Cover Oregon to Decide Whether to Scrap Independent Agency
The Cover Oregon board should decide as early as next Thursday whether to keep its public corporation alive or if its work will be folded into a state agency such as the Oregon Insurance Division or the Oregon Health Authority.
On Thursday, the board debated its continued structure and decided its format for 2016 will be similar to what it has planned for 2015 -- making use of the federal website, healthcare.gov, while keeping some work in-state on the back end, such as working with Oregon’s competitive insurance market to set plan designs for the exchange.
Cover Oregon can also maintain relationships with community partners for recruitment and tribal officials and health providers under this model.
The board has decided one thing -- it won’t use an older state-partnership model that’s in use in Illinois and six other states. Upon closer examination, officials realized they would lose oversight of the exchange-based individual market -- and the revenue stream that comes with it. Illinois’ model only keeps state involvement in the small business market, or SHOP exchange.
Thursday’s meeting at the Oregon Medical Association headquarters in Tigard featured some lively, candid debate about the exchange’s future. The board members, representing sometimes competing interests, did at least find some consensus in the need to be serious about correcting any lingering problems with Cover Oregon, so that the biggest embarrassment of Gov. Kitzhaber’s third term will become nothing more than a bad memory.
After Cover Oregon’s remaining federal grants run out at the end of this year, it will have to operate off the commissions it collects on the policies sold through the marketplace. With current enrollments less than half the rosy estimates projected when Cover Oregon was being developed in spring of 2013, the exchange has to work with a similarly reduced budget.
“It’s a big unknown whether we can be sustainable,” said Cover Oregon executive director Aaron Patnode. “I’m confident we can.”
Unless Oregon opts to give up responsibility to the federal government entirely, the state functions of the exchange will have to be sustainable, but if the exchange is placed in a state agency, money could move between departments in the greater state agency more freely than to the stand-alone public corporation.
Dr. George Brown, the CEO of Legacy Health, argued for maintaining Cover Oregon’s existence as a quasi-independent public corporation, while Oregon Health Authority director Suzanne Hoffmann said the situation calls for greater public and legislative oversight -- which may only be possible with a move into one of the state agencies.
“Strong public oversight is critical to its success. [An argument] that thinks there’s a strength in not having that is not anywhere I want to go,” Hoffmann said.
“Public oversight is an absolute must. Public oversight is great, but legislative oversight can be a barrier,” Brown said, alluding to the prospect of politicized decision-making over the exchange’s direction and funding. He underlined the strength of an independent agency to be more nimble and adaptable to changes that arise than state bureaucracies. “I’d be hard-pressed to categorize them as nimble.”
But Cover Oregon is heavily reliant on the work of the health authority and the insurance division already, as Hoffmann noted in her comments about the problems of communicating between three agencies. “The communication between three organizations has not been good. It seems like two would be better than three.”
Cynthia Johnson, a member of the community advisory council but not the board, agreed with Brown that the agency should remain independent, but labor leader Ken Allen, a wildcard on the board, dealt a blow to that model, saying that his patience with Cover Oregon’s ability to operate effectively as an independent agency had run out.
“I see it as a necessity that we not be a free-standing agency,” said Allen, the executive director of the Oregon chapter of the American Federation of State, County and Municipal Employees. He said he wanted the insurance exchange to be forced to consult with the Legislature for its direction and funding, believing this would restore the public trust.
Which agency gets Cover Oregon is also an open question.
The enrollment process for the state Medicaid program, the Oregon Health Plan, is already headed back to the Oregon Health Authority, which will administer this role on behalf of the decentralized, regional coordinated care organizations. But the insurance division, which approves the health insurance rates and regulates the state market for individuals and businesses, may be the more natural venue for the remaining functions of the state exchange.
The division is also a much smaller agency than the health authority, which at $15 billion has the largest budget of any state agency.