OKLAHOMA CITY — Oklahoma will not establish a state-run health insurance exchange under the federal health care law or expand its Medicaid eligibility to provide coverage to thousands of low-income, uninsured citizens, Gov. Mary Fallin announced Monday.

The Republican governor’s move puts Oklahoma’s insurance exchange, required under the health care reform law, in the hands of the federal government.

“This choice has been forced on the people of Oklahoma by the Obama administration,” Fallin said.

Fallin, who cited the potential costs to the state of operating a health insurance exchange, also rejected the idea of a federal-state partnership in operating the exchange.

Fallin’s decision drew immediate praise from conservative groups and lawmakers who have railed against the federal health care law and have urged the governor to resist any attempt to implement its requirements in Oklahoma.

“Oklahomans simply do not want anything to do with Obamacare, and Senate Republicans stand firmly with the governor in rejecting it,” Senate President Pro Tem Brian Bingman said in a statement. “We want real, conservative solutions to the rising cost of healthcare — we want to make care more accessible, more affordable, and easier to obtain.”

Hospitals and chambers of commerce had urged Fallin to support both a state-run exchange and the expansion of Medicaid.

Hospital officials had argued that health care providers are being forced to absorb the costs of the nearly 20 percent of uninsured Oklahomans who often seek health care services at emergency rooms and are unable to pay.

“Governor Fallin’s decision not to expand the Medicaid program to cover uninsured low-income adults is deeply troubling and unfortunate, putting politics over the interests of Oklahomans,” said David Blatt, director of the Oklahoma Policy Institute, a Tulsa-based nonprofit that promotes funding for public services. “We are missing a vital opportunity to improve the health of our citizens, bolster the financial situation of our health care providers, and strengthen our state economy.”

Oklahoma Attorney General Scott Pruitt was among the state attorneys general who filed a lawsuit alleging the health care law was unconstitutional, and even after the U.S. Supreme Court ruled the act constitutional, Pruitt amended his lawsuit to challenge its implementation.

In making her decision, Fallin cited Oklahomans’ overwhelming passage in 2010 of a state question that prohibits forced participation in a health care system.

“It does not benefit Oklahoma taxpayers to actively support and fund a new government program that will ultimately be under the control of the federal government, that is opposed by a clear majority of Oklahomans, and that will further the implementation of a law that threatens to erode both the quality of American health care and the fiscal stability of the nation,” Fallin said.  

The issue of complying with provisions of the federal health care law has been a politically difficult one for Fallin. Last year, the governor rejected $54 million in federal funding to help set up a state-run exchange after bitter opposition from grass-roots activists and conservative members of the Republican-controlled Legislature.

The governor on Monday also rejected the Medicaid expansion, saying Oklahoma couldn’t afford the costs.

“The proposed Medicaid expansion offers no meaningful reform to a massive entitlement program already contributing to the out-of-control spending of the federal government,” she said.

Nearly 20 percent of Oklahoma citizens are currently uninsured, and an expansion of Medicaid to 133 percent of the federal poverty level would make an additional 180,000 adults eligible for Medicaid, according to the Oklahoma Hospital Association, one of the groups that pushed Fallin to support the Medicaid expansion.

Mike Neal, the president and CEO of the Tulsa Metro Chamber, which had supported the Medicaid expansion, said the group plans to work with lawmakers and the governor to find alternatives to improve the health of Oklahomans.

“Ideally, the chamber would’ve liked to have seen Gov. Fallin recognize the possible benefits of expanded Medicaid funding,” Neal said. “The health of our employees and workforce is integral to our success and therefore is a priority consideration when making decisions that impact our economy.”

Although Fallin did not provide specifics of how Oklahoma plans to deal with the large number of Oklahomans without health insurance, she did cite the state’s Insure Oklahoma program as an example of a “success story” for providing coverage to low-income workers. That program splits the cost of health insurance premiums between the state, employer and employee and currently provides coverage to about 30,000 Oklahomans.