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June 2009 St@teside

Oregon Passes Landmark Reforms

Despite a remarkably challenging economic environment, Oregon, a state with the second highest unemployment in the country, passed a comprehensive health reform package. On June 11, 2009, the state legislature approved companion House Bills 2116 and 2009 which were designed to work in tandem to both expand coverage and control costs.  

The passage of these landmark reforms represent a culmination of years of effort and focus on not only improving coverage, but improving health care delivery and reducing medical inflation in the state. Oregon has been a strong partner with the SCI program, most recently as one of 12 states participating in the Coverage Institute, which helped support much of the work leading up to the passage of the bills.

House Bill 2116 will leverage nearly $2 billion over the next four years to help the state provide health insurance for 200,000 Oregonians through the Oregon Health Plan (OHP) and a new subsidized product called “KidsConnect” for families between 200 and 300 percent of the Federal Poverty Level (FPL). Funding will come from a 1 percent assessment on most health insurance premiums and a 2.8 percent hospital tax on net revenues, combined with matching federal funds.  The state expects 80,000 of the newly insured will be children under the age of 19 and the remaining will include an expansion of 35,000 low-income adults and an estimated 88,000 additional low-income and disabled individuals. 

House Bill 2009 includes several steps designed to create major reductions in health care costs and bring more efficiency and transparency to the system.  The reforms include the streamlining of multiple state health care agencies into one Oregon Health Authority governed by a citizen-led Health Policy Board, the simplification and standardization of transactions between medical providers and insurance carriers, and a requirement to collect all medical claims data in order to develop tools to help consumers compare the cost and quality of care. Other initiatives in the reform package will address health care workforce shortages, statewide electronic health information exchange, guidelines for a primary care home model and a business plan for a state health insurance exchange.

Governor Kulongoski plans to sign the bills shortly after the close of the legislative session this month.