As the Governor and the Oklahoma Health Care Authority (OHCA) quickly attempt to privatize part of the state’s Medicaid program, also known as SoonerCare, legislators, health care providers, and members of the public have raised concerns about negative impacts on patients, providers, and taxpayer dollars. Privatizing Medicaid isn’t supported by any definitive evidence. In fact, it could potentially cost the state up to an additional $904 million per year. It will also likely hamper access to care for many Oklahomans. From rural residents to those with mental health needs, privatized managed care will have uniquely negative impacts for some Oklahomans.
The Oklahoma Legislature is now the only entity that can protect the management of Oklahoma’s historically efficient, nationally recognized SoonerCare program from being hastily outsourced to private companies. The proposed managed care plan will award $2.1 billion in management contracts to these private companies, which can collect up to 15 percent in profits and administration fees — three times higher than the amount OHCA currently uses for administrative management. As stewards of the state budget, lawmakers must protect the health care of hundreds of thousands of Oklahomans and stop this irresponsible use of taxpayer dollars.
Oklahoma’s reckless approach jeopardizes access to care
Hasty implementation of privatized managed care could have catastrophic impacts on people insured by Medicaid. In its own move to managed care, Iowa anticipated the change would take a little under a year, but was ultimately required to delay its start time by several months because of concerns about inadequate provider networks. Similarly, the OHCA hopes to fully implement privatized managed care on October 1, 2021, allowing only one year for this substantial change. As a result, it has rushed through the planning before legislators or much of the public could weigh in. This timeline, outlined below, places the health of 773,794 Oklahomans at risk.
- October 2020: OHCA issued a Request for Proposals (RFP) to seek bids from private managed care organizations (MCOs).
- January 25, 2021: The OHCA Board voted 5-4 to approve funding for the contracts, despite the fact that every public comment was made in opposition, and that the Medical Advisory Committee had already voted against the move to privatize.
- January 29, 2021: Three days before the start of Oklahoma’s legislative session, OHCA awarded managed care contracts to four MCOs, leading some lawmakers to voice concerns that the agency’s intention was to circumvent the Legislature.
- February 11, 2021: The Oklahoma State Medical Association and several other provider organizations filed a lawsuit in hopes of ensuring legislative review of the $2 billion policy change.
Additionally, OHCA must obtain federal approval for this management change through the Centers for Medicare and Medicaid Services (CMS). Privatizing the Medicaid program is contingent on this federal approval, and advocates will have an opportunity to weigh in through federal comments in advance of CMS’ decision.
No matter if or how the state moves forward with privatized managed care, Medicaid expansion will go into effect on July 1, 2021, ensuring that 200,000 Oklahomans will become newly able to see a doctor and fill a prescription without jeopardizing their financial well-being. Expansion is also expected to bring billions of dollars and thousands of new jobs into the state’s economy. To ensure these gains are fully realized, Oklahoma legislators should ensure that Oklahoma’s Medicaid expansion is robust and accessible, not hamstrung by private insurance agencies that are incentivized to limit care in search of profit.
There is still time to reverse this irresponsible change
Despite some claims that privatization is a done deal, the Legislature retains the authority to reverse this decision, either by barring privatization through state statute or by stipulating that OHCA appropriations not be used to fund commercial managed care. By taking action this session, legislators can more prudently manage taxpayer dollars that would be wasted with third-party management, ensure the fiscal health of the state’s medical providers especially in rural communities, and safeguard the health of all Oklahomans insured by Medicaid.
Actions for Advocates