arkansas House of Representatives voted on Tuesday to fund the state's so-called "Private Option" medical insurance program that has drawn interest from lawmakers in other states as an alternative to Obamacare.

The measure, which had earlier passed the state Senate, received 76 votes, one more than necessary in the 100-member House. This ended a more than week-long standoff over the health insurance program for lower-income residents.

The Private Option uses $915 million in federal Medicaid funds from the Obama Administration's Affordable Care Act, or Obamacare, to purchase health insurance for employed individuals whose earnings hover just above the federal poverty level.

Those with incomes below the poverty line would be routed to the standard Medicaid program.

Medicaid is a government program that provides free or low-cost health coverage to low-income citizens. Obamacare requires participants to buy health insurance from a private company or employer. It provides subsidies for those who cannot afford insurance but make too much money to qualify for Medicaid.

The debate in Arkansas was watched closely by several other states that have adopted the approach or are considering it, including such presidential election swing states as Ohio, Pennsylvania and Michigan.

The plan appeals to some conservative lawmakers who want to provide healthcare for the uninsured through the private sector rather than the federal Medicaid program. It also fits the Obama administration's goal of seeing states use federal Medicaid money to provide insurance for lower-income residents.

The Private Option was crafted by Governor Mike Beebe, a Democrat, and Republican legislative leaders.

Both houses in the Arkansas legislature are controlled by Republicans opposed to Obamacare but divided on whether the Private Option is a reasonable alternative.

A bloc of staunch-conservative Republican lawmakers had stymied the appropriation, complaining that the state's share of Private Option funding would soon prove too costly.

They also said Obamacare was a gross and intrusive expansion of the federal government that would deepen the national debt.

About 125,000 low-income Arkansans already have enrolled in the Private Option or have applied.

Beebe had warned that failure to fund the plan would destroy his proposed $5 billion state budget for the fiscal year beginning July 1.

While expressing opposition to the Affordable Care Act, Beebe defended the hybrid program as "pragmatic."

(Reporting by Steve Barnes; Editing by Jon Herskovitz and Lisa Shumaker)

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