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Health Care Authority to delay rate reductions following Fallin’s veto

Oklahoma Capitol

OKLAHOMA CITY – A state agency that was slated to slash provider rates due to a budget deficit is now postponing those actions.

As lawmakers began to meet in special session, many state agencies were concerned about what a new budget would mean for their funding.

On Friday, Gov. Mary Fallin vetoed all but five of the 170 sections in a budget bill passed by the House and Senate. House Bill 1019X would have used millions in Rainy Day funds, carryover cash and revolving money while cutting about $60 million from state agencies.

The veto did away with the $60 million hit to state agencies and the use of revolving funds, but we’re told it provides short-term funding for three healthcare agencies: the Department of Mental Health and Substance Abuse Services, Department of Human Services, and the Oklahoma Health Care Authority. They were expected to lose between $4-$15 million.

“Those agencies, which is the Department of Mental Health Substance Abuse, the Department of Health and Human Services and the Healthcare Authority, they were facing cuts unless we passed something this session will now have the ability to keep going for several more months,” Fallin said in a video posted to Facebook.

The Oklahoma Health Care Authority has already made several budget adjustments after learning that it would lose $70 million in appropriation due to the loss of the smoking cessation fee.

When Gov. Fallin vetoed the measure, the agency received $22.8 million. Officials say the funds will allow the agency to postpone and reduce the provider rate reductions until Jan. 1.

“The OHCA continues to work diligently to protect providers from rate reductions. Reducing and delaying the rate reductions is part of that commitment. However, while these funds have provided an immediate relief, even with the Jan. 1 rate reductions, we are still approximately $9.5 million short of a balanced budget,” said OHCA CEO Becky Pasternik-Ikard. “We will continue to work with leadership to try to find funding solutions that will fully fund the agency and possibly allow us to reverse these reductions.”