Oklahoma's health care spending is increasing
(The Center Square) - Oklahoma's spending on health insurance benefits increased to $809 million in 2021, up by $160 million since 2014, according to a report.
The report presented to the Oversight Committee for the Legislative Office of Fiscal Transparency Thursday revealed cost containment strategies currently in use do not line up with health care's top cost drivers: hospital visits and prescription drugs.
Only two initiatives examined hospital prices, according to the report.
"LOFT could not substantiate the reported success of other cost savings initiatives by OMES-EGID (Employees Group Insurance Division of the Office of Management and Enterprise Services)," the report said. "For example, a member phone app is reported to have saved $500,000 annually through redirecting members from high-cost services to lower cost services, but there is no data demonstrating where and how savings were realized. The mandatory monthly fee for the app is included in HealthChoice's premium rate, which is the basis for funding employees' benefits."
Around 174,000 state employees, education personnel and their dependents were covered by the state-administered health insurance plan HealthChoice during fiscal year 2021. Employees from the education department made up more than half the participants, with 57 percent, according to the report.
Oklahoma is the only state in the seven-state region to fund 100 percent of school personnel health insurance benefits. Typically, school districts fund this, not the state, according to the report.
The legislature's spending on health benefits for school district employees increased by 91 percent since 2010, according to the report. This has a direct impact on the state budget, the report found.
"In 2021, the State's contribution to health benefits for state, local school district, and CareerTech employees accounted for 10 percent of all state-appropriated dollars, the report said. "The state's total contributions to health insurance coverage has increased by 25 percent since 2014."
HealthChoice premiums increased 3 percent from 2010 to 2021, the report found. Single coverage premiums were $5,314 compared to $7,391 in 2021. Likewise, family coverage premiums rose from $16,933 to $22,365 during that time.
The evaluation found HealthChoice has the lowest premiums and most extensive coverage among the health insurance plans offered by the state. It also found Oklahoma subsidizes employee health insurance at a higher rate than regional and national averages.
"Oklahoma has the highest state contribution rate in the region for state employees covered under self-funded health insurance plans. The state's contribution to employee health benefits has remained above both the regional and national market average for the last decade," the report said.