Oregon leads the way- again. Or, is that still? |

In the late 2000s- long before Obamacare- Oregon began considering how it could best manage the health care costs for its poorer citizens. This program eventually became known as the Oregon Health Care Experiment.

Oregon Health Care Experiemtn — http://www.nber.org/oregon/index.html

The state first determined how much money they could afford to spend on health care within the state. OK, that’s pretty much what everyone else does. What Oregon did differently was what they did next. They determined which diseases/problems were most prevalent within the state and average therapy costs for each of these ailments or diseases.

This made it possible to orient how they could provide the most therapy for the most patients, In other words, they had a list of what they would pay to provide the best care for the most people. Before you go around saying that’s heartless or cruel, because it meant some ailments would never be covered by the state (or to use an inane politician’s cry- it’s a death panel), consider this. How do you handle your own corporate or own home finances? Don’t you prioritize your needs and wants- and make sure you cover your needs and as many wants as you can? Why is that wrong when the discussion revolves about health care?

This is absolutely critical- controlling the cost of healthcare in the US is essential to our long-term fiscal health. If we can continue to ameliorate the excessive growth in our healthcare costs, we can keep our tax rates reasonable (rises in healthcare costs like those that obtained before 2010 will demand significant additional tax revenues at the state and federal levels). We simply can’t afford healthcare cost increases that exceed the overall growth in our economy by 1.5% or greater.

And, Oregon is again leading the way. Expecting an incredible $ 2 billion shortfall in the state’s Medicaid situation, Governor John Kitzhaber worked out a deal with the federal government- receiving bridge financing (upfront receipts) in return for a reduction in Medicaid expenses of at least 2% below the national average- yet still maintaining standards of care.

There are now 15 regional CCOs (Coordinated Care Organizations); each with its own budget based upon local constituencies across the state of Oregon. The CCO are responsible to meet standards of costs, outcomes, and quality of care in their efforts to deliver patient-centered care- both primary and preventive medicine.

As of now, emergency room visits have been cut by some 17% (2011-2014), yielding a cost drop of some 19% in that “pigeon-hole”. Maintenance of patients with chronic conditions like asthma and congestive heart failure has lowered the required cost and medical response by even higher levels.

If we can find a way to translate these results nationwide, Medicaid costs between now and 2025 would be some $ 900 billion lower. That ain’t chicken feed.

The problem is that this program may lead to cost-shifting. Hospitals can not be allowed to invent a way to raise the costs to those with private insurance- because they want their cost structures covered. A method to stop this process (cost-shifting)- one long used by healthcare and businesses alike as they seek new revenue- needs to be developed.