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Senate health reform bill would triple Oregon uninsured rate and increase costs for state budget

Salem, OR — The proposal from leadership in the U.S. Senate to repeal the Affordable Care Act (ACA) would cause nearly 440,000 Oregonians to lose health coverage as early as 2021, according to a new analysis from state health policy experts and insurance regulators. As a result, Oregon’s uninsured rate would triple from its current level of 5 percent.
 
In addition, the Senate plan could shift more than $6.2 billion in costs to Oregon taxpayers and the state budget, due to steep cuts in federal Medicaid funding. 
 
While younger Oregonians would likely pay lower premiums for health coverage on the individual commercial market, older people would pay more. On average, consumers would face higher deductibles and copays than they currently pay under the ACA. 
 
Although it is similar to the ACA repeal that passed the U.S. House in May, state analysts found key elements of the Senate’s Better Care Reconciliation Act (BCRA) were even harsher on Oregon and other states than the House bill, largely due to steeper Medicaid cuts. 
 
Medicaid is the federal-state program that provides safety net health coverage for low-income and disabled children and adults, as well as working individuals and families close to the poverty line. Today Medicaid covers one in four Oregonians through the Oregon Health Plan (OHP).
 
Overall, the Senate plan would have far-reaching effects on Oregon:
  • Oregon’s uninsured rate could triple by as early as 2021: Like the AHCA, more than 440,000 Oregonians would be at risk to lose health coverage as a result of BCRA. Dramatic reductions in coverage would occur over a longer time period than the House bill, due to a slower phase-out of Medicaid expansion if the state cannot make up for the loss of federal funds.
  • Oregon’s budget would face a total $6.2 billion cost shift from 2020 to 2026: By enacting potentially steeper Medicaid reductions than the House bill and phasing out Medicaid expansion, the Senate plan would expose the state to annual costs that would reach a high of $1.8 billion in 2026. To avoid these costs, Oregon would be forced to cut coverage and benefits for individuals and families on OHP (though some cost shifts would be unavoidable).
  • Oregon’s economy would lose approximately 23,000 jobs: The Senate plan would eliminate approximately 23,000 health care jobs by 2026 due to its Medicaid funding reductions, Medicaid expansion phase-out and reduced federal provider tax reimbursement.
 

Impact on premiums and out-of-pocket health care costs for Oregonians

Although the Senate plan’s approach to premium subsidies differs from the House bill, the net effect will be similar: lower costs for young adults and increasing costs for older adults and low-income enrollees. The Senate plan funds cost-sharing subsidies through 2019 but eliminates them after that time.

Impact on state budget for the 2017-2019 biennium

The Senate plan would not have a significant impact on Oregon during the 2017-2019 biennium, because Medicaid cuts, the phase-out of Medicaid expansion and reduced federal reimbursement for provider taxes would begin to take effect in 2020.

However, the Senate bill would eliminate the Prevention and Public Health Fund, effective in 2018. This fund helps Oregon counties address unexpected health emergencies (like the Zika virus), provides immunization to children, prevents teen suicide, and helps prevent chronic diseases.

Oregon Health Authority Director Lynne Saxton said, “The Senate and House bills go far beyond repealing the Affordable Care Act. They fundamentally alter Medicaid, leaving the state exposed to billions of dollars in cost shifts. We encourage our federal partners to work with states like Oregon to maintain coverage, provide better health care and hold down costs through cost-effective innovations like Oregon’s coordinated care system.”

Department of Consumer and Business Services Director Patrick Allen said, “The Oregon health insurance market has had challenges, and although we have taken steps to stabilize it, there still is much work to do. We are committed to providing Oregonians with access to high-quality, affordable insurance options.”

The report was prepared by the Oregon Department of Consumer and Business Services and the Oregon Health Authority. The full report is available at http://www.95percentoregon.com/uploads/9/9/2/6/99265876/bcra-report.pdf

 

 

 

 Media contact

Lisa Morawski

Department of Consumer and Business Services

503-947-7873
or 503-510-5576
lisa.m.morawski@oregon.gov

Robb Cowie

Oregon Health Authority

503-421-7684
or 503-945-7849
robb.cowie@state.or.us

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