A special election Tuesday night that overwhelmingly approved taxes on the health care industry to pay for Medicaid cost the state an estimated $3.32 million, according to the Oregon Secretary of State's Office.

But one of the people who forced the measure to the ballot, Rep. Sal Esquivel, R-Medford, thinks the effort was worth it.

"I think the people of Oregon need to weigh in on these issues," he said Wednesday.

Ballot Measure 101 passed 57.9 percent to 42.1 percent in Jackson County — and by a higher margin statewide. Esquivel said he was surprised that 60 percent of Oregon voters said "yes" to raising taxes on hospitals and insurance companies to avoid cuts to the Oregon Health Plan, this state's version of Medicaid.

"I thought it would be closer," he said.

He said the state has known for years that cuts to Medicaid were coming. Instead of tightening its belt, the Legislature found a way to increase taxes to pay for something it should have prepared for years ago, Esquivel said.

Oregon has been at the forefront of rolling out its version of the Affordable Care Act, signed into law by President Barack Obama in 2010. In the first years of the act, the federal government covered most of the bill. But federal funds have dropped and the state is paying a larger share.

In 2017, the Legislature, with bipartisan support, approved the tax hike on hospitals and insurance premiums that's expected to raise up to $320 million.

"It was one of my best days in the Legislature," remembers Rep. Pam Marsh, D-Ashland. "I thought it was so important to keep health care whole."

Afterward, three Republican lawmakers, including Esquivel, launched a campaign to refer the tax to voters.

Gov. Kate Brown threatened to veto three Medford-area projects in political retaliation for Esquivel opposing the health care plan.

Esquivel provided a key vote to move the health care tax through the House in exchange for funding for the Holly Theatre and other projects. At the time, Esquivel said there was no discussion about whether he needed to keep backing the health care proposal.

Later in the legislative session, Esquivel said he grew concerned about efforts to fund abortion and provide health insurance for immigrant children.

After considerable local pressure, Brown decided not to veto a $1 million grant for the Holly. Brown followed through on her veto of $750,000 earmarked for Harry and David Field’s stadium improvements and $1.8 million for a Rogue River Valley Irrigation District piping project that would benefit fish, farmers and the environment. 

Supporters of the health care tax included hospitals and insurance companies, along with Senate Republican Leader Ted Ferrioli, the Oregon PTA, Oregon Nurses Association, the Coalition of Community Health Clinics and AARP.

Political action committees in favor of the measure raised $3.6 million, while opponents raised about $125,000.

If Measure 101 had failed, Medicaid could have lost millions of dollars and the state could potentially have lost more than $1.3 billion in federal matching dollars.

Ordinarily such a measure would have appeared on a November ballot, but Democratic leaders called a special election for Jan. 23 so that if voters said no, lawmakers could have tried to find another way to fund the system during the February legislative session.

According to supporters, 350,000 Medicaid patients could have lost coverage if the measure had failed. In Oregon, one in four people are covered under the Oregon Health Plan.

Marsh said lawmakers put a complicated measure before voters, and the voters decided overwhelmingly that the Oregon Health Plan was worth saving.

"Even in Jackson County, we voted for it," she said. "How cool is that?"

— Reach reporter Damian Mann at 541-776-4476 or dmann@mailtribune.com. Follow him on www.twitter.com/reporterdm.