Republican plan to cut Medicaid would unravel Oregon’s health care safety net, experts say

The Republican plan to slash Medicaid now before the U.S. Senate  would unravel decades of progress in Oregon, causing tens of thousands to lose coverage and making health care more expensive for everyone, state and health care officials say. 

The plan, which President Donald Trump wants passed by Congress by July 4, would be worse than critics originally feared. The nonpartisan Congressional Budget Office just released its final estimate of the impact of the plan, forecasting more than $1 trillion in health care cuts nationwide, with millions losing their health insurance, Oregon’s senior senator, Ron Wyden, said in a statement Wednesday.

“This bill has gone from bad to worse. If Senate Republicans truly think this bill is the right direction for America, they owe it to Americans to defend it in public,” Wyden said.

Oregon would be hurt more than many states, national experts say. 

The health care workforce would shrink. Services would be curtailed. Rural hospitals, safety net clinics and Planned Parenthood facilities could close. The uninsured rate would rise and people would die because of lack of coverage — and the state would face higher health care costs as a whole.

Oregon could lose more than $1 billion if the plan goes through, forcing state lawmakers to hold a special session this summer to patch up the budget.

Democratic state Sen. Deb Patterson, chair of the Senate Health Care Committee, got the discussion started Tuesday, with a committee hearing on the issue. It included top experts on Medicaid, hospitals, safety net clinics and Medicaid insurance.

Their overall message was that the Republican plan would rip at the heart of Oregon’s health care system. For decades, state officials have tried to increase insurance coverage and bolster primary and preventive care to steer people away from turning to expensive emergency rooms.

“We have worked so hard as a state and had so much success for the last several decades in ensuring that people have access to health care services,” Emma Sandoe, the Oregon Health Authority’s Medicaid director, told the committee “That ensures our financial stability as a state as well as people's financial stability.”

The Oregon Health Plan, the state’s version of Medicaid, provides 1.4 million Oregonians — one-third of the state — with free health, behavioral health and dental care. It keeps children until the age of 6 insured, with those older up for renewal every two years. 

That coverage is responsible for pushing Oregon’s health insurance rate to a record 97%, Sandoe said. 

But if the cuts go through, the insured rate could drop by 4%, according to an analysis by KFF. 

“Proposed changes to Medicaid labeled as those intended to eliminate fraud, waste and abuse will harm children, seniors and veterans,” said Dr. Andy Mendenhall, CEO of Portland-based Central City Concern, one of the largest safety-net clinics in the state. “It will also make health care less available and more expensive for everyone in Oregon.”
 

Plan to slash rolls

The Republican plan is designed to cut the Medicaid rolls, Sandoe told the committee. It would require recipients to requalify every six months and show they’re working or are engaged in another approved activity for 80 hours a month. 

Most Medicaid members already work, she said, but the paperwork burden would push many off the coverage. And the state would have to hire up to 1,200 eligibility experts and pay for added IT expenses, Sandoe said.

She estimated that 100,000 to 200,000 would lose coverage in Oregon. 

Many of those still insured would face copays, which would represent a significant change in Oregon, Sandoe said.

“This would essentially reduce the amount of care that members are getting,” Sandoe said, while also reducing payments to providers who might not collect the copay.

This comes at a time when Oregon’s hospitals and clinics are already grappling with tight finances.

Becky Hultberg, president and CEO of the Hospital Association of Oregon, said hospitals would be flooded with more emergency room patients. Last year, emergency room visits soared past 1.5 million, a new high, she said.

“If a patient is uninsured and the hospital doesn't receive payment, which is likely to happen, financial pressures are going to increase, leading to a tipping point,” Hultberg said.

Rural hospitals, like Wallowa Memorial Hospital in Enterprise in northeast Oregon, would feel the pain, said Dan Grigg, CEO of the Wallowa County Health Care district. Thirty-four percent of Wallowa County residents are on Medicaid.

“Proposed federal changes will hit rural hospitals hardest,” Grigg said.

Leaders at Oregon’s 34 federally qualified health centers, safety net clinics that serve many Medicaid patients, are also worried. These clinics, which receive a higher Medicaid reimbursement rate than some other providers, can’t turn anyone away, regardless of their status.

“We're worried about things like having to reduce hours, having to eliminate services, having to close locations if we don't have the funding,” said Jennifer Griffith, CEO of One Community Health, a federally qualified health center serving Wasco and Hood River counties in Oregon. “Mental health, dental care and specialty services are often the first to go,” she told the committee.“And they're the ones that are the most needed in rural Oregon.”
 

Impact in eastern Oregon

Eastern Oregon has the state’s highest Medicaid rate: 42% in the 2nd Congressional District, which spans eastern Oregon and two-thirds of the state.

The district’s U.S. representative, Republican Rep. Cliff Bentz, is on the House Energy and Commerce subcommittee on health and worked on the bill. He voted for it, helping it pass by one vote.

During a constituency hearing last month, Bentz denied the plan cuts Medicaid, according to coverage by Oregon Capital Chronicle. He said it just adds requirements to access it. 

But not all Republicans like the plan, which is designed to continue tax cuts that have benefited the wealthy. Patterson told The Lund Report she’s hopeful U.S. senators will not approve it.

“I have a hard time believing that the Senate would frankly pass this,” Patterson said. “I’m certain cooler heads will prevail and they will see that this is not tenable not only for Oregon, but not for any state in the nation.”

But Dr. Sara Kennedy, president and CEO of Planned Parenthood Columbia Willamette, is bracing for it to pass. It would strip the organization of all Medicaid funding even though abortions only represent a fraction of its care.

“Ninety percent of what we do is basic health care,” Kennedy said.

Medicaid currently pays half of Planned Parenthood’s budget, and donors make up the rest, Kennedy said. Loss of those federal dollars would be devastating, she said.

“We are not going to be immune to these cuts,” Kennedy said. “Planned Parenthood health centers have a strong likelihood of closing across the state and abortion access will absolutely suffer.”

The pain would be immediate. While other provisions would be phased in, with the work requirements starting in 2027, the cuts to Planned Parenthood  would go into effect as soon as Trump signs the bill, Kennedy said.

“Planned Parenthood will need support from the state to ensure that patients do not lose access to care,” Kennedy said. “And this includes allocation of short-term funding to help shore up services.”
 

Oregon’s plan for undocumented immigrants

The plan also would ban federal funds for gender-affirming care, affecting 7,000 people in Oregon, Sandoe said. And it could undermine Oregon’s support of undocumented immigrants. The state’s Healthier Oregon Program uses state funds to provide Medicaid benefits to 105,000 residents who meet the low-income requirements.

Oregon is among seven states to use state dollars to pay for Medicaid benefits for children and at least some adults, according to KFF Kaiser Family Foundation. Another seven states and Washington D.C. cover children. 

The Republican plan would cut the Medicaid reimbursement rate for these states from 90% to 80% for the hundreds of thousands who qualified for Medicaid under the Affordable Care Act. 

That would cost Oregon about $1 billion in the next two-year budget and $7 billion over 10 years, Sandoe said.

“We can’t lose that much federal funding,” Patterson told The Lund Report.

The legislative Ways and Means Committee needs to nail down Oregon’s budget before the end of the session this month, and lawmakers have about $750 million less than expected to spend. 

The Oregon Health Authority has asked for $3.7 billion in general funds to pay for Medicaid.

If the federal bill passes, the Legislature will have to hold a special session to redo its budget. Lawmakers might have to consider trimming Healthier Oregon, lawmakers have told The Lund Report, but Gov. Tina Kotek opposes that idea and so does Patterson. She said cutting the program would just shift costs elsewhere.

“I would be against doing anything that increases costs for Oregonians, and that would be increasing costs in my opinion,” Patterson said. 

The health authority budgeted $717 million for Healthier Oregon in the current 2023-25 budget cycle.

But cuts would have to be made, and they would hurt, said Mendenhall of Central City Concern.

“We know that federal changes have not yet been passed, but they are imminent, and we know that they will have significant negative impacts,” Mendenhall said.