FamilyCare and the Oregon Health Authority are one step closer to agreement on their dispute over reimbursement rates. The coordinated care organization has 134,000 Medicaid members in the tri-county Portland area.
Earlier today, the OHA appeared willing to accept the 2015 rates proposed by FamilyCare; those rates are consistent with the methodology approved by the Centers for Medicare and Medicaid Services.
But there remains an ongoing dispute over FamilyCare’s 2016 rates, while both parties remain in negotiation.
Jeff Heatherington, president of FamilyCare, maintains that his counter proposal for 2016 is based on the same methodology, and there’s absolutely no reason why OHA should hesitate.
“Instead, what they’re offering us in 2016 basically amounts to us depleting our reserves below $60 million and putting into insolvency,” Heatherington told The Lund Report. “We’d be going into 2017 under the minimum statutory requirement which will also force us also to lose money, which we can’t do. There’s no way the actions by OHA can be justified as actuarially sound when their rates would essentially put us into insolvency. OHA appears to be on a mission to either close us down and terminate us or bankrupt us.”
That’s definitely not true, Lynne Saxton told The Lund Report. “We’re absolutely not trying to put FamilyCare out of business, and are very focused on getting a signed agreement for 2016,” said the director of the Oregon Health Authority.
Saxton was hesitant to confirm agreement about the 2015 proposal until “we have signed documents in our hands. We’ve worked very hard to create a solid methodology, and are doing everything we can to reach a settlement. I’m very optimistic this can be successfully concluded.”
The termination deadline to reach an agreement has also been extended to April 5. Earlier, the OHA had set a March 28 date. If the two sides cannot reach agreement, six CCOs stand ready to absorb FamilyCare’s members, having signed binding letters of intent late last year. They include PacificSource Health Plan, Trillium Community Health Plan (now owned by Centene Corporation), Health Share of Oregon, Willamette Valley Community Health, Eastern Oregon CCO and Columbia Pacific CCO.
The OHA also sent the following press release earlier today:
On March 21, 2016, OHA received a counter-proposal from FamilyCare. OHA is pleased to see in the latest proposal that FamilyCare is willing to accept the Centers for Medicare and Medicaid Services approved methodology for 2015, and the similar methodology for 2016. This indicates positive progress towards reaching a solution.
The March 21, 2016 proposal from FamilyCare includes an adjustment within the CMS approved rate range for both 2015 and 2016. Yesterday, OHA offered a counter proposal to FamilyCare that approved of the 2015 rate adjustment and offered a cash settlement to conclude this dispute. OHA, however, is unable to agree to the proposal for adjustment to the 2016 rates because:
- FamilyCare had ample opportunity to review the current 2016 rates (60 days required by law) before it agreed to them and signed the 2016 contract (all 16 CCOs signed the 2016 contract rate amendment);
- FamilyCare had time to change its business model if it was unable to operate within the offered 2016 rate; and
- Increasing FamilyCare’s 2016 rates would create a substantial increase in Oregon’s overall Medicaid budget, reducing the state’s ability to meet its federally required financial sustainability requirements (approximately an additional $27-$28 million for FamilyCare).
In establishing CCO payment rates, OHA must stay in compliance with Oregon’s Medicaid waiver for health system transformation, including maintaining a sustainable rate of growth of no more than 3.4%. FamilyCare’s proposal for changing 2016 rates will put Oregon at substantial risk for failing to make this target and may jeopardize federal funding.
No matter what, Oregon Health Plan members will continue to receive health benefits without disruption. The Oregon Health Authority’s first priority is to protect the health and well-being of Oregon’s most vulnerable citizens – Oregon Health Plan members. With this in mind, OHA seeks a solution with FamilyCare that shields OHP members while meeting federal requirements guiding Oregon's health system transformation and preserving Oregon’s access to state Medicaid funding.
FamilyCare also released a press release regarding the counter offier:
FAMILYCARE REVIEWS OREGON HEALTH AUTHORITY'S (OHA) LATEST COUNTER OFFER
On Tuesday (March 22) FamilyCare Health received a new proposal from the Oregon Health Authority (OHA) to settle its ongoing dispute over the 2015 and 2016 rates.
FamilyCare is encouraged by OHA's acknowledgement that the 2015 and 2016 reimbursement rates for FamilyCare were calculated using a flawed methodology, and that OHA has agreed to revise the 2015 rates to correct this flaw. However, the new proposal does not include a revision to the 2016 rates. OHA has previously indicated the rate methodology must be consistent for both years.
FamilyCare is reviewing and will continue working with OHA on bringing this dispute to a full resolution. FamilyCare continues its commitment to serve 130,000 Oregon Health Plan members throughout the Tri-County region with the highest quality care.
Diane can be reached at [email protected].
