Senate Passes Bill to Push Insurers, PEBB and OEBB to Invest in Primary Care
The Senate approved a bill 29-0 that will push health insurers to make a greater investment in primary care, while holding public employee health plans and the coordinated care organizations to the same standard -- 12 percent of medical claims. The legislation now heads to the House.
Under Senate Bill 934, Health insurers will have to submit a plan to the Department of Consumer & Business Services explaining how they plan to increase their medical spending on primary care, up from current levels of about 9.9 percent of medical expenses to 12 percent by 2023.
A bigger impact will hit the Public Employees Benefit Board and the Oregon Educators Benefit Board, which are pulling up the rear on primary care spending at just 7.8 percent of medical expenses. The two boards will have to increase their primary care spending to 12 percent in the same timeframe.
But 12 percent is below the current average investment for the CCOs, and the law allows laggard CCOs six years to improve to this subpar standard.
Only five CCOs did not meet the 12 percent standard, according to 2014 data -- Eastern Oregon CCO, Yamhill CCO, Health Share of Oregon and the two PacificSource CCOs, which serve central Oregon and the Gorge. The PacificSource CCOs were just under 12, while Health Share was at 10.4 percent and the other two were below 8 percent.
Sen. Elizabeth Steiner Hayward, D-Beaverton, said SB 934 is primarily geared at bringing the successes CCOs have shown in improving overall care while saving money with greater primary care investment to the commercial market. The bill should also help PEBB and OEBB keep down costs, since they have so much room to increase spending on primary care, which has been shown to reduce costs by lowering spending on more expensive medical procedures.
“It’s targeting the commercial insurance market,” Steiner Hayward told The Lund Report. “It’s a good start and sets a place with some consistency.”
A Portland State University study showed that the state saved $240 million in downstream costs because of its patient-centered primary care home program, or about $13 in savings for every $1 spent on primary care. SB 934 also works to align an alternative payment model for primary care with uniform reporting standards.
The original bill called for a 14.4 percent primary care spending standard, but the CCOs lobbied against that figure, which would have required several more of them to increase their investment.
Steiner Hayward said it was too complicated to hold them to a higher standard than the commercial health insurance companies, and that the 11 CCOs already making the higher investment in primary care will continue to do so because it has saved them money.
The apparent kid-glove treatment of the powerful CCOs was in keeping with much of the state’s attempts to reform Medicaid through these repackaged managed care organizations, which are supposed to meet a set of quality control metrics, but have consistently been given low goals that only a failing CCO would not meet. Almost all of the improvement in coordinating care has come when that health goal aligns with saving the CCOs money, such as driving down emergency room utilization, or in this case, in improving primary care.
The progress of CCOs on improving mental healthcare has been widely panned, as psychiatric care is often seen as a money loser by the healthcare industry. The challenges CCOs face in providing mental healthcare will be the topic of an Oregon Health Forum discussion later this month.
Dental utilization rates are also well below national standards, with just 42 percent of children on the Oregon Health Plan getting a routine dental checkup in 2015, compared to 50 percent of Medicaid recipients nationally, according to a recent study conducted for the American Dental Association. Utilization has actually declined from 45 percent in 2011, before the CCOs took over dental care.
A group of for-profit CCOs is also using its clout to imperil Rep. Mitch Greenlick’s reform bill, which would require them to be more open in their decision-making processes and would protect the state from CCOs selling to larger investors and taking nearly $1 billion in reserves with them. Those reserves are intended to keep them solvent as they provide care for children, poor people and people with disabilities.
To persuade legislators to lay off stricter standards, the groups have spent more than $1 million on campaign contributions in the past several years on legislative campaigns.
Reach Chris Gray at [email protected].