Medicaid Eligibility Expanded in Oklahoma

Medicaid in Oklahoma

Medicaid eligibility for all adults of ages 19 to 64 has been expanded in Oklahoma, according to which individuals in this age group making up to 133% of the Federal Poverty Level will qualify for the coverage. The expansion should begin by July 1, 2021, and the process can also be initiated earlier, a few states were able to implement it earlier than decided. The Medicaid eligibility expanded in Oklahoma through voters in a Ballot measure that will bring great benefits to state low-income citizens.

Around 200,000 Oklahomans are expected to receive coverage due to the Medicaid expansion and the number may further increase by another 50,000 as many people are losing their jobs and employer-based insurance due to COVID-19. The state has the highest number of uninsured with a 14% uninsured rate that is the second-highest in the nation after Texas. This expansion is also expected to support struggling rural hospitals, as half a dozen rural hospitals have seen closure since 2016 and few have even be declared bankrupt.

During the COVID-19 pandemic, Oklahoma is the first state to approve Medicaid expansion, where there has been a dramatic growth in unemployment. It is the fifth state to approve expansion through the voter referendum and is not part of the state’s constitution. According to a recent JAMA health Forum report, 47.5 million people are at risk of losing their employer-sponsored health insurance nationwide due to the pandemic.

The Medicaid expansion is supported by a great number of people who believe that health reform efforts should ensure that Medicaid is effective and a viable program is there to provide health insurance coverage to low-income individuals, the disabled, and the seniors. The Medicaid expansion is important because more than 14.7 million people were able to obtain coverage through Medicaid expansion under the ACA since 2013, and it also provides people with greater access to healthcare, more preventive care, and improved chronic disease management, besides improving the health of the people.

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Though four states have expanded Medicaid through a ballot initiative, Oklahoma is the first to enshrine the expansion as a state constitutional amendment. This was purposely done to make it difficult for it to be rolled back, as rolling it back would require another constitutional amendment approved by voters. The state constitution also included language reading, according to which no additional restrictions on eligibility or enrollment can be imposed on individuals eligible for medical assistance under this article. This increases the challenge for the state policymakers to impose work requirements, premiums, or other enrollment restrictions that may cause hardship on expansion populations.

Expanded Medicaid coverage in Oklahoma under 2020 poverty guidelines would provide health insurance to an individual making less than $17,608 annually, or adults in a family of four making less than $36,156 annually. Expansion of Medicaid will bring enormous benefits to low-income adults in Oklahoma and it is estimated that 215,000 Oklahomans in the age group of 18-65 earning up to 138% of the federal poverty level will qualify for the coverage.

Medicaid expansion, beyond the coverage, has a lasting impact on people’s long term health. It has been proved in studies that states which have expanded Medicaid have more preventative cancer screenings and more cancer patients were detected at an earlier stage, there was a decrease in positive depression screenings, and there was an increase in prescription drug fulfillment for chronic conditions. In addition to these, it was also discovered that states that expanded Medicaid were able to save the lives of at least 19,200 adults while states that have not expanded Medicaid had around 15,600 premature adult deaths.

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Who Pays for the Expansion Cost

The cost to cover the Medicaid population is split between the state and the federal government. Based on a calculation using the Federal Medical Assistance Percentage that compares the state’s per capita income to the national per capita income, Oklahoma receives more funding from the federal government compared to other states. Last year Oklahoma’s FMAP was 58%, which means that the federal government contributed $1.43 for every $1 spent by the state. However, the funding split between the state and the federal government for a state’s expansion population operates differently. For the first two years after the new healthcare law took effect in 2014, the federal government covers all the costs for the newly eligible people in the state that accepted the expansion. In 2020, the rate has been phased down, so the federal government from now onward will cover 90% of the expenses.

It has been estimated that the Oklahoma state’s share cost may range from $137 million to $158 million after Medicaid expansion being effective in 2021. However, the report anticipates a net cost of $49 million to $81 million while considering anticipated savings in the existing programs across state government. It is up to the state Legislature to use the savings, or find new revenues, or make pay cuts to meet the state’s share of the costs. Some of the states that have opted for Medicaid expansion have gone for a tax increase to pay for the expansion while some states have cut other Medicaid costs, or have asked hospitals to help in paying it, or have used general funds.

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