HOUSE COMMITTEE ON

AUDIT & HUMAN SERVICES BUDGET REFORM

 

 

March 31, 2003   Hearing Room 50

3:00 PM Tapes  75 - 76

 

MEMBERS PRESENT:            Rep. Ben Westlund, Chair

Rep. Steve March, Vice-Chair

Rep. Jeff Kruse

Rep. Jeff Merkley

Rep. Alan Bates

 

MEMBERS EXCUSED:            Rep. Randy Miller

Rep. Susan Morgan, Vice-Chair

 

GUEST MEMBERS:               Rep. Mitch Greenlick

                                                Rep. Carolyn Tomei

 

STAFF PRESENT:                  Rick Berkobien, Committee Administrator

Kelly Fuller, Committee Assistant

 

ISSUES HEARD: Invited Testimony Only

                                                Jeff Heatherington and Ruby Haughton, representing the Coalition for a healthy Oregon

 

                                                “Fully capitated health plans’ comments on the committee’s recommendations and other strategies to improving the OHP service delivery system”

 

These minutes are in compliance with Senate and House Rules.  Only text enclosed in quotation marks reports a speaker’s exact words.  For complete contents, please refer to the tapes.

 

TAPE/#

Speaker

Comments

TAPE 75, A

003

Chair Westlund

Calls meeting to order introduces the invited testimony and opens the informational meeting.

INFORMATIONAL MEETING

040

Jeff Heatherington

Legislative chair, Coalition for Healthy Oregon.  Informs the committee on his response of the committees recommendations and that he supports the package presented (EXHIBIT A).

028

Ruby Haughton

Director, Legislative and Public Affairs Care Oregon. 

108

Heatherington

Explains the process of purchasing drugs and rebates involved.

111

Chair Westlund

Comments that the methodology of a single purchaser makes sense.

112

Heatherington

States they are proposing the state be the purchaser of all the drugs so they would be doing the negotiation.

118

Rep. Kruse

States he does not see how that would be different than running the business the way you are now.

124

Heatherington

Comments we would prefer to keep the program as a decapitated model.

125

Rep. Kruse

Notes the assumption was you would still control.

126

Heatherington

Answers they would have control but the state would have the risk.

127

Rep. Kruse

States we are proposing we keep the risk.

129

Heatherington

Answers the understanding is the less the state buys drugs for Medicaid it can not get the maximum discount.

130

Rep. Greenlick

Notes that is why the suggestion was the state be the contractor with PBM and we would pay the state.

133

Heatherington

Confirms that we are trying to find a way to get the fifteen point one rebate.

145

Rep. Kruse

Comments the state is paying for the drugs one way or another

147

Chair Westlund

Asks the difference of the rebate between branded and generic drugs.

148

Heatherington

Answers the fifteen point one in the report is tied to branded drugs and eleven percent on generic drugs.

149

Rep. Kruse

States the fifteen point one is negotiable also.

169

Heatherington

Answers that is the federal rebate, the bottom line is the more that the state can purchase the more your bargaining power will be.

179

Rep. Kruse

Asks if the fifteen point one is the best we can do.

181

Heatherington

Notes you will have to ask someone from the state that question.

183

Rick Berkobien

Asks if the model you are proposing has been tested in other states.

185

Heatherington

Answers it is our own creation and continues to inform the committee on additional recommendations in the report.

242

Chair Westlund

Comments that we will figure this one out

250

Heatherington

Continues to explain other issues in the report.

273

Chair Westlund

Notes for cost utilization and reimbursement we put the full Price Waterhouse Cooper’s amount in the report and reductions will have to be made to it to make it work.

284

Rep. Kruse

States we are looking more at utilization and some hydraulics to gain control more than reimbursement rates.

287

Heatherington

Continues to inform on cost reductions and reimbursements.

339

Chair Westlund

Notes we are trying to get fee for service into fully capt.

348

Rep. Kruse

Asks how many fee for service hospitals are there.

264

Heatherington

Comments on the hospitals that are fee for services.

375

Rep. Kruse

Asks for a new map.

385

Heatherington

Indicates he will provide one.

388

Rep. Bates

Comments on the counties that could but don’t have health plans.

TAPE 76, A

001

Heatherington

Answers on the issue where the counties that do have a health plan and people are enrolled but haven’t been assigned.

026

Rep. Kruse

Asks that for the categorical population is there a lot of churning.

033

Heatherington

Responds no, and elaborates.

040

Rep. Kruse

Asks if this is just a management issue.

043

Heatherington

Responds yes, and continues presentation.

093

Rep. Greenlick

Why is it in the best interest to get those not living in the state off the plan.

099

Haughton

Comments that these people return to us when they are having medical difficulty.

102

Chair Westlund

Under the recommendations that we put out of this committee there is no such thing as a premium.

104

Rep. Greenlick

Comments that it seem to me that if someone that is out of state for 3 to 4 months and they are receiving premiums and was just wondering why Care Oregon cares that they get paid the premium while these people are out of the state.

112

Haughton

Comments that if they are not a resident of Oregon they should not be collecting a premium from us and elaborates.

141

Heatherington

Folks come into the state just for the Oregon Health Plan while they need services, it is these people that we are trying to screen and continues presentation.

269

Haughton

Comments that Medical Directors will be here on this week and will be able to provide more detailed information.

289

Rep. Kruse

When you are talking about integration of severe and mental health, how much of that risk are you willing to take.

298

Heatherington

Quite a bit if the numbers are good and elaborates.

327

Chair Westlund

Most of the cost for the severely and persistent mentally ill is on the physical side of the equation.

332

Heatherington

Asks if we could call up Terry Copeland, as he is the expert in this area.

334

Terry Copeland

CEO of LIPPA, the question is about severely and persistently mentally ill patients and the carve out, gives details about this are.

350

Chair Westlund

Asks if he could define severely and chronic mentally ill.  Asks if we are talking apples to apples here.

352

Copeland

Responds yes.

357

Rep. Kruse

Asks if we are talking about people in group homes and residential care folks here or what.

360

Copeland

Comments that he can’t identify those patients in terms of who they are categorically, those are handled by the mental health carve out and elaborates.

362

Rep. Kruse

Asks how much of that is just drugs.

367

Copeland

Comments that he thinks it is about thirty percent and that would be a combination of prescription drugs and seven eleven drugs.

371

Rep. Greenlick

Comments that those are psychiatric drugs and you are counting those on the physical side or the mental health side and elaborates more.

378

Copeland

Comments yes, partially but about half of the drug costs are prescription drugs non mental health.

382

Heatherington

States it would be best to come back with s more detailed definition of the different groups.

388

Rep. Greenlick

States his experience that when you combine the mental health costs in a physical health system, the costs are modest for mental health, but when you start dealing with the very seriously disabled that are in the category that you are talking about, it is only true if you don’t do what needs doing which is hospitalizing and etc.

439

Rep. Kruse

Comments on those in residential treatment and the risks involved.

424

Rep. Bates

Asks if those plans also have non-MHO’s, for non Medicaid patients.

430

Heatherington.

Answers Family Care contracts with handles mental health services for commercial insurers and some Medicaid insurers.

446

Rep. Bates

Asks if they are being reimbursed the full cost of taking care of the  Medicaid population as far as mental health is concerned.

450

Heatherington

Answers the rates paid to mental health providers are below what is received in the commercial system.

464

Rep. Bates

Asks what is happening in the Methadone program.

473

Heatherington

Answers they are covering the Methadone drugs for the standard group.

485

Rep. Bates

Asks if the duties that OMAP performs is going to be part of the discussion with the Medical Directors later in the week.

493

Heatherington

Responds to what may or may not be discussed.

TAPE 75, B

066

Rep. Bates

Asks if they will be coming back after that meeting  so we may hear what the proposals are.

071

Heatherington

Answers they will be hearing from other parts of the medical fields and will come back with answers.

082

Chair Westlund

Notes make sure to cover the rebate issue on the calculations of the bifurcated figures.

089

Heatherington

States they may describe what the rates are but they will get the numbers also.

101

Chair Westlund

Calls informational meeting to a close and adjourns committee meeting at 4:48pm.

 

 

EXHIBIT SUMMARY

 

A – Informational, prepared material, Jeff Heatherington, 5 pp