DEPARTMENT OF HEALTH & HUMAN SERVICES
Centers for Medicare & Medicaid Services
7500 Security Boulevard, Mail Stop S2-03-17
Baltimore, Maryland 21244-1850

State Demonstrations Group

December 11, 2017
Rebecca Pasternik-Ikard
Chief Executive Officer
Oklahoma Health Care Authority
4345 N. Lincoln Boulevard
Oklahoma City, OK 73105
Dear Ms. Pasternik-Ikard:
This letter is in response to Oklahoma’s request for a one-year extension of Oklahoma’s
Medicaid demonstration, entitled “SoonerCare” (Project Number 11-W-00048/6), under section
1115 of the Social Security Act (the Act). The SoonerCare demonstration provides Primary Care
Case Management (PCCM) for Medicaid beneficiaries and either premium assistance for
employer sponsored insurance or direct coverage for adults who would not otherwise be eligible
for Medicaid. We are working on the final terms of the extension, which will contain only slight
technical changes and no programmatic changes, and expect to complete that work very soon.
In addition, on August 2, 2017, Oklahoma submitted a request to amend the SoonerCare
demonstration to obtain new authority for federal match for payments to state universities, to
recruit, train and retain medical professionals. This authority is not currently a part of the
SoonerCare demonstration.
While the state did previously have authority, under the SoonerCare 1115 Demonstration, to
allow supplemental payments to medical schools for a five-year period beginning January 1,
1996, that authority expired on December 31, 2001. After the first renewal of the 1115
demonstration, the supplemental payments for the universities were no longer included in the
special terms and conditions (STC). Subsequent demonstration renewals did not include
authority for the supplemental payments.
As part of ongoing financial management review work, CMS became aware in 2015 that, despite
lack of federal authority, the state had continued to claim federal match for these payments.
From the time CMS first identified and raised this concern to Oklahoma, we have continually
asked the state to provide additional information to justify the state’s authority to make these
payments. However, we have not received such information. As a result, CMS has deferred
federal match for these payments for the last quarter, as described in the accompanying
OK/2017/4/E/01/MAP letter.
In light of this continued problem, the state proposed in August to amend the expenditure
authority and STCs of the SoonerCare demonstration to permit the state to prospectively receive
federal match for payments to state universities to recruit, train and retain medical professionals

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in order to support the development of the healthcare workforce in the state. The state indicated
that the payments for which it is now seeking authority are intended to offer the state universities
options for training, development and placement of critical health care workers.
The state proposed that eligible program schools be four year public universities that request
funding for students enrolled in academic programs that result in licensure eligibility for
physicians, registered nurses, advance practice nurses or physical therapists. Universities must
also provide an intergovernmental transfer (IGT) for the non-federal share, and meet or exceed
defined metrics for payment. Eligible universities must also provide face to face onsite classes.
The state estimates the federal financial impact to be $115,000,000.
We support the state’s goal of expanding the healthcare workforce, particularly for providers
who serve Medicaid beneficiaries, and we appreciate the state’s efforts to address this important
issue. We understand that Oklahoma is facing a variety of issues related to training and retaining
a healthcare workforce, as well as a particularly challenging budget situation.
However, at this time, CMS does not see a path to approval for the state’s proposal to receive
federal Medicaid match for payments made to the above described universities. Medicaid
payments must be linked to the delivery of services to Medicaid beneficiaries and, if authorized
under the state plan, must be in compliance with all other applicable limits.
If the state would like to provide additional information, indicating that the payments support
Medicaid services to Medicaid beneficiaries, we are committed to working to identify a path
forward toward an acceptable payment structure. Some portion of the expenditures, to the extent
they are directed to medical providers and fit within Upper Payment Limits, may be incorporated
into the state’s fee-for-service payment methodology. CMS is available to provide technical
assistance on options that may be available. In the meantime, CMS will continue working with
the state on the extension of the current terms of the SoonerCare demonstration and expects to
complete that work very soon.
If you have any questions, please do not hesitate to contact me or your project officer, Ms. Annie
Hollis. Ms. Hollis can be reached at (410) 786-0795 or annie.hollis@cms.hhs.gov. We look forward
to continuing to work with you and your staff on this demonstration.
Sincerely,
/s/
Judith Cash
Acting Director

cc:

Bill Brooks, Associate Regional Administrator, CMS Dallas Regional Office