Regional organizations that oversee care to low-income Oregonians will invest $25 million in projects focused on youth behavioral health under an agreement announced Thursday, Jan. 4.
The new spending is the product of behind-the-scenes discussions with Gov. Tina Kotek that were first reported by The Lund Report last July. Contracted by the state, the organizations act as highly regulated insurance companies and use state and federal funds to administer care to about 1.5 million members of the Oregon Health Plan.
The news come at a time when children's mental health has become a focus of state reports and proposed reforms. It also comes at a time when longtime Oregon health leaders are calling on Kotek and state lawmakers to institute new reforms of the Oregon Health Plan to ensure profits are reinvested in community health.
Oregon's coordinated care organizations, as they are known, reaped massive profits during the pandemic. The trend was fueled by an influx of per-member funds as Oregon Health Plan rolls grew, even as spending on medical and behavioral health services sagged due to COVID-19 clampdowns. One state report said the trends set the stage for an “unjustified windfall.”
In the agreement announced by Kotek Thursday, the $25 million will be contributed by care organizations across the state, and would go to four projects, which were for the most part already being pursued by nonprofits or health care agencies:
- $13.2 million for Trillium Family Services as part of a project to add 12 beds to The Parry Center in Portland, which serves youth with psychiatric needs.
- $7.5 million for Adapt Integrated Health Care in Roseburg as part of an effort to add up to 77 beds for adult and youth detoxing and other substance use disorder treatment.
- $2 million for Community Counseling Solutions in Boardman, as part of a project to build a proposed 14-bed psychiatric facility for children from around the state.
- $2.3 million for staffing costs to add 4 psychiatric beds at a Eugene facility run by the nonprofit Looking Glass Project. The money should staff those beds for a year, although payments from the Oregon Health Plan for services at the facility would likely extend that, a spokesperson for Health Share of Oregon told The Lund Report last year.
“Oregon needs more treatment options to help young people in our state who are struggling with serious behavioral health issues,” Governor Kotek said in a prepared statement released by her office. “The state and CCOs developed a plan to reinvest surplus Medicaid dollars into Oregon communities, and this partnership will support youth behavioral health projects that we desperately need.”
The press release also included a statement from Adapt Integrated Health Care
“Adapt has developed plans for a Recovery Campus and with the generous support of the CCOs, under Governor Kotek’s leadership, we now have the funding to move forward on construction,” said Dr. Greg Brigham, CEO of Adapt, in a prepared statement included in the press release. “The Recovery Campus, located on 40 acres just east of Roseburg, will replace antiquated facilities and more than triple usable residential capacity from 40 beds to approximately 118 beds. This resource will result in access to life saving care for those who need it, when they need it.”
Pandemic profits drew attention
On May 30, 2023, Oregon Health Authority’s interim Director David Baden wrote in a letter to the chief executive officers of the care organizations that The Lund Report had been gathering information on their profits. He wrote that Kotek would be in touch with them all to have a “holistic” discussion about the rules governing their spending and care. It would include the state’s “current and future expectations to maximize Medicaid funds for member benefit.”
Leaders of the insurers responded to Baden’s letter, which requested more details of their spending, and defended their efforts to invest in community health. They protested that the profits would help meet new state reserve requirements and address future unforeseen needs.
However, under pressure from Kotek they agreed to take Kotek up on what insiders referred to as her “$25 million challenge” to invest more of their reserves in Kotek priorities.
In a Sept. 1, 2023 memo, the organizations detailed their proposed spending on the four projects. The final agreement announced Thursday was almost identical in its framework.
It’s unclear how the projects were selected, but the press release on Jan. 4 said they were “identified” by “the Governor’s Office and CCOs” because they “serve youth, meet the greatest need, and are geographically diverse.”
Observers interpreted the discussions as allowing Kotek to secure more funding for projects outside of the state budget process, without public hearings or lengthy debate over what projects in the state were most deserving of additional funds.
The agreement also seemingly staved off, for a time, discussions of whether state rule were doing enough to ensure proper investments by the organizations — though Kotek recently told The Lund Report she supports the Legislature and the state reexamining those rules later this year.
“I commend CCOs for working as a system to be a part of the solution for our statewide challenges,” OHA’s Behavioral Health Director Ebony Clarke said, according to the press release. “These investments will help spur and close projects that will propel the state forward in closing key program gaps that have been exacerbated by fentanyl in recent years. I look forward to this partnership making a real difference in Oregon communities.”
