Highlight on Oklahoma: Budget cuts are leaving providers weak

An Oklahoma budget deficit is leading to actual and proposed rate cuts that could have a dramatic impact on patients and providers.  This month, the State Medicaid agency proposed to cut Medicaid (SoonerCare) provider rates by 25 percent, and the State Health Department eliminated state funding for community health centers. Mental health care providers are also hurting under the strained budget with the Oklahoma Department of Mental Health and Substance Abuse Services (ODMHSAS) taking on $13 million in new budget cuts.


The Oklahoma Health Care Authority (OHCA) announced that the 25 percent rate cut could begin impacting providers on June 1, 2016. The rate cuts would impact reimbursement for all 46,000 SoonerCare providers, including hospitals, physicians, durable medical equipment suppliers, nursing facilities and pharmacies. The cuts could have a substantial impact on the 800,000 Oklahomans that are beneficiaries of the program, 524,000 of which are children. Some Medicaid providers in the state have already said the cuts will be so devastating that they will either have to reduce salaries or stop treating SoonerCare patients altogether. Nico Gomez, CEO of the OHCA, said that in addition to the impact of providers that stop accepting SoonerCare, many rural providers might move their businesses to larger communities in order to remain financially stable. Because the program receives federal matching funds, the $64 million rate cut will reduce SoonerCare funding by $164 million in combined state and federal funds.


Oklahoma is currently operating with a physician shortage. Now, with lowered Medicaid reimbursement rates, there are concerns that the state will have an even harder time retaining and recruiting doctors. The cuts also hit community Health Centers. By cutting all state funding for federally qualified health centers (FQHCs), facilities that 175,000 Oklahomans use for primary, dental and mental health care services, the state took away an important source of care for individuals that do not have health insurance. Funding for the community health centers was provided through the uncompensated care fund, but because that fund has been steadily shrinking, the state department of health was forced to pull the funding, which will save the health department about $700,000 for the remainder of the year. Some community health centers, like Variety Care are being forced to reduce hours and the services they offer to stay open. Variety Care CEO, Lou Carmichael, said that the result of the cuts is that individuals without insurance will go to hospitals for primary care.

Mental Health

The $13 million in cuts to mental health is being tacked on to $22.8 million in cuts made since January. Because the state relies on federal matching for many mental health services, the total impact of the cuts will be even higher, almost $40 million. The new cuts are feared to be more impactful than the first round because they more directly impact front-end treatments to help those suffering from mental illness and substance abuse. The cuts include a $7 million reduction in the payments to private mental health and substance abuse facilities, which come a year after those facilities provided $12 million in services that ODMHSAS was unable to pay for. The cuts are also forcing reductions in the number of therapy sessions available to children and adults with mental illnesses and substance abuse disorders. How much strain providers can endure remains to be seen, however, as the cuts keep coming, lawmakers are falling under growing pressure to provide greater funding to the state’s health care programs.

Minding the mental health problem from the start

The alarming incidence of mental health and substance abuse problems in the United States can be mitigated with a reliance on prevention and early intervention (PEI), according to a Mental Health America (MHA) report titled “The State of Mental Health in America 2016.” Due to limited funding, the absence of health insurance, and limited access to mental health care, many Americans are not receiving necessary treatment for mental health and substance abuse issues. The report, which drew comparisons between access and treatment across the fifty states, identified dramatic disparities across the country. For example, in the states with the lowest number of mental health providers, there are approximately 1,100 individuals for every one mental health provider. The report suggests that the problems can be corrected through care coordination, community support, and shared saving efforts.


To evaluate the prevalence of mental health and substance abuse problems and compare the incidence and treatment of those things across multiple states, MHA relied on publically available data, for adults and youths, that captured information regardless of whether a patient used private or public health systems. Specifically, MHA used 15 measures for its 2016 analysis, including: Adults with any mental illness (AMI), adults with dependence or abuse of illicit drugs or alcohol, adults with serious thoughts of suicide, youth with at least one past year major depressive episode (MDE), youth with severe MDE, Adults with AMI who did not receive treatment, and Adults with AMI who are uninsured.


MHA identified an increase in the number of youths becoming depressed. Specifically, there was a 1.2 percent increase in the number of youths with depression. Youth depression is also unevenly distrusted across the states. States with the highest rates of youth depression have nearly twice as many depressed youths as the states with the lowest rates.  Treatment disparities exist as well. For example, youth with severe depression in Nevada are four times less likely to get consistent outpatient treatment when compared to the treatment of youth with severe depression in South Dakota.


The report identified, on average, 57 percent of the adults in the U.S. with mental illness receive no treatment. In other states the non-treatment rates are much higher. For example, in Nevada and Hawaii, the rate of adults with mental illness not seeking treatment reaches 70 percent. The report also revealed that in 2012 and 2013, one in five adults with mental illness was uninsured. Additionally, cost remains a barrier to treatment. One in five adults with mental illness reported difficulty obtaining access to mental health care as a result of costs.


For both adults and youth, access remains a crucial component of the mental health and substance abuse crisis. In addition to the cost and insurance factors, a lack of mental health providers plays a key role in reducing patient access to mental health care. In states with relatively good access to mental health care services—Massachusetts, Maine, and Vermont—there are about 250 individuals for every mental health provider. However, in states with relatively poor access to care—West Virginia, Texas, and Alabama—there are approximately 1,100 individuals for every mental health provider.


The report focuses on the impacts of untreated mental illness and substance abuse problems. The report placed specific emphasis on the impacts for young people. For example, MHA noted that suicide is the third leading cause of death among 10 to 24 year olds.  Additionally, of the over 600,000 youth placed in juvenile detention centers, 65 to 70 percent have diagnosable mental health disorders. Additionally, the existence of a disability dramatically increases a student’s likelihood of dropping out of high school.


To correct the problems, the report makes specific recommendations regarding prevention and intervention. The report suggests that PEI is the best strategy because in addition to providing the necessary support and treatment for individuals, there are benefits to the broader community and country. Specifically, by reducing the number of individuals that reach a crisis state, PEI reduces costs by spending less on late stage expenses like hospitals and disability benefits.  To actually achieve the goal of moving towards PEI for mental health care, the report recommended three approaches: (1) increase incentives to pay for prevention and early intervention with organizations like accountable care organizations; (2) expand health insurance coverage for PEI services; and (3) engage communities in PEI with provider, insurer, government, consumer, and business coalitions. According to the report, the problem is plain and prevention is the obvious solution. Now, it’s just a matter of policymakers taking action.