Access to Oregon Health Plan Shrinks

The Standard package will stop taking new members as officials struggle to reduce coverage, but co-payments will end Wednesday, June 09, 2004

PATRICK O'NEILL

Oregon's health plan for poor people continued its collapse Tuesday as state officials announced a halt to new enrollment in the Oregon Health Plan Standard benefit package beginning July 1.

At the same time, health plan officials began mailing notices to Standard patients saying they no longer will be expected to make co-payments for medical services beginning June 19.

The move to stop enrollment is meant to help slash the number of low-income Oregonians covered by the plan from the current 50,700 to fewer than 25,000 by June 30, 2005, said Cindy Becker, deputy director of the Oregon Department of Human Services.

The closure does not affect the 304,000 Oregonians covered by the Oregon Health Plan's Plus package -- traditional Medicaid -- which provides care for people on public assistance; for those who are blind, aged or disabled; and for foster children.

The Standard plan is meant to cover adults who don't automatically qualify for Medicaid but whose incomes fall below the federal poverty level -- $1,571 a month for a family of four.

"We need to get (Standard enrollment) down below 25,000," Becker said. "It doesn't do us any good to continue enrollment when we know we're going to have to cut."

In addition, Becker said, the plan probably will begin actively dropping members within a few months by tightening eligibility requirements. The plan now accepts members whose incomes are 100 percent of the federal poverty level. Depending on the ability to cut the plan's membership through attrition, eligibility requirements may go to 30 percent or 50 percent of the poverty level, she said.

The final number of plan members also depends on the amount of new revenue made available through taxes on medical providers.

The 2003 Oregon Legislature approved taxes on managed care organizations and hospitals to help shore up the Standard plan. The federal government has approved taxes on managed care but has made no decision on the hospital tax, she said.

The tax on managed care organizations amounts to 5.8 percent of their gross revenues from Medicaid. State officials estimate that if the hospital tax also is approved, revenue will be sufficient to cover basic medical care for 24,000 people.

Under state regulations, Standard plan members must re-enroll every six months. Becker said current members will be permitted to re-enroll, but she cautioned them against failing to pay their premiums. If members don't make their payments, she said, they will be dropped from the program and won't be allowed to enroll again.

"We're trying to be as fair about this as we possibly can," she said. "These are difficult decisions."

Plan began a decade ago

The Oregon Health Plan began in 1994 as an effort to provide basic health care to all Oregonians. At the heart of the plan was a list of medical conditions and their treatments, ranked from the most to the least important.

Under the original concept, legislators would cut medical treatments from the list if revenues became tight rather than dropping low-income people from the health plan's roster. But the federal government severely restricted Oregon's ability to reduce services. Enrollment has fallen precipitously since January 2003, when about 100,000 Oregonians were Standard members.

Ellen Pinney, executive director of the Oregon Health Action Campaign, a coalition working for universal access to health care, mourned the continuing loss of medical care for low-income people. But she praised hospital and managed care executives for agreeing to pay the taxes.

"This is completely financed by self-imposed taxes by the managed care and hospital industries," she said. "My hat's off to them for maintaining some skeletal structure of the remaining OHP Standard."

Pinney also was buoyed by word that members of the health plan's Standard benefit package will not have to make co-payments for office visits, hospital admissions and certain prescriptions. Co-payments ranged from $2 for prescriptions to $5 for office visits to $250 for hospital admissions.

Judge rules on co-payments

Health plan officials announced Tuesday that they are mailing notices to the 50,700 adults covered by the Standard benefit package, telling them that they will not have to make the co-payments because of a ruling May 20 by U.S District Judge Garr M. King.

King ruled on a lawsuit filed by the Oregon Law Center on behalf of those covered by the Standard benefit package. Co-payments, which were approved by a federal agency, have been charged to the health plan's Standard patients since Feb. 1, 2003. But King ruled that requiring co-payments of those patients violated federal law.

The decision does not affect co-payments by members of OHP Plus, however, said Jim Edge, assistant administrator for the state Office of Medical Assistance Programs. Many of those on OHP Plus make co-payments of $2 or $3 for selected medical services. OHP Plus members do not pay premiums.

Edge said people receiving the OHP-Standard package must continue to pay premiums even though the co-payments are not required. Over time, thousands of low-income residents have been disqualified for not being able to keep up with monthly premiums, ranging from $6 to $20.

Pinney said the co-payment ruling is "an enormous victory."

"It will make it a lot easier for the remaining clients to get medical access," she said.

Patrick O'Neill; 503-221-8233;