Senate and House Public Health Committees
February 4, 2026
Representative Jeff Wardlaw Members, if you would, grab your seats. Senator Crowell, will you open us with prayer? If you would, hit your mic. I’ll turn you on.
Senator Steve Crowell Dear Lord, we come before you today and humble just to serve the people. Please Lord be with us when we’re serving and have your hand in our brains and our thought processes when we do what we do for the people. Thank you for all your blessings and forgiveness of our sins. In your name we all pray, amen.
Representative Jeff Wardlaw Thank you, Senator. With that, I need a motion for the January 7 meeting minutes. I have a motion. I have a second? I have the second. All those in favor, say aye. All opposed. Ayes have it. Minutes are adopted. Item C on the agenda, Ms. Elizabeth Pitman and Paula Stone. We have a rule for DHS. If you guys would, introduce yourself for the record, and you’re recognized to present your rule.
Paula Stone Paula Stone, Director, Office of Substance Abuse and Mental Health, Department of Human Services.
Elizabeth Pitman And Elizabeth Pitman, Director for Division of Medical Services, Department of Human Services.
Paula Stone This rule allows rehabilitative hospitals to open psychiatric units, provide psychiatric acute services and be reimbursed by Medicaid. So we did not have that ability prior to this rule. So we have one rehabilitative hospital that’s opened in Jefferson County that is providing that psychiatric service. Medicaid was unable to pay for it. And this is a needed service across the state, particularly in that area of the state. So this allows us to be able to reimburse for those services.
Representative Jeff Wardlaw It’s a proper explanation. Seeing no questions, without objection, this rule stands reviewed. So if you would, I think you guys have the next rule and the next rule. So if you would carry on, Ms. Pitman.
Elizabeth Pitman Yes, thank you. The next rule is to allow the Department of Human Services to participate in the cell and gene therapy model, which is a Center for Medical Services model that allows us to enter into value-based payment agreements to treat patients with sickle cell disorder with CGT therapy. And happy to take any questions regarding that.
Representative Jeff Wardlaw Seeing no questions, this rule also stands reviewed without objection. Next rule, please.
Elizabeth Pitman The last rule we have on the agenda today is a rule to allow us to be exempt from the recovery audit contractor requirement of CMS. We believe that this is unnecessary. CMS has agreed and approved this exemption because we have four other layers of program integrity in place, both internal and external, including the Office of Medicaid Inspector General and the Attorney General Medicaid Fraud Control Unit. This has no cost because it is simply just allowing us to be exempt from that requirement. And again happy to take any questions
Representative Jeff Wardlaw Representative Ladyman, you’re recognized.
Representative Jack Ladyman Thank you, Mr Chairman. I don’t have a problem with this rule, but can you expand a little bit on what a recovery audit contractor is? What do they do now?
Elizabeth Pitman So they usually, on a contingency basis, will go and look for fraud, waste, or abuse of Medicaid providers, and then do recoveries of those providers who have committed that fraud, waste, abuse, or overpayment. They get a percentage of that as a contingent for anything that they recover.
There’s a state law that we are not allowed to enter into contingency arrangements for those types of agreements. So we were not able to secure a recovery audit contractor using a traditional form of payment. And so we look to other ways of doing the same function, program integrity function, to ensure that we’re not overpaying or paying out claims that are fraudulent or wasteful.
Yes, sir, internally, we have our team that does retrospective reviews to look for medical necessity and appropriate billing. We have a program integrity or payment integrity office that’s external to the DMS team that also looks post-payment to see patterns of waste, fraud or abuse. They also look for things we could do in our payment policy to make things a little more efficient and transparent.
Then we have external to us the Office of Medicaid Inspector General. They’re looking for fraud, waste, and abuse and make credible allegations of fraud that they then turn over to the Attorney General’s office for the Medicaid Fraud Control Unit and they prosecute civil and criminal fraud.
Representative Jeff Wardlaw Seeing no further questions, this rule also stands reviewed without objection. Members, there was a computer left on the table in the back. It’s an iPad issued by the House of Representatives. So if somebody’s missing their iPad, you’re welcome to pick it up here at the Chairman’s desk. Seeing no other business– yeah, Representative Pilkington, who do you need?
Representative Aaron Pilkington Just a quick question. It’s under new business. I figured we’re all here anyways, you know?
Representative Jeff Wardlaw We’ve only been here seven minutes, so you’re doing good. Ms. Pitman, you’re recognized to answer Representative Pilkington’s questions.
Representative Aaron Pilkington Good evening, Mrs. Pitman. And I’m sorry to put you on the spot here because I’m sure you weren’t prepared to talk about this. But I got the postpartum report that DHS does every quarter, and we saw an increase in uninsured. Do you guys have any kind of explanation for that spike in uninsured?
Elizabeth Pitman You’re right. I was not prepared to talk about that today. So I am not–
Representative Aaron Pilkington If you don’t, that’s okay. I just figured while we had you, we could have that discussion.
Elizabeth Pitman Lori’s coming. I would defer to Mary or Lori on that one. So Lori.
Lori McDonald Hi, good morning. Lori McDonald, DHS. Representative Pilkington, I did send you those– I’m sorry, I did send you those reports yesterday. I don’t have answers to those questions, but I will certainly get with Director Franklin and get back with you.
Representative Aaron Pilkington That’s fine. We just were here in the room. I just wanted to just get some information, but we can have a discussion offline. I’m not trying to get you or anything. Just wanted to kind of see what was going on, if you all had some any reasoning behind it. But we can talk offline.
Lori McDonald Thank you. I’ll get that for you.
Representative Jeff Wardlaw Representative Johnson.
Representative Lee Johnson Yeah, Mr. Chairman, we have a handout here– I’m trying to figure out what it applies to with regard to the agenda– around ensuring program integrity in Arkansas Medicaid. Is that something?
Representative Jeff Wardlaw It was the handout associated with E.
Representative Lee Johnson Okay, sorry I missed that one. Thank you.
Representative Jeff Wardlaw Seeing no further business, we stand adjourned.
