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Oregon's Medicaid Director Wants To Step Up Oversight, Drive Reform

Lori Coyner became Oregon's Medicaid director at the end of January, returning to her old position./Jessica Floum/The Lund Report
February 14, 2019

Oregon’s former Medicaid Director Lori Coyner returned to the role Jan. 28, filling the vacancy she left in 2017. Her return comes in the midst of the state’s application process to cover the health care of about 1 million low-income Oregonians over the next five years. Worth more than $5 billion in total, the procurement is the largest in the state’s history.

Coyner oversaw Medicaid policy reform, but not operations, during her last stint as Medicaid director. She worked on the governor’s budget and helped negotiate an agreement with the federal government, known as the 1115 Waiver, that renewed Oregon’s ability to operate a unique Medicaid program as long as the state could prove it was improving care and keeping costs down.

The Lund Report interviewed Coyner on Wednesday to ask her about what she plans to do in her new role. The interview has been edited for clarity.

You were previously the Medicaid Director. Why did you leave and why did you come back?

I had been with the agency five years and was ready for a break so I took some time off and did some traveling. I went to work for Health Management Associates, a consulting company for a year.

During that time I was able to consult with other states on their Medicaid program so had the opportunity to give broader national perspective in terms of what some of the challenges are in other states, how they’re tackling them.

A lot of states have the same challenge that Oregon does so it was a real opportunity to look at those approaches that maybe we haven’t thought of.

Any that stood out?

There are a couple of states that have done some real innovations around housing and behavioral health integration and how to provide services to members with high needs. We have those same challenges. The new CCO 2.0 direction is to tackle some of those so it is fitting.

The reason I came back (is) I think it’s an exciting time with Oregon’s Medicaid program, with CCO 2.0, policies that are laid out and the opportunity to move health system transformation forward over the next five years is really exciting.

What is your top priority as you come back to this role?

I have been in the role for two and half weeks. I’m spending a lot of time meeting with staff, meeting with leadership, doing a lot of meet-and-greets to understand the lay of the land and where the Oregon Health Authority is different. It’s under new leadership.  I really want to focus on the areas that Pat (Allen, director of the Oregon Health Authority) has laid out. I want to focus on transparency, collaboration (and) business processes.

One of the first things for me is to look at our business processes and see what we can do from the Medicaid division to improve those processes as we bring in the new CCOs.

Other areas are improving health equity, continuing to build strong relationships with our tribes in Oregon, working on social determinants of health meaning education, housing, transportation --some of those nonmedical issues that really do affect the health of members. We’re thinking about innovative ways to move that forward.

Another big priority is looking at (the) behavioral health system. We are hoping to get a new behavioral health director and work really closely with them to advance integration with members with mental health challenges, addiction issues. We made big strides in CCO 1.0 in that area, but there is a lot more that can be done.

How do you plan to drive reform in the next round of CCO 2.0?

There’s lots of policies the Oregon Health Policy Board laid out that pushed the CCOs in a direction to expand the work they’ve already done (on social determinants of health, health equity, behavioral health, cost containment and value-based payments).

From the Medicaid program perspective, some of it will be working on developing better business processes to have better compliance oversight. How do we do that in a way that we also are able to continue to foster innovation for the CCOs?  Being collaborative, supporting their community-based activities, looking at ways to (incentivize) them to invest in social determinants. Those are some areas we could foster innovation.

Do you have any ideas for encouraging investment in social determinants of health?

One of the areas we are having active conversations on already are health-related services. Those are non-medical services that can be provided to members to improve their overall health. There are two kinds. Some can be directed right at the member. For example, if a child has asthma, a CCO can help provide some sort of air cleaner for the home and do prevention. That would be considered a health-related service that’s not billable to Medicaid. The other is community intervention. A CCO may pay for cooking classes for their members to eat in a more healthy way or to use foods from the nutrition program. That kind of thing, you can’t bill Medicaid for it.

We have some policies (that) allow the CCOs to include that in some of their accounting so they get “credit” for investing in those services.

The other is to continue to work on housing, work with the Oregon Housing and Community Services to leverage the work they do and collaborate with them. Medicaid will pay for housing supports and services so we can join together and support the CCOs.

Some of that is helping (to) write policy that makes it easier for the CCOs to collaborate.

Medicaid won’t pay for brick and mortar. Medicaid dollars can’t be used to build housing, but they can be used for tenancy supports to help people stay in their housing – sometimes rental assistance, sometimes things they need to help teach them how to work with their property manager. Medicaid dollars can be used to help them find housing.

We certainly are trying to partner. We have an interagency workgroup that meets to talk about how to leverage the work that each agency is working on.

Were you pleased with the results of your previous waiver negotiation? Where would you like to go further, and how will that inform what you do as you look toward the next waiver?

We were able to continue the work that the CCOs had started. The first five years, there was a lot of learning, and we had a lot of successes. There were also areas (where) we learned we could expand and improve our programs.

One example is the agency has been working on a substance use disorder waiver. That’s another 1115 Waiver. We, I think, are going to look at another waiver for people with major depression and serious persistent mental illness. We’re looking for opportunities in the waiver to expand services and expand funding for people with mental health issues.

You alluded to funding social determinants of health through Medicaid. Where does that money come from?

That I don’t know. I’m still learning so I’d have to get back to you on that. I did follow the policy board work over the last year to see where CCO 2.0 is going.

How do you plan to hold CCOs accountable for tackling the priorities mentioned in the application for prospective Medicaid insurers?

That’s a good question. If you look at the policy documents that were approved by the Oregon Health Policy Board, there’s a mention of what they’re hoping the CCOs do and what OHA is committed to doing. You’ll notice that there is much more of a focus on the Oregon Health Authority providing oversight around some of the requirements. In some cases, that will be more formal contract oversight. In other cases, we will continue to use some of the other tools that were developed in the first round of CCO 1.0. (Those include) writing the community health assessments and the community health improvement plans (and) being engaged with community advisory councils. In the CCO metric council, the metrics continue to get more and more difficult across time. I think that’s going to continue, and that’s a good thing. It forces the CCOs to think about how they’re going to, for example, improve the health of younger children.

From the Medicaid program side, it’s really looking at that contract compliance. That’s in alignment with Pat’s focus on developing better processes. Right now, I’m interviewing staff. We’re trying to determine where we have some strong processes in place and where there are some gaps and thinking about where to add more of a compliance component.

When this first started, we were doing something completely new. There was lots of room for the CCOs to innovate and in some ways co-create with the agency what it would look like. Now that we have five years of experience, we want to move to the next level where the CCOs are ready for more compliance oversight. We don’t want to do that at the expense of losing innovation and transparency that we built in the last five years.

Can you tell me more about the business processes that you have and specifically the ones you want to improve?

I am still gathering that information so I don’t know well enough yet in terms of where we have processes that are working well and where we need to be more clear.

What’s an example of a business process you’re looking at right now?

CCOs really need to improve their behavioral health integration system. As part of that, there are going to be some behavioral health metrics that they are going to need to meet. If they don’t meet them then there is going to be some sort of corrective action plan. On the OHA side, we need to develop the metrics. We need to develop a way to measure those. We need to inform where the CCOs are on those. Then we need to have some sort of review process. A commitment from me is that there is an element of transparency with the CCOs on that. If someone is not meeting those, what are the next steps? That’s an example of developing a business process that’s going to be new in the contract. What are the steps that need to happen, what are the checkpoints, and how do we collaborate with the CCOs in that process?

Speaking of accountability, you obviously have a very big goal of containing cost growth to 3.4 percent or less. Some CCOs have done that and some CCOs have exceeded that growth cap.  What do you plan to do to encourage CCOs to meet that? Will you penalize them for failing to meet that?

In the waiver, we did commit to keeping costs at a 3.4 percent rate of growth. You do run the risk of not meeting your waiver, and there could be implications for that. In the waiver, there is some discussion about cost containment and there are some mechanisms through the waiver in the rate-setting process that will provide additional dollars for CCOs that are providing high-quality care and keeping their cost growth down. Part of the thinking of that was because the incentive metric program is an example that has worked really well. What are other ways you (incentivize) the CCOs to do what you want them to do? In this case, it’s to improve the quality of care and reduce our whole costs down.

There are some mechanisms that are built in. I don’t, as Medicaid director, oversee the rate-setting that falls under the CFO’s purview, but I certainly will work with Dave (Baden) closely on those topics.

You said the incentive program is working? Are you talking about the quality incentive pool?


One complaint among CCOs is that they are penalized for decreasing their costs because their rates are based in part on what they spent in previous years. What do you plan to do to address that?

That’s under the CFO’s purview. There are some provisions in the waiver that address that. That’s the performance-based metric I was talking about. CCOs would be given some sort of quality bonus for quality and then for decreasing or holding costs the same. If you are a high-performing CCO in the realm of holding costs down and improving quality, you get a bump.

The other thing is Pat has been committed -- and as an agency as a whole, we’ve been committed — to looking at the global budget again and figuring out ways to make that happen so that the CCOs won’t be so worried about having to meet rates that are created through an old fee-for-service model. The value-based payment is one way to move out of the fee for service model.

Your role has changed quite a bit from your last time as Medicaid director to this time. How has your role changed and what opportunities and challenges does that present?

I was in health policy and analytics when I was Medicaid director before. The role of the Medicaid director was very policy oriented. I was focused on the waiver. I was focused on the agency budget and other policy pieces — rates and things like that. But I didn’t have the Medicaid staff reporting to me. I didn’t have a direct line of sight into, for example, eligibility. My new role is part of the health systems division. I have oversight of the Medicaid staff.

It’s an opportunity to implement CCO 2.0, build these business processes, work with the CCOs in the startup of another phase.

The challenge is doing all of that work and still being able to have some external facing work that involves policy, something that I am passionate about. Having that opportunity to wed policy work and policy vision with the operational parts of an agency is really exciting. It’s a big job.

There were issues when you were the director with people getting dropped from enrollment and will Medicaid payments. What was your role in that?

That was in a different division than the division I worked in.

Now you would have more insight and directive authority over things like that?


Anything else you want people to know about you as Medicaid director?

I’m really excited to be back. I’m really excited about Pat’s leadership team that he’s put together and (about) working with the CCOs on the next phase of Oregon’s Medicaid transformation.

Have a tip about health care? Contact Jessica Floum at [email protected].