Legislators Express Concerns About Transformation Progress

November 17, 2011—Lack of detail, unanswered questions, and a clock quickly ticking to the Legislature’s February session were the themes of an hour-long presentation to a joint meeting of the Legislature’s House and Senate healthcare committees about the progress of developing a business plan for coordinated care organizations (CCOs), the centerpiece of the state’s overhaul of the Oregon Health Plan.

“[The Oregon Health Authority] needs to get its act together to give us more detail,” said Sen. Laurie Monnes Anderson (D-Gresham), chair of the Senate Healthcare Committee. “It’s extremely important for [them] to have more of a product for us.”

Monnes Anderson was referring to the business plan the Oregon Health Policy Board must  present to the Legislature during its February session. Without legislative approval, the Oregon Health Authority cannot move forward with transforming the state’s healthcare system.

The business plan is expected to answer a wide variety of questions about how CCOs will work, including their structure and goals, the composition of their governing board, and a framework for providing physical, dental and mental healthcare services that meet the needs of their communities.

At the legislative hearing, the criteria for the CCOs was a main topic of conversation by Eric Parsons, who chairs the Oregon Health Policy Board. Current discussions indicate that individual CCOs will develop criteria tailored to the health needs of their population. Nevertheless, “It’s intended that there be some specific criteria about how the CCO should be set up and how it should work,” said Parsons, who didn’t offer specifics. 

He also said it’s unclear what would happen if a CCO failed to meet the criteria. “One way to go would be to say that if a CCO isn’t meeting its objectives, someone could fire the board and start all over again,” Parsons said.

Sen. Jeff Kruse (R-Roseburg) said Parsons was going back and forth between endorsing the need for specific criteria and more flexible criteria, saying that it sounded like he  was saying “[The policy board] is going to be less prescriptive, as long as [the CCO] is prescriptive.

“You’re right,” Parsons acknowledged. “We’ve probably confused the issue a little bit with prescriptiveness and flexibility.”

When Rep. Bill Kennemer (R-Oregon City) asked Parsons how many CCOs might be developed, he responded, “some regions may have more than one. Some may overlap.”

One of the major concerns from legislators is how the tri-county area—Multnomah, Clackamas, and Washington counties—will transition into CCOs. “There are several competitors,” said Sen. Chip Shields (D-Portland). “There are hospitals right next to each other. I’m panicked on how this is going to play out for needy, needy populations.”

“I don’t have a crystal ball,” said Lillian Shirley, vice chair of the policy board and the director of Multnomah County’s Health Department. But, “there are a lot of conversations taking place…I would say that I’m optimistic at this point that we will be able to come to some resolution before the deadline. Some of the reasons I feel this way are that we have learned a lot in our region about what each other does.”

“How do they envision these organizations working together?” Shields asked.

“It really has to be a provider driven system,” Shirley responded.

“It’s early,” said Dr. Bruce Goldberg, director of the Oregon Health Authority. “Nothing’s been decided, but they’re looking at how to do this. I don’t want to predispose how that’s going to end up, but it’s clear that there needs to be some organizing framework.”

That organizing framework, he said, might be the current managed care organizations in the metropolitan region, including FamilyCare or CareOregon, which provide benefits to the Oregon Health Plan population.

“Was there any discussion around the idea of past history?” asked Rep. Tim Freeman (R-Roseburg). “We have a lot of organizations that have done this type of thing successful.”

“Experience, background and ability will clearly be part of the criteria,” Parsons replied.

“What if a CCO becomes insolvent?” asked Rep. Jason Conger (R-Bend).

While Parsons’ said “we recognize we need to have a plan in place,” Goldberg was much more direct. “What you do about insolvency is not get there,” he said. “You have to set up the appropriate reserves and monitoring. We understand that different communities are going to have different abilities to take risk.”

Following the presentation, legislators felt a sense of urgency, and suggested that at least one additional meeting be held with the policy board to iron out the details of the business plan.

“We definitely need to get more detail,” said Rep. Val Hoyle (D-Eugene). “There’s so many questions,” and the hour long presentation only gave time for the committees to get at “the tip of the iceberg.” 

Other legislators weren’t surprised that many of the specifics hadn’t been developed such as the criteria for the CCOs, their global budgets, outcome measurements and integration of the dual eligible population.

“They didn’t have anything to work on until October,” said Rep. Mitch Greenlick (D-Portland), a co-chair of the House Health Committee, referring to four workgroups appointed by Governor John Kitzhaber that are working out these issues. The policy board will use their recommendations as the basis for the business plan.

“There’s still not enough detail,” Monnes Anderson said. “[But] it’s not like they are sitting on their hands. It’s a very monumental, overwhelming task.”

Sen. Alan Bates (D-Ashland), said he was “uncomfortable with the amount of information” currently available, and suggested the legislative committee meet in December before the Legislature’s three interim days in mid-January to review the business plan. That, he said, would ensure that legislators have enough time to consider the business plan and offer feedback.

“That is a whole 30 days we could be discussing their initial recommendations,” said Rep. Tina Kotek (D-Portland), describing what currently exists for a business plan as “amorphous.”

Greenlick said he’s in discussions with the House leadership to schedule another meeting during the week of Christmas. “I think we need a whole day meeting,” he said. “I don’t think we can wait until February to see what’s going on. There needs to be an opportunity to give us something substantive for us to react to it.”

That will also give legislators time to gain the support of other lawmakers. “It will be too late for that discussion in February,” Greenlick said.

Goldberg was quick to point out that a draft business plan will be available by December 13.

“It needs to be a pretty complete proposal,” Kotek said. “There has to be a level of detail that stakeholders can respond to.”

Rep. Jim Thompson (R-Dalles) stressed the need for a business plan allowing CCOs to become operational in all parts of the state instead of incentivizing areas, such as central Oregon, which appears to be more ready to start a CCO than other areas of the state.

“There are people lobbying me heavily against moving this forward because they’re not ready,” he said. “We need to have some sort of timeline or plan moving this forward showing statewide readiness.”