Consultant Recommends Arkansas-Type Health Plan

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A consultant hired by Oklahoma to propose ideas on state health care policies  is recommending the state adopt a plan similar to one in Arkansas that channels state and federal money to private  insurers to cover the uninsured.

The earliest realistic time to implement that plan would be in 2015, said Michael Deily, a senior adviser for Utah-based consultant Leavitt Partners.

If that were the timetable, it could mean tens of thousands of uninsured Oklahomans would remain without health insurance in 2014, when major parts of the federal Affordable Care Act take effect. It’s unclear how many uninsured people in Oklahoma would gain coverage under a new plan that uses private insurers, or what the cost to the state would be.

The approach recommended by Leavitt Partners would mean changing and expanding the current Insure Oklahoma plan, which subsidizes premiums for more than  30,000 uninsured people but is capped.

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Oklahoma Health Authority slide show:

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An estimated 200,000 low-income Oklahomans will be denied Medicaid coverage in 2014 because of Gov. Mary Fallin’s decision to reject federal money to expand the program under the Patient Protection and Affordable Care Act. Most of those are in a “crater,” meaning they will be ineligible for Medicaid as well as for getting tax credits to buy coverage on a health exchange.

At a meeting Thursday of the Oklahoma Health Care Authority board, officials summarized early recommendations from Leavitt Partners.

Among those were changing Insure Oklahoma to allow individuals making up to 138 percent of the federal poverty level to receive subsidies to pay premiums.

Cindy Roberts, the authority’s deputy CEO, said the proposal is similar to what Arkansas proposed to the federal government: using federal Medicaid expansion funds under the Affordable Care Act to subsidize low-income individuals’ purchase of private insurance.

Deily said under the plan, participants should share costs, such as co-pays, and the state should offer rebates as an incentive for healthy behavior, such as eating healthy and not smoking.

The Centers for Medicare & Medicaid Services recently rejected Oklahoma’s request for a waiver to continue Insure Oklahoma. Insure Oklahoma uses state tobacco trust money, along with Medicaid money and employer and employee contributions, to help pay premiums for individuals and businesses to purchase insurance. The CMS said major changes would need to be made to get a waiver, including removing the cap and changing cost-sharing requirements.

Leavitt Partners recommended the state continue to work with the federal government to preserve the program and change it so low-income people can use a revised individual plan to buy insurance subsidized at least in part by federal Medicaid money.

The state Health Care Authority did not release a copy of the consultant’s draft report, but did release a Power Point slide-show summary. A final version of Leavitt Partners’ findings is expected in June.

According to Howard Pallotta, general counsel for the Health Care Authority, the agency does not have to immediately release the draft report in response to an Oklahoma Watch request made under the Opens Records Act. He cited as a reason a part of the act that allows a public official, before taking action that includes making recommendations or issuing a report, to “keep confidential his or her personal notes and personally created materials … prepared as an aid to memory or research leading to the adoption of a public policy or the implementation of a public project.”

It’s not clear if the state will release Leavitt Partners’ preliminary findings after the final report is issued in June.

Joey Senat, president of the nonprofit Freedom of Information Oklahoma, said the exemption cited by Pallotta doesn’t refer to records prepared by an outside party, rather to a public official’s own personal notes.

Also, a 2009 Oklahoma Court of Civil Appeals ruling should compel release of Leavitt Partners’ draft findings, he said. In that case, the city of Lawton used the exemption to deny a police union a copy of a draft audit report prepared by an outside firm. The document was in the city’s hands, and the city had used it in preparation for a hearing. When the police union requested the document, the city refused citing the “personal notes and personally created materials” exemption. The court ruled that because the city had used the document, the record was not exempt from the state Open Records Act. In general, the act presumes that government records are open.

Leavitt Partners’ report could play a big role in the formation of a state health plan, as it will give the state data and information about what other states are doing to cover the uninsured and about Oklahoma’s current health system. State officials could implement some recommendations on their own; others might need approval from the Legislature.

During her State of the State Speech in February, Fallin announced that the state would be pursuing its own “Oklahoma plan,” focusing on improving health outcomes, reducing the cost of care and expanding access to health care.

The Arkansas proposal has received only verbal confirmation from U.S. Health and Human Services Secretary Kathleen Sebelius. Several states that initially rejected Medicaid expansion have shown interest in pursuing a similar option.

The Oklahoma Hospital Association released a statement Thursday expressing support for exploring options under Insure Oklahoma to expand coverage for the uninsured. The group urged the state to act during this legislative session.