Steiner Hayward Wants Insurers to Increase Primary Care Investments

SB 934 would mandate insurers and CCOs pay at least 14.4 percent toward primary care, and would punish CCOs if they don’t make improvement. Meanwhile, FamilyCare claims the state is now actually penalizing it for “wasting” money on primary care.

Sen. Elizabeth Steiner Hayward, D-Beaverton, is supporting legislation that would promote primary care innovations in statute and requires Medicaid plans and health insurers to spend 14.4 percent of their budgets on primary care.

Senate Bill 934 would direct the Oregon Department of Consumer & Business Services to require health insurers who are not currently spending 14.4 percent to submit a plan for increasing their primary care spending. Steiner Hayward said she was ready to compromise and negotiate that figure to 12 percent for health insurers.

Coordinated care organizations serving Medicaid could be penalized if they fall below that 14.4 percent standard, but only if they don’t show improvement of at least 1 percentage point a year.

SB 934 also encourages CCOs and health plans to adopt the federal comprehensive primary care plus program, which promotes alternative payment methods to treat the whole health of a person, creates incentives to fund community health workers, and moves away from paying clinics and doctor’s offices only when patients are sick.

“The fee-for-service model is really broken and does not get the outcomes we desire,” said Steiner Hayward, a family physician.

Her bill is co-sponsored in the House by the Legislature’s other physician, Rep. Knute Buehler, R-Bend. “Increased spending on primary care saves money for the system,” she said.

Irony underlies the push to boost primary care spending, given that executives of Portland CCO FamilyCare complained just days ago that their payment rates have been docked because Oregon Health Authority officials told them they waste tax dollars overpaying primary care providers, indicating that the state agency may be working at cross-purposes.

FamilyCare CEO Jeff Heatherington has argued that investments in primary care have allowed his providers to more adequately treat their patients on the front end, leading to fewer speciality care and emergency care visits.

The Oregon Health Authority hides from the public information about each CCO’s primary care spending in its reports. However, health authority’s CCO data can be cross-referenced by enrollment numbers, allowing The Lund Report to unmask the information.

FamilyCare spent 21.7 percent on primary care in 2014 -- more than twice the rate of its competitor, Health Share of Oregon, which spent just 10.4 percent on primary care, the third-lowest rate in Oregon. Two others spent less than 8 percent.

But even as one wing of the Oregon Health Authority bureaucracy is allegedly penalizing FamilyCare for its investments in primary care, OHA’s chief medical officer, Dr. Jim Rickards, testified in support of SB 934 and said that for every $1 Oregon has invested in its patient-centered primary care home program, the state has saved $13 in downstream costs, amounting to about $240 million in three years, according to a comprehensive report from Portland State University.

Rickards’ presentation showed that the average CCO spent 12.5 percent of its budget on primary care in 2015, down from 13.1 percent in 2014. Private insurance plans spent 10.1 percent, Medicare C plans spent 8.9 percent, and the plans for public employees spent just 7.9 percent.

Steiner Hayward said she planned an amendment for these plans -- the Public Employees Benefit Board and the Oregon Educators Benefit Board -- that would require them to meet the same standards as health insurance plans regulated by the Department of Consumer & Business Services.

The insurance mandate in SB 934 was opposed by Tom Holt of Regence BlueCross BlueShield as well as PacificSource Health Plan’s Peter McGarry, though McGarry nonetheless praised its aim: “There’s no better way for the ‘triple aim’ to be attained than implementing robust primary care.”

McGarry said fixing the insurers’ cost percentage at 14.4 percent could hamstring PacificSource as other medical costs increase, including high-priced prescription drugs, over which it often has little control. There is also no guarantee the documented savings from primary care investments would immediately bear fruit for the insurer.

Reach Chris Gray at [email protected].

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