This article has been updated in light of additional developments and reporting.
The announcement on Friday that James Schroeder is stepping down as interim head of the Oregon Health Authority after less than two months has sparked questions and mixed reactions from health care insiders.
Gov. Tina Kotek announced that day that she is launching a search for a permanent director. The unexpected development sparked questions about the agency's leadership, the circumstances around the decision and reigniting speculation about who might take on the permanent job.
On Tuesday, March 7, top agency official Dave Baden answered one of the questions sparked by the news, that of who will run the agency in the short term. He announced at a public meeting he's been asked to step in as interim once Schroeder leaves.
Schroeder, 51, had been expected to cruise to confirmation as the agency’s first new permanent director in six years. But on March 1, he told Gov. Tina Kotek he would not be staying, according to Kotek’s press secretary, Elisabeth Shepard.
“I look forward to working with you and your team to ensure a seamless transition and keep the critical work of the agency on track,” he wrote in a formal resignation letter the next day. His last day will be March 17.
The surprise move came as the 2023 Oregon Legislature is in full swing, always a demanding time for the agency’s leadership.
Shepard told The Lund Report Schroeder was not asked to leave, and his decision was not expected. Schroeder, meanwhile gave few details as to his motivation in a farewell email to health authority’s roughly 5,000 employees.
“After much reflection, I have decided I will not pursue the permanent director position at OHA,” he wrote in the message sent shortly before 9 a.m. on Friday. “My family is the center of my life and I recognize the demands of this role are not compatible with the focus I want to give to them.
“I know this news may come as some surprise. However, I want you to know I am proud of the transformative work you do every day. From launching innovative first-in-the-nation housing, food and climate change benefits for Oregon Health Plan members, to strengthening Oregon’s behavioral health system, to protecting public health, you are making communities healthier and more equitable.”
Schroeder could not be reached for comment, and a spokesman for the agency said he is declining to do media interviews.
“I want to thank Interim Director Schroeder for jumping in on day one of this administration to lead the incredibly important work of the Oregon Health Authority,” Kotek was quoted as saying in a press release. “I also want to thank the staff at OHA for continuing to work hard everyday to provide critical services for Oregonians across the state. Improving access to mental health and addiction services remains a top priority for my administration, and I’m looking forward to bringing on a permanent director who will lead the agency in carrying that work forward.”
Schroeder had taken on a job considered one of the most demanding in Oregon state government. The pressure was even greater due to the agency's status as a focal point of reforms promised by Kotek on the campaign trail.
Insiders said there were hints that the job would require an adjustment for Schroeder. Not long after taking over the job, Schroeder reportedly expressed a desire to avoid scheduling meetings on Mondays and Fridays out of a desire to spend time with his family.
In a public meeting on Feb. 22, Kotek's top health advisor, Rachel Currans-Henry, expressed the governor's “amazing confidence” in Schroeder, but also repeatedly mispronounced his last name, fueling speculation about the closeness of the working relationship between the two.
Some observers said the sudden decision was not a great look for the agency. Rep. Rob Nosse, D-Portland, chair of the House Behavioral Health and Health Care Committee, called it a “small setback.” He added that if the job was not a good fit, it's good that people know it now. He said he's “glad we learn this now and not a year into it ... I think that's fine.”
As for Schroeder's role with the Legislature, Nosse said the budget process was an important one.
“One of the most important jobs of the agency director is to communicate to the legislature in a ways and means process, about what you need to make the organization run,“ the lawmaker said, but added that Kotek's long experience as House Speaker should make up for the change in leadership. “Does Governor Kotek have a thought or two about what she wants for OHA? I'm sure she does.”
Before taking the job Schroeder was the CEO of Health Share of Oregon, the state’s biggest regional insurer contracted to serve members of the Oregon Health Plan. Before that, he worked for Kaiser Permanente and as a physician assistant in a low-income health clinic before moving into management.
As the agency's director, Schroeder oversaw about 5,000 employees while providing health care for about one in three Oregonians who are enrolled in the Oregon Health Plan, among other things.
In an interview with The Lund Report on Jan. 11, his second official day, he expressed confidence in taking on the massive job, saying a collaborative approach would help him tackle needed reforms to Oregon’s health care system.
“I don’t have all of the answers,” he said at the time. “But I hope to pull together the people that, collectively, we can get to those answers so that we can make it better than what it is today.”
On March 7, Schroeder did not deliver agency updates to the Oregon Health Policy Board's public meeting, a customary role for the director. Instead, Baden did, announcing that he's been asked to take over as interim when Schroeder is gone.
Later in the morning, Kotek's office announced the decision formally in a press release, noting Baden's key role in a variety of health authority efforts during the pandemic.
“Interim Director Baden has a track record of getting things done and leading with transparency,” Governor Tina Kotek was quoted as saying. “I am grateful he’s agreed to take on this position at a critical time for Oregon.”