CCOs tell Oregon Health Authority to keep medicaid local

October 4, 2018 –

Portland Business Journal

The boundaries and even operators of the Oregon’s 15 coordinated care organizations could change next year, when the Oregon Health Authority awards new five-year contracts.

The CCOs have provided care to 1 million Oregonians on Medicaid, coordinating their physical, mental and dental needs, since they were created in 2012.

Even if they take on more responsibilities, one major aspect of CCO 1.0 that leaders of the coordinated care organizations want to retain in CCO 2.0 is to remain locally based.

“If there’s a secret sauce to the transformation in 1.0, it was that local control,” said Josh Balloch, vice president of government affairs for AllCare Health, a CCO with 50,000 members in Jackson, Josephine and Curry counties. “That’s vital to the long-term success. You can’t export or import health care. It has to be done locally.”

Until OHA receives applications for the next round of contracts, no one knows whether entities based outside of Oregon will apply. Only current CCOs and companies with an existing Oregon footprint can apply, but that could still include out-of-state corporations that currently sell insurance in Oregon, such as United HealthCare or Centene Corp.

The other message several CCO leaders have sent to the state is to allow them the space to meet their members needs as they see fit, without a top-down approach. They hope the next round of five-year contracts, which will be issued next year, won’t be overly prescriptive about how the CCOs spend their dollars.

“We need to thread the needle between clarity of evaluations, with enough flexibility for the work to be impactful for local communities,” said Lindsey Hopper, vice president of Medicaid for PacificSource Community Solutions. “That’s the balance I hope gets struck.”

Each organization has the flexibility to respond to the needs of the local community in different ways, such as partnering with schools or nonprofits on smoking cessation or weight reduction programs.

For example, Intercommunity Health Network, which serves Benton, Lincoln and Linn Counties, uses the “collective impact model,” bringing the community together around a common agenda and measuring results, said CEO Kelley Kaiser. Contracted providers took a pay cut to create a transformation fund, which Intercommunity uses to fund innovative pilot projects.

“We end up being the backbone organization that brings all the organizations together,” Kaiser said. “CCO 1.0 led us to be in that role, and it’s served our communities well. CCO 1.0 said here’s the goal we’re trying to achieve and had the local partners figure out how to get there.”

Each CCO has at least one community advisory council, which can include Oregon Health Plan members.

“Especially as we move into the social determinants of health and connect the pieces of the safety net together, unless you’re locally based, you don’t know where those pieces are,” Balloch said. “I think if you look at other states, they bought into bigger is better and Oregon went in the opposite direction.”

Oregon once had larger players delivering Medicaid services, but many of those entities got out because they weren’t profitable, Balloch said. Then regional groups of providers formed independent practice associations that took on that caseload, later morphing into the CCOs.

One of those groups, the parent company of Trillium Community Health Plan, was scooped up by St. Louis-based Centene, a publicly traded company with $48.3 billion in annual revenue, in 2015. The sale generated a $131 million windfall for Trillium’s owners, while some community members in Lane County raised alarms about the potential loss of local control to a profit-motivated outside corporation.

But Trillium CEO Chris Ellertson said Centene “puts tons of accountability in the local team.”

“My team works closely with local board and delivery systems,” Ellertson said. “I don’t know that I’ve experienced a situation yet where we locally felt we couldn’t do something we wanted to do.”