Is the Oklahoma Health Care Authority playing a shell game?
It’s a legitimate question after its board recently approved a flat FY ’27 budget with no provider cuts … just days before the agency notified the feds it would slash $218 million in Medicaid payments to state hospitals and providers.
The left hand didn’t know what the right was doing? Not likely. Agencies rarely reverse course in a matter of hours on official, public decisions involving hundreds of millions of dollars.
This looks for all the world like an agency that knew what was coming … knew the uproar it would cause … and opted to play a public relations game that blew up in its face.
Oklahoma hospitals – many already strapped financially, especially in rural areas – undoubtedly were relieved to learn the OHCA board was banking on a flat budget.
Not ideal, but better than cuts that could push some providers into bankruptcy or closure.
To then learn the agency about-faced and filed paperwork with the federal Centers for Medicare and Medicaid Services is … what? A breach of public trust? A violation of administrative law?
It was a gut punch to providers, who were assured by legislative leaders in late June that cuts would not be necessary this fiscal year.
According to the federal filings, OHCA instead proposed a 20% cut – $218 million – to the Supplemental Hospital Offset Payment Program [SHOPP] which helps providers offset losses when treating private Medicaid patients.
As the Oklahoma Hospital Association’s Rich Rasmussen noted in a letter – first reported by Oklahoma Watch – to OHCA chief Clay Bullard, “Over the past several weeks, stakeholders were advised that significant reductions to SHOPP directed payments were being considered in response to the agency’s FY 2027 budget shortfall. Following the June 23, 2026, letter from legislative leadership and subsequent discussions regarding the agency’s fiscal position, stakeholders reasonably understood that the budget-driven reductions previously discussed by the agency would no longer be necessary.”
That was followed by the OHCA board’s approval of the cut-free, flat budget.
Providers thought they had another year – until July 1, 2027 – to prepare to navigate new rules promoted by the Trump administration and enacted by Congress.
Unfortunately, these are the sorts of shenanigans that have become all-too-common under Gov. Kevin Stitt’s reign-of-error. An evangelical who loves to deploy Christianity when it suits him, Stitt apparently missed Jesus’ exhortations about the least among us.
Almost as if the wealthy, Oak Tree-residing governor considers those on Medicaid – the working poor – to be gaming the system, trying to get something for nothing. There’s scant recognition that public investment in Medicaid helps keep the lights on at hospitals across the state.
It’s important to remember OHCA sought an additional $495 million for the new fiscal year that began July 1. But lawmakers weren’t buying the actuarial estimates the agency presented. They approved a $250 million boost instead – interestingly, the same amount Stitt requested in February in his proposed executive budget.
It’s also worth noting that SHOPP is something hospitals agreed to pay into voluntarily – making the OHCA filing doubly deceptive.
According to Oklahoma Watch, providers asked the state to delay its federal filing so they could gather additional information “about its estimates and assumptions.” As a result, lawmakers and hospital officials were scheduled to meet today to discuss the proposed cuts.
In the meantime, hospital providers, leaders and perhaps even OHCA board members are left to wonder why Bullard assured board members that a flat budget did not portend reimbursement cuts to hospitals or other providers … only to reverse course days later.
Something stinks here.
