Name: Managed care is a bad investment for Oklahoma - Oklahoma Policy Institute
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Managed care is a bad investment for Oklahoma - Oklahoma Policy Institute

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To speak out on the managed care proposal:• Contact your legislators, who have the power to stop policy changes that negatively impact Oklahomans. Use to contact your elected officials.• Oklahoma Health Care Authority allow public comment, and interested Oklahomans should use these meetings to express opinions on this substantial change.&nbsp;&nbsp;Following voters’ approval of Medicaid expansion during the June 30 election, Oklahoma’s next steps should be relatively simple. The state has already been providing high-quality, low-cost Medicaid for years; the Oklahoma Health Care Authority (OHCA) has a in efficiency and effectiveness. OHCA could expand Medicaid to cover more than 200,000 low-income Oklahomans for between and , all .&nbsp;&nbsp;Unfortunately, Gov. Stitt and OHCA CEO Kevin Corbett have that after decades of proven results, Oklahoma should try something else, something that has never worked in the state, and something that, if other states’ experiences hold true here, will cost the state much more money than in-house expansion. Their proposal for , though appealing in the abstract, harkens back to Oklahoma’s . To avoid , Oklahoma must ensure that Medicaid administration remains in the proven, capable hands of the Oklahoma Health Care Authority.&nbsp;Simply put, transitioning to managed care would outsource the services that OHCA already provides. Currently, most Oklahoma Medicaid enrollees are served through , meaning that OHCA contracts directly with primary care providers to coordinate . In the model proposed for Oklahoma, state Medicaid agencies contract with privately owned managed care organizations (MCOs), who then contract with providers to coordinate care. States pay the MCOs a monthly per-member . If the MCO can provide services for less than the monthly payment, it makes a profit. If not, the MCO loses money.Gov. Stitt has championed throughout his time in office, so it’s difficult to understand the reason for adding an additional management layer. Perhaps this would make more sense if managed care had historically been cheaper than the in-house SoonerCare Choice model, but that’s not the case either. SoonerCare Choice boasts than most states with managed care, and a has already found that “with sufficient resources and leadership commitment, state Medicaid agencies can manage care at lower costs than managed care organizations and with similar outcomes.”&nbsp;Oklahoma does not have the problems that managed care is supposed to fix. States often privatize Medicaid in hopes of reducing “,” maintaining budget stability, and . The majority of care in Oklahoma, however, is already coordinated through SoonerCare Choice, and Oklahoma’s cost per Medicaid enrollee is already . No compelling evidence suggests that implementing managed care would lower cost in Oklahoma.&nbsp;&nbsp;There is no that managed care brings savings for the state; indeed, most studies have found that managed care tends to be either cost neutral or more expensive. Managed care organizations must make a profit to survive, and those in profit come directly from taxpayers. In the midst of the coming state budget crisis, taxpayer dollars must be used to fund existing services, not funneled to private corporations. In Oklahoma, savings are unlikely because of potential MCO demands for rate increases, Oklahoma’s already low administrative costs, and comparatively low costs per enrollee, and the potential loss of federal funds.Budget stability is far from a guarantee. As demonstrated by , as well as Oklahoma’s , MCOs are known to demand significant rate increases. Because of Oklahoma’s , this could easily leave the state scrounging for more money to maintain existing services.&nbsp;Additionally, Oklahoma already has a low Medicaid administrative cost, with only of expenses going to overhead administration in 2019. That number has even decreased in recent years; in 2017, administration accounted for just of total SoonerCare expenditures, which was in most states that used managed care (shown in the graph below). In rural areas, managed care organizations find it difficult to achieve increased administrative savings . Oklahoma will certainly have to account for this need because outsourced care coordination has already proven .&nbsp;While inclusion of the expansion population in managed care will likely , medical costs could easily increase. In 2017, Oklahoma spent per Medicaid enrollee, the lowest of states in the surrounding region that had not expanded Medicaid (Kansas, Missouri and Texas). These states rely heavily on managed care, and recorded costs per enrollee ranging from $8,228 to $10,265 with an average cost of $8,957. If Oklahoma’s per-person costs increased to that average in 2017, SoonerCare could have cost the state an additional . As shown in the graph below, Oklahoma’s per-enrollee cost is also already less than that of most states nationwide with high managed care usage.&nbsp;Lastly, implementing managed care could lead to a significant loss of federal funds. Services provided for American Indians through Indian Health Care Providers (IHCPs) are currently reimbursed by the federal government at a rate of 100 percent, according to a recent Senate . If the state shifts to managed care, it could lose the 100 percent matching rate for some services provided to American Indians through managed care organizations, meaning that available federal funds would remain in Washington, leaving Oklahoma to foot the entire bill.&nbsp;Managed care has a history of in Oklahoma, and there’s no evidence to suggest the market has changed in recent years. In the 1990s, managed care was only feasible in urban areas, and many providers were reluctant to enter into contracts. A 2003 demand from MCOs for an 18 percent rate increase — and subsequent realizations that OHCA could administer the program for — drove the nail into the coffin of Oklahoma’s first attempt. A 2015 bill passed by the Legislaturedirected OHCA to , and this attempt was again to avoid cuts to provider rates.&nbsp;Taxpayers deserve a fiscally responsible Medicaid program that prioritizes patient needs. OHCA has already proven that it can administer Medicaid for a lower cost than managed care organizations, with fewer staff and less bureaucracy. Medicaid privatization has yet to work in Oklahoma, and taxpayer money shouldn’t be used for another experiment.This site uses Akismet to reduce spam. .

To speak out on the managed care proposal:• Contact your legislators, who have the power to stop policy changes that negatively impact Oklahomans. Use to contact your elected officials.• Oklahoma Health Care Authority allow public comment, and interested Oklahomans should use these meetings to express opinions on this substantial change.&nbsp;&nbsp;Following voters’ approval of Medicaid expansion during the June 30 election, Oklahoma’s next steps should be relatively simple. The state has already been providing high-quality, low-cost Medicaid for years; the Oklahoma Health Care Authority...

Managed care is a bad investment for Oklahoma - Oklahoma Policy Institute

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