Rep. Mitch Greenlick, D-Portland, has shepherded out of his committee a bill designed to reform the state’s coordinated care organizations.
The bill was heavily amended after its introduction, but kept intact provisions that will pry open the secrecy of CCO operations and subject their monthly board meetings to Oregon Public Meetings Law.
House Bill 2122 also puts a moratorium on creating new for-profit CCOs in the Medicaid system, but a compromise allows the current physician-owned, for-profit CCOs, such as Willamette Valley Community Health and Umpqua Health Alliance, to remain in perpetuity.
Greenlick gave up ground on creating special escrow accounts in the state treasury to protect the publicly funded CCO reserves. He deleted strict rules about how the CCOs must pay providers through alternative payment models.
Sen. Elizabeth Steiner Hayward, D-Portland, is hashing out that policy in a separate bill, SB 934; it would require CCOs to spend at least 12 percent on primary care and would encourage an alternative payment model which moves away from paying per office visit and procedure.
SB 934 passed the Senate Health Committee unanimously on Tuesday; Rep. Knute Buehler, R-Bend, co-sponsored that measure.
Instead of being assigned special accounts in the Oregon Treasury, CCOs will have strict caps on their operational reserves and will be required to spend any excess money on targeting the social determinants of health, such as safe, comfortable housing, early childhood programs and smoking cessation.
“They just have to spend it,” Greenlick told The Lund Report.
The changes in HB 2122 would take effect with the new state contracts with CCOs next year.
House Bill 2122 passed the Health Committee on a 5-4 vote on Friday, with Republicans preferring a watered-down version that only called for one CCO public hearing a year, while also calling for a statewide community advisory council to give civilians more chances to give input. “We need the flexibility,” said Rep. Cedric Hayden, R-Cottage Grove. Hayden introduced an amendment that also addressed rural hospitals and ensured they were adequately funded.
Trillium-Centene Controversy
HB 2122 was co-sponsored by Rep. Paul Holvey, D-Eugene, and support for the bill was catalyzed by the sale of Trillium, the Lane County CCO, from a local group of physicians, Agate Resources, to a Fortune 500 company, Centene Corp., a sale that alarmed many Oregon healthcare observers.
Charlie Swanson of HealthCare for All Oregon, who lives in Lane County, testified with concerns about an earlier version of the bill that seemed to stop short of making the CCOs more transparent, arguing that a lack of transparency and accountability allowed Trillium’s CCO to privately deliberate and agree to the sale to Centene for $109 million.
Swanson said the sale was driven by Centene’s wish to profit from publicly-funded Medicaid, and came after Trillium had failed to provide adequate access to primary care for its CCO members, possibly because it did not sufficiently compensate providers. He said lowballing providers and withholding medical spending on primary care was a strategy to increase the business’ sale price.
Debi Farr, spokeswoman for Trillium, rebutted Swanson’s account of the Trillium sale: “Mr. Swanson’s testimony falsely stated that Trillium denied clients services, held back money in reserves that should have gone to patient care and underpaid primary care providers. Each of these allegations are false and seriously misrepresent what was happening at Trillium, and across the state, in 2014-15.”
Farr conceded that Trillium struggled with primary care access with the Medicaid expansion, but blamed those struggles on a shortage of local providers and a higher-than-expected upsurge in new members from Obamacare. However, only two CCOs in all of Oregon experienced enough turmoil to cut off access to care -- and the other was also a for-profit CCO, Cascade Health Alliance in Klamath Falls. Farr said that only 1.6 percent of Trillium’s clients were without a primary care provider by the end of 2014. That number grew to 3.5 percent at the end of 2015.
According to Farr, the Oregon Health Authority required Trillium to expand its reserves between 2013 and 2014, but by 2016, the CCO had a medical-loss ratio of 92 percent -- much higher than the state standard of 85 percent.
She noted that Trillium pays its primary care providers more than the extremely low reimbursements that Medicaid pays for fee-for-service, but she did not provide any figures on what that rate might be. Trillium directed 12.8 percent of its medical spending to primary care in 2014, which is slightly below the state average, according to the Oregon Health Authority. Some providers were also given bonuses out of the quality pool that Trillium won for meeting state standards, Farr said.
Trillium netted $22 million profit in 2014 and $14 million in 2015, doubling its capital in two years from $20 million in 2013 to $41 million in 2015.
In 2015, Trillium tried to pass a bill that would have forced providers who have been unwilling to contract with Trillium to accept whatever rates the CCO wanted if those providers also wanted to keep their more lucrative contracts with the Public Employees Benefit Board and Oregon Educators Benefit Board.
Greenlick earlier warned that Centene has tried to wrestle control of reserves as it exited other states, such as Kentucky, which led to litigation.
Reach Chris Gray at [email protected].
