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 April Kaiser, Regence follow different paths in 2003 It was the best of times, it was the worst of times. It was 2003 for Oregon health insurers, and the state’s two largest company’s books told dramatically different tales. Kaiser and Regence, which serve more than half of all insured Oregonians, were starkly contrasted. Kaiser saw its net income surge 356 percent, from $9 million at end year 2002 to $42 million in 2003, and its cash from operations jump 121 percent, from $29 million to $64 million. Its membership declined by 12,000, but 10,000 of those people were Medicaid clients Kaiser chose to drop. Taxes could save OHP Despite news to the contrary, thousands of single adults and married couples might not lose their Oregon Health Plan benefits on Aug. 1. The Legislative Emergency Board wasn’t able to offer any state revenue to keep the Standard Plan alive, but Oregon Health Forum has learned intense negotiations –– often confrontational –– are underway between the Oregon Association of Hospitals and Health Systems, the managed care plans and the governor’s office to try and save health benefits for at least a portion of this population, which now numbers 48,000 adults. A compromise could be reached as early as late April. The issue boils down to how the provider tax –– paid by the health plans and the hospitals –– would be spent. The hospitals went along with the tax during the 2003 legislative session because they were convinced the majority of their taxes, along with federal matching funds –– would end up in their bank accounts. They were promised higher payments for fee-for-service patients and restoration of retroactive eligibility –– which means if a patient shows up at a hospital needing care and isn’t on the Oregon Health Plan they can be signed up immediately, assuring the hospital of payment. AARP buyer remorse? When AARP came out in support of the Medicare prescription drug bill, it raised some eyebrows –– and tempers. Initially, 15,000 members resigned in protest. Now that the law is getting hammered by both parties –– Democrats call it a giveaway to the drug companies, Republicans bemoan its whopping $530 billion price tag –– the backlash is increasing. Recently, 45,000 more members parted with AARP for its continued support of the law. While that’s just a drop in the bucket for an organization with 36 million members nationwide, it can’t be comforting to its leaders, who maintain the law was a good first step that needs some fine tuning. Trial lawyers ready defense For months the Oregon Medical Association has raised money, held focus groups, done public outreach and given countless interviews about the need for tort reform. All the while, trial lawyers and consumer advocates have sat mum, seemingly oblivious to the $2.3 million war chest doctors have built to pass a $250,000 cap on non-economic damages and a $100,000 limit on attorney fees. That changed at the end of March with the formation of Trust Juries for Responsible Solutions, which will spearhead efforts to defeat the November initiatives. Charlie Burr, a former Senate Democratic Party caucus staffer, manages the campaign. “It strikes at the very basis of American democracy,” said Jason Reynolds, executive director of the Oregon Consumer League, who will volunteer for the coalition. “We have a jury system.” If juries are trusted to give the ultimate punishment –– the death penalty –– they should also be trusted to decide damages in medical liability cases. Smokers get a break When voters defeated Ballot Measure 30, Oregon became the first state in 10 years to lower its cigarette tax. Tucked inside the measure was the renewal of the 10-cent cigarette surtax. Had the tax not disappeared on Jan. 1, it would have generated $22 million this biennium, according to the Department of Revenue. “We think it should be reinstated,” said Tabitha Engle, spokesperson for the Tobacco Free Coalition of Oregon. But that won’t be easy to accomplish. “The environment isn’t there for tax increases,” said Bruce Anderson, legislative director for House Speaker Karen Minnis (R–Wood Village). “The results from Measure 30 bear that out.” He said it’s “way to far off” to comment on whether the speaker would endorse raising the tax in the 2005 session. California dreaming There might no longer be such a thing as a free lunch, but there is such thing as a cheap stay at a luxury resort –– especially for physicians. The 1st Annual Electrophysiology for Primary Care Conference treated Oregon doctors to airfare and lodging for an opulent weekend getaway at San Diego’s Four Seasons Avaria Resort –– a $2,000 value –– in exchange for a pithy $99 conference registration fee. Between 40-42 physicians were expected to attend. The Marion-Polk County Medical Society and Salem Cardiology Associates handled registration. When asked who was paying the additional costs for this seminar, Melissa Gaffke from Salem Cardiology Associates mentioned that Guidant Corporation, a designer and developer of cardiovascular medical products, was among the sponsors. She refused to provide the names of other sponsors. Guidant didn’t return a call for comment. Lilly pays $1.5 million for drug study Eli Lilly will pay Comprehensive NeuroScience up to $1.5 million to implement an evidence-based program on mental health drugs used by Oregon’s Medicaid population over a 26-month time period. The program got underway in January. “We have a behavior pharmacy management system and what it does is analyze Medicaid clams data against quality indicators to determine whether prescribing practices are aligned with best practices,” said Sandy Forquer, PhD, vice president of education services for CNS. Q&A with Joel Ario Half of all consumers in this country have difficulty using health information, according to a recently released Institute of Medicine report. That’s troubling news since Oregon is on the brink of a health insurance revolution that relies upon consumers’ ability to navigate the complex system. One person they can trust is Insurance Administrator Joel Ario. Charged with protecting consumers while keeping health insurance companies honest, his department is working hard to make sure consumers are protected from those who seek to put profits before people. Ario spoke to Oregon Health Forum Associate Editor Rory Carroll about his skepticism of consumer-driven health plans. OHF: How do you reconcile insurers making so much money while premiums continue rising? JA: Some companies are more profitable than others. Certainly the health care companies are more profitable in general today than a couple of years ago, but compared to most of America’s industries, they are still not very profitable enterprises. If you compare them to, say, banks, their rate of return is substantially less. I’m not sure this has become a very profitable business. Sun sets on Sunwest lawsuit It’s all over but the shouting. A lawsuit filed against the officers of Sunwest Management, which operates senior living communities in 18 states, has been settled, according to Wally Gutzler, general counsel and vice president of Sunwest. He characterized the agreement as a business divorce, saying, “we’re going our separate ways.” The terms of the settlement will remain confidential. A minority owner, Jeffrey Kraus, had alleged that Sunwest officers violated the Racketeer Influenced and Corrupt Organization Act and committed wire and mail fraud by using money from the senior living communities for their own personal use to purchase real estate and to open new assisted living communities. Also in this issue...
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