A Tale of Two Behavioral Health Systems, or How the State Border Determines Who Gets Access to Mental Healthcare

In July 2025, the One Big Beautiful Bill Act (OBBBA) mandated significant health care funding cuts and policy changes related to low-income health insurance programs like Medicaid and the Children's Health Insurance Program (CHIP) administration.

As of April 2026, 1.59 million Americans had lost their Medicaid insurance because of OBBBA-related cuts. Because of the bill, an estimated 13 million more people will lose their insurance over the next three years. Between direct funding cuts and a massive loss of clients, health care providers around the country were understandably left on edge.

And then the no-cause termination letters started to arrive.

Becky Wolery, the founder of the Oregon/Idaho-based mental health clinic, Insight Matters, first got the news in December 2025: her clinic was losing its Oregon Medicaid eligibility. Going forward, Wolery's Ontario, Oregon-based clinic could no longer accept any new Medicaid patients.

"It was basically a close-down notice," Wolery said. At the Ontario office, 90% of patients are insured through Medicaid. Even existing patients need to renew their prior authorization every six months. Once their existing authorizations had expired, these patients' coverage would be denied.

Wolery panicked. Ontario, population 11,645 — the largest of any in eastern Oregon's expansive Malheur County — was already in a health care desert, despite having the highest rate of Medicaid enrollment of any county in the state.

For years, Wolery had only practiced in Idaho, where she lives. When her clinic had outgrown its first building in Payette, she decided to analyze her patients' demographic data so she could find a new space that best fit her clientele, only to realize that a huge portion of the patients were paying with Oregon Medicaid, crossing the border from Ontario or elsewhere in Malheur County in order to seek out counseling or substance use treatment. She decided to open a second location in Ontario. In less than a year, they had outgrown the first building and had to relocate into a new, larger space. Since then, her practice has been booming.

Now, a total closure was on the horizon. All this, before Medicaid enrollment had really begun to unwind.

Which Side Are You On?

One year after its passage, the implementation of the many fiscal changes mandated by OBBBA — which have been largely managed by individual states — has had vastly different impacts for communities depending on which side of a state border they find themselves on.

For residents of the Oregon-Idaho boundary area, access to care largely depends on which side of the Snake River a person happens to live on. On the eastern, Idahoan side of the border, 4% of state residents were cut from Medicaid in September 2025. Some behavioral health programs — including some that provide funding for peer support and crisis response teams — were cut, but subsequently refunded. Otherwise, business has continued more or less as usual. Although behavioral health providers are anticipating new restrictions to arrive this July, Idaho has yet to experience any seismic shifts to its health care landscape.

This is largely because Idaho had such limited state-sponsored health care services to begin with; the state's 19% enrollment rate is well below the national average. And in the rural communities along the Idaho-Oregon border, behavioral health care access has always been limited.

In Weiser, Idaho, across the water from Ontario, there were no mental health care providers practicing in town until the town's hospital opened a small clinic three years ago. Since then, more clinics have followed — but mostly have sprung up to serve the population being sentenced to court-mandated rehabilitation following drug and alcohol charges. For everyone else, the closest in-patient facility is over an hour away.

"For a small city like us, we have nowhere to take our people that need help," said Weiser City Clerk Natasha McDaniel. "We just put them in jail. And when they come out, they have a criminal record, and it's harder to get a job. It's just a vicious cycle."

So business may be carrying on in Idaho — but it's bad business to begin with.

For Oregonians living on the other side of the Snake River, it's a different story.

In recent years, the Oregon Health Plan, which administers Medicaid for state residents, has significantly expanded Medicaid eligibility. Whereas most states only allow coverage for able-bodied adults below the Federal Poverty Line (FPL) — which is $15,960 for a single person — Oregon enrolls anyone earning less than double the FPL. There have been additional expansions for pregnant people and immigrants.

Because of this, Oregon stands to have the most significant drop in Medicaid enrollment of any state in the nation. In Oregon's rural areas alone, OBBBA will lead to a $4 billion reduction in Medicaid funding through direct cuts and cuts to Medicaid-covered health care services — though most of these changes won't begin to be implemented until late 2027, and some won't take full effect until 2034.

In June 2026, the Oregon Health Authority announced new Medicaid eligibility rules. Beginning in 2027, Medicaid participants will need to renew their coverage every six months (currently, the renewal period is two years). And, beginning in October 2028, copays will be required for many health care services, though emergency care, mental health care, prenatal care, and substance use treatments will be excluded — which will likely reduce access to care even among people who retain Medicaid eligibility. Already, 20% of rural Oregonians delay or skip necessary care due to cost.

And in Malheur County — Oregon's second largest, and one of its most rural — Medicaid enrollment is disproportionately high, relative to other parts of the state: 50% of residents are currently enrolled in Medicaid or Medicare. Among those enrolled in Medicaid (which provides free insurance to low-income people), the vast majority (almost 80%) are children. Nearly 25% have a disability, nearly 50% are Hispanic or Latino, and more than 25% speak Spanish as their primary language. And for residents living outside of Ontario, where all of Malheur County's behavioral health clinics are located, patients may have to drive more than three hours to access a clinic.

Inadequate Response

The federal government has taken some steps to offset these impacts — though economists and health care researchers suggest that the measures made to date will almost certainly be inadequate.

In addition to sweeping Medicaid cuts, the OBBBA established the Rural Health Transformation Program (RHTP), which sought to distribute special funding to rural areas, like Malheur County, to offset the disproportionately high impacts that other portions of the bill would cause in regions already facing worse health outcomes. Oregon's rural residents have been shown to "experience higher rates of chronic disease, including heart disease, diabetes and cancer," said Clare Pierce-Wrobel, Oregon Health Authority (OHA) Director of Health Policy and Analytics, in an interview for KEZI earlier this year. The state was awarded $200 million in RHTP funding.

Across the country, the RHTP has allocated $50 billion to rural hospitals over five years — though the Kaiser Family Foundation, a national nonprofit focused on health policy, wrote in a study published in July 2025 that "Federal Medicaid spending in rural areas is estimated to decline by $137 billion, more than the $50 billion appropriated for the rural health fund." Because of this, an estimated 338 rural hospitals are expected to close, including three in Idaho and four in Oregon — as well as additional closures among private and specialty clinics located outside of hospitals. By the end of 2025, Oregon had already lost an acute care hospital, an inpatient care center, a birth center, six occupational health centers, and four occupational medicine clinics.

In April, the first $21.7 million in RHTP funds was awarded to 12 Oregon-based programs — but none went to projects located in Malheur County. Because so many clinics — like Insight Matters — are funded almost entirely through Medicaid payments, it has been predicted that many rural hospitals and clinics will close despite the patchwork funding provided by the RHTP.

Bad News

In Malheur County, four of the five behavioral health clinics, including Insight Matters, received no-cause termination notices in December. For now, the Insight Matters' Ontario clinic has been able to stay open — in part because of the additional programming they offer, via a grant-funded contract with the Department of Health and Welfare, in schools, domestic violence shelters, and nursing homes. The grant will fund these programs through next year, at which point the viability of the Ontario location will depend on fickle grant funding. Whether or not the clinic closes entirely will depend on whether such grants are renewed.

In the meantime, the clinic's 350 patients, 90% of whom rely on Medicaid, are faced with a choice: terminate care, or cross the river to receive out-of-pocket treatment in Idaho.

"People in these rural areas are used to driving into main areas for services," said April Browne, a Licensed Clinical Social Worker at Family Services Treatment in Weiser, Idaho — a community that got its first mental health care provider just three years ago.

"They're getting on the freeway anyway to go to work. So maybe they're going to attend a group or see a counselor at that time [after work]." Even before the clinics in Ontario began to close, Browne already had several Oregon-based, self-pay clients. But a health care landscape that only offers substantive options to people who can afford to pay out-of-pocket will mean that already stark poverty-related health outcomes will continue to intensify.

This is bad news for a state that has historically had the highest rates of mental health challenges in America. Despite hundreds of millions of dollars in state investments, Oregon has been ranked the worst state in the nation for mental health for several years — more than 30% of the state's adults live with some form of mental illness. With new funding, the state's ability to provide care has improved — in 2025, Oregon was ranked seventh in the country for mental health care access — but wellbeing indexes have yet to follow. Part of the problem is that health care is managed at the county level, and so standards and implementation can be inconsistent at best.

Only one behavioral health clinic in Malheur County, Lifeways, remains to serve the entire population of a county that has a larger area than the state of Maryland — and will need to find a way to provide care to the 800 patients who had previously received treatment at the newly out-of-network clinics.

Lifeways did not respond to multiple requests for comments. But several clinicians working in the region reported that many patients pursuing behavioral health care are hesitant to pursue care there. The clinic has developed a bad reputation because of huge staff turnovers (among its leadership and clinicians), as well as long wait times, and bad personality fits — which research has shown is one of the largest determinants in the success of behavioral health treatment. For patients who don't find a good fit at Lifeways, no other options exist.

Cooked Books?

Which clinics are in-network in Oregon is determined by the different regional coordinated care organizations, or CCOs, that administer the state's health care plans. In the more densely populated parts of the state, several CCOs are available for Medicaid clients to enrol in, based on which providers they want access to.

But for the entire eastern half of the state, only one CCO exists. All mental health dollars distributed through the Eastern Oregon Coordinated Care Organization are managed through Greater Oregon Behavioral Health Inc. (GOBHI).

When the OBBBA was passed, OHA directed the state's CCOs to implement cost-cutting measures, prompting GOBHI to terminate Medicaid eligibility for the three Malheur County-based clinics, according to the termination letters GOBHI distributed. (GOBHI also terminated contracts with several clinics in Harney and Baker counties, also in Eastern Oregon.)

Wolery requested a meeting with the GOBHI CEO to ask why Lifeways was selected to maintain its contract, while other clinics were not. At the meeting, the CEO explained that they had analyzed "network capacity," and found that Lifeways had adequate capacity to meet behavioral health needs, according to Wolery. But when Wolery reviewed the numbers, she found that they were only using Lifeways existing patients in their calculations — and not the 800 patients receiving care at the other clinics.

"I think they're doing false reporting," Wolery said. Earlier this year, Wolery joined four other local agencies to file for an investigation against GOBHI with the CMS, citing multiple NQTL violations of the Mental Health Parity Act. GOBHI did not respond to interview requests from the Daily Yonder.

Wolery also suspects that the need for these cuts might have more to do with general fiscal mismanagement than any immediate OBBBA-related funding gaps. In recent months, GOBHI has been faced with fines and repayment requests related to financial and administrative errors.

It might also have something to do with the who's-who of Eastern Oregon health care. The current Lifeways CEO is the treasurer for the GOBHI board tasked with GOBHI's fiscal decision-making, including how to implement the coming Medicaid funding cuts.

Oregon's Radical Plan Years in the Making

What are residents of these rural regions of Idaho and Oregon to do, in the face of dwindling insurance options and closing clinics and hospitals? In Idaho, social worker April Browne said, "There will just be people that fall through the gaps. We all have community connection. But that's the only thing here that can close those gaps."

In Oregon, there might be another option: the state is currently considering a universal health care plan. Since 2023, a governance board has been developing a policy proposal that could fully fund and implement a single-payer health care option that would cover every resident in the state. It's the first serious effort to establish a single-payer health care system since 2002, when voters overwhelmingly rejected a plan proposed via ballot measure.

For Oregon's rural clinics, which have historically been less likely to withstand unstable funding environments, the plan could have a "stabilizing effect," said the advocacy nonprofit Health Care for All Oregon (HCAO) President Valdez Bravo, who works in health care administration. "The Baker City Birthing Center closed a few years ago, right on the eastern edge of the state. That wouldn't have happened if we had a universal health care system providing stability and predictability to funding," Bravo thinks.

One of the Universal Health Plan Governance Board's (UHPGB) nine members, Chunhuei Chi, helped design Taiwan's first universal health plan in 1995. He's been working on health care finance ever since, and has been involved in Oregon's efforts to implement a universal health plan ever since the last ballot initiative in 2002. In an interview for Willamette Week in May 2026, Chi said the current UHPGB effort is "the closest [to success]. This is probably the closest ever."

If enacted, the plan put forward by the UHPGB could resolve many of the health care funding gaps created by OBBBA. While the draft plan is not set to be released until September 2026, early summary documents released by the UHPGB suggest that the final version will include provisions to provide full insurance coverage to every resident, regardless of income, for all medically necessary services. There would be no premiums, no co-pays, no out-of-network providers, and no Coordinated Care Organizations.

According to a 19-page summary of preliminary recommendations released in April 2026, the plan would cover all necessary physical and behavioral health services, as well as routine vision and dental care and some fertility services, with minimal to zero cost-sharing for patients at the point of service. For patients, there would be no insurance premiums, no deductibles, and no co-pays. And insurance would no longer be tied to a person's job — which could have a huge impact for the 40% of Oregonians who currently do not have coverage through their employer.

The plan would be funded through a combination of federal funding, business contributions, and a progressive income tax. (The income tax would only be on income over 200% of the FPL, or $31,500,) Preliminary analysis shows most Oregon residents would pay less for their care under the proposed plan, and most businesses would pay less in health care costs for their employees.

The UHPGB is due to submit its final recommendations to the state legislature in September of 2026. But whether or not the legislature acts on the plan depends on whether or not it is written into a bill that is then introduced to the 2027 legislative session. In July, a petition circulated by HCAO and the Portland chapter of the Democratic Socialists of America encouraging legislatures to do so had collected more than 4,000 signatures.

If the UHPGB's plan is brought to the session, the legislature could then either vote to pass the recommendations into law as-is — though the HCAO leadership team does not expect that it will — or refer the plan to a ballot measure, which could go before voters in 2028.

If a bill or ballot measure is eventually passed, the new plan would not fully cure Oregon's health care landscape overnight. "There will still be challenges for rural communities that lack services," said Colin Stackhouse, who serves as HCAO's Communications Coordinator and also volunteers on the UHPGB Community Engagement and Communications Committee.

"Rural clinics are closing. This plan won't directly address that," Stackhouse said. "But it will solve the problem for the people in these rural communities who can't see available providers because their local providers don't take coverage. It would solve the insurance coverage access question."

Bravo is optimistic about the plan's potential trickle-down effects. "Right now, we're heading in a direction where there's just not going to be any care offered [to rural residents]. We're going to be like five hours away from what you need." But if more robust insurance infrastructure existed, Bravo is confident that "it will promulgate more care being offered out there in Eastern Oregon."

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