At the fifth and most recent committee hearing looking into the Oklahoma Department of Mental Health and Substance Abuse Services, financial investigators told lawmakers they would get an appropriation request as soon as Monday afternoon.
Lawmakers were not given an estimate for the request, but were told it would be enough to maintain "contractual obligations" and pay the agency's more than 2,000 employees, a responsibility the department says it will run out of money for this month.
David Greenwell, a CPA appointed by Gov. Kevin Stitt, started looking into the finances last week, and was the latest official called to testify before the board.
Unless the legislature calls a special session, all budget decisions have to be made before the end of May.
Despite becoming aware of a shortfall in February, agency officials still haven't been able to put a finger on just how much is missing. Commissioner Allie Friesen first asserted only $6.2 million was needed to sustain the department through a $43 million shortfall, but suspicion about the number grew when interim-CFO Skip Leonard failed to explain why.
In her most recent appearance in front of the committee, Friesen changed her approach, saying she couldn't define the department's needs because of "layers of dysfunction." She asked the legislature for help.
On Monday, Greenwell, joined by State CFO Aaron Morris, said he has been working closely with the Legislative Office of Fiscal Transparency and the state mental health department to get accurate numbers.
Cancelled contracts with state mental health and substance abuse service providers have intensified the crisis. The department is responsible for contracting with the state's Certified Community Behavioral Health Clinics, or CCBHCs, and budget changes have impacted local care facilities and their staff.
CCBHCs are designated clinics that provide a comprehensive range of mental health and substance use services to anyone who requests them, regardless of their diagnosis or insurance status.
The model operates under a prospective payment system, where the state gives providers money based on a fixed, pre-determined rate that may be less than the actual service cost for people without insurance.
Historically, payments for these uninsured individuals have been addressed through what are referred to as "pended payments."
Some providers report reimbursement rates have dropped from 55% to 14% in the last year, threatening their ability to serve uninsured clients, whose numbers have grown as a result of broader state-level reforms.
In a press release, spokesperson Maria Chaverri said the department has not traditionally "budgeted separately" for pended payments.
"Instead, these payments have been managed at year-end using available funds," the release reads. "To enhance financial predictability for providers, Commissioner Allie Friesen previously directed the former Chief Financial Officer to develop an algorithm to assist providers in estimating and planning for anticipated pended payments. Unfortunately, this analysis was never delivered."
Friesen has repeatedly pointed her finger at the former CFO Richard Edwards for financial mismanagement at her agency. There is a job posting for a permanent replacement, but co-chair Rep. Mark Lawson, R-Sapulpa, said he worries it doesn't require enough financial experience.
Financial investigators Greenwell and Morris said their appropriation request, made on behalf of Gov. Stitt, would not include funds for pended payments.
Morris said they could include information about outstanding reimbursement requests to the legislature, but fulfilling them is not part of the department's current plan.
"We can provide supporting data, supplemental data to the legislature so they can make a determination on whether they would like to fund pended payments," Morris said. "But in our analysis of how do we meet contractual obligations, that would not be a consideration."
After the meeting, Lawson said lawmakers will have to consider whether to appropriate more than the agency initially requests or stick to what is contractually obligated.
"I would say that's something we'll consider. To what degree, I'm not certain," Lawson said. "I would say, first and foremost, we're going to pay our state employees, we're going to get through the fiscal year. That is, I would say, the House's primary objective."
He said providers have counted on pended payments "for years" and it is important that the state continues providing services for people who are uninsured, so lawmakers will have to "tamp down" how to address budget payments moving forward, possibly shifting to a contractual agreement.
After lawmakers get a financial request from investigators, Lawson said the legislature will review it internally and negotiate from there.
This report was produced by the Oklahoma Public Media Exchange, a collaboration of public media organizations. Help support collaborative journalism by donating at the link at the top of this webpage.
