Oklahoma voters on Tuesday narrowly approved a ballot initiative that will expand Medicaid to cover more low-income residents.
Oklahoma was the first state to vote on expanding Medicaid since the COVID-19 pandemic began, and Missouri is scheduled to vote on the issue in August. The vote disrupts Oklahoma Republican Gov. Kevin Stitt's plan to make the state a test case for the Trump administration's Medicaid block grant demonstration.
The result is another blow to the Trump administration's healthcare agenda in an election year. The administration is pursuing a lawsuit before the Supreme Court that could invalidate Medicaid expansions across the country.
Oklahoma has the second-highest uninsured rate in the country behind Texas. The Oklahoma Health Care Authority projected that more than 200,000 new Medicaid enrollees may sign up due to the ballot initiative's passage, for a total annual cost of about $1.3 billion. The estimated state share would be about $164 million. But those numbers could be considerably higher given the number of Oklahomans who have lost their jobs and work-related health insurance because of the economic shutdown during the coronavirus pandemic.
Total Medicaid enrollment was 833,302 in May, according to the most recent state data.
The initiative requires Oklahoma officials to begin enrolling members no later than July 1, 2021. Oklahoma Health Care Authority spokesperson Katelynn Burns said some aspects of the state's Medicaid block grant demonstration application will be incompatible with the new Medicaid expansion, and the agency is collaborating with CMS and state leaders to evaluate available options.
"OHCA will re-evaluate the (Healthy Adult Opportunity) waiver to determine if it is operative and in Oklahomans' best interest," Burns said in a written statement.
State officials will now have to wrestle with how to pay for the expansion as they face down a budget shortfall. Stitt reversed course and abandoned plans to pursue a traditional Medicaid expansion earlier this year, and in May vetoed a bill that would have mostly paid for the first year of the expansion by raising hospital fees. The Legislature is expected to attempt again to increase that fee from 2.5% to 4%, generating about $134 million annually.
Critical-access hospitals are exempt from the fees. Richard Gillespie, president of the 18-bed Jefferson County Hospital, said smaller hospitals would be able to ride the coattails of larger hospitals who would pay the increased fees. If the Oklahoma officials had stayed the course and expanded Medicaid legislatively, the expansion would have started Wednesday.
"Hardworking Oklahomans would have had coverage now, and we would have had money for operational expenses, but now we have to wait a year for it," Gillespie said.
But during the campaign, Stitt claimed that payment for the expansion would have to come through cuts to other programs.
"We have a billion-dollar shortfall next year," Stitt said recently at a forum hosted by Americans for Prosperity, a Koch-backed political advocacy group that opposed the measure. The state would have to "either raise taxes or cut services somewhere else like education, first responders, or roads and bridges" to pay for the expansion, he said.
The Oklahoma Hospital Association supported the ballot initiative, and recent rural hospital closures in the state were a point advocates used to argue for the expansion. Hospitals indicated they are gearing up for the legislative slog to implement voters' wishes.
"We look forward to working with lawmakers on budget options to fund expansion without raising taxes," the Oklahoma Hospital Association said in a written statement.
Idaho, Maine, Nebraska and Utah have all expanded Medicaid through ballot questions, but did so by amending state statutes, according to the nonpartisan Kaiser Family Foundation.
Oklahoma's ballot initiative amended the state constitution and was designed to weather opposition by state officials.
"Before tonight, we were the second to worst state in the country when it came to the number of people going without healthcare. After tonight, we are the only state in the nation to guarantee access to healthcare that politicians can never take away," said Amber England, the manager of the campaign in favor of the ballot initiative.
Some Republican opposition to Medicaid expansion has eroded in recent years, particularly in rural areas where hospitals have suffered financial problems or closed.
Kevin Penry, a Republican and retired pastor from Edmond, said that before going on Medicare last month he had to buy expensive insurance on the federal marketplace, which "really made me feel for folks who are in a difficult financial situation." He said he voted for the expansion.
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