March 2012 Newsletter

ORH News

Oregon Legislature Wraps Up!

The 2012 Oregon Legislature ended its regular annual session March 5, 2012. Budgets and health care were on the top of the agenda. Passage of legislation to implement Community Care Organizations (CCOs) and the Health Insurance Exchange moves Oregon down the road to health care transformation. Legislators rebalanced the budget to meet shortfalls since the budget was passed during the 2011 Session.

You can find additional information on the session including staff summaries and bill histories by visiting the Oregon Legislative website.

Health Care Transformation – CCO Implementation (SB 1580)

In 2011, the Oregon legislature passed legislation to transform the way health care services are delivered through the Oregon Health Plan with the goal of improving care and lowering costs. The legislation created Coordinated Care Organizations (CCOs) - local health entities that will deliver health care and coverage for people eligible for the Oregon Health Plan (Medicaid), including those dually eligible who are covered by Medicare. CCOs will be accountable for health outcomes for the populations they serve and will create new models of delivery that are patient- centered and team- focused. They will be “governed by a partnership among health care providers, community members and stakeholders in the health systems that have financial responsibility and risk.”

SB 1580 gives the go- ahead for the Oregon Health Authority (OHA) to draft rules and implement the new CCO program. A Waiver has been submitted to the Centers for Medicare and Medicaid Services (CMS) and the federal government has signaled a willingness to commit up to $500M per year for five years to support Oregon’s transformation effort.

“It is a fast timeline,” says Scott Ekblad, Director of the Oregon Office of Rural Health (ORH). “We will all need to pay attention to the rule making process. This is health care transformation and things will look different when it is finished.”

The legislation included an eight-member work group led by the Governor to address the issues of liability reform. The work group will bring legislation to the 2013 session.

Insurance Exchange (HB 4164)

A key part of health care reform at both the state and federal levels is the Health Insurance Exchange (HIE). The HIE is not an insurance company but a “marketplace” where insurance companies will offer health insurance with coverage options for individuals, families, and small employers. In 2011, the Oregon Legislature passed Senate Bill 99, which established a public corporation to administer the Oregon Health Insurance Exchange. Senate Bill 99 required the public corporation to submit a formal business plan to the Legislature for approval, which was done in HB 4164.

HB 4164 was amended to allow school districts to opt out of the Oregon Educators Benefits Board (OEBB) beginning in October 2015, but only if the district buys its insurance through the HIE. With approval of HB 4164, the HIE can now move forward with implementation.

Budget Rebalance (SB5101)

A top agenda item for the 2012 Session was the rebalance of the budget passed by the 2011 Session. The bill was one of the last to make it out and spared the Oregon Health Authority (OHA) from major cuts.

The 2011 legislature passed an $11.9 billion budget. Due to revenue shortfalls as a result of slower economic growth, the legislature cut $26 million general fund dollars. However, after much negotiation, the legislature used three separate revenue sources to bring those cuts down to $10 million.

SB 5101 instructs state agencies to eliminate middle management positions in order to “streamline”. Impact to the Oregon Health Authority will be approximately $5 million. Positions to be cut have not been determined.

Legislators also tapped into the state’s rainy day fund as well as other reserves. The OHA was directed to use $16.8 million in insurance taxes for children’s healthcare programs. They also used $5.7 million from a housing trust fund to continue funding for community services to children and adults with mental illness, preventing cuts to community mental health and additional services.

The Oregon State Hospital was impacted by the cuts. Four new wards that were scheduled to open this year will be opened in 2013, saving the state $19.6 million.

Oregon's Healthcare Transformation

Oregon’s Community Care Organizations (CCOs) —What Are They and Why Should We Care?

During the 2011 Session, legislators passed HB 3615, which laid the groundwork for the development of CCOs and moved the state far along on its road to health care transformation. HB 3615 required the Oregon Health Authority (OHA) to return to the 2012 legislature with a plan to implement the CCOs and they did so in SB 1580.

So what is a CCO?

CCOs are a new legal entity that will coordinate health care services among various providers including primary care physicians, hospitals, behavioral health professionals and dentists. By law, CCOs can be local, community-based organizations or statewide organizations with community-based participation in their governance, or a combination of the two.

Who gets to be a CCO?

The OHA is currently accepting -requests for applications to create the CCOs. There are organizations throughout the state currently developing CCOs. CCOs will be made up of local providers, hospitals, clinics, public health, local government and consumer representation. There is no set number of CCOs expected and it will depend on how each applicant attempts to serve its chosen geographical area.

Legislation requires a CCO’s governing body be made up of those who share in the financial risk of the organization, major components of the health care delivery system such as hospitals and outpatient offices and members of the community. CCOs will also have advisory councils primarily comprised of consumers and will include local government and community representatives.

Who will be cared for by a CCO?

CCOs are focused on serving the 600,000 people covered by the Oregon Health Plan and other state Medicaid programs (except individuals receiving nursing and other long-term care) and the Medicare enrollees who are dually eligible for Medicaid. CCOs will replace the managed care insurers that currently serve OHP enrollees. While they are currently not included in the CCOs, teachers, other state employees and children who receive state assistance with their health insurance premiums may be included in the future.

How will CCOs keep people healthier?

Health care is currently delivered in a very fragmented manner with little coordination between various providers. And providers are paid for treating illness rather than for preventing people from being ill. Patients suffering from chronic conditions are not receiving the coordinated services they need to stay healthy. CCOs will coordinate that care in a patient centered primary care medical home with a team model that is focused on keeping people from getting sick. The new payment structure pays for preventions and outcomes, not for visits.

Will CCOs really save money?

The legislature anticipated that CCOs would save the state $239 million in 2012-13. The state will do this by pre-paying CCOs an amount, called a “global budget,” for comprehensive care of each enrollee. The money will come from multiple federal and state funding sources. CCOs will, in turn, reimburse their providers based on the quality of the care they deliver — how healthy they keep their enrollees — rather than the volume of services they provide.

The federal government has agreed to support Oregon’s transformation process over the next five years. They believe if Oregon can successfully change how health care is delivered, similar programs could be implemented in other states saving the federal government billions of dollars.

What’s the difference between an Accountable Care Organization (ACO) and a CCO?

Accountable Care Organizations (ACOs) are a central part of the national health care reform legislation. Much like a CCO, they encourage providers and provider sites to come together to improve the quality and lower cost of care for Medicare patients. Oregon’s CCOs are similar but are focused on OHP and Medicare dual eligible patients with the hope that more people will be included in the future. To read more on the comparisons between ACOs and CCOs, click here. Compare ACOs and CCOs

Is there more information on CCOs available?

Yes. The sites and documents linked below will help you better understand CCOs.

What Will CCO Rules Mean for You? - Regional Meetings

Attend one of the five regional meetings that will be held around the state to discuss CCOs and their impact on Oregon.

Meeting dates and locations are:

  • Monday, April 2nd / Bend / The Riverhouse
  • Wednesday, April 11th / Hood River / Hood River Inn
  • Tuesday, April 17th / Portland / The Doubletree Lloyd Center
  • Thursday, April 19th / Eugene / Lane Community College
  • Tuesday, April 24th / Medford / The Red Lion

The ORH will continue to track and update these developments as they happen.


Grand Ronde Hospital has received the Health Devices Achievement Award from the nonprofit ECRI Institute. The award recognizes excellence in patent safety, reduced costs and health technology.

Tillamook county General Hospital’s Tillamook Home Health has been named to the annual HomeCare Elite, a compilation of the top-performing home health agencies worldwide.

Mark Your Calendars!

29th Annual Oregon Rural Health Conference & 4th Annual Apple A Day Dinner and Auction
October 24 - 26, 2012
Salishan Spa & Golf Resort, Gleneden Beach
Learn more

National Brain Awareness Week
March 12 – 18, 2012
Learn more

National Public Health Awareness Week
April 2 - 8, 2012
Learn more

Youth Sports Concussion: Definition, Assessment, Research and Oregon’s Max’s Law
A conference for medical providers, school administrators and staff, athletic directors, trainers and coaches.
Saturday, April 21, 2012
St. Charles Conference Center
2500 NE Neff Rd, Bend OR, 97701
Learn more

Nominate your 2012 Hero of the Year!

Every year, the Office of Rural Health awards the rural Hero of the Year award to someone who has made an impact on health care in rural Oregon. It can be a provider, a teacher, a local leader, activist, provider group or volunteer.

Get all the details on how you can nominate your Hero now!

Primary Health Care Loan Forgiveness Program

Are you a medical, physician assistant or nurse practitioner student enrolled in an approved rural specific Oregon training program, or do you intend to enter a Primary Health Care Loan Forgiveness Program?

You must submit the application packet and other accompanying required documentation by Monday, April 30, 2012.

Students are encouraged to apply early!