The U.S. Centers for Medicare and Medicaid Services wrote to the head of Oklahoma’s Medicaid agency that it has determined the federal government is entitled to a portion of Oklahoma’s proceeds.
The June 12 letter from CMS’ regional director Bill Brooks also seeks detailed information from the Oklahoma Health Care Authority and warns that failure to return a portion of the settlement money could result in the withholding of federal funds.
Details of the letter were first reported by The Washington Post.
The Oklahoma Health Care Authority referred questions about the letter to Oklahoma Attorney General Mike Hunter, who didn’t immediately respond to a request for comment.
It’s not clear how much of the state’s settlement the federal government is seeking or where the money would come from. Oklahoma’s settlement in March with Purdue, the maker of OxyContin, and the company’s controlling family called for nearly $200 million to go into a trust for the creation of a National Center for Addiction Studies and Treatment at Oklahoma State University in Tulsa. Private attorneys who handled the case for Oklahoma received about $60 million, while another $12.5 million was earmarked for local governments.
The letter did not reference Oklahoma’s $85 million settlement with Israeli-owned Teva Pharmaceuticals or the state’s ongoing public nuisance lawsuit against consumer products giant Johnson & Johnson. Witnesses for the state of Oklahoma have suggested the cost of abating the opioid crisis in Oklahoma could be as much as $17.5 billion over the next 30 years.
CMS didn’t immediately respond to a request for comment about the letter.
The idea the state could be on the hook to pay millions of dollars to the federal government didn’t sit well with Oklahoma state Rep. Mark McBride, R-Moore.
“As far as I’m concerned, that’s the state’s money,” said McBride, one of several lawmakers critical of the way the Purdue settlement was structured. “It seems like the federal government is seeing that the attorney general won with these two settlements, and now they have their hand out, and I think that’s just wrong.”
After the Purdue settlement was announced, the Oklahoma Legislature approved a new law clarifying that any settlement proceeds go directly into the state treasury.