Health Care Authority on exchange: “all grant activities have ceased”
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Published: 04-May-2011


The office of Mike Fogarty, CEO of the Oklahoma Health Care Authority, has sketched for CapitolBeatOK some details about the process involved in turning back previously accepted (but never received) grant money to design an Oklahoma health exchange.

Nico Gomez, deputy CEO at the Health Care Authority, told CapitolBeatOK today (Wednesday, May 4) he had been directed to respond, “Since I have been dealing with this issue today.

“We have notified our federal grant coordinator, via conference call, that Oklahoma does not intend to pursue the grant and we asked for further direction from the Centers for Medicare and Medicaid Services (CMS) to officially reject the grant award.

“We have not been provided any further direction at this time as it may be the first occasion for this action to occur in some time. It is the first time the Oklahoma Health Care Authority has had to reject a federal grant.

“Nothing else may be required since the federal grant funds are still in the federal treasury and no amount was ever transferred to the state and all grant activities have ceased.”

Meanwhile, statutory language now exists to create an alternative to the exchange. 

Senate Bill 971 will be sponsored in the upper chamber by Sens. David Myers of Ponca City and Clark Jolley of Edmond. Carrying the bill in the House of Representatives are Earl Sears of Bartlesville and Scott Martin of Norman. Myers and Sears run the appropriations and budget process. 

Language in the new bill tracks closely with the outline of provisions provided at the April 14 press conference where Governor Mary Fallin, flanked by Bingman and Steele, announced the state would reject the $54.6 million federal grant that was applied for during the administration of Governor Brad Henry.

The new bill’s purpose, according to its current draft, is “to allow Oklahoma to establish and operate its own Health Insurance Private Enterprise Network to facilitate access to health insurance and enhance competition in the individual and small employer health insurance markets.

The measure would create a “Health Insurance Private Enterprise Network” designed as “a state-beneficiary public trust.”

As now drafted, the board will consist of seven members, to be chosen as indicated in the bill’s text:

“One member appointed by the Governor representing health insurance carriers granted a certificate of authority by the Oklahoma Department of Insurance; … One member appointed by the Speaker of the House of Representatives representing consumers and who has purchased policies through the network or is reasonably expected to purchase policies through the Network; … One member appointed by the Governor who shall be a health care provider; … One member appointed by the Governor who shall be a representative of employer groups; One member appointed by the President Pro Tempore of the Senate who shall be an insurance agent or broker; The Insurance Commissioner; and … The Secretary of Health and Human Services.

The legislation designates the Oklahoma Commissioner of Insurance as “chair of the network board.” The board will have power to appoint an executive director. 

The bill in its current language reads: “In order to avoid the establishment of a federal exchange, the network shall have the minimum authority under state law that is necessary to implement its purposes.  Funding for the network shall come from state and private sources.”

The purpose of the network is defined in the bill as increasing choice and competition, “in the health insurance market of Oklahoma” and providing more choices and options to employees. Additionally, the network is intended to promote “a competitive, patient-centered, market based health insurance system that includes a defined-contribution health insurance alternative for employer-sponsored coverage which includes an aggregate premium system.” 

The network is also to encourage “health insurance carriers to collaborate with medical providers to offer health insurance coverage that provides consumers quality care delivered in the most cost-effective manner” and to establish “a fair and impartial health insurance producer referral network for the purpose of assisting individual and qualified small employers in obtaining health insurance coverage through the Network.”

The legislation includes statutory language fulfilling a promise Fallin made in discussions with reporters, including CapitolBeatOK, at the earlier press conference. The network, the proposed law says, “shall not” hold regulatory authority “over any entity” and is not to “Discriminate against any qualified health insurance carrier willing to participate in the Network;… Supplant any marketplace outside the network.”

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