1 STATE OF OKLAHOMA
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2 1st Session of the 60th Legislature (2025)
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3 SENATE BILL 252 By: Standridge
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5 AS INTRODUCED
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6 An Act relating to the state Medicaid program;
6 amending Section 3, Chapter 395, O.S.L. 2022, as
7 amended by Section 2, Chapter 448, O.S.L. 2024 (56
7 O.S. Supp. 2024, Section 4002.3a), which relates to
8 capitated contracts; excluding prescription drug
8 services from certain provisions; directing certain
9 program delivery model for prescription drug
9 services; requiring certain transition, contracts,
10 and reimbursement; directing amendment of specified
10 contracts; providing certain construction; requiring
11 the Oklahoma Health Care Authority to seek certain
11 federal approval; amending Section 4, Chapter 395,
12 O.S.L. 2022, as amended by Section 3, Chapter 448,
12 O.S.L. 2024 (56 O.S. Supp. 2024, Section 4002.3b),
13 which relates to capitated contracts; conforming
13 language; amending 56 O.S. 2021, Section 4002.5, as
14 last amended by Section 1, Chapter 243, O.S.L. 2023
14 (56 O.S. Supp. 2024, Section 4002.5), which relates
15 to contracted entity responsibilities; conforming
15 language; updating statutory references; amending 56
16 O.S. 2021, Section 4002.12, as last amended by
16 Section 7, Chapter 448, O.S.L. 2024 (56 O.S. Supp.
17 2024, Section 4002.12), which relates to minimum
17 rates of reimbursement; conforming language; and
18 providing an effective date.
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19
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20 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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21 SECTION 1. AMENDATORY Section 3, Chapter 395, O.S.L.
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22 2022, as amended by Section 2, Chapter 448, O.S.L. 2024 (56 O.S.
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23 Supp. 2024, Section 4002.3a), is amended to read as follows:
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 1 Section 4002.3a. A. 1. The Oklahoma Health Care Authority
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2 (OHCA) shall enter into capitated contracts with contracted entities
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3 for the delivery of Medicaid services as specified in the Ensuring
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4 Access to Medicaid Act to transform the delivery system of the state
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5 Medicaid program for the Medicaid populations listed in this
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6 section.
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7 2. Unless expressly authorized by the Legislature, the
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8 Authority shall not issue any request for proposals or enter into
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9 any contract to transform the delivery system for the aged, blind,
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10 and disabled populations eligible for SoonerCare.
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11 B. 1. The Oklahoma Health Care Authority shall issue a request
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12 for proposals to enter into public-private partnerships with
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13 contracted entities other than dental benefit managers to cover all
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14 Medicaid services other than dental services and prescription drug
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15 services for the following Medicaid populations:
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16 a. pregnant women,
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17 b. children,
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18 c. deemed newborns under 42 C.F.R., Section 435.117,
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19 d. parents and caretaker relatives, and
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20 e. the expansion population.
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21 2. The Authority shall specify the services to be covered in
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22 the request for proposals referenced in paragraph 1 of this
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23 subsection. Capitated contracts referenced in this subsection shall
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 1 cover all Medicaid services other than dental services and
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2 prescription drug services including:
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3 a. physical health services including, but not limited
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4 to:
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5 (1) primary care,
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6 (2) inpatient and outpatient services, and
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7 (3) emergency room services, and
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8 b. behavioral health services, and
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9 c. prescription drug services.
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10 3. The Authority shall specify the services not covered in the
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11 request for proposals referenced in paragraph 1 of this subsection.
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12 4. Subject to the requirements and approval of the Centers for
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13 Medicare and Medicaid Services, the implementation of the program
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14 shall be no later than April 1, 2024.
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15 C. 1. The Authority shall issue a request for proposals to
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16 enter into public-private partnerships with dental benefit managers
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17 to cover dental services for the following Medicaid populations:
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18 a. pregnant women,
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19 b. children,
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20 c. parents and caretaker relatives,
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21 d. the expansion population, and
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22 e. members of the Children’s Specialty Plan as provided
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23 by subsection D of this section.
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 1 2. The Authority shall specify the services to be covered in
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2 the request for proposals referenced in paragraph 1 of this
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3 subsection.
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4 3. Subject to the requirements and approval of the Centers for
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5 Medicare and Medicaid Services, the implementation of the program
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6 shall be no later than April 1, 2024.
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7 D. 1. Either as part of the request for proposals referenced
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8 in subsection B of this section or as a separate request for
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9 proposals, the Authority shall issue a request for proposals to
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10 enter into public-private partnerships with one contracted entity to
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11 administer a Children’s Specialty Plan.
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12 2. The Authority shall specify the services to be covered in
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13 the request for proposals referenced in paragraph 1 of this
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14 subsection.
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15 3. The contracted entity for the Children’s Specialty Plan
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16 shall coordinate with the dental benefit managers who cover dental
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17 services for its members as provided by subsection C of this
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18 section.
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19 4. Subject to the requirements and approval of the Centers for
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20 Medicare and Medicaid Services, the implementation of the program
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21 shall be no later than April 1, 2024.
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22 E. The Authority shall not implement the transformation of the
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23 Medicaid delivery system until it receives written confirmation from
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24 the Centers for Medicare and Medicaid Services that a managed care
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 1 directed payment program utilizing average commercial rate
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2 methodology for hospital services under the Supplemental Hospital
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3 Offset Payment Program has been approved for Year 1 of the
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4 transformation and will be included in the budget neutrality cap
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5 baseline spending level for purposes of Oklahoma’s 1115 waiver
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6 renewal; provided, however, nothing in this section shall prohibit
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7 the Authority from exploring alternative opportunities with the
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8 Centers for Medicare and Medicaid Services to maximize the average
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9 commercial rate benefit.
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10 F. 1. Upon receipt of federal approval as described in
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11 paragraph 3 of this subsection, the Authority shall cover
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12 prescription drug services through a fee-for-service delivery model.
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13 The Authority shall transition prescription drug coverage of all
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14 Medicaid members covered by a contracted entity to direct coverage
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15 by the Authority, shall enter into such contracts with pharmacists
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16 and pharmacy providers as are necessary to ensure network adequacy
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17 as required by federal regulation, and shall directly reimburse such
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18 pharmacists and pharmacy providers. The Authority shall amend its
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19 contracts with all contracted entities as necessary to implement the
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20 provisions of this subsection.
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21 2. Nothing in this subsection shall be construed to prohibit
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22 the Authority from:
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 1 a. implementing value-based payment arrangements with
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2 Medicaid providers through direct contractual
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3 agreements,
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4 b. implementing cost-saving measures for prescription
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5 drug services including, but not limited to,
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6 participation in the Medicaid Drug Rebate Program, or
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7 c. contracting with a pharmacy benefits administrator
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8 that is located in this state to administer claims and
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9 perform other administrative functions on behalf of
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10 the Authority; provided, however, the Authority shall
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11 not contract with a pharmacy benefits manager.
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12 3. The Authority shall seek any federal approval necessary to
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13 implement the provisions of this section.
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14 SECTION 2. AMENDATORY Section 4, Chapter 395, O.S.L.
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15 2022, as amended by Section 3, Chapter 448, O.S.L. 2024 (56 O.S.
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16 Supp. 2024, Section 4002.3b), is amended to read as follows:
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17 Section 4002.3b. A. All capitated contracts shall be the
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18 result of requests for proposals issued by the Oklahoma Health Care
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19 Authority and submission of competitive bids by contracted entities
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20 pursuant to the Oklahoma Central Purchasing Act.
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21 B. Statewide capitated contracts may be awarded to any
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22 contracted entity including, but not limited to, any provider-led
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23 entity or provider-owned entity, or both.
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 1 C. The Authority shall award no less than three statewide
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2 capitated contracts to provide comprehensive integrated health
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3 services including, but not limited to, medical, and behavioral
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4 health, and pharmacy services and no less than two statewide
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5 capitated contracts to provide dental coverage to Medicaid members
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6 as specified in Section 4002.3a of this title.
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7 D. 1. Except as specified in paragraph 3 of this subsection,
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8 at least one capitated contract to provide statewide coverage to
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9 Medicaid members shall be awarded to a provider-led entity, as long
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10 as the provider-led entity submits a responsive reply to the
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11 Authority’s request for proposals demonstrating ability to fulfill
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12 the contract requirements.
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13 2. Effective with the next procurement cycle, and except as
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14 specified in paragraph 3 of this subsection, at least one capitated
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15 contract to provide statewide coverage to Medicaid members shall be
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16 awarded to a provider-owned entity, as long as the provider-owned
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17 entity submits a responsive reply to the Authority’s request for
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18 proposals demonstrating ability to fulfill the contract
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19 requirements.
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20 3. If no provider-led entity or provider-owned entity submits a
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21 responsive reply to the Authority’s request for proposals
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22 demonstrating ability to fulfill the contract requirements, the
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23 Authority shall not be required to contract for statewide coverage
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24 with a provider-led entity or provider-owned entity.
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 1 4. The Authority shall develop a scoring methodology for the
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2 request for proposals that affords preferential scoring to provider-
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3 led entities and provider-owned entities, as long as the provider-
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4 led entity and provider-owned entity otherwise demonstrate an
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5 ability to fulfill the contract requirements. The preferential
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6 scoring methodology shall include opportunities to award additional
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7 points to provider-led entities and provider-owned entities based on
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8 certain factors including, but not limited to:
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9 a. broad provider participation in ownership and
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10 governance structure,
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11 b. demonstrated experience in care coordination and care
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12 management for Medicaid members across a variety of
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13 service types including, but not limited to, primary
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14 care and behavioral health,
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15 c. demonstrated experience in Medicare or Medicaid
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16 accountable care organizations or other Medicare or
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17 Medicaid alternative payment models, Medicare or
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18 Medicaid value-based payment arrangements, or Medicare
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19 or Medicaid risk-sharing arrangements including, but
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20 not limited to, innovation models of the Center for
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21 Medicare and Medicaid Innovation of the Centers for
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22 Medicare and Medicaid Services, or value-based payment
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23 arrangements or risk-sharing arrangements in the
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24 commercial health care market, and
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 1 d. other relevant factors identified by the Authority.
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2 E. The Authority may select at least one provider-led entity or
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3 one provider-owned entity for the urban region if:
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4 1. The provider-led entity or provider-owned entity submits a
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5 responsive reply to the Authority’s request for proposals
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6 demonstrating ability to fulfill the contract requirements; and
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7 2. The provider-led entity or provider-owned entity
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8 demonstrates the ability, and agrees continually, to expand its
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9 coverage area throughout the contract term and to develop statewide
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10 operational readiness within a time frame set by the Authority but
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11 not mandated before five (5) years.
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12 F. At the discretion of the Authority, capitated contracts may
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13 be extended to ensure there are no gaps in coverage that may result
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14 from termination of a capitated contract; provided, the total
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15 contracting period for a capitated contract shall not exceed seven
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16 (7) years.
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17 G. At the end of the contracting period, the Authority shall
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18 solicit and award new contracts as provided by this section and
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19 Section 4002.3a of this title.
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20 H. At the discretion of the Authority, subject to appropriate
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21 notice to the Legislature and the Centers for Medicare and Medicaid
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22 Services, the Authority may approve a delay in the implementation of
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23 one or more capitated contracts to ensure financial and operational
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24 readiness.
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 1 SECTION 3. AMENDATORY 56 O.S. 2021, Section 4002.5, as
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2 last amended by Section 1, Chapter 243, O.S.L. 2023 (56 O.S. Supp.
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3 2024, Section 4002.5), is amended to read as follows:
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4 Section 4002.5. A. A contracted entity shall be responsible
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5 for all administrative functions for members enrolled in its plan
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6 including, but not limited to, claims processing, authorization of
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7 health services, care and case management, grievances and appeals,
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8 and other necessary administrative services.
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9 B. Prior to the execution of a contract between a contracted
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10 entity and the Oklahoma Health Care Authority, the contracted entity
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11 shall obtain the appropriate certificate of authority issued by the
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12 Insurance Department.
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13 1. A contracted entity shall obtain a certificate of authority
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14 issued by the Insurance Department to operate as a health
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15 maintenance organization when the contracted services to be
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16 delivered include physical health services, behavioral health
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17 services, and prescription drug services.
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18 2. A contracted entity shall obtain a certificate of authority
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19 issued by the Insurance Department to operate as an accident and
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20 health insurer or as a prepaid dental plan organization when the
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21 contracted services to be delivered include dental services.
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22 C. 1. To ensure providers have a voice in the direction and
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23 operation of the contracted entities selected by the Oklahoma Health
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 1 Care Authority under Section 4002.3b of this title, each contracted
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2 entity shall have a shared governance structure that includes: