The demise of Insure Oklahoma at the hands of the federal government means that nearly 30,000 people won't get to keep their current policies if they like them, no matter the president's promises.
This is another sign that state officials have little reason to have faith in the federal government's consistent support of a proposed alternative to Obamacare's Medicaid expansion. The alternative option would use money designated for Medicaid expansion to instead provide premium support for those who buy private-market insurance policies. That plan would duplicate much of the framework of Insure Oklahoma. It would require a federal Medicaid waiver — just like the one the government has now denied for Insure Oklahoma.
The biggest concern tied to any expansion of Medicaid or Insure Oklahoma-style alternatives remains the cost to Oklahoma taxpayers. Although the federal government will supposedly fund at least 90 percent of expenses, the 10 percent covered by the state could be substantial. Also, the feds aren't noted for keeping financial promises.
Insure Oklahoma illustrates the potential for greater costs under Medicaid expansion or alternatives. State government's share of Insure Oklahoma's expenses was about $50 million annually, funded by the tobacco tax. Yet it covered only 30,000 people even with federal matching funds and the contributions of employers and employees thrown in. The proposed Medicaid expansion involves a larger federal match, but would cover up to 180,000 people. The argument that Oklahoma can cover six times the number of people enrolled in Insure Oklahoma without significantly increasing state costs is hard to believe.
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