Oregon’s CCO’sWhat They Mean to Your Future

Jeff Heatherington, LHD (Hon)President and CEO

FamilyCare, Inc.

Oregon’s Managed Care History

Began in 1985 with PPO risk model for Medicaid Privatized Medicaid physician services

Coalition of Interests Big business, Small business, State, Advocates,

Providers Legislature authorized Oregon Health Plan in 1989 Began operation in 1995

Oregon Health PlanGoals of the Oregon Health

Reduce cost shift of uninsured Reduce cost shift of under reimbursement by Medicaid Guarantee access to care Expanded Population Coverage Integrate Physical, Mental, and Dental care Prioritize health coverage to the most effective treatments

and prevention – Prioritized List Define covered and non-covered benefits by Prioritized List Create community based care organizations (MCO’s) to

provide health care Fund health care services through an annual set premium. Audit delivery of services by MCO’s to guarantee

compliance

Oregon Health PlanGoals Achieved

Reduce cost shift of uninsured Reduce cost shift of under reimbursement by Medicaid Guarantee access to care Expanded population coverage Integrate Physical, Mental, and Dental care Prioritize health coverage to the most effective treatments

and prevention – Prioritized List Define covered and non-covered benefits by Prioritized List Create community based care organizations (MCO’s) to

provide health care Fund health care services through an annual set premium. Audit delivery of services by MCO’s to guarantee

compliance

Significant Outcomes

Prioritized List Only Evidence-based Benefit Package in U.S.

Client Access 16 successful community based MCO’s

throughout Oregon Integration of Services

Only one plan in Portland Savings

$ 16 Billion since 1995Bi-Partisan support in the Legislature

Health Care TransformationGoals of Transformation

Reduce cost of Health Care Guarantee access to care Expanded Population Coverage Integrate Physical, Mental, and Dental care Define covered and non-covered benefits by Prioritized

List Create community based care organizations (CCO’s) to

provide health care Fund health care services through a Global Budget. Audit delivery of services by CCO’s to guarantee

compliance Cover PEBB and OEBB under CCO’s Establish Insurance Exchange for Individuals

What’s New about CCO’s Full Integration of Mental and Physical Health Better collaboration of providers and social and County

services Changes in Governance Community Advisory Councils

Everyone thinks it’s a whole new ballgame.

Outcomes to Date 14 Certified CCO’s throughout Oregon Integration of Mental and Physical Health

Services Dental soon?

Insurance Exchange Developing Federal Dollars coming in

$ 1.9 Billion Positive Energy about Effecting Change

What’s Left? Mature Integration of Mental and Physical Health Integration of Dental Health Actuarial Soundness of Global Budget Re-Organization of Oregon Health Authority

OHA and DHS not integrated IT Systems not functional or not developed for CCO’s

Rules not yet finished Hospital challenges to the System Funding in current economic environment

What’s Missing?

Access to Primary CareNo Real Attention to Health DemandReal Discussion about Reducing Costs

Future of CCO’s Integration of PEBB and OEBB

Politics undecidedOpposition from commercial insurer’s, Hospitals, Unions are hesitant

Exchange membership questions State General Fund budget implications

Integration of Long Term Care (same issues) Worker’s Compensation Commercial Insurance

Competition vs Integration Self-Insured industries

Rent the system

What Does This Mean For You WHAT DO YOU WANT? WHAT ARE YOU WILLING TO FIGHT FOR?

GDP Revenue going into Health Care is 18% and rising It should be 11% and stable No Health Care Sector is willing to give up their share

What Does This Mean For You As A Purchaser you are currently

Uniformed Misinformed Heavily Marketed Satisfied with insignificant levels of information and facts Not curious Unwilling to challenge your friends in Health Care

WHAT DO YOU WANT?WHAT ARE YOU WILLING TO FIGHT FOR?

CCO MYTHS Quality focus will lower costs

Unit and Utilization Costs? Maybe Prices? NO

Collaboration and Integration will mean better care CCO’s and providers have no skill set for this – YET

Quality outcome incentives will drive the process Not if Primary care continues to be under-paid Not if the reporting/record requirements cost more than

the incentive Not if Price increases as Utilization goes down.

Access to Primary Care

Primary Care Services are Under-reimbursed Physician supply is old and not being replenished Education is too expensive Education system is not responding to the shortage

Need ~ 24,000 new primary care physicians annually Producing a TOTAL of 18,000 new physicians annually

Health Care Demand

Health Care is the service provided for a disease process Disease processes start OUTSIDE of the Health Care System Disease development involves:

The physical, mental, emotional and spiritual development of the individual The environment, Economics, Education, Nutrition, Family dynamics and

relationships, and genetics Reducing the Demand for services starts in the family, the

neighborhood, the schools, the whole community. The Result is what lands in the Health Care System We are paying not only for a broken health care system, we are

also paying for a deficient community system.

Health Care Demand

Health Care is the service provided for a disease process Disease processes start OUTSIDE of the Health Care System Disease development involves:

The physical, mental, emotional and spiritual development of the individual The environment, Economics, Education, Nutrition, Family dynamics and

relationships, and genetics Reducing the Demand for services starts in the family, the

neighborhood, the schools, the whole community. The Result is what lands in the Health Care System We are paying not only for a broken health care system, we are

also paying for a deficient community system.

ACO MYTHS Primary Care Medical Homes will be the basis for

healthcare transformation. Primary care is underpaid by 40-50% and there is no

plan to raise reimbursement Growing shortage of primary care physicians and nurses. You can’t make up the shortage and improve quality by

putting care into the hands of lessor trained people Practicing at the top of one’s license does not mean

putting the patient in an assembly line. It means paying the provider for the time necessary to diagnose and deliver complete patient centered care.

The Reality1. This is not about health care – it is

about money and politics.2. No health care entity will willingly give up

revenue or profit.3. Health outcomes are what will be achieved

after money and politics are decided.4. You have to be prepared to fight for

everything.5. Trust no one – This is about money and

politics.

My Opinions1. You, and your business sector, are 100%

responsible for the current mess. Clean up your own house.

2. Equal attention must be paid to creating healthy communities. Health begins in the community, not in the Health Care system.

3. We need different leaders for change to occur.

Your Choices1. You can do nothing and be a victim2. You can plan for the future and take your

chances3. You can Create the Future and Build a

Healthy Community.