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 July Behavioral Care Network winds up with $850,000 nest egg As state agencies crunch their budgets to squeeze the last few pennies out of every program, one government-sponsored entity is sitting on a nest egg. To the tune of $850,000 to be exact, not counting $500,000 in reserves. Who's the victor? Mid-Valley Behavioral Care Network. In November 1997, BCN became responsible for mental health services for Oregon Health Plan members in Linn, Marion, Polk, Tillamook and Yamhill counties. Since then, the mental health organization (MHO) has received $26.7 million in state revenue. BCN averages 49,336 members, and about 2,981 people visit a mental health practitioner every month or require hospitalization, giving it one of the highest penetration rates. "We're buying more outpatient and inpatient care than most MHOs," said Jim Russell, executive manager. Currently BCN spends 73.5% of its budget on outpatient care, 15% for hospitalization, 6.8% for administration, 1.25% for prevention and education, 1.5% for consumer-run services and 3% for residential and out-of-plan services. Since 1997, BCN's built a huge windfall because of several factors: it's kept administrative costs low (6% on average); hospital expenses fell below targets and more money was kept in reserves. So what's going to happen to the $850,000? BCN's soliciting proposals, due Aug. 9, and has identified several priorities such as expanding mental health services to older adults and Latinos and developing a regional information system. BCN anticipates allocating funds in October. PeaceHealth spends $62,000 on Japan trip; closes Prenatal Clinic The recent closing of a clinic for low-income pregnant women in Eugene highlights ongoing tensions between physicians and midwives. In early July, PeaceHealth, which operates Sacred Heart Medical Center, closed the Prenatal Clinic, a small, two-storey facility that, since 1987, had offered prenatal and postpartum care to low-income, largely Hispanic women in a homey setting. The services are now located in a traditional clinic near the hospital's main medical campus. PeaceHealth also eliminated two full-time midwives. Hospital officials said the decision was economic. "We moved to a clinic that has a broader range of services," said Beverly Mayhew, regional director of public affairs. "It was more cost-efficient to consolidate services instead of having them divided." In September four high-ranking PeaceHealth officials, including Chief Executive Officer Curt Roberts and Chief Operating Officer Alan Yordy, travel to Japan, at a cost of $62,000, to participate in training and corporate improvement programs. . . Mayhew said [the trip] is "entirely unrelated" to the budgetary decision to close the Prenatal Clinic. OMA loses battle with NPs over drugs Nurse practitioners can celebrate their 20th anniversary with a legislative victory. Gov. Kitzhaber has signed Senate Bill 974 allowing nurse practitioners to prescribe narcotics and other potent drugs, confirmed Mark Gibson, health policy analyst. Despite opposition from the Oregon Medical Association (OMA), the legislature overwhelmingly approved the bill, giving nurse practitioners a privilege they have lacked since 1979, when the legislature granted them authority to prescribe almost all medications except the powerful Schedule II drugs. "There are two primary reasons we brought (the bill) forward," said Susan King, administrator of professional services for the Oregon Nurses Association (ONA) and an emergency-room nurse. Nurse practitioners manage many patients at the end of their life or with long-term chronic pain, she said. And they frequently staff emergency rooms or situations requiring short-term therapy using Schedule II drugs -- treating a broken leg, for example. "They must be able to prescribe pain-killing medications," King said. Oregon Health Plan spent $26.5 million on Prozac, Paxil, Zoloft Oregonians should consider investing heavily in Eli Lilly, SmithKline Beecham and Pfizer. These companies are the makers of Prozac, Paxil and Zoloft, prescription antidepressants which account for approximately 20% of yearly outpatient drug expenditures under the Oregon Health Plan (OHP). Lilly's also basking in the profits of Zyprexa, which could become the most profitable antipsychotic medication in the world. The stocks become an even better bet when one considers that the cost to Oregon taxpayers for these drugs increased a booming 19% in 1998. This trend shows no signs of leveling off and comes at a time when the number of people eligible for the OHP has decreased by about 1%. According to figures supplied by the Office of the Oregon Health Plan Policy and Research, 43,919 OHP members received at least one prescription in 1998 for Prozac, Paxil or Zoloft -- selective serotonin re-uptake inhibitors (SSRIs). That same year, 498,304 children and adults were on the OHP. These three drugs accounted for at least $26.5 million in outpatient drug expenditures alone. Contrast this with $3.2 million spent for antibiotics; $4 million for analgesics such as ibuprofen; and $7 million for cardiac drugs. $10 million malpractice suit against Rogue Valley Rogue Valley Medical Center has agreed to pay $10 million in a malpractice lawsuit on behalf of 21-year old Morgan Smith. He suffered severe brain damage while recovering from a routine surgery in February 1998. Smith is partially blind, bedridden and paralyzed after slipping into a coma while recovering from surgery to repair a small leak in his lung, a condition common among athletes. A swimmer and cross-country runner for his high school, Smith will probably require 24-hour care for the rest of his life. The lawsuit alleged that an RVMC nurse and certified nursing assistant failed to follow doctors' orders and monitor Smith's blood-oxygen levels while he was on morphine and recovering from surgery. As a result he slipped into a coma and suffered brain damage. Regence BCBSO cuts losses by slashing commissions Following fiscal 1998 losses, Regence BlueCross BlueShield has begun trimming budgetary edges, reducing its 4,000-member agent work force and slashing small group commissions. Large-scale cuts will start by December. That means some Blues-reliant agents may be out of a job, and small group purchasers out of options. Commission scales for group sizes 1-50 will begin at 6%, while groups over 50 employees will start at 10%. For groups of 3-10 employees, only one fee-for-service dental plan will be available. Rural communities will be hit especially hard. "Ninety percent of our business is in small groups," said John Gridley, a Roseburg agent. "So the commission rates represent a 22.5% cut on Blue Cross commissions." Many of Gridley's small group clients are opting out of BlueCross and questioning the company's intentions. "It would appear BlueCross is trying to avoid doing any business with small groups," he said. In 1998, the Blues were among the lowest priced plans in the small group market, Gridley said. "Now they're on the high side. The Blues have reduced plans, increased prices, imposed new rules and lowered commissions." Drug industry devotes $18 million to research The pharmaceutical and biotechnology industry contend research dollars will dry up because Oregon's genetic privacy law treats a person's genetic material as personal property -- giving them the right to sue a drug manufacturer for royalties. Nevertheless, Oregon Health Sciences University, Legacy Health System and Kaiser Center for Health Policy Research benefited from the drug industry -- to the tune of $18 million last year. However, none of that money went for genetic research. The drug companies have increased their spending by 10% over the last three years, said Dr. Manuel Martinez-Maldonado, vice provost for research. In 1998, they gave $12.5 million to OHSU, roughly 10% of its research budget. "At the moment, we don't depend on them for survival." But OHSU, like Legacy and Kaiser, wants to capture more of these dollars. Legacy garnered $4 million of its $14 million research budget from the pharmaceutical industry; Kaiser only captured $1.67 million of its $13.8 million budget. The Oregon Medical Association convinced legislators and the governor not to weaken the genetic privacy law. Instead, an interim task force led by Barney Speight, administrator of the Office of the Oregon Health Plan Policy and Research, will resolve the dispute. Also in this issue...
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