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Bates: Health care reforms seek cure for bureaucracy

A 55-year-old Medford man with schizophrenia and other mental problems was rushed to the emergency room with a bowel obstruction two months ago.

After the latest hospital visit, a change in medications appeared to have cleared up the problem, but not before he racked up $100,000 in Medicaid bills for five different trips to the emergency room for the same issue.

That's the kind of expensive, and potentially avoidable, situation legislators, doctors and federal officials say has contributed to skyrocketing Medicaid costs.

Legislators are hopeful — with some reservations — that a proposed Oregon health-care overhaul could control those costs and become a model for the rest of the nation.

Current Oregon laws create a stumbling block for mental health workers, courts, and hospitals hoping to offer a more coordinated, and considerably cheaper, way to deal with the mentally disabled and others seeking care, said state Sen. Alan Bates, a Medford Democrat and physician who has pushed for health-care reform.

"Bureaucracy has been the problem," said Bates. "And, we don't have the funds to try to maintain this kind of system."

Bates, who treated the man with the bowel obstruction two months ago, said he personally has been frustrated by health-care provided to patients with severe mental and physical disabilities.

Currently, agencies and doctors often aren't allowed to exchange information and can't readily retrieve a patient's history or records of medications used or mental problems. Often, a doctor might not be aware of other agencies that are working with a patient, Bates said.

All that could change under House Bill 3650, which will be considered by the Oregon Legislature this month. If the bill is approved, the federal government will make a decision to send up to $500 million to Oregon to provide the seed money for an experimental Medicaid reform program.

Rather than have a hospital treating these patients on an emergency basis, the state wants to create regional community care organizations so patients with severe disabilities and mental problems don't fall through the cracks and don't run up big bills unnecessarily, Bates said.

A case worker would be assigned to patients who require high levels of care, and the patients would be managed through electronic records and better coordination with hospitals, drug and alcohol clinics, physicians, mental health workers and the court system.

If successful, the program could make a significant dent in the rise in Medicaid costs, and potentially cut down on state administrative costs, Bates said.

Since 2008, the Oregon Health Plan, which administers the Medicaid program in this state, has seen a 50 percent jump in participants, from 400,000 to 600,000. By 2019, state officials estimate, 1 million people could be on the Oregon Health Plan, or about one in four people.

There is a lot at stake for Oregon, where Medicaid costs are predicted to reach $3.2 billion in 2013. Some 20 percent of Medicaid patients generate 80 percent of the costs, said Bates, and these are the patients who would be carefully monitored under the program in the hopes that emergency situations could be avoided.

In the first year of the new program, state and private health officials hope the program will generate $239 million in savings. Over a three-year period, savings could reach $1 billion and after five years, $3.1 billion.

While initial analyses look promising, legislators are worried the program could get bogged down in more layers of bureaucracy, or might not generate the kind of savings expected. Also, the expense of monitoring, housing and caring for high-need patients could offset some of the savings.

"This is clearly a journey," said Bill Thorndike, owner of Medford Fabrication and a member of various health-related boards.

He said there are many local health agencies that do fine work in Jackson County but they need a more unified approach.

Coordinating these agencies will be a challenge as the program is rolled out over the next five years, he said.

"That's where a lot of the head-scratching is going on right now," Thorndike said.

One of the health organizations Thorndike is involved in is the Jefferson Regional Health Alliance, an 18-member board of community and health leaders.

Anne Alftine, a local physician and project coordinator for the alliance, said her organization has been working on improving coordination since 2005.

Local hospitals are already taking steps toward the exchange of medical information on patients, but Alftine said it could take another two years before the program is fully rolled out, and patient privacy concerns are fully addressed.

State officials have pushed for a new system because Medicaid has proven too costly, particularly for states hard hit by declining tax revenues.

Mike Bonetto, healthcare policy advisor for Gov. John Kitzhaber, said for every dollar Oregon provides toward Medicaid costs, the federal government contributes $1.75.

He said patients who often end up in emergency rooms — "frequent flyers" — have been created, in part, because current system is geared toward providing needed care in crisis situations.

He said different agencies are also second-guessing each other, wondering who should take the lead role in handling a particular patient.

"Right now we play a game of hot potato," he said.

Reach reporter Damian Mann at 541-776-4476, or email dmann@mailtribune.com.

Bates: Health care reforms seek cure for bureaucracy