By Patrick B. McGuigan | CapitolBeatOK

OKLAHOMA CITY – Gov. Mary Fallin was for Medicaid expansion before she was against it.

MEDICAID MOVES? Oklahoma Gov. Mary Fallin and other state officials are contemplating new steps on Medicaid reform, but insist they still want to avoid the costs and mandates in “Obamacare.”

For the past two years, she has stuck to her more conservative inclinations – often restating her intention for Oklahoma to go its own way. In this year’s State of the State address, Fallin said she wants to improve health outcomes, without the explosive costs envisioned under the Affordable Care Act.

Two legislators have developed a proposal to increase insurance premium assistance for the working poor under a homegrown Medicaid program started in 2004. Known as Insure Oklahoma, it has bipartisan support, but is destined for the ash heap of history under provisions of the ACA.

Some foes of the ACA, aka “Obamacare,” fear the Sooner State‘s leaders may be inclined to implement the president’s agenda indirectly. In a recent speech at the task force meeting for the American Legislative Exchange Council, Fallin reiterated her opposition to Obamacare Medicaid expansion, but said officials were working on a state reform that would involve waivers.

In response to questions from CapitolBeatOK, Fallin spokesman Alex Weintz said, “The short answer is, nothing has changed about the governor’s decision not to expand Medicaid as outlined in Obamacare. Her thinking on the issue has not changed.”

State Sen. Brian Crain, R-Tulsa, and Rep. Doug Cox, R-Grove, have proposed Senate Bill 640, to offer “premium assistance” for the purchase of health insurance, along the lines of Insure Oklahoma — explicitly designed to assist the working poor with access to better health care. Crain and Cox want to sustain Insure Oklahoma and expand its reach to children, mothers with children and poor adults in school.

However, unless it grants a waiver, the Obama administration has slated programs like Insure Oklahoma for termination Dec. 31. Crain and Cox say the state should seek a waiver, along the lines of that enacted in Arkansas on April 23, aimed at certain populations rather than the wholesale expansion of Medicaid envisioned in the ACA.

In a statement sent to CapitolBeatOK, Crain said, “We are currently discussing a waiver request for Insure Oklahoma that would provide federal support for premium assistance to low income applicants who are working, looking for work, going to school or caring for a child at home.”

Under the existing plan approved in a statewide referendum in 2004, Insure Oklahoma helps low-income workers buy private insurance. It is financed by Medicaid dollars. Voters have also approved use of tobacco settlement funds and taxes for health programs.

In an editorial, The Tulsa World characterized the Crain-Cox idea as “a decent compromise.”  The state’s largest newspaper, The Oklahoman in Oklahoma City, commented the state-based idea had appeal, but that Obamacare remains a bad idea.

As for the activist community, Michael Carnuccio of the free-market think tank Oklahoma Council of Public Affairs, says the Arkansas plan is still “fool’s gold.”

“Oklahoma lawmakers should advance their own solutions to the problems dealt by the ACA. However, with a $16 trillion federal deficit, it may be unwise to build any Oklahoma solution on a broken federal treasury. And it is unclear that HHS in Washington will give states like Arkansas all of the free-market reforms they’re looking for,” said Christie Herrera, policy vice president at the Florida-based Foundation for Government Accountability.

She told CapitolBeatOK, “It’s important for Oklahoma to examine reforms like the one that passed the Florida House this year, which offered limited, targeted premium assistance to working young adults and low-income parents with state-only dollars.”

On the other side of the argument, supporters of Medicaid expansion include members of the Oklahoma Council of Churches. Two dozen ministers signed a joint letter in late April. Then, at a Capitol press briefing, organized by OCC’s Dr. William Tabbernee, a diverse group of preachers made the case for Medicaid expansion.

Even if the governor gravitated toward some new steps on Medicaid, she would need legislative support, and she might not get it.

Oklahoma Capitol Source, an independent online news organization, reported results of a survey of Oklahoma legislators. Of 41 responses garnered, 28 legislators opposed taking additional federal funds for Medicaid, nine supported Medicaid expansion as envisioned in Obamacare, and four said they preferred using federal funds for an Oklahoma-developed plan. Another 22 legislators are on-record as supporting Medicaid expansion.

Meanwhile, the Oklahoma Health Care Authority, the agency that administers state Medicaid, is awaiting a report from the Leavitt Group, a consulting firm making a comprehensive study of low-income health care in Oklahoma.

Nationally, during the 2010 debate on the Affordable Care Act, federal Health and Human Services Secretary Kathleen Sebelius and President Obama said Americans who liked their current insurance plans could keep them. For thousands of Oklahoma’s working poor, their “current plan” is Insure Oklahoma.

Given the U.S. Supreme Court’s decision allowing the state flexibility on Medicaid, a “waiver” could be as simple or elegant as approving current funding levels to sustain a program like Insure Oklahoma, allowing state legislators more time to consider a fresh cycle of homegrown solutions.

Contact Patrick B. McGuigan, Oklahoma city bureau chief for the Watchdog.org network, at Patrick@capitolbeatok.com and follow us on Twitter: @capitolbeatok.