Just days after its board approved a flat budget with no provider cuts for the new fiscal year, the Oklahoma Health Care Authority told the federal government it plans to cut more than $200 million in payments to state hospitals under the state’s Medicaid program. In filings with the federal Centers for Medicare Medicaid Services, OHCA proposed a $218 million, or 20%, cut to the Supplemental Hospital Offset Payment Program. The program helps hospitals offset revenue losses when treating Medicaid patients compared with patients covered by Medicare or private insurance.  The filing came as a surprise to many, including the Oklahoma Hospital Association. In a letter to the agency, officials asked the state to delay its filing with the federal agency so providers could get additional information about its estimates and assumptions.  A series of meetings with lawmakers and hospital officials is scheduled for Wednesday to discuss the proposed cuts to the SHOPP program.  Officials from the Health Care Authority did not respond to a request for comment on Tuesday.  Rich Rasmussen, president of the Oklahoma Hospital Association, said the federal government is still weighing how it will treat state directed-payment programs like SHOPP under stricter Trump administration Medicaid requirements passed by Congress last year. He said other requirements for those programs won’t take effect in Oklahoma until July 1, 2027.   “Over the past several weeks, stakeholders were advised that significant reductions to SHOPP directed payments were being considered in response to the agency’s FY 2027 budget shortfall,”  Rasmussen said in the letter sent Monday to OHCA CEO Clay Bullard. “Following the June 23, 2026, letter from legislative leadership and subsequent discussions regarding the agency’s fiscal position, stakeholders reasonably understood that the budget-driven reductions previously discussed by the agency would no longer be necessary.”  The Health Care Authority asked the Legislature for an extra $495 million for fiscal year 2027, which starts July 1. But lawmakers had little confidence in the actuarial estimates of expected service use by Soonercare members. After budget negotiations concluded in April, lawmakers approved an extra $250 million. That was the same amount Gov. Kevin Stitt requested in February in his executive budget proposal.  A week of turmoil behind the scenes over possible medical provider cuts culminated in Friday’s Health Care Authority board meeting. In presenting the budget, Bullard assured board members that a flat budget would not mean cuts to the reimbursements to hospitals or other medical providers.  An estimated $66 million shortfall will be covered by carryover money from the FY 2026 fiscal year. Republican Legislative leaders also gave the agency a green light to tap a pot of savings called the Rate Preservation Fund if it faces a cash crunch in the coming months.  Bullard said the agency, which has an annual budget of more than $12 billion, faces razor-thin cash flow margins. To help close the budget gap, it cut vendor contracts and employee bonuses. “The summary of this budget is: hospitals got no cuts, providers got no cuts, no member will have a program that will be cut,” Bullard said during Friday’s meeting. “The people that were cut and the staff and those vendors that supply services to this agency were the ones who got the cut.” Paul Monies has been a reporter with Oklahoma Watch since 2017 and covers state agencies and public health. Contact him at (571) 319-3289 or [email protected]. Follow him on Twitter @pmonies.  The post In Reversal, Oklahoma Medicaid Agency Plans $218 Million in Provider Cuts appeared first on Oklahoma Watch. ...read more read less