Oregon Emphatic on Expanding Medicaid

While some states have debated whether to expand Medicaid as part of implementation of the federal Affordable Care Act, Oregon appears not even to have considered the possibility of saying no.

Led by an activist governor, John Kitzhaber, Oregon has proceeded as if health care reform was a foregone conclusion.  In fact, the governor, a former emergency room physician and one of the country's acknowledged health care policy experts, has taken action to put the state ahead of almost all others, contending there is no choice but to reform a system that could threaten to bankrupt the state budget.

Kitzhaber encouraged the state to develop an online health insurance shopping center before there were any federal rules on such health insurance exchanges. He proposed a new approach to delivering health care to Medicaid recipients through "coordinated care organizations" and prodded the legislature to go along with him. In the new budget Kitzhaber unveiled for 2013-15, he continued moving down the road aggressively toward reform.

Lawmakers, even with a nearly even split between Democrats and Republicans in the 2011 legislative session, went along with the governor in large numbers. The vote on the underpinning of reform, Senate Bill 1580, passed on a party line vote in the Senate, but cleared the House by a wide margin, 53 to 7.

Few legislators went on record with statements in opposition to reform, though a couple Republican voices in the Senate asked whether the state wanted to get linked up with Obamacare when so little was known about long-range costs.

Last week, one Republican said he was concerned that the governor had included Medicaid expansion population in his Oregon Health Plan budget recommendation, exposing the state to unfunded costs down the road.

Meanwhile, other states have moved more slowly than Oregon. An Associated Press story this week reported several governors have resisted submitting to the federal directives.

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Huge Issues Loom in 2013 Session

The short 2012 session just ended and there are nine months until the 2013 legislature convenes, but it is still timely to look ahead at the issues that need resolution or are just ripening for action.

At the top of the list is how Governor Kitzhaber's health care transformation strategy will work and whether newly forming coordinated care organizations can squeeze out cost savings in serving Oregon's Medicaid population. The health insurance exchange will get up and running, just as the federal health care reform measure lands in the U.S. Supreme Court, which could toss some or all of the controversial reform legislation.

Despite a slow economic recovery, many parts of Oregon still feel the after-effects of recession and could benefit from state efforts to boost employment. Strong differences exist between Republicans and Democrats on how to stimulate job growth, especially in rural Oregon.

As a result of education reform measures pushed by Kitzhaber, K-12 school districts are signing achievement compacts to promote improved student learning. A question remains whether this reform will under-perform or have unintended consequences as have previous reforms such as No Child Left Behind and Race to the Top.

Lawmakers in February approved a measure that deals with home foreclosures. However, consumer advocates felt it didn't go far enough, while bank and title company officials said it might not work as expected.

Kitzhaber, who will be entering the last two years of his third term, has vowed to give tax reform another shot. This has proven to be as elusive as the pot of gold under the rainbow. While a majority of Oregonians feel the state's current tax system isn't sustainable, there is no clear consensus on how to refine or replace it. A state sales tax is certain to make another stage appearance, with a few clapping and others throwing big red tomatoes. 

Local governments are pressing for expanded access to property tax revenues. They are looking for authority to exceed property tax rate limitations for voter-approved levies. The temporary state hospital tax expires and hospital interests may be less willing to go along with an extension after proceeds were diverted from their original purpose.

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