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Oregon universal health insurance proposal draws praise, fire

Bill would task a new board to craft a single health plan covering all 4 million Oregonians
While Democratic lawmakers’ push for universal coverage is attracting renewed praise from labor unions and many members of the public, opponents, including a number of business groups, are stepping up their criticism. | LUND REPORT ILLUSTRATION/SHUTTERSTOCK
March 21, 2023

A bill intended to lay the groundwork for universal health care in Oregon is scheduled for a committee vote on March 22.

But while Democratic lawmakers’ push for universal coverage is attracting renewed praise from labor unions and many members of the public, opponents, including a number of business groups, are stepping up their criticism.

If passed, Senate Bill 704 would take the planning process to the next level by establishing a new nine-member panel– the Universal Health Plan Governance Board – tasked with developing a plan for how to broadly revamp health insurance in the state. 

Under the proposed system, all residents would be covered by a generous statewide government-run comprehensive health insurance plan that would eliminate premiums, co-pays, office visit fees, deductibles and co-insurance. It would be funded with federal revenue as well as $21 billion a year new taxes to be paid by employers and individuals, in place of existing health insurance premiums.

In pursuing the idea, Oregon is trying to succeed where other states have not. Vermont, Colorado, Massachusetts and California have all explored universal health care, only to drop the idea in the face of hefty projected costs or political opposition.

In Oregon, lawmakers in 2019 created a task force to investigate the idea and come up with a broad outline. That group, co-headed by state Sen. James Manning, D-Eugene, issued its report last fall. The topic gained urgency in November, when voters approved a measure making access to affordable health care a right under the Oregon Constitution.

To flesh out the task force’s plan, Manning is proposing the governance board, with nine paid members, a paid executive, plus other employees, which would have until fall 2025 to present lawmakers with a plan for how to implement a universal health insurance system starting in 2027. Manning estimates the work by the board and its staff would cost $3 million to $4 million.

The subject of two public hearings last month by the Senate Committee on Health Care, the bill has already drawn hundreds of comments from residents who support it, as well as backing from labor and advocacy groups. Their chorus: The current fragmented health insurance system is expensive and inefficient, and saddles many Oregonians with anemic coverage and high premiums, or no insurance at all.

Business interests are largely critical, however. Opponents of the bill include the Oregon branch of the National Federation of Independent Business, which represents mostly small businesses; Oregon Business and Industry, which represents large and small companies; the Oregon Association of Hospitals and Health Systems, which represents Oregon hospital groups; and the Oregon Association of Health Underwriters, which represents health insurance brokers and commercial health insurance companies. Most critics argue that scuttling the current system in favor of a state-run system funded by massive new taxes is unnecessary and far beyond state government’s administrative capabilities.

Manning said he expects both chambers to pass the bill and hopes it will pick up Republican support. But so far, the sponsors – 21 in all – are all Democrats.

With Democrats controlling both chambers, Manning and his allies have managed to keep the universal health care concept rolling forward.

Complexity, cost are drawbacks

Critics highlight the vast complexity and staggering cost of the proposal. Any final decision would rest with the Legislature, and would likely be referred to the public for a referendum.

Manning told The Lund Report he’s frustrated by the critics.

Universal health insurance “will be a big positive for our businesses because they won’t have to deal with (health insurance) anymore,” he said.

He said he wants to see critics’ proposals for helping residents who don’t qualify for Medicaid, get little or no health insurance from their employer, or have to pay sky-high premiums for feeble coverage.

But Oregon Business & Industry argues the state in the last several years has launched a number of programs to improve the health care system, including drug price transparency and holding major health care providers and insurers to cost growth caps, and those should be given time to work.

“More than 95% of Oregonians are covered by some form of (health) insurance, and we believe it would be more prudent to focus attention on less disruptive ways to provide coverage to the small percentage of Oregonians currently without it.”

“More than 95% of Oregonians are covered by some form of (health) insurance, and we believe it would be more prudent to focus attention on less disruptive ways to provide coverage to the small percentage of Oregonians currently without it,” wrote Katie Koenig, public affairs manager for OBI, to the Senate committee.

The sides argued extensively over the universal health insurance concept during hearings held by the task force over the past two years. Many of those arguments are now being replayed.

Bill sets out tasks

SB 704 spells out what the governance board would need to do, including:

  • Design a standard health care benefits package for all residents, plus how claims would be processed and financial reserves built up;

  • Assessing the ability of state agencies and other institutions to carry out the plan;

  • Determine how to “unwind the existing health care financing system” by working with hospitals, other health care providers, commercial insurers and coordinated care organizations that manage Medicaid members;

  • Determine reimbursement rates for providers;

  • Determine how the new system would impact different types of employers;

  • Secure federal approvals to ensure federally funded health insurance – Medicaid and Medicare – could be part of the system.

Small businesses and the self-employed would be particularly harmed by the proposed universal insurance system, Anthony Smith, Oregon director for NFIB wrote in a letter to the committee. Self-employed Oregonians would have to pay both new taxes – as employer and individual, he wrote. That would likely exceed existing premium costs they pay, he wrote. Employers that offer employees only minimal insurance coverage would also likely have to pay more under a universal plan, he wrote.

Furthermore, the universal system would likely deprive existing health care insurance companies of much of their work, prompting them to close and lay off workers, Smith wrote. Supporters of the universal insurance concept have said many of those workers could shift to jobs administering the universal insurance system for the state.

Critics also say the state is ill-equipped to handle the massive job of running a health insurance program for all 4 million state residents. Currently, the state, through privately run coordinated care organizations, insures the 1.4 million Oregonians on the Oregon Health Plan, Oregon’s version of Medicaid.

“Oregon doesn’t have a great track record for administering large-scale programs or adhering to projected budgets and timelines,” wrote OBI’s Koenig.

The Oregon hospital association said it is unclear whether the federal government would even approve any plan the state developed. Under the universal insurance concept the state task force outlined, federal money for Medicaid and Medicare would flow into the state-run system. Plus federally regulated commercial health insurance plans -- those offered by most private-sector employers – would be replaced by the universal insurance plan.

Without federal buy-in, Oregon would still have a fragmented system, wrote Sean Kolmer, executive vice president for external affairs for OAHHS.

“It remains unknown whether the plan would be able to overcome significant federal regulatory and legal hurdles to operate as a true single payer (system),” he wrote.

Universal system lauded

But as expressed in hundreds of emails to the committee, some public sentiment in strongly in favor of a universal system.

Retired physician Joseph Eusterman of Milwaukie wrote that creating such a system would be a more important legacy than other Oregon achievements, such as preserving public beaches, recycling bottles, allowing death with dignity and decriminalizing some drugs.

Tom Rafalski, a doctor at Samaritan Health Services in Lincoln County, wrote: “I see on a daily basis the human and societal costs of lack of access to health care.” He added, “Universal health (insurance) not only makes sense according to plain decency, but it’s also cost effective.”

Manning said he expects the health committee to approve the bill and send it to the Joint Committee on Ways and Means for financial analysis.

You can reach Christian Wihtol at [email protected].


Submitted by Linda Alband on Tue, 03/21/2023 - 12:45 Permalink

This article covers a lot of territory but fails to reveal many of the truths about the currently unaffordable and inequitable complexity of a so-called health system. 

  1. Not focused on improving the health status of individuals, families, and communities
  2. Unnecessary deaths
  3. Lack of incentive for prevention
    • Lack of $ for public health
    • Does not protect against threats to the public health
  4. Failure to take care of overall needed healthcare that includes behavioral health, vision, hearing, and dental 
  5. Creates undo stress
    • Complexity of navigation
    • Toxic Stress and subsequent health problems
  6. Medical debt

    Medical debt is the leading cause of bankruptcy in Oregon

  7. Rural hospital closures
  8. Unstainable rising costs
    • The current complexity of health care financing is costly and inefficient
    • Administrative waste within the complexity and across all sectors of the economy
    • While perhaps 6% of Oregon’s population is uninsured, many are under-insured, and both struggle to get access to quality, affordable healthcare. 
    • Families balance the rising cost of healthcare and prescription drugs with other necessities such as housing, utilities, and groceries.
  9. Burden on businesses
    • HR expenses
    • Expenses of bargaining
    • Excess expenses for local and state government
  10. Not transparent
    • Excess fraud and abuse
  11. Surprise billing 
  12. Denials of care 
  13. Delays of care
    • Unaffordable medications
    • Those needing care often delay care due to worry about cost and actual cost
  14. Inequitably delivered
    • There are financial incentives to deliver care to one person over another
  15. Inequitable outcomes
    • Systemic inequalities have resulted in lesser access to health services for BIPOC people
    • POC are less likely to have access to healthcare and have poorer health outcomes
  16. Provider burnout and demoralization
    • Prior authorizations
    • Denials of treatment recommendations
    • Decisions made by insurers not based on patient needs
    • Critical staffing issues-health care providers of all kinds including nurses, doctors, and mental health therapists are exiting profession
  17. Lack of freedom to choose provider
  • People do not have the freedom to choose their own provider--employers and insurance companies do with narrow networks
  • Discriminates against provider types
  1. Tied to employment
    • People refusing wage increases and promotions as this represents net loss.
    • Barrier for entrepreneurs
    • Inability to move out of the Medicaid system
    • Inability to separate from current employment
  2. Profits instead of care
  3. These issues have only been exacerbated by the COVID-19 pandemic
  4. Currently healthcare is a commodity and not a right
    • Oregon’s Constitutional right to health care has not yet been actualized


Submitted by Linda Alband on Tue, 03/21/2023 - 13:08 Permalink

The testimony from paid business lobbyists does not really capture the reality. Many small businesses including not for profits give health care stipends which under a universal health plan could be directed to the publicly funded system and result in better benefits for the employees. Health Care for All Oregon ( has an extensive list of small business allies. They want systemic change. 

Submitted by Jo Alexander on Tue, 03/21/2023 - 16:50 Permalink

There is not much left to say, after Linda's comment. I'll just add: follow the money. See who supports 704 and who opposes it.

Submitted by Lou Sinniger on Wed, 03/22/2023 - 11:33 Permalink

It comes as no surprise that the majority of the opponents are those who are taking profits and capital gains with the current system of profits over care.