Oregon Governor Kitzhaber Signs Money Saving Health Care Law

John Kitzhaber

Former emergency room doctor turned Oregon Governor John Kitzhaber signed into law legislation last Friday which will overhaul healthcare in his state emphasizing a healthier population while saving the state potentially large sums of money. The governor said that savings could be so profound that there is a real potential, if the plan was implemented by the nation as a whole, to fix the overruns of the federal budget.

The Oregon health plan utilizes innovation and a focus on prevention to save money. One new idea is to assign the most expensive Medicaid patients to individual caseworkers who would oversee all aspects of their care, from medical to psychological. The goal in this case would be to reduce or eliminate altogether redundant tests and procedures, hopefully reducing expensive hospital stays.

Supporters of the plan say that if all 50 states took on this plan the federal budget could save over $1.5 trillion over ten years. That is $300 billion more than the failed “super committee” of Congress was trying to save over the same period of time.

"Today we set out on a path . . . to create a system here in Oregon that will be good for our people, that will be good for our state budget," said Democratic Governor Kitzhaber before he signed the bill.

Those less enthusiastic about the bill warn that the plan will almost surely overpromise and underdeliver. They say the potential for much real savings is not that high, and worry that a plan like this could cause too much government control over health care.

The essence of Kitahaber’s plan is to coordinate care and reward doctors for having health patients.  The plan will begin with Oregon’s 600,000 low-income patients who are on the Medicaid plan.

The hope is that the plan will eventually spread to include government workers and then the public at large. The private insurance plans of many patients would be affected as the health-care system grows.

The federal government will need to get involved for the plan to succeed by approving a waiver of standard Medicaid requirements. Kitzhaber also needs federal money to help Oregon pay for the upfront costs to start implementation.

The proposal has already been presented to the Obama administration as a concept, but the feds are still waiting for a detailed description for Oregon.

Alyssa Anderson

Alyssa Anderson has been involved in the world of business on several levels for many years. She was the CEO of a start-up high-tech company until its purchase by a global on-line e-business. Alyssa helped formulate marketing strategies for several other companies as an independent consultant, and she has advised local government on methods to achieve appropriate fiscal responsibility. Her opinions are well known through her many editorials which have been published throughout her career in a variety of local and national print media. She has been heard on radio discussing current issues affecting the business community and Alyssa hopes to bring her special brand of commonsense coupled with uncanny insight into her editorial responsibilities as the Business Page editor for Left Justified. Contact Alyssa at alyssa(at)leftjustified.com.

View all posts by Alyssa Anderson →