Kaiser Permanente Northwest's decision last week to leave the Oregon Health Plan by next July, forcing 12,000 low-income patients to find new doctors, should worry all of us.
That's because it's not a problem faced only by the health plan, which helps the poor and uninsured. The Oregon Health Plan is under the same economic pressures, including double-digit cost increases, as the rest of the health care system.
Kaiser's move, of course, is disruptive for the patients who will no longer have access to the giant HMO's doctors, pharmacists and other providers.
Kaiser has pledged to do what it can to ease the transition and will continue to care for the neediest patients, said Denise Honzel, vice president and health plan manager for Kaiser.
Still, it will be hard to find doctors willing to take on new Oregon Health Plan patients because of the low reimbursement rates the state pays for these patients.
As an example, the state pays primary care doctors an average of 40 cents on the dollar for Oregon Health Plan patients, says Jim Kronenberg, associate executive director of the Oregon Medical Association.
'The reimbursement doesn't even cover the cost of the care,' he said. 'Most physicians don't like to talk about it, but a lot of them are saying, 'I can't take any more health plan patients. I lose money on them every time I see them.' '
Because of these economic realities, no one seems to blame Kaiser for dropping health plan patients. After all, the other big insurers stopped covering Oregon Health Plan patients long ago, including Regence BlueCross BlueShield of Oregon, ODS Health Plans and Providence Health Systems, though Providence still covers about 8,000 Oregon Health Plan patients.
'We determined we were serving fewer people and spending more money,' Honzel said. 'We want to find a better way to contribute to the community.'
Kaiser Ñ which at its peak covered 25,000 Oregon Health Plan patients and currently serves about 12,000 Ñ is projecting a loss of $18 million this year because of the health plan.
So what happens to these patients dropped by the big insurers?
The state contracts with about 15 smaller insurers, most of them nonprofit, that will try to absorb many of these patients. The largest, CareOregon Inc., already covers about 90,000 health plan patients.
CareOregon spokeswoman Ruby Haughton says these organizations will work hard to find doctors who will take on Kaiser health plan patients.
They did it before, when they absorbed health plan patients dropped by the other insurers.
The Oregon Health Plan's problems could cost all of us when access to health care becomes more difficult for patients displaced by private health insurers.
'When patients don't get interventive care early, they will end up in the hospital or needing a higher level of health care at a higher economic cost,' said D'Anne Gilmore, executive director of the Oregon Coalition of Health Care Purchasers, a coalition of public- and private-sector health insurance purchasers, which covers about 400,000 members.
'That affects everyone. Someone has to pay those costs and a certain amount of cost shifting will happen,' Gilmore said.
One solution advocated by the coalition is to encourage doctors and other providers to be more accountable for costs and performance and for consumers to take a more active role in finding the best value for their care.
'It's time for us to go back and look at the fact that ultimately, health care is financed by all of us,' Gilmore said. 'How do we take a look at that and make sure that what we're paying for makes sense?
'It is time we start figuring out collectively what works and what doesn't.'