State health officials had some bad and good news for a crowd of around 120 that gathered Tuesday night at the Santo Community Center in Medford to hear about possible changes to the Oregon Health Plan coming next year.

State health officials had some bad and good news for a crowd of around 120 that gathered Tuesday night at the Santo Community Center in Medford to hear about possible changes to the Oregon Health Plan coming next year.

The bad news, they said, is the state's health care system is seriously ill and costing taxpayers millions in waste and ineffective treatment. Also, the state's revenue stream lags far behind skyrocketing health care costs.

The good news is the Legislature, acting in a rare bit of bipartisanship last session, has passed House Bill 3650, which seeks to cut down on needless red tape within the medical field and get patients preventive health care, as opposed to soaking them for pricey specialty procedures and then directing them into emergency rooms when crises arise, they said.

Sound too good to be true? Mike Bonetto, the governor's health policy adviser, doesn't think so.

"We are not trying to reinvent the wheel," Bonetto said. "But I'm not saying that we have everything all figured out."

Bonetto told the audience that the goal of HB 3650 is to get all areas of the medical field on the same page. The Oregon Health Authority believes that not having mental and physical health services interact and coordinate care is creating logjams in the system, which causes patients sometimes to see multiple doctors to get the same treatments repeatedly.

This is costing taxpayers millions and not keeping Oregon residents healthy, argued Dr. Barry Hamann, a family practitioner in Grants Pass.

"The current system incentivizes specialty care over primary care," Hamann said.

Hamann said he recently saw a patient who went to the emergency room once a month for the previous two years. The woman complained of a headache and received a CT scan several times in two years. Each of the scans came back negative, he said.

"Does anyone know how much a CT scan costs?" he asked the crowd. "They are at least thousands of dollars each time."

Hamann said the woman suffered from a mental disability and needed psychiatric help, not more expensive tests that did nothing for her health.

Hamann, who said he is skeptical of government overreach in many cases, said the new law could help break down barriers between doctors and allow them to get care to patients quickly and at lower cost.

Tuesday's meeting was the second of eight stops throughout Oregon seeking input into how the law could benefit communities.

The crux of HB 3650 is the creation of Coordinated Care Organizations, which will group mental, physical and dental care providers together.

"This is only going to succeed if it works locally, for each community" said OHA spokeswoman Patty Wentz. "This isn't going to exist only in Salem."

Dr. Christian Mathisen, a Medford chiropractor, said he hopes the new law will include naturopaths, nutritionists and other alternative care providers.

OHA Director Bruce Goldberg said there is space in the new law for these care providers.

"We want to create alternatives to expensive care that doesn't work," Goldberg said.

Hamann said the law's success will hinge on whether doctors will realize the importance of affecting behavioral change on many patients. He said it is important to give doctors incentives for steering patients toward healthy eating and exercise.

"A big part of preventive care is lifestyle," he said.

If the federal government approves the provisions of HB 3065, the Coordinated Care Organizations could begin forming by July 2012.

Reach reporter Chris Conrad at 541-776-4471; or email cconrad@mailtribune.com.