Oregon to increase payments for Health Plan members

Next year, Oregon will pay an average of nearly $630 per member every month to the organizations arranging providers for the vast majority of Oregon’s 1.4 million Medicaid members under new fixed payment rates announced by the Oregon Health Authority.

While the new rates — a 6.1% increase from this year — still need formal approval by the federal government, the agency said in a Monday news release that it expects the U.S. Centers for Medicare & Medicaid to approve the rise by the end of 2026. The health authority said the increases will ensure healthcare remains accessible statewide in light of people losing coverage due to federal policy changes and rising healthcare costs.

“Oregon Health Authority remains focused on ensuring people enrolled in the Oregon Health Plan can receive quality healthcare well into the future,” Rochelle Layton, the Oregon Health Authority’s chief financial officer, said in a statement. “Our updated 2027 rates support the financial stability of the coordinated care organizations that help us deliver Medicaid benefits across the state.”

The increase for payments to Oregon’s 15 coordinated care organizations is lower than last year’s rate increase at 10.2%, but it aims to stabilize the health market in Oregon at a time when operating margins have been slow to climb for providers who are reliant upon the model and state funding. 

Providence Health Assurance, which is contracted with a coordinated care organization, for instance, announced earlier this year that it would be ending coverage in Oregon. The organization cited an untenable financial environment, and its members by 2027 will transition to CareOregon for their coverage instead.

The increased dollars to coordinated care organizations also come after the payment structure has faced increased scrutiny for its use of taxpayer dollars. A September audit from the Oregon Secretary of State’s Office found that the health authority made up to $4.1 million in erroneous payments through its fixed monthly payment program to the local insurers.

Amy Bacher, a health authority spokesperson, stressed in an email that the audit found a low payment error rate and that “OHA already takes steps to identify these instances and follow-up proactively.” The audit found that 0.0004% to 0.0064% of Medicaid program spending over the past few years involved duplicative monthly fixed payments.

“This low percentage is the result of coordination between OHA, federal and state partners, ensuring strong accountability for taxpayer funds while keeping healthcare accessible and sustainable for Oregon,” she said. 

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