Gov. Mary Fallin's plan to cut state spending on health care is expected to result in fewer benefits and a reduction in reimbursement rates to doctors that provide medical services to the poor.
Fallin has proposed a 5 percent reduction in state appropriations to the Oklahoma Health Care Authority, the agency that oversees the Medicaid program. That amounts to a $47 million cut to the agency's budget at a time when the federal health care law is driving tens of thousands of low-income Oklahomans into the program.
“The problems with Medicaid are creating a perfect storm for the Health Care Authority, because at a time they have to operate on less money, they're having to serve more and more people,” said Rep. Doug Cox, a Republican and emergency room physician from Grove who leads the House committee overseeing Medicaid spending.
The Health Care Authority was requesting $144 million in new funding from the Legislature this year, a large portion of which is to cover an increase in the number of Medicaid-eligible Oklahomans who are now applying for coverage because of the new health insurance mandate. The federal government also is requiring Oklahoma to increase its portion of Medicaid matching funds because of improvements in the state's economy.
But with the state currently projected to have about $170 million to spend on next year's budget, increased funding for the program is unlikely, and a spokesman for Fallin defended the cuts.
“Medicaid costs continue to rise every year,” said spokesman Alex Weintz. “Governor Fallin's budget sends a signal that taxpayers are not going to keep cutting a larger and larger check for an entitlement program that is in serious need of reform.”
The Health Care Authority has limited options for cuts because the federal government dictates the benefits that must be provided. That leaves provider rates as one of the few areas the agency can cut to gain savings.