Last year, the institutions that manage the health benefits for 1 in 3 Oregonians started a collective brouhaha when they said they were getting lowballed by the state.<\/p>\n
The geographically dispersed \u201ccoordinated care organizations,\u201d as the large health insurance-style entities are known, receive a certain amount per member per month to administer and fund Oregon Health Plan benefits.<\/p>\n
The model is supposed to incentivize the facilitation of efficient, high-quality health care that keeps global costs down for taxpayers. But, as in much of the country, costs had in fact risen greatly. The state had offered the CCOs a record pay increase in recompense. But CCOs, hemorrhaging money, said they required more money still, and threatened in some cases to leave the system entirely. <\/p>\n
In the end, a CCO in Lane County halted its operations<\/a>. But others stuck around after the state sweetened the deal<\/a>, bumping their pay 10.1% on average overall.<\/p>\n The cycle is now beginning anew, as the state proposes to raise CCO rates by an average 6.1% per member, according to a preliminary proposal obtained by WW through a public records request. <\/p>\n The rate would be the highest increase in at least a decade\u2014second only to last year\u2019s. Most years, per-member pay rates on the multibillion-dollar program go up between 3% and 4% on average.<\/p>\n The rate increase would pale in comparison to some of the price hikes looming<\/a> for consumers on the commercial insurance market. Still, multiplied to cover the medical expenses of the 1.4 million-plus Oregonians on the Oregon Health Plan, the proposed pay bump represents a massive budgetary figure. Much of this would come from the feds, who cover most Medicaid expenses, but a large portion would also come out of Oregon\u2019s already stretched general fund.<\/a><\/p>\n The preliminary OHP proposal comes as alarm bells clang over runaway medical inflation. <\/p>\n \u201cThe overarching challenge facing our health care system today is the total cost of care\u2014which has become increasingly unaffordable for individual consumers, the government and for employers,\u201d said the first sentence in a lengthy report on the state health system submitted to Gov. Tina Kotek in early July by a group of health care figures led by former Gov. John Kitzhaber. \u201cReducing the total cost of care, therefore must be our primary objective\u2014but it must be achieved without compromising quality or access.\u201d<\/p>\n The group\u2019s recommendations range from convening labor and management, to cutting red tape at the Oregon Health Authority, to stabilizing the commercial health insurance markets. A separate group, tasked with assessing a response to massive Republican legislation that will bring \u201cdrastic\u201d<\/a> federal funding reductions for Medicaid, urged Kotek to focus on administrative inefficiencies before considering benefit reductions.<\/p>\n