The Oregon Health Authority has reached an agreement with its coordinated care organization partners that will end any future clawbacks of money the the state agency has disbursed to them to administer the Oregon Health Plan -- unless directed by the Centers for Medicare and Medicaid Services.
“It does not touch existing litigation, but it sets for a path for greater transparency,” said Rep. John Davis, R-Wilsonville.
Some CCOs, led by Portland-based FamilyCare, had sponsored legislation to end the agency’s practice of takebacks -- a move the Oregon Health Authority made in August to reset CCO payments for 2015, mid-year, according to a better actuarial analysis -- and a power the agency retained in the amended 2016 Medicaid contracts.
That legislation -- House Bill 4107 -- sailed through the House of Representatives before facing opposition from the Oregon Health Authority, which tried to delay the bill’s impact till next year or longer. The bill’s supporters, including Davis, said the point of the legislation was to protect CCO finances for this year and override the clawback authority the agency gave itself in the amended contract.
The dispute came to a head this Tuesday when Oregon Health Authority Director Lynne Saxton took to the stand and warned the legislation could affect its dispute with FamilyCare and order the state to pay the full $532 million for the healthcare of FamilyCare members without federal support.
But after a pair of long meetings convened by Sen. Alan Bates, D-Medford, the health authority, the attorney general’s office, CCOs -- including FamilyCare and its competitor Health Share -- and Davis all came to agree on an amendment that makes clear the law does not affect those 2015 contracts, and gives the state agency more express permission to follow the direction of the Centers for Medicare and Medicaid Services.
“OHA is neutral and we appreciate the clarity the bill provides going forward,” said Robb Cowie, the Oregon Health Authority spokesman.
“CCOs can get a global budget for a year, plan their investments for their year and know where they stand,” Bates told The Lund Report. “There can’t be a clawback for a CCO unless there’s direction from CMS.”
The consensus amendment passed out of the Senate Rules Committee on Thursday by a unanimous vote. It’s hard to say exactly which day the Senate will vote on it, but Republican bill delays have created a long docket for the Senate to consider, and HB 4107 will likely be put at the end of that line early next week.
The agreement came just as the federal government weighed in, approving the 2015 contracts for 15 of the state’s 16 CCOs, while refusing to approve the rates for FamilyCare, which are currently in dispute. However, the letter states, “If the Oregon Health Authority submits a contract action with FamilyCare including calendar year 2015 capitation rates that are consistent with the approved rate ranges included in the August 2015 certification, CMS will consider the rates in those contract actions to be actuarially sound.”
FamilyCare spokeswoman Cindy Becker said that this could open the door for the state to resolve its conflict with FamilyCare if it agrees to the CCO’s position that it receive the average payment rate for the Medicaid expansion population as determined for the Portland Metro area by Optumas, the actuarial consultants Oregon hired from Arizona to reset last year’s rates according to more rigorous standards.
This would leave FamilyCare with a lower rate than it received in 2014, a lower rate than the state’s initial offer in 2015, and lower than Health Share, but higher than the rates the state wanted to impose upon FamilyCare in August -- which would have easily been the lowest in Oregon.
It would also still force FamilyCare to eat a clawback, albeit one about half of what the state has been demanding: “After receiving the average rate range for the ACA population, we would pay a net of approximately $25 million to the state for 2015,” Becker said.
