Democratic lawmakers, union leaders, some health care advocates and the Oregon Health Authority are pushing a proposal to keep tens of thousands of Oregonians who risk losing free Medicaid coverage on a health care plan.
Without the plan, authorities worry that more people will be without insurance and in turn delay or avoid medical care. Untreated medical conditions can result in more costly care later that is often borne by hospitals and other medical care providers as charity care.
House Bill 4035 would create a new insurance plan for low-income people who get booted off Medicaid when the federal public health emergency over the pandemic ends. That’s due to happen in mid-April, but it could be extended another 90 days. “We do not know when the public health emergency will end,” Jeremy Vandehey, the Oregon Health Authority’s director of health policy and analytics, recently told the House Health Care Committee.
The agency estimates that when the public health emergency ends, 300,000 people who rely on the Oregon Health Plan, the state’s version of Medicaid, will no longer qualify for coverage because they earn too much. The plan covers people who earn up to 138% of the federal poverty level – $18,750 a year for an individual and $39,300 for a family of four.
When the pandemic started and the public health emergency was declared in March in 2020, states had the option to keep everyone on Medicaid, despite any change in their income, and receive extra federal funding if they did. As a result, Medicaid enrollment increased 30%. Currently, 1.4 million residents – one in three – are covered by the Oregon Health Plan.
When the public health emergency ends, the state will have 12 months to assess who is qualified under federal rules to remain on Medicaid, removing those who are no longer eligible. That will create a pool of uninsured Oregonians, state officials said.
“A big concern that we have as we go through the redetermination process,” Vandehey said, “is how do we not go backwards on the gains we’ve made as a state.”
Oregon is among a number of states seeking creative ways to insure those who will lose Medicaid coverage.
The health authority would like to transfer 55,000 of those to a new insurance plan – a “bridge plan.” It would cover those who make between $27,180 a year for an individual and $55,500 a year for a family of four.
The remaining 245,000 people who now make too much for Medicaid would lose that coverage. If they didn’t have insurance through an employer, they would have the option of buying their own coverage on the federal marketplace. It is the only place where individuals can obtain subsidies to help pay premiums and other costs.
About 150,000 Oregonians purchased their health insurance this year through the marketplace. A majority of them received federal subsidies. The health authority would like to use the subsidies that the 55,000 people would qualify for to pay for their coverage on the bridge plan.
To work, the federal government has to agree. Without that federal cost-sharing, Oregon would be unable to go ahead with its plan. The health authority figures that many among the 55,000 would become uninsured because they wouldn’t be able to afford health insurance.
Proponents say it will save money
Supporters say the proposal would save money in the long run because it would keep more people insured.
“The data are really clear that keeping people on continual health insurance improves (outcomes) dramatically and lowers health care costs,” Sen. Elizabeth Steiner Hayward, D-Portland and a primary care physician, recently told the Joint Ways and Means Capital Construction Subcommittee. “We have actually seen improvements in health for chronic conditions during the pandemic because people have had stable health insurance.”
But Republicans on the committee worry about the cost of the proposal: about $584 million through June 30, 2023, with the state paying about 27% and the federal government picking up almost all of the rest.
“That’s a lot of money,” said Rep. Greg Smith, R-Heppner.
The Oregon Association of Hospitals and Health Systems, which represents the hospital industry and is one of the heavyweight lobbying groups in the Legislature, is also wary of the state creating a new insurance product.
“Developing, implementing and funding a bridge program is a significant undertaking that will require complex negotiations with federal regulators and could carry very high costs for the state,” the association said in written testimony.
The Joint Ways and Means Committee endorsed the proposal on Saturday on a party line vote, with 12 Democrats in favor and nine Republicans against. It is now headed to the House for a vote.
Worries about implementation
Those covered by the bridge plan would be under one of the state’s 16 regionally based Medicaid insurers – they’re called coordinated care organizations – to keep them connected to a primary care provider.
It’s not yet been determined what the coverage would entail. A task force would be created to propose a plan to the Legislature by May 31.
Felisa Hagins, political director of the Service Employees International Local 49, said many racial and ethnic minorities likely would qualify for the bridge plan.
“Homecare and nursing home workers who are represented by SEIU 503 often earn between 138% and 200% of federal poverty,” Hagins said in written testimony. “Some of these workers were sick and unable to work during part of the pandemic, pushing their income into Medicaid eligibility. With the pause in redeterminations, these workers have been able to stay enrolled in Medicaid throughout the pandemic.”
She said they’re primarily people of color.
“We call on you to adopt a robust plan and give OHA the tools they need to work with the federal government to keep Oregonians covered,” she said.
She said New York and Minnesota have adopted a similar strategy and that Kentucky was also considering the bridge option.
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