- Citing a lack of funding, Oklahoma Gov. Kevin Stitt is canceling the state's planned July 1 expansion of Medicaid, a move which — if enacted — would have expanded coverage to hundreds of thousands of low-income residents amid the COVID-19 pandemic.
- The state's health department has submitted a letter to CMS to withdraw its state plan amendments related to the expansion, Oklahoma Health Care Authority Communications Director Jonathan Cannon confirmed to Healthcare Dive on Friday.
- It's unclear how this will affect Oklahoma's request to cap funding in the Medicaid expansion population, which was posted for public comment Wednesday and, if approved, would take effect July 2021. Oklahoma in April became the first state to apply for a waiver to enact block grants in its Medicaid program under controversial guidance the Trump administration released earlier in the year.
Oklahoma is one of just 14 states that has not yet expanded the safety-net insurance program under the Affordable Care Act. Calls for expanding Medicaid have strengthened as millions of people find their health coverage threatened through mounting job losses attributed to the COVID-19 crisis.
Stitt's Medicaid expansion plan, called SoonerCare 2.0, would apply capped funding to an estimated 220,000 low-income adults with income less than 133% of the federal poverty line who would become newly eligible for Medicaid under the expansion.
As part of the plan, Stitt asked CMS for approval to expand Medicaid in March, in a bid to preempt State Question 802, a voter initiative to expand Medicaid without block grants or a work requirement program. That state question, which would enshrine expansion in the state's constitution, is up for a vote on June 30.
However, on May 21 the governor vetoed a bill that would have increased hospital fees to help fund his planned expansion, saying it didn't include enough long-term funding for the program. The bill would have generated an estimated $134 million annually — a significant chunk of Oklahoma's share of the expansion, expected to be roughly $164 million in the upcoming fiscal year.
But the economic downturn brought on by the novel coronavirus has resulted in skyrocketing rates of unemployment. Millions of Americans have likely been booted off their employer-sponsored insurance and many are newly eligible for Medicaid, something Oklahoma did not anticipate when prepping for the July expansion.
"Due to the current COVID-19 pandemic and uncertainty within the energy markets and commodity prices, unemployment rates are expected to be as high as 14%. This will not only increase the number of individuals currently enrolled in Medicaid, but will also increase the number of potential enrollees in the expanded population," Stitt wrote regarding his veto of the bill.
The state previously said it anticipates receiving approval for its block grants proposal by November, though the Center on Budget and Policy Priorities and Georgetown University's Center for Children and Families have flagged completeness issues with its waiver that could impede the approval process.
The state's health department will continue to work with CMS to "evaluate available options for delivering quality health care to Oklahomans," Cannon said.