Gov. Mary Fallin rejected a proposal Monday to expand the Medicaid health care program to an estimated 150,000 uninsured individuals in Oklahoma and refused to establish an online marketplace for the uninsured to shop for health insurance.
For more than two years, a group of 28 states, mostly with Republican governors, have fought to prevent the implementation of the Patient Protection and Affordable Care Act, which has come to be known as Obamacare.
First, states challenged the law in federal court, but the Supreme Court upheld most of the law as constitutional in a ruling on a challenge led by Florida.
Now, many states are refusing to participate in two of the mandated programs.
By refusing the expansion of Medicaid, critics say Oklahoma is turning down between $300 million and $500 million in federal money annually to provide health insurance to those in need.
Fallin's refusal to set up a health exchange means the federal government will establish and operate one in Oklahoma.
Fallin said the Medicaid expansion is unaffordable and untenable given the fiscal challenges the federal government faces. She said any health care exchange set up by Oklahoma would be stymied with strict federal guidelines.
“If we tried to do our own state exchange, myself and other governors across the nation believe it's in name only because in the end it would be the Obama administration that would approve it,” Fallin said.
“It does not benefit Oklahoma taxpayers to actively support or fund a new government program that will ultimately be under the control of the federal government, that is opposed by a clear majority of Oklahomans, and that will further the implementation of a law that threatens to erode both the quality of the American health care system and the fiscal stability of the nation.”
Oklahoma voters passed a state question in 2010 that sought to prohibit some portions of the Affordable Care Act from being implemented in Oklahoma. State Question 756 had 64.7 percent approval.
“Oklahomans simply do not want anything to do with Obamacare, and Senate Republicans stand firmly with Governor Fallin in rejecting it,” said Senate President Pro Tem Brian Bingman, R-Sapulpa.
“We want real, conservative solutions to the rising cost of health care. We want to make care more accessible, more affordable and easier to obtain.”
State Senate Minority Leader Sean Burrage, D-Claremore, said the decision came down to politics rather than what is good for Oklahomans.
“We already currently take about $3 billion from the federal government for Medicaid,” Burrage said.
“It provides not just health care for many Oklahomans, but in many cases, it is the financial backbone for our hospitals, particularly our rural hospitals. We had an opportunity here to have compensated care for 115,000 to 200,000 people.”
Fallin sent a letter Monday to the U.S. Secretary of Health Kathleen Sebelius, informing her of Oklahoma's decision.
Legal challenges ahead
Fallin and Attorney General Scott Pruitt said they are now hopeful that Oklahoma's challenge to the Affordable Care Act — which was separate from the Florida challenge struck down by the Supreme Court — will prevail in overturning part of the federal law.
“Pruitt's lawsuit raises different constitutional questions than previous legal challenges,” Fallin said. “And both he and I remain optimistic that Oklahoma's challenge can succeed.”
Pruitt filed his lawsuit in January 2011, shortly after taking office, in federal court in Muskogee.
It seeks to have parts of the health care law ruled unconstitutional to prevent the entire law from being enforced. A stay on the lawsuit was issued by the judge until the U.S. Supreme Court decided the other lawsuit filed by Florida and 25 other states.
Pruitt said his office is reviewing several aspects of the health care law and tax, including a new rule by the Internal Revenue Service. The rule contradicts a provision in the health care law that keeps businesses from being taxed for lack of employee insurance coverage in states such as Oklahoma, where a state-run health insurance exchange has not been created.
“The Governor's decision secures our ability to continue the state's lawsuit, challenging implementation of the health care law and fighting this administration's attempt to overstep the boundaries of the law,” Pruitt said in a statement.
Health care exchange
Fallin in 2010 accepted a $54 million federal grant to set up the health care exchange, but she later rejected it at the urging of Republican leadership in the Legislature.
House Minority Leader Scott Inman said by refusing to develop a health insurance exchange, the governor has gone against one of her campaign promises — to do everything in her power to fight federal government interference in the state.
“Instead of allowing Oklahomans to establish and create an Oklahoma health care exchange, she and Republican leaders have simply extended the invitation to the Obama administration to come to our state and do it for us,” Inman said.
Burrage said he also was disappointed that the program would now be run by the federal government instead of by Oklahomans for Oklahomans.
Oklahoma already has a program in place — Insure Oklahoma — that many thought could have served as a blueprint for a marketplace for health insurance.
Dan Ramsey, chief executive officer of Independent Insurance Agents of Oklahoma, said the roughly 3,000 members he represents unanimously oppose a health care exchange of any kind.
“We've had an exchange for health insurance for over 100 years, they're called insurance agents,” Ramsey said. “But if we're going to be regulated by someone, it would be more comfortable in Oklahoma. The Oklahoma Insurance Department would be more easy for us to deal with. A customer toll-free number in Washington, D.C., is probably the least friendly option.”
Ramsey said he understands why Fallin made the decision she did, though.
Fallin said there were too many unanswered questions to have the state move forward with an exchange or the Medicaid expansion.