Lawmakers Indicate They're Prepared To Push Back On Plan To Outsource Medicaid Management

Jan 25, 2021

The fight over outsourcing management of Oklahoma’s expanding Medicaid program looms large over the upcoming legislative session.

During a budget hearing Monday for the Oklahoma Health Care Authority, Senate Health and Human Services Committee Chair Greg McCortney (R-Ada) asked CEO Kevin Corbett about $217 million in estimated reserve cash the agency has from increased federal funding during the COVID-19 pandemic.

"There’s a general feeling, I think amongst most members of this committee, that you are sitting on that money to use it for the upfront payment for a managed care system that most everyone on this committee is opposed to. Is that correct?" McCortney said.

"No, it’s not. We do know that there is the possibility of what we’ll call a ‘claims lag’ in terms of shifting over to an MCO when we still have claims from the prior year coming in, in the current year," Corbett said.

Gov. Kevin Stitt favors hiring a managed care organization, a private company to coordinate health care for Oklahomans newly eligible for Medicaid after expansion takes effect July 1, and Corbett is moving ahead with the plan. 

The company that’s ultimately selected would get a set amount per enrollee to put toward their health care.

Dozens of lawmakers oppose the managed care idea. McCortney asked Corbett what would happen if the legislature rejects a managed care arrangement.

"What’s the turnaround time to drop all of this for-profit managed care stuff and do it ourselves?" McCortney said.

"It’s a long road," Corbett said.

"The flexibilities and the work we’d have to do to engage with our providers on an incentive-based compensation and value-based compensation and performance-based — that’s a significant undertaking," Corbett said.

The state took a run at managed care in the 1990s. It only served urban areas, and OHCA terminated the program in 2004 after companies demanded an 18% rate hike.

OHCA’s board will consider the agency’s ability to enter into a managed care contract during a special meeting Tuesday.