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 June Pharmaceutical costs take a 200 percent leap for Oregon Health Plan Since 1993, Oregon taxpayers have spent 112 percent more for the Oregon Health Plan. The real cost driver has been pharmaceuticals, which have risen more than 200 percent, from $62 million in 1993-1995 to projections of $186 million in 1999-2001, according to Dr. John Santa, director of the Office of the Oregon Health Plan Policy and Research. These figures include all drugs covered by the Oregon Health Plan. During that same time, hospital and professional costs only grew by 36-38 percent, Santa said. "From everything we know, there's no light at the end of this particular tunnel," Santa said. "Health plans are truly perplexed. This industry is much bigger than they are." Maine is solving the problem by purchasing drugs directly from the manufacturers for the same price as Canada. However, the pharmaceutical industry is expected to file legal action. In Vermont, people can take their prescriptions to Quebec. "Oregon will attempt to get better prices for vulnerable groups such as seniors, but we won't be as aggressive as Maine," Santa said. In the past, Oregon has been stifled by the pharmaceutical industry, which has fought attempts to impose a drug formulary even though every hospital and HMO has one. "As far as manufacturers are concerned, every formulary is bad," said Santa, who favors an open formulary approach. Nursing shortage threatens to damage health care If necessity is the mother of invention, nursing recruiters may be poised to become some of the nation's greatest visionaries. The United States is facing a growing nursing shortage with the potential to severely damage health care. Since Oregon Health Forum reported on the shortage in May 1999, the crisis has worsened, prompting health care providers to rethink their human resource strategies and nursing schools to change their recruitment methodologies. Unlike the shortages in previous years, this one crosses all boundaries. It not only affects specialty nursing disciplines, such as ob/gyn, emergency room and telemetry, it carries all the way to certified nursing assistants (CNAs), RNs, and new graduates. In January, a shortage of CNAs forced Mercy Rehabilitation and Care Center in Roseburg to turn away patients. Mercy's CNA turnover rate over the past few years has been up to 60-90 percent. "It is simply a matter of supply and demand,'' says Rita Bauman, program executive for licensing and certification at the Oregon State Board of Nursing. "We have a growing need for services and the nursing supply is dwindling." Oregon Clinic refuses to accept capitation Is the end of capitation around the corner in the managed care industry? That's the question on some health policy watchers' minds as insurance premiums rise while physician dissatisfaction and patient complaints continue. But predictions of capitation's imminent demise probably are, as Mark Twain might say, greatly exaggerated especially in Oregon, where 70 percent of the commercially insured are in HMOs. It just wouldn't be realistic for most primary care physician groups to opt out of managed care plans that capitate since some form of provider risk sharing is standard in Oregon. But the most-hated method of shifting economic risk onto physicians Ñ global capitation Ñ for the first time is sparking a rebellion that might have some teeth. Global capitation is largely used by PacifiCare, which manages utilization by requiring primary care physicians to cover the costs of specialists, diagnostic tests and hospitals. Portland area specialists Ñ who sub-contract with primary care physicians for a part of the global fee Ñ may lead the way. CareOregon, ODS Health Plan provide most alcohol/drug treatment Across the state, only five percent of people on the Oregon Health Plan received treatment for alcohol and drug abuse. But that doesn't tell the entire story. Several health plans excelled Ñ CareOregon and ODS. Their numbers were strikingly higher than the statewide average. During fiscal 1998-1999, CareOregon treated 9.9 percent of its population, while ODS Health Plan followed closely behind with 7.1 percent. But, several health plans fell below the norm Ñ Kaiser Permanente, Mid-Rogue IPA, Providence Health Plan (Portland area) and Tuality Health Alliance. What led to the difference? Mary Lou Hennrich, CEO of CareOregon, might have the answer. Its primary care providers regularly screen and refer people for alcohol and drug treatment. "We try and help people come to grips with the issue," Hennrich said. "Alcohol and drug abuse are societal taboos. People need to feel safe and comfortable. Front-line providers need to be aware of signs and symptoms and not be afraid to talk to people." HCFA calls off threats against Legacy Oregon hospices are mulling what to do next after a state and federal investigation of the Visiting Nurse Assn. Hospice briefly threatened to cut off Medicare funding for Legacy Health Systems's hospice program. "The whole hospice industry is really looking at some of these findings because some of them are very different from what we've been instructed to follow in the past," said Ann Jackson, executive director of the Oregon Hospice Assn. "There have been different interpretations by HCFA over the years of the guidelines for hospice care, which themselves haven't changed." HCFA sent Legacy a letter on April 28 saying certain practices that its branch hospice program, Health Dynamics in McMinnville, was following at two nursing homes "constitute an immediate and serious threat to the health and safety of patients." Derfler promises to help small businesses Sen. Majority Leader Gene Derfler, R-Salem, has become very interested in helping small businesses find affordable health care coverage. He's joined forces with the Oregon chapter of the National Federation of Independent Business. In 1996, 69 percent of Oregon's small business owners offered insurance to their employees and families, according to NFIB figures. That number dropped to 59 percent in 1999. Rising premiums and the small businessperson's lack of a voice has led to this situation, said J.L. Wilson, NFIB's director. "When premiums go up 40 to 50 percent in the past three years, insurance for small business people becomes plain unaffordable," he said. "The main culprit is small businesses which have no negotiating clout. They aren't able to pool their resources and join with other economies of scale." Also in this issue...
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