Coleman says funding unclear for Medicaid expansion

BARNSDALL -- State Sen. Bill Coleman, R-Ponca City, last week commented before a Barnsdall Chamber of Commerce audience that he didn't know where funding would come from for a legally mandated expansion of Medicaid in Oklahoma.

State Question 814, which was on Oklahoma ballots Nov. 3, went down to defeat, with 58.8 % of the electorate voting "No." That question called for money to be diverted from the state's Tobacco Settlement Endowment Trust to help pay the cost of Medicaid expansion. It was anticipated that passage of SQ 814 would likely have yielded more than $50 million in the first year alone, to help pay for Medicaid expansion.

Oklahoma voters mandated Medicaid expansion when they approved State Question 802 in June of this year. Expansion is supposed to take effect July 1, 2021.

"I don't know where we're going to get it," Coleman said of the money necessary to pay for Medicaid expansion. He said the state needs $156 million annually. It would be 2022 before State Question 814 could be placed back on the ballot, he said.

Coleman predicted that voters will be hearing more, in coming months, about the possibility of Oklahoma bringing in a private firm to manage health care for Medicaid recipients.

“I haven’t found anybody yet who has said, ‘Please put that in,’” Coleman said, casting doubt on whether the outsourcing option will be popular with the public.

Coleman said he would not mind a state question that would raise the tax rate on medical marijuana to help generate funding for Medicaid expansion.

Kelly Bland, Osage County's tourism director (who was in the luncheon audience), was supportive of the notion of finding a way to tax medical marijuana more heavily to help finance health care services.

With regard to the state budget overall, Coleman said Oklahoma officials are anticipating a revenue shortfall of somewhere between $400 million and $1.2 billion.

“So, we’re looking at new sources of revenue in the state of Oklahoma,” he said, explaining that aerospace is an economic sector where the state could generate growth. "We've got to think a little bit more out of the box."

Coleman added that the 2021 legislative session, which is scheduled to begin in February, will be marked by the consideration of "a glut of bills" that did not receive attention during the 2020 session because of the COVID-19 pandemic.

‘I think we’re going to be selling off a lot of real estate," Coleman said, when asked to elaborate on possible sources of revenue to respond to the anticipated shortfall. He explained that state government owns excess office space. 

The Legislature could also look at sales tax exemptions, Coleman said. He clarified, however, that he didn’t think all such exemptions should be eliminated, but perhaps some of them. Lawmakers could also look at eliminating some of the exemptions for a temporary period of time, he said.

Eliminating or temporarily suspending some sales tax exemptions would not legally be a tax, so could pass it with a vote of 50 percent plus one, Coleman noted. He was scheduled to meet with other Oklahoma GOP lawmakers this week.