Capitol Updates

 This week's Capitol Updates newsletter:


October 23, 2017

It looks like the House leadership has decided to opt for a temporary budget solution to avoid drastic cuts in the healthcare and social services agencies. I don't know if this includes any revenue increases or just moving money around to cover the agencies' budget expenditures until early next year when the legislature reconvenes in February. I would guess it does not include revenue increases because statements by the leadership indicate the "fix" is just until early next year. That would indicate they have not found enough money to finish the current fiscal year that ends June 30th-only to get by until the regular session begins.

This is a good idea. There's no reason to disrupt state services to people until necessary. In addition, the move may relieve some pressure and give legislators time to find an overall solution for the lack of adequate revenue. But the risk involved in pushing out the drop-dead date for stopping services is, if no solution is reached all the pools of money will have been emptied. Some agencies may be effectively closed for business for some of their neediest clients.

If legislators simply postpone catastrophic cuts, where do we go from here? I accidentally learned something in the HB 1017 special session years ago that would be good to remember now. It would be a good idea NOT to adjourn the special session sine die. Having the special session still going, even if it is running simultaneously with the regular session, will come in very handy. As we've already seen, in special session the legislature is not tied to meeting every day to get their work done before the last Friday in May. In special session they can adjourn for days or weeks to hold reconsideration votes when necessary or to work on amendments without worrying about deadlines. A conference committee can meet as long as necessary to report out a bill.

When we reached an impasse in the HB 1017 special session we passed a resolution creating a citizen's task force to recommend school reforms and revenue, then adjourned for 2 months for them to do their work. They brought in experts and held town meetings around the state. When they returned with their report in November, we introduced the bill with most of their recommendations. Naturally it was amended and debated just as in any legislative process, but it remained mainly intact. Several times there were long adjournments to do the hard work of compromise and vote counting. You can't do that in a regular session without suspending the rules which is often impossible.

I know current leadership wants to solve the problem. They've already said they don't want to see these cuts. But it seems to me that it just can't get done in the way that has become customary. That is, with a few people doing the negotiating behind closed doors, reaching an up-front agreement, then bringing it out and ramming it through. I doubt they'll ever reach 75% that way. A way that might work is what was for years the normal process: Running a bill through the House and Senate with substantive content but crippled with the title stricken, allowing amendments, getting the bill into conference (which can be done with 51%) then having a conference committee that includes a broad group of legislators write the final bill. This allows all members (even those firmly opposed) to participate, and it allows the leadership to gauge where members are in their thinking. I believe the HB 1017 conference committee had 30 House members and 15 Senators representing all areas of the state and many points of view. Their charge was not to write a perfect bill, but to write a bill that, at the end of the day, could pass, and they did.

White announces elimination of outpatient services if funds not replaced

Shawn Ashley, eCapitol

Oklahoma Department of Mental Health and Substance Abuse Services Commissioner Terri White said Wednesday her agency will begin the process of implementing a series of emergency rules Nov. 1 that will allow it to cut $75 million, effectively eliminating most of its outpatient services.
"These cuts are unbearable and will decimate our state's behavioral health care system. Yet, they are the only choices the agency has left to keep from completely eliminating services for Oklahoma's most acutely ill," White said at a press conference Wednesday.
"This is a really difficult day for our department and the behavioral health network across Oklahoma and the families and individuals who rely on our life-saving services," White said.
"None of us want this to happen," she added.
The cuts will come in the department's out-patient services area, said White. The most acutely ill, those who are a threat to themselves or someone else, will continue to receive services, White said. "We cannot start by eliminating those services."
The services lost will include all state-funded outpatient services statewide for indigent and behavioral health Medicaid eligible clients, as well as the elimination of residential treatment services for children. Drug courts, mental health courts and other court related programs will no longer be funded. The state's Systems of Care program that serves vulnerable youth and their families, in addition to other state agencies and local schools, will be discontinued.
"We will have to eliminate every outpatient service available in the state of Oklahoma with the exception of medications," White said.
White said the cuts will impact nearly 189,000 Oklahomans currently receiving outpatient services, 700 treatment agencies in communities statewide and more than 8,500 therapists, case managers, doctors and nurses, as well as hundreds of support staff.
"We will have about 300 state employees who will be laid off, riffed (Reduction-in-Force) or let go," White added.
White said she did not believe lawmakers and Gov. Mary Fallin want to see the cuts implemented. The only way to avoid that, she said, is to come up with a revenue and budget agreement.
"The reality is we lost $75 million when the cigarette fee was thrown out. Without additional appropriations, we have no choice but to begin talking about what $75 million in cuts is going to look like," said White.
Fallin's office did not respond to a request for a comment. The governor said on Twitter, "The cuts announced today by (ODMHSAS) are nothing short of devastating. We must put people above politics."
Like the Oklahoma Health Care Authority which has announced a series of cuts it too is beginning the process of implementing as a result of losing $70 million when the tobacco cessation fee was found unconstitutional, White said the agency must meet a series of deadlines to implement the service reductions that would begin Dec. 1.
White said the process will not begin if legislators reach an agreement by Nov. 1. The cuts might not take effect Dec. 1 if lawmakers come to an agreement before then, depending on exactly what they decide to do.
"We are at a place now where we have to have this discussion," she said.
The House and Senate Joint Committees on Appropriations and Budget have scheduled meetings for Monday, but House members are not scheduled to return to the Capitol until Tuesday to resume the special session that began Sept. 25. The special session adjourned to the call of the chair two days after it began when it became apparent to House leaders they did not have the votes needed to pass a $1.50 per pack cigarette tax increase.
While noted the timing of the situation also poses challenges. The $75 million represents approximately 23 percent of the agency's total state appropriations, she said, but the reductions will have to be implemented over the final six months of the fiscal year, effectively doubling their impact.
ODMHSAS Board of Directors Chair Brian Bush said the cuts will hurt rural communities in particular, where there are fewer service providers. That, he said, will magnify the economic impact as individuals will loose work time seeking treatment elsewhere and potentially their jobs if they do not receive the treatment they need.
Bush is president and chief executive office of the Altus Chamber of Commerce. He also is one of Senate President Pro Tempore Mike Schulz's two appointees to the Board of Legislative Compensation. It was Bush who at Tuesday's meeting first suggested the board delay its decision on adjusting lawmakers' pay and proposed the board wait to see if lawmakers were able to overcome the current budget stalemate in the next several months. The board voted unanimously Tuesday to leave legislative pay at its current rate and to meet again in January to consider whether it should be cut.
Bush said it costs approximately $2,000 for the agency to provide services to someone with mental health needs, but it costs more than $20,000 for them to be incarcerated.
"What we do impacts so many lives in so many ways. Unfortunately, if people are not able to get the services they need, they show up in other agencies," he said.
Bush added, "The cost to the lives is more than the economic cost. We know that lives are at stake and when services are not available, people die."
District Attorneys Council Vice Chair Richard Smotherman, who is the district attorney for Lincoln and Pottawatomie counties, said the service reductions could mean 4,600 people will enter Oklahoma's prison system. That number represents the number of drug court and mental health court slots that will be cut under the plan announced Wednesday.
"It's not fair...It's not right," Smotherman said, adding that such moves would undermine criminal justice reform efforts in the state. "These programs are an absolutely essential part of criminal justice reform. Meaningful criminal justice reform cannot occur without these programs funded."
Office of Juvenile Affairs Director Steven Buck, who previously worked under White at ODMHSAS, said he expected his agency to be impact, as well. Buck estimated that 50 percent of the juveniles in his agency's care have open behavioral health files, as do a significant number of their parents, as well.
"Absent needed care in the community, we know that young people will be entering our agency..." Buck said. He added, if the cuts are implemented his agency will have to increase its footprint "because demand will require it."
Craig Jones, president Oklahoma Hospital Association, predicted the services' cuts will mean those with mental health needs will end up in emergency rooms across the state that are not designed or prepared to provide care for them. It also will put added pressure on hospitals in the state, including the 42 that are in danger of closing, he said.
"It's a tragedy we are in this situation," he said.
Also present at Wednesday's press conference but not speaking was DHS Director Ed Lake. His agency is implementing its own series of cuts after losing $69 million because of the court's decision.

Workers' Compensation Commission evaluating medical fee schedule changes

Shawn Ashley, eCapitol

The chair of the Workers' Compensation Commission hopes to see the state move toward a formulaic medical fee schedule and away from an arbitrary schedule.
Former Rep. Mark Liotta, who chairs the commission, said, "We think we should move forward with a plan of small, incremental changes toward a fee schedule that is formulaic, predictable and logical and less arbitrary."
Liotta was scheduled to discuss the issue Friday at a joint meeting of the commission and its Physician Advisory Committee. The advisory committee meeting, however, had to be cancelled when it was realized the agenda for the meeting had not been properly posted. The commission was called to order and then adjourned since its agenda called only for it to participate in the advisory committee's meeting.
The fee schedule determines the maximum amount to be paid by insurers to providers for certain services, Liotta explained. Providers are free to bill more than the amount set on the fee schedule, he added, and in some cases, providers have agreements to provide the service at a lower rate.
The current fee schedule, which was adopted by administrative rule, originally was implemented in 2012 by the Workers' Compensation Court administrator. The court is now known as the Workers' Compensation Court of Existing Claims and deals only with those claims filed before the commission came into existence in 2014.
In his prepared remarks, Liotta said, " is my evaluation our fee schedule is the produce of many historical legislative efforts which included the various medical disciplines and is, in effect, arbitrary with no logical formulaic basis."
Liotta wrote in his prepared remarks that 38 states have chosen a structure that is formulaic, predictable, logical and uniform to the extent reasonable and practicable. That is the goal the commission is pursuing, he added.
Liotta suggests the commission "...move forward with a plan of small, incremental changes toward a formula every year, instead of every two years." That, he wrote, currently is being researched.

Have a good week. Give me a call at 918.671.6860 if I can be of help in any way.