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managed Medicaid
The Oklahoma Health Care Authority's headquarters are located on Lincoln Boulevard north of the Oklahoma State Capitol. (William W. Savage III)

Oklahoma political leaders are taking different cautious approaches to the potential implementation of a managed Medicaid program.

While Gov. Mary Fallin has ordered the Oklahoma Health Care Authority to “delay the start date” of the controversial managed care program until July 1, 2018, she asked OHCA to “continue implementation activities” in a letter dated May 10 (embedded below). As such, she did not ask the agency to delay awarding a contract for the program.

But the Oklahoma House of Representatives passed HR 1009 on Tuesday directing OHCA to:

… refrain from awarding or signing any contract based on the request for proposals initiated for care coordination models for aged, blind and disabled persons, due to the uncertainty of new federal managed care regulations that will impact the Medicaid budget.

House Floor Leader Jon Echols (R-OKC) noted that while a resolution does not carry the weight of a law, 59 House members co-authored it, meaning the votes were likely there in the House if members felt they needed to force OHCA to pause its contract process as opposed to simply asking them nicely.

“With all that’s going on at the federal level, it sends a message to the agency that the House would like them to hit the pause button,” Echols said. “Not the rewind button. Not the stop button. The pause button.”

Echols, who emphasized that he does not oppose managed Medicaid in general, said the agency could still award the contract if it wants to.

“If they do it and there are issues that arise, that would fall square on the agency and the agency head because they were warned what would happen,” Echols said. “I would think the ramifications would be very severe if they did it anyway and we end up losing pass-through (dollars), especially after we’ve said it makes sense to slow down.”

‘We can cancel contracts’

The Oklahoma Senate, on the other hand, appears likely not to hear a similar resolution asking for a pause on the contract’s possible award.

“I don’t believe at this time that we’re inclined to hear it on the Senate side,” said Sen. Kim David (R-Porter). “I believe that the governor’s letter went to great strides to try to reassure our providers that we are looking out for them on the SHOP payment. And that’s always a concern for us.”

The state’s Supplemental Hospital Offset Payment (SHOP) program helps draw additional federal dollars to Oklahoma by pooling a self-imposed fee on certain hospitals. It’s an example of a type of payment that could be in jeopardy under a new federal Medicaid rule implemented in January.

“Years ago I ran the original SHOP payments making sure they had those pass-through payments. So I’m not going to do anything that’s going to jeopardize those,” David said. “We have all through next session to be able to look at that again. If it looks like CMS isn’t able to come up with a solution for us, we can address it then. We can continue to push it back, or we can cancel contracts. We have done that.”

But Echols said he doesn’t believe it’s wise to award a contract under such uncertainty.

“We don’t know what Medicaid is going to look like even six months from now,” Echols said. “Why we would bind ourselves to a new program with that much flux, it doesn’t make sense.”

Concern about whether to move forward with the managed Medicaid effort grew this legislative session in the wake of a new federal rule that could have caused the program to lose hundreds of millions of dollars.

The Centers for Medicare and Medicaid Services issued the new rule in January. It would limit pass-through (aka supplemental) payments for any state that adopts a new managed-care model. Oklahoma had been pursuing a managed-care model for ABD SoonerCare enrollees as an attempt to lower costs associated with that patient population.

HR 1009

Gov. Mary Fallin letter to OHCA

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William W. Savage III holds a journalism degree from the University of Oklahoma. He covered two sessions of the Oklahoma Legislature for eCapitol.net before working in health care for six years. He is a nationally certified Mental Health First Aid instructor.