Budget & Tax, Health Care

Medicaid costs continue to rise

December 11, 2017

Trent England

By refusing to adopt the Obamacare Medicaid expansion, Oklahoma lawmakers stood up for the premise that Medicaid should remain a safety net for the most vulnerable, not an entitlement for able-bodied adults.

And yet Medicaid has been growing in Oklahoma nonetheless, eating up an ever larger portion of state spending.

The Oklahoma Health Care Authority (OHCA) administers the state’s Medicaid program. During last year’s budget debate, OHCA leaders again called for Medicaid expansion and threatened that, without it, most Oklahoma nursing homes would shut down. It was a craven claim, easily disproved, and both appropriations and total spending at OHCA actually went up.

In fact, Medicaid enrollment and costs have been increasing in Oklahoma for years. A higher percentage of Oklahomans are covered by either Medicaid or the related Children’s Health Insurance Program than in Texas, Kansas, Missouri, and a dozen other states. Looking at data from all states between 2000 and 2014, The Pew Charitable Trusts found Oklahoma had the 11th largest increase in state Medicaid spending as a share of the total state budget.

In 2008, the legislature appropriated $771 million to the agency. The agency had 410 staff and spent a total of $3.8 billion. OHCA last year had 556 staff, and (as shown in the chart below) received an appropriation of nearly $1 billion to support total spending of $5.6 billion. (Numbers come from Senate reports; the Governor’s budget book includes similar and additional data.)

OHCA has a critical mission. Medicaid was designed to be the safety net for those who are both poor and also disabled, elderly, or children. Oklahoma is spending more than ever on these programs. Both taxpayers (who foot the bill for every state and federal dollar) and service recipients deserve an honest conversation about these costs and an active consideration of reforms.