Summary of Oregon’s Public Option Implementation Plan

Summary of Oregon’s Public Option Implementation Plan

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In the 2021 legislative session, Democratic Governor Kate Brown signed  House Bill 2010 into law, setting in motion the groundwork for legislation to authorize the creation of a public option program in 2022. Over the next six months, the Oregon Health Authority (OHA) and the Department of Consumer and Business Service (DCBS) will prepare an implementation plan for a state-supported public health plan (i.e., public option). The report, due January 1, 2022, will guide public option legislation in the coming year. 

Implementation Plan Recommendations

The law requires OHA, in collaboration with DCBS, to develop an implementation plan for a state public health plan (i.e., public option program) that would be offered in the individual market. The plan may also be offered in the small group market. The implementation plan is due to the Legislative Assembly no later than January 1, 2022. This report must also include additional state authority needed to implement the public health plan or legislative changes needed to secure federal waivers or federal funding.

OHA is provided with $650,000 to support development of the implementation plan, which may include contracting with external experts to conduct analyses. OHA and DCBS must analyze the following elements:

  • Potential federal opportunities to support a state-supported public health plan, such as federal waivers;

  • Which populations are most in need of new coverage options, and how options could be tailored to the needs of specific populations;

  • The effect of a public health plan on the overall stability of insurance markets in the state;

  • How the American Rescue Plan Act of 2021 (ARP) (P.L. 117-2) and other federal program changes may improve access and coverage and how these changes inform state policy options related to developing a public option; 

  • How a state-based technology platform could further the implementation and accessibility of a public health plan;

  • Adverse consequences of certain design elements the state may wish to avoid, including not adopting a state public health plan;

  • The level of additional subsidies that would help Oregonians afford health care; and

  • Coverage strategies developed by the Task Force on Universal Health Care, which is tasked with developing recommendations for a universal health care system.

OHA and CBS may use previous studies, such as the “Oregon Public Option Report: An Evaluation and Comparison of Proposed Delivery Models” (December 2020) prepared by Manatt, Phelps and Philipps; research and consultation from the Task Force on Universal Health Care, and other relevant studies or reported completed within the past five years. Of note, Chiquita Brooks-LaSure, the Administrator of the Centers for Medicare and Medicaid Services (CMS) was the lead author of the Oregon public option report. In the report, the authors assessed three public option delivery models: (1) a coordinated care organization (CCO)-led model; (2) a carrier-led model; and (3) a state-led model in partnership with a third-party administrator (TPA).

The analysis will culminate in an implementation plan with recommendations that address the following key program design components:

  • Administration – The operating structure and governance of the public health plan, including which agency will administer the plan and how a delivery system will be procured;

  • Delivery System – How the state can leverage existing state-backed plans or networks, such as CCOs and plans offered by the Public Employees’ Benefit Board (PEBB) and the Oregon Educators Benefit Board (OEBB), to offer a more affordable option;

  • Out-of-Pocket Costs – How the state can lower out-of-pocket costs to reduce barriers to care;

  • Health System Transformation – How the plan can advance the state goals of health system transformation including but not limited to:

    • The use of value-based payment and global budgets;

    • Eliminating health disparities;

    • Aligning quality and access metrics; and

    • Meeting the state’s cost growth target;

  • Cost Containment – Options and opportunities for the state to leverage state purchasing power to ensure program affordability and ensure that per capita costs stay within the cost growth target;

  • Health Equity – Ways to eliminate health inequities in the next 10 years;

  • Infrastructure

    • Other structural and program changes the state could make to ensure successful implementation of any plans developed, including how a state-based technology platform could enhance the implementation and accessibility of the plan;

    • Enrollment infrastructure that may be needed by coordinated care organizations, if CCOs are the recommended delivery system, to enroll members, in a separate program;

    • Outreach infrastructure and investments that would support educating people in the state, particularly communities of color and populations with above-average uninsured rates, about available options for subsidized coverage and newly available options under ARP and support increasing enrollment of eligible individuals in existing programs that provide affordable coverage; and

  • Statutory Changes – Additional authority needed to implement recommendations.

 Regional Global Budget Health Care Delivery Model Pilot

 The law also requires OHA to submit a report to the Legislative Assembly with recommendations for a global budget health care delivery model pilot. The recommendations must take into account state and private participation in the health insurance exchange and may include employer-sponsored plans; and be aligned with the state goals for health care transformation (noted above). This report is due July 1, 2022.

With support from Arnold Ventures