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OHA’s 2018 CCO rate review process insufficient, biased, and unsound

December 6, 2017

Portland, Ore. – From the beginning of the Oregon Health Authority’s (OHA) proposed 2018 CCO rate review process, FamilyCare Health leadership expressed serious concerns about the scope and independence of that process. FamilyCare reiterated those concerns in a November 29 letter to OHA’s new CFO. 

FamilyCare warned that the limited regulatory and actuarial reviews ignored key issues, were over reliant on assertions from the state’s third party actuary (Optumas), and would fail to uncover potential biases and flaws in the 2018 rates. The findings in the report released today by OHA validate those concerns.

While OHA stated this would be an independent review, FamilyCare questioned the reviewers’ past ties to Oregon’s rate setting process. Furthermore, OHA denied FamilyCare’s request to allow CCOs to communicate their concerns directly to the reviewers. Instead, only OHA and Optumas provided ongoing input during the reviews, creating an inherent bias in the process.

“FamilyCare is losing approximately $75 million based on the 2017 rates and will have an equal or higher loss in 2018,” said Jeff Heatherington, President & CEO of FamilyCare Health. “You cannot have an actuarially sound process that produces a deficit three years in a row.”

“A surface-level review of OHA’s methodology is not sufficient to address the underlying problems that allowed the agency’s prior leadership to target FamilyCare with the lowest rates in the state for three years. It appears the widely publicized OHA campaign to harm FamilyCare is still in operation,” added Heatherington.

“If OHA goes forward with the planned 2018 rates, FamilyCare will have to close its doors on December 31, 2017,” he added. “That would put more than 300 people out of work and OHA would have to transfer the care of 120,000 individuals from FamilyCare. That’s a very sad ending to the 32 years of service that FamilyCare has provided to Oregon’s Medicaid population.”

 

About FamilyCare Health

For more than 30 years, FamilyCare Health has been providing patient-centered health care to Oregonians. FamilyCare Health is an Oregon Health Plan Coordinated Care Organization (CCO) and a Medicare Advantage plan serving approximately 120,000 members in Multnomah, Clackamas, Washington, Marion, and Clatsop counties. FamilyCare Health was the first health plan in Oregon to integrate models of physical and mental health and the first CCO in the tri‐county area certified by the Oregon Health Authority. More information at http://www.familycareinc.org/.

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