Health Care

Medicaid reform urgently needed

April 14, 2015

Given lower revenues available for appropriation by lawmakers, there is no better time than now to implement Medicaid reform in Oklahoma. State government in Oklahoma now spends more on Medicaid than on K-12 education and higher education combined. State government agency directors, including state Chancellor for Higher Education Glen Johnson, have noted that the significant rise in Medicaid and health care costs have put pressure on state government’s ability to provide funding for other core services.

According to the Oklahoma Health Care Authority:

• Medicaid covers approximately 61.6 percent of the births in Oklahoma.
• 359,682 people were enrolled in Medicaid in FY-2004 comprising 10.2 percent of the population, compared to 1,033,114 people or 26 percent of Oklahoma’s total population that were enrolled in the Medicaid program during FY-2014. This represents a Medicaid population increase of 187 percent.
• Of Oklahoma’s 77 counties, 35 have at least 30 percent of the population enrolled in Medicaid.
• Medicaid funded 66.8 percent of Oklahoma’s total long-term-care occupied bed days.
• Over the last decade the rate of reimbursement by the federal government for Medicaid has declined almost 14 percent
• The state share of the Medicaid program has grown from $750 million in FY-2004 to nearly $2 billion in FY-2014, increasing 161 percent.
• Emergency room visits for Medicaid totaled 548,136 for FY-2013.
• Approximately 28 percent of Medicaid enrollees visited the emergency room in FY-2013.
• The cost of emergency room visits for Medicaid in FY-2013 was $178 million.
• Aged, blind and disabled enrollees in Medicaid comprise 16.4 percent of enrollees and account for 46.4 percent of costs
• To maintain the Medicaid program as it currently exists, lawmakers would need to increase appropriated funds by $120 million.

Given the staggering reality of Oklahoma’s Medicaid program, adoption of Medicaid reform that seeks to better coordinate care and improve health outcomes is a must. Oklahoma cannot afford the status quo in Medicaid. HB 1566 by Representative Glen Mulready and Senator Kim David directs the Oklahoma Health Care Authority to begin the process of Medicaid reform with the most costly population—the aged, blind and disabled. This would create an opportunity to begin reforming Oklahoma’s Medicaid program, which has been a consistent recommendation from OCPA for several years.

To be sure, defenders of the status quo will assert there are no problems with Medicaid and that any changes will result in displacing patients to the streets without health care. This hyperbole has been used in every other state where reforms are having a positive impact. Florida, Louisiana, Kansas and other states have all moved to Medicaid reform models that seek to better coordinate care, deliver better outcomes, and hopefully transition people to independence from Medicaid. These reforms are leading to these states and others saving hundreds of millions of dollars. It’s past time for Medicaid reform in Oklahoma and HB 1566 provides an opportunity to make Oklahoma’s Medicaid program work better for patients and taxpayers.