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Oklahoma and the ACA’s Medicaid expansion

Medicaid expansion takes effect July 1, 2021, with enrollment starting June 1

Medicaid expansion initiative approved by voters; expansion will take effect in July 2021 (and Medicaid managed care takes effect October 1, 2021)

Oklahoma Medicaid (SoonerCare) is undergoing some significant changes in 2021. Medicaid expansion, as called for in the ACA, takes effect in July, with coverage newly available to non-elderly adults earning up to 138% of the poverty level. And in October, the Medicaid program is transitioning to a managed care system (SoonerSelect), with four private insurers contracting with the state to provide Medicaid benefits to eligible residents.

Although Medicaid expansion has been in the works in Oklahoma since the summer of 2020, the state will still benefit from the American Rescue Plan‘s two years of additional federal funding for states that newly expand Medicaid after March 2021. In Oklahoma’s case, this amounts to about $500 million in additional funding, on top of the 90% funding that the federal government will provide indefinitely for costs associated with the newly eligible population.

In June 2020, voters in Oklahoma passed a Medicaid expansion ballot initiative, paving the way for Medicaid expansion to take effect in Oklahoma. The measure passed by a slim margin, garnering 50.5 percent of the vote. Oklahoma joins several other states — Maine, Utah, Idaho, Nebraska, and Missouri —where voters have approved Medicaid expansion ballot initiatives over the last few years, after state lawmakers or governors had rejected Medicaid expansion for several prior years.

Medicaid expansion in Oklahoma goes into effect on July 1, 2021. Eligible enrollees can sign up starting on June 1, with coverage effective July 1. At least 200,000 Oklahoma residents are expected to gain eligibility for Medicaid under the new rules, including 110,000 who are currently stuck in the coverage gap  (prior to Medicaid expansion, they too little to qualify for premium subsidies in the exchange, but are also ineligible for Medicaid).

Estimates vary in terms of how many people will gain eligibility for Medicaid once expansion takes effect in Oklahoma. The Robert Wood Johnson Foundation estimates it would be at least 160,000 people. A study commissioned by the Oklahoma Health Care Authority (the agency that oversees Medicaid in the state) estimated that there would likely be more than 200,000 newly eligible residents. The Center on Budget and Policy Priorities estimates 225,000. And the Oklahoma Hospital Association (which notes that rural hospital closures are due in part to the state’s failure to accept federal funding to expand Medicaid) estimates that 272,000 people would gain access to Medicaid in the first full year of expansion. All of those numbers were calculated before the COVID-19 pandemic, though, so the actual number of newly eligible people could be considerably higher if the employment effects of the pandemic continue (employment is stronger than it was in the early months of the pandemic, but is still far short of full recovery).

Medicaid expansion ballot measure: The backstory

The process of getting a Medicaid expansion measure on the ballot and approved by voters took a substantial amount of work. Medicaid expansion supporters in Oklahoma gathered signatures in 2019 for Question 802, which calls for Medicaid expansion under the terms outlined in the ACA (i.e., to anyone earning up to 133 percent of the poverty level, plus the built-in 5 percent income disregard). They needed 177,958 valid signatures by October 28, 2019, and reportedly submitted 313,000 — the most signatures that had ever been collected for a ballot initiative in the state. The Secretary of State’s office determined that 299,731 signatures were valid, and sent them to the Oklahoma Supreme Court to have the measure officially certified for the state’s 2020 ballot. In January 2020, Oklahoma’s secretary of state confirmed that the measure would appear on the ballot in 2020 (updates on the status of the initiative are available here, under Question 802).

However, it was up to Gov. Kevin Stitt — a Republican who opposes Medicaid expansion and has expressed opposition to the ballot initiative — to determine whether the Medicaid expansion question should be on the primary ballot in June, or on the general election ballot in November. Stitt ultimately determined that the measure would appear on the June 30, 2020, primary ballot. It’s rare for a governor to opt to put a ballot initiative on the primary ballot, although former Gov. Mary Fallin did so with a medical marijuana initiative in 2018.

Stitt had previously said that he would not sign legislation calling for unaltered Medicaid expansion as outlined in the ACA, and he did not support the ballot initiative as it also called for the ACA’s expansion of Medicaid, without any modifications. But the Stitt administration had also proposed an alternative approach to Medicaid expansion — dubbed SoonerCare 2.0 — that would have eventually included premiums, a work requirement, and a per-capita spending cap. And as described below, Oklahoma was also awaiting CMS approval for a proposed Medicaid work requirement for the state’s existing Medicaid population, although the Biden administration is in the process of rescinding already-approved Medicaid work requirement waivers and will not approve any that were still pending after the Trump administration left office.

SoonerCare 2.0 is described below in more detail, but Ballotpedia has a useful side-by-side comparison of SoonerCare 2.0 and the ballot initiative (Question 802). As voters approved Question 802, Medicaid expansion will take effect in Oklahoma as of July 2021, with no strings attached. SoonerCare 2.0 called for Medicaid expansion a year earlier — on July 1, 2020 (just one day after voters cast their ballots regarding Question 802) — but various restrictions would have then be added to the program a year later, assuming they had been approved by the Trump administration and left intact by the Biden administration.

But the future of SoonerCare 2.0 was upended after Governor Stitt unexpectedly vetoed a bill that would have provided funding for the program. Stitt had proposed the SoonerCare 2.0 program before the COVID-19 pandemic began, but noted that the widespread unemployment due to the pandemic has resulted in far more people who would be eligible for coverage under expanded Medicaid, at a financial cost that would be significantly higher than the state had initially projected. Once Stitt vetoed the funding bill, the state withdrew its expansion state plan amendment. So Medicaid was not expanded as of July 2020 under SoonerCare 2.0.

A month later, voters in Oklahoma approved ballot Question 802, paving the way for full (no strings attached) Medicaid expansion to take effect in the state as of July 2021.

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Oklahoma Medicaid enrollment numbers

As of November 2020, there were 854,774 Oklahoma residents enrolled in SoonerCare, the state’s Medicaid program. Two-thirds of them were children.

For perspective, SoonerCare enrollment stood at 790,051 at the end of 2013, and had been at just under 808,000 as of April 2020. But Medicaid programs all across the country saw ballooning enrollment in the spring of 2020, amid the COVID-19 pandemic, and this was true even in states that hadn’t expanded Medicaid under the ACA.

But overall, total enrollment in Oklahoma’s Medicaid program has not changed significantly since the Affordable Care Act (ACA) implementation began — as opposed to a national average enrollment increase of 38% — because Oklahoma has not accepted federal funding to expand Medicaid under the ACA. That will change substantially in the summer of 2021, when Medicaid is expanded in Oklahoma under the terms of State Question 802.

Gov. Stitt’s alternative to a Medicaid expansion ballot initiative: SoonerCare 2.0 (expansion, but with strings attached)

As described below, Oklahoma submitted a waiver proposal to CMS in December 2018, seeking permission to implement a Medicaid work requirement. But Governor Stitt’s administration had also been working on a new approach, called SoonerCare 2.0. Instead of the straight Medicaid expansion called for in the ballot initiative that was ultimately approved by voters in 2020, Stitt’s proposal was significantly more complicated.

In early 2020, the Stitt administration expressed support for the Trump administration’s Healthy Adult Opportunity Medicaid waiver approach, and rolled out a proposal designed to take advantage of the new flexibility the federal government is offering states.

SoonerCare 2.0 called for Medicaid expansion as of July 2020, although as noted above, that was canceled as a result of the COVID-19 pandemic. But the second phase of the program, which would have required federal approval and would have taken effect in July 2021, called for premiums for people eligible due to Medicaid expansion, a per-capita spending cap, a waiver of retroactive coverage, and a Medicaid work requirement (the Biden administration has notified states that approved work requirements are being reconsidered and likely rescinded, and that additional work requirement proposals are unlikely to be approved, as they do not mesh with the goals of the Medicaid program; no Medicaid work requirements have been in effect anywhere in the country since early 2020).

The Stitt administration opened a public comment period for the SoonerCare 2.0 proposal in mid-March 2020. The comment period closed in mid-April 2020, although the COVID-19 pandemic may have reduced the amount of public attention focused on the state’s Medicaid waiver proposal. As described above, Stitt surprised lawmakers in May 2020 when he vetoed the bill they had passed that would have provided funding for the SoonerCare 2.0 program that Stitt had proposed. And the state soon withdrew the state plan amendment that called for Medicaid expansion to take effect in July 2020.

Although Medicaid expansion in July 2020 would have significantly improved access to health coverage in the state, consumer advocates worried that the various restrictions in the proposed SoonerCare 2.0 plan would have subsequently reduced the number of people covered under the program. And the proposed per-capita spending cap would have hampered the program’s ability to cope during an economic downturn.

Since late 2018, Oklahoma has been awaiting federal approval for a Medicaid work requirement

Oklahoma has long been seeking federal permission to impose a work requirement on its Medicaid population (despite rejecting Medicaid expansion until voters authorized it themselves). The work requirement proposal ws based on the executive order signed by then-Governor Mary Fallin in March 2018, and HB2932, enacted in May 2018, both of which directed the Oklahoma Health Care Authority to seek federal permission to implement a Medicaid work requirement.

Throughout the summer of 2018, the Oklahoma Health Care Authority received 1,000 comments from the public on the proposed work requirement. The state submitted its proposed SoonerCare amendment in December 2018 (the proposal was still pending federal approval when the Biden administration took office; states have been notified of the new administration’s stance that Medicaid work requirements are not in line with the Medicaid program’s goals and are not likely to be approved). The state’s proposed amendment would:

  • Require non-exempt SoonerCare enrollees, age 19-50, to work at least 20 hours per week (or participate in various community engagement activities, including community service, job training, etc. for a total of 20 hours per week).
  • Allow the state to waive retroactive eligibility (except for blind, elderly, and disabled population, and Tax Equity and Fiscal Responsibility population).

Various populations would be exempt from the work requirement. Exemptions would include pregnant women, a caretaker of a child under 6 (or an incapacitated person of any age), people participating in substance abuse treatment, disabled enrollees, those who are medically or physically unable to work, etc.

The state estimates that out of 102,000 SoonerCare enrollees who are age 19 to 50, roughly 6,000 would be subject to the work requirement, as the rest would be exempt (again, this is based on pre-Medicaid expansion numbers).

If a non-exempt person did not comply with the work requirement, their Medicaid coverage would be suspended. After at least one month of suspension, the person would be allowed to re-apply for Medicaid, but would have to demonstrate that they’re in compliance with the work requirement.

The draft proposal noted that non-elderly adult Medicaid enrollment in Oklahoma had been relatively flat since 2014, but “is expected to decline as members move from public assistance to community engagement by becoming gainfully employed as a result of the education and training initiatives under this demonstration.” In other words, they expected people to lose their Medicaid coverage — which could happen because a person works enough that their income exceeds the Medicaid eligibility cap (for a single parent with one child, that was less than $7,000 in annual earnings in 2018), or because they failed to comply with the work requirement (which can happen for a variety of reasons including lack of understanding of the reporting requirements, even for people who are working).

The impact of delaying Medicaid expansion by seven years

Oklahoma’s Medicaid expansion will take effect on July 1, 2021 — seven and a half years after federal funding for Medicaid expansion first became available under the Affordable Care Act.

Due in large part to lack of Medicaid expansion thus far, Oklahoma is one of only two states where the uninsured rate is still above 14%. According to US Census data, 14.3% of Oklahoma residents were uninsured in 2019. Texas is the only state with a higher uninsured rate. Nationwide, the average uninsured rate was 9.2 percent in 2019.

Democrats in Oklahoma’s legislature have been pushing for Medicaid expansion for years. But Republicans hold a substantial majority in both chambers of the state’s legislature, and Governor Kevin Stitt continued former Governor Mary Fallin’s opposition to Medicaid. After years of lawmakers rejecting Medicaid expansion, a ballot initiative ultimately took the issue directly to the state’s residents, and they approved it.

Oklahoma commissioned the Leavitt Report, which found that expansion of Medicaid would directly cost the state $850 million over a ten-year period, but would ultimately result in a net savings of $464 million for Oklahoma over the same time period, when other factors were taken into consideration. Despite that finding, the state legislature has not been receptive to expansion of Medicaid. Lawmakers and the Governor have concerns over the amount that the state is currently spending to provide care for the existing Medicaid population, and they’ve expressed concerns about the sustainability of adding more people to the state’s Medicaid program.

But by not expanding Medicaid, Oklahoma has been missing out on $8.6 billion in federal funding between 2013 and 2022. And Oklahoma residents are paying federal tax dollars that are being used to pay for Medicaid expansion in other states. Once Medicaid is expanded, that federal funding will start to flow into Oklahoma, creating jobs, protecting rural hospitals, and ensuring that low-income residents have health coverage.

Lawmakers rejected controversial legislation in 2016, but it likely wouldn’t have expanded Medicaid even if it had passed

In May 2016, there was a flurry of news articles indicating that Oklahoma might be on the brink of agreeing to Medicaid expansion. But the legislation in question – HB3210 – did not pass, and wouldn’t necessarily have expanded Medicaid, even if it had passed.

Oklahoma was facing a significant budget shortfall and the possibility of having to cut Medicaid provider reimbursement rates by 25 percent. Ultimately, lawmakers passed a budget that did not call for a reduction in Medicaid reimbursements, but they also did not move forward with Medicaid expansion.

Prior to the passage of the budget, in an effort to shore up the financial situation, four Republican lawmakers introduced HB3210 in May 2016. The legislation called for an additional cigarette tax of $1.50 per pack (on top of the $1.03 per pack tax that already exists in Oklahoma).

The money collected by the cigarette tax would have then been deposited into the state’s “Healthcare Revolving Fund” and could have been used by state agencies that receive federal matching funds under the Social Security Act (e.g., Medicaid). HB3210 was supported by Oklahoma Governor Mary Fallin.

The measure passed out of committee on May 17, but failed in a vote on the House floor on May 18. The final vote was 59 to 40, and the measure needed at least 76 Representatives in favor in order to pass. All of the yes votes came from Republicans, while the no votes included both Republicans and Democrats.

The deal-breaker for Democrats was that the measure did not specifically require the state to expand Medicaid. It would have essentially been a very regressive tax (tobacco use is much more common among lower-income residents), and the money in the Healthcare Revolving Fund would have been apportioned by lawmakers to agencies that get federal matching Medicaid funds – but there was no accompanying requirement that the state expand its eligibility guidelines for Medicaid.

Failed attempt to cut Medicaid eligibility for parents

Despite not expanding Medicaid under the ACA, Oklahoma also attempted to go one step further than that, and tighten already-stringent eligibility rules even more.

Amid a budget shortfall of $1.3 billion, lawmakers in the Oklahoma House of Representatives passed HB2665 in March 2016. HB2665 called for eliminating Medicaid eligibility for non-pregnant, able-bodied adults under age 65. All 30 Democrats in the Oklahoma House opposed the bill, and were joined by four Republicans.

But the Senate did not pass HB2665, so Medicaid eligibility for parents in Oklahoma remained unchanged.

As background, the only non-pregnant, able-bodied adults under age 65 who currently qualify for Medicaid are those with household incomes up to 41 percent of the poverty level, and who also have dependent children. For a household of two (one adult and one child), that’s an annual income of about $6,750 in 2018.

Most able-bodied adults with dependent children aren’t able to qualify for Medicaid in Oklahoma because their incomes aren’t low enough. And able-bodied adults without dependent children aren’t eligible for Medicaid at all in Oklahoma, regardless of their income, because the state has not accepted federal funding to expand Medicaid.

If HB2665 had been passed by the Senate and signed into law, it would have cut about 111,000 people from SoonerCare (Oklahoma Medicaid), effective November 2016. The measure was expected to save the state about $130 million a year, but the state would have also missed out on $203 million a year in matching funds if they had eliminated the state funding.

The federal government would have had to approve a waiver in order for Oklahoma to be able to cut Medicaid eligibility for low-income, able-bodied parents. Representative Doug Cox (R-Grove) authored HB2665. He has also said that he was “working with some folks to design something” in terms of legislation to expand Medicaid in Oklahoma under the ACA.

Oklahoma backed away from Medicaid managed care in 2017, but is switching to managed care as of late 2021

In 1995, Oklahoma contracted with private insurers in a capitated managed care program to serve Medicaid enrollees in the Tulsa, Oklahoma City, and Lawton areas. But by 2004, the state had pulled the plug on the managed care system after too many providers dropped out.

In 2015, in an effort to reign in Medicaid spending growth, lawmakers in Oklahoma began considering the possibility of reviving the managed care model for the state’s Medicaid enrollees. Some advocates for Medicaid patients were opposed to the possibility, noting that it would result in disabled, blind, and elderly residents needing to switch to new doctors and new treatment plans. But supporters of the privatization note that there have been many advances in Medicaid managed care programs in the last two decades.

In May 2015, lawmakers in Oklahoma passed HB1566, which directed the state to implement a pilot program to evaluate the managed care model for Medicaid enrollees, and gather proposals from private insurers. Twenty three “outside parties,” including Blue Cross Blue Shield of Oklahoma, provided proposals to the state. Blue Cross Blue Shield indicated that their recommendations could cut total Medicaid spending in Oklahoma (including federal and state spending) by up to $450 million over five years. But in mid-2017, Oklahoma cancelled the Request for Proposals for Medicaid managed care organizations.

As of 2018, according to Kaiser Family Foundation data, Oklahoma was one of only 12 states that didn’t have any managed care organizations contracted with their Medicaid program.

That’s changing in 2021, however. The state has opted to transition to a Medicaid managed care approach as of October 2021, with four private health insurers and three private dental insurers contracting with the state to provide Medicaid benefits to eligible enrollees. The new Medicaid managed care system is called SoonerSelect.

Who is eligible for Medicaid in Oklahoma?

Although the state’s SoonerCare Medicaid coverage is available for Oklahoma children with household incomes as high as 205% of poverty, parents with dependent children are only eligible for Medicaid if their annual household income is under 41% of poverty (just over $10,000 for a family of four), and most childless adults are ineligible regardless of income. Insure Oklahoma helps to provide coverage for low-income adults, and is discussed below.

But that’s changing as of July 2021. Medicaid expansion will take effect at that point, ensuring that non-elderly adults are eligible for Medicaid with household income up to 138% of the poverty level (that amount to $17,774 for a single adult). Children and pregnant women will continue to be eligible for Medicaid at higher income levels, although nothing is changing about Medicaid eligibility rules for people age 65 and older.

As part of a demonstration waiver that was approved in 2019, up to 3,000 full-time college students aged 19 to 22 in Oklahoma could be covered under Medicaid if their incomes don’t exceed 200% of the poverty level (the cap was raised to 250% in 2010, but eligibility for students who don’t work for a qualifying employer is limited to 100% of the poverty level). The state has clarified that dependent college students must count their parents’ household income, whereas independent college students (who aren’t considered dependents for tax purposes) can enroll based on their own income. SB1548, introduced in February 2016, would have increased the age limit for the demonstration waiver to 26, would have removed the requirement that the student be in school full-time, and would have expanded the term “college” to include trade and technical schools. But SB1548 did not advance out of committee.

How does Medicaid provide financial assistance to Medicare beneficiaries in Oklahoma?

Many Medicare beneficiaries receive Medicaid’s help with paying for Medicare premiums, affording prescription drug costs, and covering expenses not reimbursed by Medicare – such as long-term care.

Our guide to financial assistance for Medicare enrollees in Oklahoma includes overviews of these benefits, including Medicare Savings Programs, long-term care coverage, and eligibility guidelines for assistance.

How do I enroll in Medicaid in Oklahoma?

You can apply at HealthCare.gov or by phone at 1-800-318-2596. Applications can also be completed online through the SoonerCare enrollment portal. Medicaid enrollment is available year-round.

Assistance is also available by phone.  The SoonerCare Helpline can be reached at 1-800-987-7767.

For applicants who are aged, blind, or disabled, enrollment can be completed at an Oklahoma DHS Human Services Center.

Other low-income health programs in Oklahoma

In addition to SoonerCare Medicaid, the state also operates SoonerPlan, which is a state-funded program to provide family planning services to men and women with incomes that do not exceed 133 percent of poverty level, and who are not enrolled in SoonerCare Medicaid.

Another state-run program, Insure Oklahoma, predates the ACA by several years and subsidizes private health insurance for residents with incomes up to the poverty level. Prior to 2014, the upper income limit for Insure Oklahoma was 200% of poverty level, but the limit was lowered in January 2014 because enrollees with incomes above 100% of poverty became eligible to receive federal tax credits to offset the cost of private plans purchased through the exchange.

Insure Oklahoma offers assistance to people who obtain employer-sponsored insurance from one of the 4,543 employers who are enrolled in the Insure Oklahoma program (with a 60/25/15, state/employer/employee split on the premiums), and it also offers a program that allows individuals to purchase coverage on their own.

As of March 2021, there were more than 15,000 enrollees in the employer-sponsored insurance program, and more than 20,000 in the individual insurance program. This was up from a combined total of only about 18,000 people in 2018 (although total enrollment had stood at around 30,000 enrollees in 2013).

Funding for Insure Oklahoma comes from tobacco taxes and matching federal funds that were scheduled to cease at the end of 2013 and be replaced with Medicaid expansion funding. But because Oklahoma did not accept Medicaid expansion, the state instead negotiated with the federal government to get a one-year extension for Insure Oklahoma. The state got a second extension in June 2014 that allowed Insure Oklahoma to continue to operate throughout 2015, and a third extension in June 2015 provided continued federal funding through the end of 2016. In March 2016, Oklahoma received another waiver extension through the end of 2018, and Insure Oklahoma was again part of the waiver that CMS approved for 2019-2023.


Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

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Apply for Medicaid in Oklahoma

Online at HealthCare.gov or the SoonerCare Medicaid website.  Or by phone at 1-800-318-2596.  You can also get in-person help at an Oklahoma DHS Human Services Center or contact the SoonerCare Helpline at 1-800-987-7767

Eligibility: The aged, blind, and disabled.  Also, parents with income up to 42% of poverty, pregnant women with income up to 138% of poverty level, and children under age 19 with income up to 205% of poverty. Insure Oklahoma helps cover the cost of private insurance for adults with income below poverty level.

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