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1 million Oklahomans may go on Medicaid

BY CHRIS CASTEEL Published: March 28, 2010
WASHINGTON — Nearly one-third of Oklahomans — or roughly 1 million people — could be on Medicaid when the new health care law is fully implemented, eventually costing the state about $93 million more each year, according to a state official trying to plan for the increased enrollment.

Though the Medicaid expansion alone could dramatically lower the number of the state’s uninsured, Sen. Tom Coburn warned last week that new Medicaid patients will have trouble finding doctors because many already won’t see patients in the program. Moreover, Coburn said the low physician and hospital rates paid by Medicaid will cause more costs to be shifted to those who are covered by private insurance.

The new health reform law is expected to mean coverage for 32 million more Americans. But half of those are anticipated to be in the Medicaid program, the federal-state health care program for low-income people

Beginning in 2014, people with incomes up to 133 percent of the federal poverty level — $29,326 for a family of four — will be eligible. The Oklahoma program currently is limited to children, pregnant women and disabled people — it also helps pay nursing home costs for the elderly — but the new federal law will make anyone eligible who meets the guideline for income.

Should every Oklahoman who currently is eligible for Medicaid but not signed up, and everyone who is newly eligible participate, the state could be paying an additional $66 million a year from 2014 and 2017 and an additional $93 million for each year after that.

Nico Gomez, deputy chief executive officer at the Oklahoma Health Care Authority, said "there’s an element of mystery” about how all the pieces of the health reform law will work together.

Will the mandate to buy health insurance, which takes effect in 2014, drive eligible people to sign up for Medicaid, when many who are eligible today don’t enroll?

"The mandate provision is going to change behavior,” Gomez said. "This is a game-changer in terms of health insurance.”

Another big question for the agency is whether the economy turns around, raising incomes and making fewer Oklahomans eligible for Medicaid.

The most recent projections by the authority for the program’s participation and cost are based on today’s economic assumptions; a lot could change in the next few years.

But, Gomez said, "In the next 10 years, assuming there’s no change in the law, the state Medicaid program will have more than 1 million people.”

There are nearly 600,000 Oklahomans on Medicare, the government insurance program for seniors. So, if Medicaid expands to cover more than 1 million people and Medicare enrollment stays near the current level, about half of the people in the state will be in one of the two programs.

The health care authority is estimating that the Medicaid expansion under the new law will reduce the rate of uninsured people in the state from about 17 percent to around 11 percent. The law’s subsidies to individuals and small businesses to buy private insurance are expected to reduce that rate further.

At one time or another in the last fiscal year, the Oklahoma Medicaid program, SoonerCare, had 825,000 participants. This month, there are about 680,000 Oklahomans on Medicaid and an estimated 51,000 children whose parents have no other insurance who could be, but aren’t, enrolled.

When the new eligibility guidelines begin in January 2014, there will be 265,000 newly qualified Oklahomans, according to the health care authority.

For the first three years, the federal government is going to pay 100 percent of the costs for the newly eligible, but that doesn’t mean it won’t cost the state anything.

In part because of the individual mandate, the authority has to assume that everyone who is already eligible but not on the program will enroll, and the federal government only pays from 64 percent to 75 percent of those costs.


Key dates and events as the law is implemented:

This year
→Tax credits of up to 35 percent of premiums to small businesses.

→$250 rebate to seniors who hit the Medicare prescription drug gap — referred to as the doughnut hole.

→Prohibits lifetime caps on coverage or denying coverage to children with pre-existing conditions.

→ National high-risk pool to provide health coverage to adults with pre-existing medical conditions.

→Up to age 26 covered by parents’ insurance.

→10 percent tax on indoor tanning.

→Nutritional content must be posted at chain restaurants and vending machines.

→States get grants to develop malpractice reform.

→Drug makers’ 50 percent discount on name-brand drugs sold to people in the Medicare prescription drug doughnut hole.

→Preventive services free under Medicare.

→Individual and small group market insurance plans must spend 80 percent of premiums on medical services; large group market plans must spend 85 percent.

→50-state co-op program created to encourage non-profit, member-run health insurance.

→Subsidies begin for name-brand drugs in Medicare prescription drug doughnut hole.

→Two-year increase in payments for Medicaid primary care services.

→Medicare Part A tax increased from 1.45 percent to 2.35 percent for earnings over $200,000 by individuals and $250,000 for married couples filing jointly; 3.8 percent tax levied on unearned income.

→2.3 percent tax on medical devices.

→Individual mandate to buy insurance — lower-income people who don’t purchase will have to pay a fee of $325 in 2015 and $695 in 2016, while higher-income people will have to pay 1 percent of income in 2014, 2 percent in 2015 and 2.5 percent in 2016 and thereafter.

→Exchanges in all states to serve individuals and businesses with fewer than 100 employees.

→Subsidies to people with income up to 400 percent of the federal poverty level (about $88,000 for a family of four).

→Businesses with more than 50 employees must offer coverage or pay penalties if an employee gets federal insurance subsidies.

→Medicaid expanded to everyone under 65 whose income is up to 133 percent of federal poverty level (about $29,000 for a family of four).


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