Congressional megabill will slash Oregonians’ health coverage

The Congressional budget bill passed Thursday will hit Oregon harder than most other states by restricting Oregon’s ability to fund the program that provides health care for one in three Oregonians, the Medicaid-funded Oregon Health Plan.

The coverage reductions caused by the bill are expected to have ripple effects on jobs as well, for instance, by cutting the incomes of clinics as well as hospitals.

In Oregon, hospitals are expected to receive 25% less in Medicaid revenue, adding up to $17 billion in impacts over the next decade, according to an analysis conducted by a consultant to the Oregon Health Authority. The analysis estimated that 238,000 people would lose their Oregon Health Plan coverage under the GOP plan.

In part that impact stems from new work requirements and increased paperwork that are expected to push people off the Medicaid rolls.

The bill also will restrict the Medicaid provider tax that Oregon relies on more than most states to fund low-income coverage, slashing it from 6% down to 3.5% over the coming decade. 

Government and health care officials in Oregon said the federal cuts billed as reducing waste will merely shift costs to states and individuals who can't afford them.

"This bill will have catastrophic impacts on health care access and affordability in Oregon. Hundreds of thousands of our friends and neighbors could lose their health coverage,” said Becky Hultberg, president and CEO of the Hospital Association of Oregon, in a statement. "For Oregon hospitals, these changes are coming at a time when the health care system is teetering on the brink of financial failure. Our focus now is on solutions that help hospitals keep their doors open so they can continue serving their communities.”

Gov. Tina Kotek, however, said the state doesn’t have enough money to make up for the cuts. In a statement, she said she has directed state agencies to evaluate the bill’s impact on Oregon. She noted that half of all the state’s children receive coverage through the Oregon Health Plan and that the bill would extend tax cuts that benefit the wealthy.

“Every dollar stripped from these services and put towards the top 1% is a moral failure,” she said. “This budget was inked in greed, not human dignity.”

Rep. Rob Nosse of Portland told The Lund Report that due to the level of fine-print in the bill, it’s too soon to say if the Legislature will need to call a special session to recalibrate the just-passed state budget to respond to the federal changes. 

“We'll spend our summer analyzing that, to be honest with you,” he said.

For instance, it’s unclear if the federal changes requiring six-month eligibility checks and work requirements will override the Oregon program approved by the federal government in 2022. The state program requires eligibility checks every two years — which is designed to prevent paperwork hassles from depriving people of access.

The bill will also hurt behavioral health providers, many of whom rely on the Oregon Health Plan to help fund treatment, counseling and other services.

Heather Jefferis, executive director of the Oregon Council for Behavioral Health, said the providers in her coalition are concerned not only about the funding cuts, but also that new requirements will be complex to implement, increasing administrative costs and creating barriers to care for consumers, providers, and the state.

“We anticipate that the bill's numerous provisions will significantly affect who can access health insurance, the availability of services, and the behavioral health sector's ability to offer competitive and fair wages to its highly skilled workforce, further compounding healthcare workforce shortages,” she said. “The structure of these reductions and new regulations will be complex to implement, increasing administrative costs and creating barriers for consumers, providers, and the state.”

Changes to individual health insurance

Among its many changes, the bill does not extend enhanced premium subsidies spearheaded during the pandemic by the Biden administration. That means people who purchase their own coverage and are not on Medicare will see an average monthly premium boost of 75%, according to one estimate. 

Already, as many as 20,000 people in Oregon or more were expected to have their premiums increase by at least $900 a year  — a small number of them by 100% or more — even without the federal changes, thanks to a different program adopted by the state of Oregon.

In addition to causing many to voluntarily drop their coverage due to higher costs, the end of enhanced subsidies could hurt the finances of the state’s recently enacted Bridge Plan that extended coverage for the working poor in Oregon — meaning the state general fund could be asked to pick up the difference.

Many of the reactions to the bill in Oregon singled out Republican Congressman Cliff Bentz, who voted for the bill despite pleas to oppose it made by people like former Gov. John Kitzhaber, who Bentz has praised in the past.

Contacted Wednesday and Thursday, Bentz’s office did not provide a comment on the bill.

In a statement, leadership of the Oregon Nurses Association, for instance, called the bill “cruel and calculated” and Bentz’s vote “disgraceful” and a “betrayal.”

The union’s statement added that “Oregon’s nurses know what’s coming. We will see more patients showing up in crisis, having lost their coverage and delayed care. We will see more hospitals slash staff, close departments, or shut down altogether. We will see more burnout, more moral injury, and more nurses forced to leave a profession they love because the system is breaking around them. 

In a statement issued shortly after the vote, Democratic Rep. Val Hoyle, whose district represents rural Southwestern Oregon, called the bill “ruthless,” adding that “This bill slams the door shut on working class families like mine in Oregon and across the country.”

Providence Health issued its own statement, calling the bill “a significant threat to the health and well-being of our communities … These sweeping reductions will limit health services; lead to care delays and longer wait times, especially in emergency departments; and place undue strain on overburdened health care providers.