Weekly Opinion Editorial

MAIL ORDER IS FOR A BRIDE, NOT DRUGS!
by Steve Fair

The Oklahoma State and Education Employees Group Insurance Board was created by the legislature in 1990 to administer the health, dental, disability and life insurance programs for state employees and educators. It is governed by an eight member appointed board that meets monthly. For several years, the OSEEGIB has been toying with the idea of having state employees and teachers purchase their drugs through a mail order pharmacy. The toying is over.
*****
In a press release issue on August 19th, the OSEEGIB said, “Beginning January 1, HealthChoice plans will make a mail-order pharmacy program for maintenance medications available to all pre-Medicare members. Maintenance medications are prescriptions that are usually taken on a daily basis and include drugs used to treat high-blood pressure, diabetes, high cholesterol, heart conditions, etc. By adopting a mail-order pharmacy program, it is estimated the plan will save about $9 million in prescription drug costs."
*****
Not everyone was happy with the decision. The Pharmacy Providers of Oklahoma, who negotiates contracts on behalf of over 500 Oklahoma pharmacies, distributed a flyer to HealthChoice members stating the proposal would hurt locally owned pharmacies and communities. The presented a plan of their own the ‘Community Pharmacy Proposal,’ saying it would save taxpayers $13.5 million more than the mail-order proposal.
*****
PPOk also said the decision would hurt local pharmacies and would have a negative economic impact of up to $75 million annually. The OSEEGIB disputes the amount of the economic impact and said they have been more than fair with independent rural Oklahoma pharmacists by ‘maintaining their reimbursement rate for over two decades.’
*****
After the PPOk’s flyer was distributed, the OSEEGIB’s Director of External Affairs, Dana Webb responded with a four page letter to members of the legislature providing a timeline of when the mail order proposal was discussed, who was invited to address the issue, and the justification for the decision by the board.
*****
Last week, three Enid area Republican lawmakers- Senator Patrick Anderson and Representatives John Enns and Representative Mike Jackson, sent a letter to Governor Fallin urging her to stop the mail order implementation by executive order. “There are better approaches to take than this OSEEBIG plan if the goal is to save money. Other options do exist- OSEEGIB has heard their plans and does not seem interested,” the lawmakers allege.
*****
This issue begs five questions:
*****
First, the move to a mail order pharmacy by the OSEEGIB will directly impact over 100,000 state employees and teachers plus their dependents. Webb states in her letter the OSEEGIB held two public meetings in August on this issue and lists a laundry list of organizations and associations contacted, it still begs the question why this flew under the radar? I can assure you that most of the insured were unaware this change was being considered.
*****
Second, who is Medco? They are a New Jersey publically traded company and a spinoff of Merck. They provide health care management services to over 65 million people nationally. In fact, Medco is the current Pharmacy Benefit Manager for the OSEEGIB. They also just happen to be in the pharmacy business. They operate nine mail-order pharmacies and six call center pharmacies throughout the country. Doesn’t this look like a conflict of interest? They decide what is covered, how much is paid and they sell the product?
*****
In 2004 Medco settled a lawsuit brought by 20 states alleging that they failed to disclose ‘incentives’ they received from drug companies and improperly switched or pressured doctors to switch patient's medication in pursuit of profit. Medco Health Solutions agreed to pay the United States $155 million plus interest to settle allegations that it defrauded the government. Was the OSEEGIB aware of Medco’s ethics issues?
*****
Third, if the PPOk’s Community Pharmacy Proposal will save taxpayers more money than Medco, why was it not considered by the OSEEGIB? On the flip side, why wasn’t PPOk charging these reduced prices proposed in their ‘Community Pharmacy Proposal’ before the mail order issue came up? Both questions should be addressed.
*****
Fourth, was the trust factor considered? Most people trust their local pharmacist when they have questions about their medication. They know them and feel comfortable confiding in them. Calling an 800 number and talking to someone in a call center just isn’t the same.
*****
Fifth, why would we intentionally do something to hurt our local businesses and communities? The actual savings to the taxpayer and the amount of economic impact this proposal will have on local pharmacies may be in dispute, but whatever the impact, there is no doubt it would hurt the local pharmacies. That actual savings to the taxpayers may also be insignificant.
*****
Fallin should issue an Executive Order delaying the implementation of this proposal. This decision needs to be revisited with the next round including full disclosure and more legislative and public input. Mail order may be fine for a bride, but not drugs.

Weekly Opinion Editorial

HAS RIGHT TO WORK WORKED?

by Steve Fair

Right-to-work laws are enforced in twenty-two states, mostly in southern and western states. Right to Work laws are allowed under the provisions of the Taft-Hartley Act, which prohibit agreements between labor unions and employers to make union membership and/or payment of union dues a condition of employment.
*****
Oklahoma passed State Question #695(Right-to-Work) on September 25, 2001 in a special election. The vote was close- 54% to 46%- with twenty six of the state’s seventy seven counties voting against the proposal. Of the twenty two Right to Work states, Oklahoma was the last state to pass Right-to-Work. To view county by county election results, go to http://www.ok.gov/elections/support/02sq.pdf
*****
In 2001, I wrote a brochure that was widely distributed in the state advocating the passage of Right-to-Work entitled, “The Exodus Continues.” It featured a comparison of the mass migration of the Okies fleeing the dust bowl to modern day college grads fleeing the state for better paying jobs. The facts were clear- just like in the 1930s, Oklahomans were leaving the state not because they hated Oklahoma, but because they needed a job.

*****
It has been ten years since Right to work was passed in Oklahoma and eight years since it was implemented. Has passage of Right-to-Work worked in Oklahoma? That is a legitimate question and one that deserves an answer.

*****
According to The Economic Policy Institute, R-T-W has failed in Oklahoma. In a paper written in February 2011, the EPI claims “manufacturing employment and relocations into the state (Oklahoma) reversed their climb and began to fall, precisely the opposite of what right-to-work advocates promised.” They also point out the state’s unemployment rate(still lower than the US rate) continues to be comparable to neighboring states. You can read the report at http://www.epi.org/publication/right-to-work_law_did_not_help_oklahomas_labor_market/
*****
In the interest of full disclosure, The Economic Policy Institute is a union funded organization with an agenda, so their objectivity in the analysis must be questioned. Because jobs are a primary issue at the forefront of the 2012 Presidential campaign and Republicans have introduced a National Right to Work Act in Congress, the EPI will use any means possible to defeat a National Right to Work law. For more on the National Right-to-Work law, go to http://capwiz.com/nrtwc/issues/alert/?alertid=48799571&type=CO

*****
Last week, the Oklahoma Council of Public Affairs released an in-depth study by Scott Moody and Wendy Warcholik countering the EPI study. They claim Right-Work has been a boon for Oklahoma. “Manufacturing output and productivity have outpaced the competition, and people from non-RTW states are voting with their feet by moving to Oklahoma in increasing numbers,” Moody and Warcholik wrote. You can read the report at http://www.ocpathink.org/articles/1549.
*****
Oklahoma’s population grew +8.7% between 2000 and 2010, but according to the US Census Bureau, the US population grew faster- +9.7% -during that same period, so Oklahoma has not seen major population growth from migration. And increased productivity” in manufacturing was not what those of us advocating passage of Right to Work were talking about in 2011. When we said R-T-W would help Oklahoma, we meant jobs- real jobs. We expected existing businesses to expand and grow and other businesses to relocate to the state.

*****
The truth is the measure of how Right to Work has helped Oklahoma is somewhere in between the two studies. Passing Right-to-Work in Oklahoma was not a mistake and it certainly has helped our state in business recruitment, but it is fair to ask if R-T-W has delivered what was expected. It hasn’t and here is why:
*****
First the national economical climate has been poor. Even though the R-T-W election was held two weeks after 9/11, no one could have foreseen that event would have a dramatic impact on the economic business climate in America. Ten years later, almost ten percent of Americans are unemployed and our country teeters on the brink of bankruptcy. Much of that is due to the cost of the war on terror.
*****
Secondly, Oklahoma has a flawed strategy in business recruitment. Economic development teams across the state spend too much time trying to recruit the ‘sexy’ jobs (aerospace/high tech), to Oklahoma and neglect the ‘meat and potatoes’ (distribution centers/consumer products) segment. Because of our geographic location, Oklahoma should be the hub for DCs, freight companies and CPG manufacturers. Those segments provide good paying stable jobs. In economic development, every segment should be recruited.
*****
Thirdly, Right-to-Work was just one of the impediments to recruiting business and industry to Oklahoma. Oklahoma’s workers comp laws and jackpot justice laws were two others. This past legislative session progress was made in both those areas. We have other impediments- tax structure, infrastructure- and our leadership must address those if we are to continue to move forward.
*****
Finally, passing R-T-W was not a quick fix solution to Oklahoma’s job woes. It took the state one hundred years to get to #45 in the country in per capita income. It will take time to reverse the trend but Scotsman Walter Elliott, a physician and politician, was right when he said "Perseverance is not a long race; it is many short races one after another." Right to Work was just one of those races.

Weekly Opinion Editorial

GRADING THEIR OWN TESTS!
by Steve Fair

The Oklahoma Tax Commission last week released a report that examined the 2009 impact of the state’s Small Business Capital Formation Incentive Act as well as the Rural Venture Capital Formation Incentive Act. These tax credit programs stated objective was to create jobs for Oklahomans. According to the report, the two programs cost Oklahoma taxpayers more than $550,000 per job. In comparison, Solyndra cost federal taxpayers $486,000 per job.

*****
According to State Representative Mike Reynolds, (R-Oklahoma City), “This is just more proof that the government should not try to pick winners and losers in the marketplace. The track record of government officials displays why legislators, other government officials, and employees in the various departments who make the decisions to give away this money aren’t in the private sector. This money should have been used for roads, schools, or constitutional incentives like across-the-board tax cuts.”

*****
The Small Business Capital Formation Incentive Act provides up to a 30 percent tax credit of qualified investments made in certain small business capital companies or investments made “in conjunction” with those ventures.

*****
The Tax Commission report found that of the $158 million in total tax credits generated through the program in 2008 and 2009, only $41 million has currently been claimed, leaving at least $117 million in potential revenue reductions for the next budget year. Of the 99 total jobs created by the program, over half were at the Patriot Golf Course, a private golf course in the Tulsa area.

*****
State Representative David Dank, (R-Oklahoma City) is the chairman of the Task Force on State Tax Credits and Economic Incentives. He and Reynolds agree that a 2010 AG’s opinion that some of the tax credits in the two programs were unconstitutional because they failed the ‘accountability’ test should sent up a red flag and put a stop to them, but it didn’t.

*****
In the 2010 opinion, then Attorney General Drew Edmondson said for the credits to be legal, they had to serve a public purpose, provide more benefit than cost, and include adequate controls and safeguards.

*****
Dank believes many state tax-credit programs fail the third test involving safeguards. “We have reviewed enough of these tax credits so far to know that the controls and safeguards in place are often a joke,” Dank said. “In many cases, they are nonexistent.” In other words, these programs had no oversight- no one was watching to make sure they were not being abused. Why has there not been any ‘accountability’ for these two programs?

*****
Oklahoma has the office of State Auditor and Inspector. The state constitution states the Auditor’s duties include examining the state and all county treasurer's books, accounts and cash on hand or in bank and to publish an annual report with the results of those examinations.

*****
You would think the State Auditor’s office could audit any agency or program that receives state money, but that is not true. The office is limited by statue from looking at certain agencies books. You would also think that any honestly administrated publically funded program would welcome an annual outside audit by the Auditor’s office.

*****
But there are two problems. First, some agencies and programs don’t want the taxpayers to know how and where tax money is being spent. They know taxpayers would be outraged and demand reform, so they conduct ‘internal’ audits that are designed to make them look good. They account for the money, but no ‘performance’ audit is conducted. A performance audit differs from a regular audit because it examines whether tax dollars were spent economically, efficiently and effectively. Agencies and programs shouldn’t be grading their own tests. An objective set of eyes should be auditing their books.

*****
Second, audits are expensive. Expanding the reach of the Auditor’s office would cost money, requiring the legislature to increase the Auditor’s budget, but if we are truly concerned about accountability, this would be a good investment for taxpayers.

*****
The so-called Venture Capital programs mentioned were supposed to create permanent jobs for Oklahomans, but they appear to have done nothing but give tax credits to wealthy investors. The long term answer is to expand the State Auditor’s authority to audit any agency, program or group that gets a penny of state money or receives a reduction in their tax obligations.

Weekly Opinion Editorial

DON’T MESS WITH OUR RIGHTS!

by Steve Fair

Qui tam lawsuits are essentially a civil lawsuit filed on behalf of the government by a private citizen for fraud on or false claims submitted to the government. The individual bringing the qui tam lawsuit, called the "relator," is often a whistleblower with personal knowledge about a past or ongoing fraud scheme. If the qui tam lawsuit is successful, the whistleblower is entitled to a share in the recovery. Qui tam is Latin for ‘he who sues in this matter for the king as well as for himself.” Qui tam lawsuits were used in colonial times, and were embraced by the first U.S. Congress as a way to enforce the laws when the new federal government had virtually no law enforcement officers.
*****
Close to half of the states have enacted Qui Tam laws modeled on the federal False Claims Act to combat fraud against state and local governments. Most of the reforms deal with Medicare and Medicade fraud.
*****

State Senator Rob Johnson, (R-Kingfisher) authored SB 331, which increases the number of signatures required for "qui tam" lawsuits against government in Oklahoma. Currently it takes only ten taxpayers to file a suit to stop a questionable government action in Oklahoma. SB 331 increased that number to one hundred registered voters or 2.5% of the registered voters in the district involved. It also limits the amount a citizen can be awarded from a Qui tam lawsuit to attorney fees and court costs. Currently citizens who bring Qui tam lawsuits can share up to fifty percent of the court’s award.

*****
Senator Johnson says the increase will make it more difficult for a small group of disgruntled citizens to stop a government project. He believes the increases to be reasonable. Evidently his colleagues in the Senate agreed, passing SB331 by a vote of 43-0. The measure passed the House by a vote of 65-34. See House votes at http://e-lobbyist.com/gaits/rollcall/64856

*****
On Thursday, Oklahoma City attorney Jerry Fent filed a lawsuit directly with the Oklahoma Supreme Court seeking to stop SB331 from taking effect on November 1st. Fent says the law will make it more difficult for taxpayers to stop government corruption. Fent named only Governor Fallin in the suit since she signed the bill.

*****
Fent has a history of suing government when he disagrees with their actions. He has been called both a watchdog and a nutcase by various groups. Fent sued the state in June of this year over the state budget. In 2010, he won a lawsuit against the state when the State Supreme Court ruled 6-2 in his favor after he successfully argued the legislature could not collect ‘a fee’ from one area and use it somewhere else. In that case, it was a clear violation of SQ 640 and the state constitution.

*****
Fent has also argued before the State Supreme Court the current Judicial Nominating Committee is unconstitutional because it operates from old historical congressional lines and not the new lines. He lost that argument in February. He argued unsuccessfully in 2009 that Oklahoma’s acceptance of federal stimulus money was not handled properly.

*****
No one should be able to get rich by suing taxpayers. The provision to limit awards to only attorney fees and court costs is needed reform, but raising the number of discontented citizens necessary to file a suit against the state from 10 to 100 is too much. It appears this bill may have been targeted at Fent and like-minded individuals who file frequent lawsuits against government, but when legislators ‘target’ a citizen because he uses his ‘right’ too much, they hurt all of us. The average citizen must have a mechanism to appeal laws that are not well thought out.

*****
Taxpayer lawsuits against government do cost taxpayers money, are sometimes frivolous and take up valuable time for courts, but we need them left in the tool chest. Let’s hope Fent wins this battle in the Supreme Court. In this case, he is battling for all of us.

Weekly Opinion EditorialOklahoma Prison Overcrowding a growing issue!
by Steve Fair

Last legislative session, HB 2131, authored by Speaker of the House Kris Steele, (R-Shawnee) and State Senator Patrick Anderson, (R-Enid) was approved overwhelmingly by both chambers of the legislature, passing the House by an 84-7 margin and the Senate 44-3. It was signed into law on May 11th by Governor Fallin and was scheduled to go into effect November 1st.

*****
The motive behind HB 2131 was Oklahoma’s prison overcrowding. According to Speaker Steele, “Our prisons are near capacity. Currently, if someone is convicted and considered a danger to society, there is virtually no place to put them.”
*****
HB 2131 changed the default sentencing structure from consecutive to concurrent terms, enhanced eligibility for community service and GPS monitor sentencing, and reduced the Governor’s role in the parole process for non-violent offenders.

*****
While the idea was good, the new law hit a snag last week when Oklahoma Attorney General Scott Pruitt said HB 2131 was unconstitutional. Pruitt’s opinion states that it violates the Oklahoma Constitution for the Oklahoma Pardon and Parole Board to grant parole without action by the governor. The statute provision that provided that, in cases involving nonviolent offenders, a parole recommendation by the Pardon and Parole Board is deemed approved if the governor does not take action on it within a 30-day period.

*****
While an Attorney General’s opinion is not binding on state officials, it appears the legislature and the Governor will defer to Pruitt’s judgment and start over next session.

*****
Oklahoma is the only state that requires the Governor to approve every parole after the Pardon and Parole Board submits a recommendation. That does seem unnecessary and redundant when you consider the Governor appoints the majority of the board. The Board is composed of five appointive members. Three are appointed by the Governor, one by the Chief Justice of the Oklahoma Supreme Court, and one by the Presiding Judge of the Oklahoma Court of Criminal Appeals. The five members serve four year terms that run concurrent with the term of the Governor.

*****
Like governors before her, Fallin supports the reforms in HB 2131 and was disappointed by Pruitt’s opinion. “It will be up to the legislature to once again look and see where they want to move from this point on, Fallin said. “I do support going to a vote of the people.”

*****
State Senator Harry "Turn" Coates, (R-Seminole) has filed Senate Joint Resolution 46 that would remove the governor totally from the parole process- violent and non-violent offenders. Coates’ says it will allow the Governor to focus on the state's budget and other official business. If it passes both chambers, it would still have to be approved by Oklahoma voters.

*****
"The Legislature took a step in the right direction this session passing House Bill 2131, but we need to do more to speed up the parole process and make it more efficient,” said "Turn" Coates, R-Seminole. “The Pardon and Parole Board is a group of highly qualified experts with backgrounds in criminal justice. Giving the Board complete control over the pardon and parole process will save the state money and allow the Governor to focus more time on her primary responsibilities, which are finding ways to strengthen the state’s economy, help attract new businesses to our state and improve the lives of our citizens.”

*****
Coates' proposal goes too far by totally eliminating the governor from the process. The governor is the ‘elected’ representative of the people charged with specific duties- one of which is to deal with pardons and paroles. No appointed body should be granted that much power. While efficiency is a desired characteristic of government, accountability is more important.

*****
Oklahoma’s prisons are being filled up with non-violent offenders. The Sooner state locks up more women per capita than any other state. More than two thirds of the women in Oklahoma prisons were convicted of nonviolent crimes (mostly drugs) and have children that become the responsibility of extended family or state taxpayers.

*****
According to the Oklahoma Department of Corrections, about 20,000 Oklahomans are convicted of felonies annually. The current population in Oklahoma prisons is about 26,000- 60% of those who are there for nonviolent crimes.

*****
Steele is on the right track by attempting to ease prison overcrowding. With the cost to Oklahoma taxpayers to lock up criminals now at over 600 million annually (almost 10% of the state budget), and growing this is an issue that demands immediate attention.