Health Insurance Exchange & Medicaid Expansion

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The big news coming out of Oklahoma yesterday was Governor Fallin’s rejection of state established Health Insurance Exchanges and the Expansion of Medicaid.

You might be asking “what is a health insurance exchange?”

The Kaiser Family Foundation defines it this way:  “Exchanges are new organizations that will be set up to create a more organized and competitive market for buying health insurance. They will offer a choice of different health plans, certifying plans that participate and providing information to help consumers better understand their options.”

So, what’s the big deal about Governor Fallin rejecting the Health Insurance Exchange?

Under the Affordable Care Act each state is required to offer a health insurance exchange. Fallin’s rejection now puts the responsibility of establishing the exchange in the hands of the Federal government. Of the 50 states, 17 including Oklahoma have rejected the establishment of health insurance exchanges. According to some news sources, these rejections could jeopardize the aim of the Affordable Care Act to expand coverage to over 30 million Americans by October 2013.

What does the rejection of the expansion of Medicaid mean for Oklahomans?

NewsOK .com reports that about 90% of those eligible for SoonerCare, Oklahoma’s Medicaid program, are enrolled. If Oklahoma was to expand SoonerCare many more low income adults would qualify.

The greatest impact could be felt by hospitals. According to the same NewsOK.com story, Craig Jones, president of the Oklahoma Hospital Association reports that hospitals serve as the medical safety net for Oklahoma's communities and provide approximately $600 million annually in uncompensated care.  “Without increased coverage for the uninsured, such as Medicaid expansion would provide, these costs are shifted to businesses and those who have insurance, contributing to increased health care costs,” Jones said.

Governor Fallin’s Statement

“After careful consideration, I have today informed U.S. Secretary of Health Kathleen Sebelius that Oklahoma will not pursue the creation of its own health insurance exchange. Any exchange that is PPACA compliant will necessarily be ‘state-run’ in name only and would require Oklahoma resources, staff and tax dollars to implement. It does not benefit Oklahoma taxpayers to actively support and fund a new government program that will ultimately be under the control of the federal government, that is opposed by a clear majority of Oklahomans, and that will further the implementation of a law that threatens to erode both the quality of American health care and the fiscal stability of the nation.

“Furthermore, I have also decided that Oklahoma will not be participating in the Obama Administration’s proposed expansion of Medicaid. Such an expansion would be unaffordable, costing the state of Oklahoma up to $475 million between now and 2020, with escalating annual expenses in subsequent years. It would also further Oklahoma’s reliance on federal money that may or may not be available in the future given the dire fiscal problems facing the federal government. On a state level, massive new costs associated with Medicaid expansion would require cuts to important government priorities such as education and public safety. Furthermore, the proposed Medicaid expansion offers no meaningful reform to a massive entitlement program already contributing to the out-of-control spending of the federal government.”

Just because I like statistics, a few numbers for you...

2011 Population Estimate (from the Census Bureau's American Community Survey)

  • United States: 306,560,685
  • Oklahoma: 3,710,368
  •  Tulsa County: 604,918

2011 Health Insurance Status

  • Uninsured Americans: 46,375,539 (15.1%)
  • Uninsured Americans under the age of 18: 5,527,657 (7.5%)
  • Uninsured Oklahomans: 693,545 (18.7%)
  • Uninsured Oklahomans under the age of 18: 99,384 (10.6%)
  • Uninsured Residents of Tulsa County: 112,268 (18.6%)
  • Uninsured Residents of Tulsa County under the age of 18: 16,102 (10.4%)

2011 Poverty Status 

  • Americans: 48,452,035 (15.9%)
  • under the age of 18: 16,386,500 (22.5%)
  • Oklahomans: 633,298 (17.2%)
  • under the age of 18: 215,804 (23.4%)
  • Residents of Tulsa County: 91,019 (15.1%)
  • under the age of 18: 32,907 (21.5%)

& to get a better understanding of the health of Oklahomans, the 2011 State of the State's Health Report (yes, there's a lot of Ds & Fs)