Issue Brief: Medicaid Expansion Ballot Initiatives

April 08, 2019

Issue Brief: Medicaid Expansion Ballot Initiatives

Understanding the Issues: Medicaid Expansion Ballot Initiatives

Oklahoma has one of the highest rates of uninsured individuals in the nation. The state’s large population of uninsured individuals contributes to the state’s poor health outcomes and costs Oklahoma hospitals $500 million per year in uncompensated care. Accepting federal dollars to  expand the Insure Oklahoma plan to cover all individuals eligible under Medicaid expansion will generate $400 million in new economic activity in the state and add 4,700 new jobs without negatively impacting the state budget, according to research by the State Chamber Research Foundation.

Voters in three states opted to expand Medicaid via ballot question in the November 2018 election: Utah, Idaho, and Nebraska. These states join Maine as states in which voters have sidestepped their legislatures in order to expand Medicaid. In the wake of these election results, legislators in these states have been left scrambling, attempting to implement the will of the voters while still balancing their states’ budgets and policy desires.

Voters in Utah approved a 0.15% increase in the state’s non-food sales tax to pay for the state’s share of the cost of expanding Medicaid; however, lawmakers do not believe this increase will be enough to cover the state’s expense. Legislators have passed a bill which reduces the state’s Medicaid eligible population to only those earning up to 100% of the federal poverty line, but there is uncertainty about whether the federal government will approve that program amendment. It is possible that the plans proposed by the Utah Legislature in order to reduce the cost of Medicaid expansion, such as limiting the eligible population, will reduce the matching rate from the normal 90-10 rate for the expansion population.

Expanding Medicaid eligibility through the normal legislative process allows legislators to use the tools and information at their disposal to craft a Medicaid program plan that matches the needs and circumstances of the state. Options, such as Section 1332 State Innovation Waivers, which exist to allow the state to craft program features to meet its specific needs require time to research and draft,  must be presented for public comment, and must be approved by the federal government, bringing the total time from passage until implementation to about eighteen months. Ballot initiatives frequently force states to enact changes on a much faster timeline, forcing the state to accept traditional Medicaid expansion and limiting the state’s ability to innovate to improve program efficiency and outcomes.

In Idaho, legislators are proposing reforms to the Medicaid system after voters passed a ballot initiative expanding Medicaid eligibility to those at up to 138% of the FPL. Among the proposals sought by legislators is a federal waiver to create a program similar to Insure Oklahoma that requires Medicaid enrollees between 100% and 138% of the FPL to pay for a portion of the cost of their premium. However, the timeline for seeking federal approval extends far beyond the timeline for implementing Medicaid expansion found in the ballot question supported by 60% of voters.

Oklahoma legislators have the opportunity to explore innovative reforms to the Medicaid program with an expanded eligibility pool on their own timeline by being proactive rather than reactive. Oklahoma is uniquely prepared to expand upon the success of the innovative Insure Oklahoma program, itself a product of a federal Medicaid waiver, in order to reach and cover more Oklahomans. The Trump Administration has encouraged states to pursue Medicaid waivers aggressively, but the process by which such waivers are approved can often take over a year.

The people of Oklahoma have the right to enact any policy they desire, and the Legislature should not stand in the way of their desire to do so. However, the Legislature has the duty to ensure that taxpayers’ dollars are being prudently managed. The Legislature has a unique opportunity this session to accept federal funds while advancing reforms to the state’s Medicaid program that will promote government efficiency, save taxpayer dollars, and improve the state’s healthcare outcomes.


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Issue Brief: Medicaid Expansion Ballot Initiatives | Issues