Legislators Discuss Funding Medicaid Expansion

State Question 802, expanding Medicaid, passed by a narrow margin Tuesday night. Now the question is how does the state pay for it? 

State Question 802 will expand Medicaid coverage to about 200,000 Oklahomans. But it comes with a hefty price tag.

With COVID-19, and the job losses that came with it, Medicaid expansion could cost the state up to $200 million. It would extend medical coverage to Oklahomans under 65-years old. Backers point out, with a 9-to-1 federal match that means as much as $1.8 billion could be coming into the state, a lifeline for rural hospitals.

“I was really taken by a lot of the opposition to this. This is a really business friendly state and I have never met a businessperson who would turn down a 9 to 1 ROI,” said Representative Forrest Bennett (D) Oklahoma City.

The problem is that initial investment. Because this was a state question, it changes the constitution and lawmakers have no choice but to fund it. This year, the legislature was able to scrape up some cash to fund the governor’s plan for Medicaid expansion.

“The numbers range from anywhere from 121 million to north of 200-million. We towards the end of our timeline in session worked on funding of 164-million,” said Representative Kevin Wallace (R) Appropriations and Budget Chair.

The governor vetoed that though. He didn’t believe $164 million would be enough. And the governor said he does not back tax increases to fund it. That could mean massive cuts in jobs and services. 

Democrats said a tax increase may be the only solution.

“None of us want to raise taxes on working families right now. But I’d say that there are plenty of us that believe that our revenue structure is not equitable,” Bennett said.

Wallace added, “We’ll figure a way through this and have to make some adjustments, but we’ll get there.”

The legislature could tap into tobacco settlement money if voters approve the plan in November. That will bring in an additional $70 million. By law, Medicaid expansion has to be in place within one year of its passing.