Oklahoma Health Officials Seek Funding Boost and Agency Restructuring

Mar 25, 2026, 2:35 AM
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Oklahoma health care leaders are pressing lawmakers for increased funding to address serious budget shortfalls within the state’s mental health services. The Oklahoma Department of Mental Health and Substance Abuse Services (ODMHSAS) has reported a substantial financial deficit, prompting calls for significant fiscal intervention from the state legislature.
Clay Bullard, director of the Oklahoma Health Care Authority, emphasized that the financial instability of the mental health department is adversely affecting Medicaid services, which reach approximately one in four Oklahomans. He stated, "We have a situation where one agency's failure creates a second failure for a secondary agency," highlighting the interconnected nature of state health services.
Despite recent emergency funding of $19.6 million, ODMHSAS faces an urgent need for an additional $29 million to cover Medicaid matching costs for the current budget year, along with similar requests for the next fiscal year. Additional funding needs include $30.2 million for a court-ordered competency restoration settlement and $22.5 million for technology upgrades, pushing the required funding beyond $71 million more than initially projected.
In response to these challenges, Bullard has suggested that privatizing certain mental health facilities could streamline operations and save taxpayer dollars. "We continue to see the government is not great at managing facilities and large numbers of staff," he said, indicating that private companies might offer more effective management solutions.
The state has an existing request for proposals to possibly privatize its Certified Community Behavioral Health Clinics, which provide mental health and substance abuse treatment to all Oklahomans, regardless of their ability to pay.
Commissioner Gregory Slavonic echoed Bullard's concerns, suggesting that lawmakers should consider reallocating some responsibilities from ODMHSAS to the State Department of Health. This would include the implementation and oversight of the competency restoration consent decree, which aims to improve services for pre-trial detainees.
Amidst these discussions, Slavonic indicated his plans to leave the mental health agency following the current legislative session, raising questions about leadership stability within the department.
The urgency of addressing these financial issues has heightened following a series of investigations and legal disputes that have rocked the agency. Recent revelations indicate a $43 million budget shortfall for FY 25 and a required $54 million increase for FY 26 to avoid drastic service cuts.
Former Commissioner Carrie Slatton-Hodges, who was ousted in January, left behind a complex budget situation that has left current officials scrambling for solutions. Lawmakers are investigating the agency's past financial practices, which included using future fiscal allocations to cover past debts, leading to accusations of mismanagement.
Despite the gravity of the situation, no concrete legislative proposals have been drafted yet, although the ideas presented have reportedly been met with positive reception among some lawmakers. There is a growing sense of urgency within the legislature to address these funding deficiencies, particularly as the needs of mental health services continue to expand.
House Bill 1343, filed by Rep. Justin Humphrey, seeks to abolish ODMHSAS and transfer its functions to the Department of Corrections, underscoring the contentious nature of mental health care management in Oklahoma. Humphrey's controversial proposal has drawn attention to the state’s current inability to meet growing mental health demands.
As the legislative session progresses, Oklahoma's health care officials are advocating not only for increased funding but also for a comprehensive restructuring of the state's mental health services to ensure sustainable and effective care for its residents. The outcomes of these discussions will be critical in shaping the future of mental health support in Oklahoma, as officials continue to navigate the complexities of state health care funding and management.
With lawmakers now alerted to the budget crises facing ODMHSAS, the hope is that a collaborative approach can be developed to secure the necessary resources and implement the structural changes needed to address these long-standing issues effectively.

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