Four companies have been selected to lead Gov. Kevin Stitt’s Medicaid managed care effort within the Oklahoma Health Care Authority. Stitt joined Senate Floor Leader Kim David (R-Porter) and OHCA CEO Kevin Corbett in announcing the contracts today.

Noting that Oklahoma currently has one of the worst health-outcome rankings in the country, Stitt insisted that these third-party managed care contracts would help turn that situation around.

“As leaders, we have a moral obligation to make life better for the people we serve,” Stitt said. “Business as usual will not make us a Top 10 state. Changing how we deliver health care to Oklahomans is the right path forward.”

Contracts for managing SoonerCare, as Oklahoma’s Medicaid program is known, will go to:

  • Blue Cross Blue Shield of Oklahoma
  • Humana Healthy Horizons
  • Oklahoma Complete Health, which is a subsidiary the Centene Corporation
  • United Health Care.

Oklahoma Complete Health received the contract to provide managed care for children under the custody of Oklahoma Child Welfare and Oklahoma Juvenile affairs. Neither Stitt nor agency leaders have announced which program components will be managed by the other companies, and the OHCA’s dental managed care contract recipient has not yet been revealed.

On Tuesday, the Oklahoma Health Care Authority Board approved spending as much as $2.1 billion on managed-care contracts as the state moves forward with Medicaid expansion.

Corbett said today that the selected companies will be paid on a per-member, per-month payment structure, so the total amounts of the contracts will depend on how many patients end up in each plan.

David said the new contracts would be vital as Medicaid coverage expands for Oklahoma adults.

“The people we will be serving need be helped in finding that primary care provider,” David said this afternoon. “They need that caseworker to help hold their hand and guide them through this system. We need someone to follow up on their health care needs and make sure they’re doing what needs to be done.”

Move to managed care draws criticism

Managed care, which involves a private entity taking a portion of state dollars to pursue care coordination and compliance efforts for Medicaid patients, is a controversial topic. Critics say the model siphons Medicaid money into private companies, restricts patients’ medical access and leads to reduced rates of payment for medical providers.

Today’s announcement was panned by health professional organizations in the state.

“It is unfortunate that, rather than working with stakeholders and legislators on his managed care scheme, this administration has chosen to push through an ill-conceived plan that will have serious implications for our state’s most vulnerable and at-risk populations,” Dr. Woody Jenkins of Stillwater said in a press release from the Oklahoma State Medical Association, the Oklahoma Osteopathic Association and Oklahoma’s chapter of the American Academy of Pediatrics, sent out shortly before today’s announcement. “Real leadership involves more than buzzwords and partisan talking points. It requires dialogue and compromise, two things that have been sorely lacking during this process.”

Following the announcement, the Oklahoma Hospital Association was similarly critical.

“We’re disappointed in the governor’s decision to award these contracts that will do nothing to improve the health of Oklahomans and will increase costs in the state,” the group said in a press release. “The middle of a public health crisis is not the time to be sending Oklahoma health care dollars to insurance companies to manage the care of Oklahomans.”

Managed care and the Legislature

The announcement of the selected contracts comes three days before the Oklahoma Legislature returns for its 2021 session. A bipartisan group of lawmakers in the House and Senate has criticized the concept of using private companies to implement managed care practices.

“I have some real concerns using an outside of the state company to come in and do this,” House Majority Floor Leader Jon Echols (R-OKC) recently said on NonDoc’s podcast. “I don’t know why we can’t do it inside the Health Care Authority. I think it can do the exact same function that we’re doing right now.”

David, the Senate’s most vocal proponent of third-party Medicaid managed care, was dismissive of the opposition in the Legislature.

“As to the few members who are against this (…) some of those who have been outspoken about it don’t exactly understand what the concept is,” David said at Friday’s press conference. “They know what they’ve been told, and they know they should be afraid. And then I have several who stand to gain by keeping the system the way it is.”

It remains possible that the Oklahoma Legislature could attempt to pass statute or appropriation limitations prohibiting or disrupting the Medicaid managed care effort, but any such bill would need to have support in both chambers of at least two-thirds of lawmakers to override a likely Stitt veto.

Last year, Stitt vetoed a hospital fee bill intended to help pay for Medicaid expansion costs because it also included a prohibition against Medicaid managed care.

This year, even some freshman lawmakers have already come out in opposition to Medicaid managed care.

“My district is on the border between Oklahoma and Texas, so I have constituents with experience working with managed care in Texas, and none of the people I’ve spoken to who’ve had to deal with managed care systems believe it’s good for patients or the healthcare system,” Sen. George Burns (R-Haworth) said in a press release with nine other GOP senators who oppose the plan. “Based on my conversations, they aren’t sure who it’s good for other than the out-of-state insurance companies and their stockholders.”

But Stitt told Carmen Forman of The Oklahoman that he is not particularly worried about legislative opposition to managed care.

“I don’t think that’s going to happen because there are plenty of people in the House and Senate that appreciate changing this delivery model,” Stitt said.

Oklahoma had a third-party Medicaid managed care set up in the 1990s, but technological limitations and providers declining to accept SoonerCare led to the termination of third-party managed care in the mid-2000s.