August 21, 2014

Oregon Medicaid Reforms Begin to Show Results

  • The American health care system is a patchwork of public and private programs that serve citizens in different ways, depending on their age, military...

As more people gain health insurance coverage, policymakers should focus their efforts on making the health care system more efficient so it can meet the increased demand for services.

Oregon has experimented with payment and delivery reforms in Medicaid in ways that could serve as a model for possible solutions to this challenge.

In 2011, the state divided its Medicaid providers into coordinated care organizations serving 15 regions, with each CCO receiving a fixed amount of money to care for each patient.

By encouraging cooperation among providers and introducing patients to less expensive types of care, the CCOs have allowed Oregon to make progress towards higher quality care that leads to better health outcomes at lower overall costs.

So far the results have been encouraging; emergency department visits among Medicaid enrollees have declined since 2011, and spending on such visits has declined 18 percent.

States trying to improve their own Medicaid system should consider Oregon’s forward-thinking payment and delivery reforms as a model to produce savings and develop a more integrated and effective health care system.