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Technical Error by Oregon Health Authority Leads to Confusion

The state never intended to go through a competitive bid process with the CCOs.
August 16, 2016

Executives at Oregon’s 16 coordinated care organizations were caught off guard when state officials announced a competitive bidding process during the next round of contracts in December 2018.

But it was nothing more than a technical error, according to BethAnne Darby, director of the Oregon Health Authority’s external relations division.

The error occurred during the waiver renewal process underway with the federal government. Two sentences were inadvertently included that mentioned a competitive bid process, Darby told The Lund Report.

“We submitted a revised waiver yesterday” (Sunday), she added. ”We’ve never had a conversation about a competitive bid. It was just a technical error.”

The OHA is hoping to get approval for the waiver later this fall, before the new president takes office.

According to an earlier article in The Lund Report, the new waiver includes a significant emphasis on supportive housing for beneficiaries, a key social determinant of health that has reached crisis levels from Portland outward.

Some of Oregon’s coordinated care organizations have sought to help stabilize the living situation for vulnerable members, but the federal government has stymied state Medicaid programs that have desired to build more low-income housing.

The Health Authority is willing to wager that since Oregon has saved the federal government $29.7 billion since it first adopted the Oregon Health Plan in 1994, the Centers for Medicare and Medicaid Systems will allow Oregon to innovate on targeting more social determinants of health.

The new waiver also continues the state’s 2012 innovation -- the coordinated care system, which has saved $1.7 billion compared to other states since its inception by reducing the growth in healthcare costs. Those savings have been driven by a 23 percent decline in emergency department utilization and a reduction in hospital stays for chronic conditions: short-term admissions for diabetes have dropped by a third and hospital stays for chronic obstructive pulmonary disorder and asthma have dropped by two-thirds since 2011.

The overall state Medicaid budget will continue to have a fixed ceiling which is 2 percentage points below the national standard for medical inflation, or about a 3.4 percent annual increase.

The Oregon Health Authority projects it will save federal taxpayers another $4.8 billion through 2022 -- with one big caveat: those savings do not include the cost of exorbitantly expensive biological drugs such as those to treat Hepatitis C.

The waiver calls for new “community health partnerships” that will coordinate housing providers, county officials, hospitals and behavioral health providers to streamline housing supports and save the system money by stepping down more people from costly institutional settings like the Oregon State Hospital, nursing homes and jails and enable more community-based care.

Housing programs will zero in on the costliest patients, those who repeatedly utilize emergency rooms or inpatient hospital services and who have been diagnosed with two or more medical conditions. Homeless people and those with serious behavioral health needs will also be singled out for support.

Diane can be reached at [email protected].

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