Oklahoma Medicaid History and Facts

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Initial Medicaid Implementation: Oklahoma began their Medicaid program in January of 1966, the first available time that states could participate. Senator Kerr of the Kerr-Mills legislation represented Oklahoma. It was estimated that approximately 16% of the population would be eligible for Medicaid when the program began. After Medicaid was implemented an estimated 8% of the population had signed up within a year of the program beginning or approximately 195,000 people. When the program began, the state offered generous eligibility levels. In 1967 when the federal matching rate was restricted to only people earning under 150% of AFDC levels the state decided to reduce eligibility levels instead of pay state funds to maintain levels at the same rate. In 1968 the state was facing fiscal pressures as the Medicaid program spending was running ahead of expectations. The state continued to face financial pressure and in 1968 the cash reserves of the state’s welfare program were so low that the state was forced to ask for federal funds in advance of the payments in order to meet the needs of the Department. At that time the state reduced payment rates to hospitals and physicians and reduced eligibility levels. Medicaid beneficiaries were also encouraged to reduce or “carefully use” the amount of benefits that they used.

Key Medicaid Political Issues: Oklahoma faces issues around rural access to health care and low reimbursement rates for providers. In 1993 the state created the Oklahoma Health Care Authority to oversee the Medicaid program. Before that point the state had seen a rise in the number of beneficiaries in the late 1980s and early 1990s, in part due to the economic conditions at that time. The growth in enrollment was coupled with a growth in spending that nearly doubled the state’s budget. The state had proposed an increase on providers to fund the increase in spending but the proposal was defeated. Instead the state cut provider payments by approximately 5% and instituted limits on beneficiary use and adult dental benefits were eliminated. As part of these reforms, the state also began transferring the Medicaid system from a largely fee-for-service based approach to begin contracting with managed care companies. By 2004 there were not enough providers to operate the managed care program and the state was forced to terminate the program. The state has considered restoring their managed care program several times but remains one of the few states in the country without a managed care program to administer their Medicaid program. The state instituted broad tax increases on oil and natural gas to fund increasing costs in the Medicaid program in 2005. The state has been focused on updating their IT system for the last decade. The state has had a premium assistance program since 2005. The state has the highest proportion of Native American residents. While Native residents often receive their health care services through the Indian Health Service, many low-income residents are dependent on Medicaid coverage to pay for their health care outside of the IHS network or to receive services not available at IHS facilities.

Medicaid Expansion Implementation: Oklahoma has not expanded Medicaid as of January 1, 2019. Legislators in the state had made several attempts to expand. In 2016 there was a suggestion to use cigarette taxes to fund the Medicaid expansion. Instead, the state made cuts to their existing Medicaid program that impacted approximately 111,000 residents. In May of 2018 the legislature passed a work requirement bill that would impact the adults and parents currently covered by the Oklahoma Medicaid program. As of January 1, 2019 the Trump Administration has not yet approved their waiver or any state who has not extended coverage to individuals making at least 100% of the federal poverty level.

General facts about Oklahoma Medicaid:

Medicaid program name: SoonerCare

CHIP Program name: SoonerCare

Separate or combined CHIP: Combination

Medicaid Enrollment: 803,600 (November 2016 enrollment)

Total Medicaid Spending: $5 billion (FY 2015 estimate)

Share of total population covered by Medicaid: 17%

Share of Children covered by Medicaid: 40% (estimate)

Share of Medicaid that is Children and Adults: 78%

Share of Spending on Elderly and people with disabilities: 57%

Share of Nursing Facility Residents covered by Medicaid: 66% (estimate)

FMAP: 59.9%

Expansion state: No

Number of people in expansion: N/A

Work Requirement: Under review

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