Oklahoma Health Insurance Plugging a $6.8 billion Hole

Oklahoma health insurance seeking to plug a $6.8 billion hole in the state’s budget, the House forwarded one of several “revenue enhancement” bills to the Senate, which promptly adopted the bill and sent it to Governor Brad Henry. The bill would impose a 1 percent fee on all health insurance claims paid. It would apply to third party administrators, HMOs, self-insured plans, excess carriers, stop loss carriers, multiple employer welfare arrangements, professional employer organizations, and the state employee program. The revenue would be used to fund the Oklahoma Health Care Authority, which administers the state’s Medicaid program. Questions persist as to whether the measure will withstand a likely court challenge on the grounds that the Oklahoma constitution states that no tax increases may be passed during the last five days of the session. Also, if a tax increase is not approved by three-fourths of both legislative chambers – it was not – then the increase must be put to a statewide vote. If signed, the bill will go into effect on July 1.

Additionally, a conference committee released compromise language on the topic of the state’s employee health plan. The bill would change the existing Board to become the “Oklahoma Health and Wellness Board” with a HealthChoice Health Insurance Division within it. The new 11-member board is required to contract with a web-based, doctor-patient mutual accountability incentive program for 2011 and establish a wellness program for all participants in the plan including financial incentives for participation in the wellness program and healthy living practices. The board would be required to contract with only one HMO. This bill now requires the Governor’s signature to take effect.

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