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OHP Rate Development

Process Overview

The Oregon Health Plan (OHP) is our state Medicaid program. It provides health coverage for low-income Oregonians that include working families, children, pregnant women, single adults, seniors and more. The Oregon Health Authority (OHA) has contracted with a variety of health entities, known as Coordinated Care Organizations or CCOs, to manage and deliver health care for most of these people eligible for Medicaid. OHA pays CCOs to cover these individuals with capitation rates. Capitation rates are a predetermined payment that depends on the individual's OHP eligibility status and is paid to CCOs on a monthly basis dependent on enrollment.

These capitation rates are developed and certified by OHA's actuaries on a yearly basis. The process and methodology used to develop capitation rates are governed by federal and state regulations. CMS requires Oregon's capitation rates be Actuarially Sound and follow applicable Actuarially Standards of Practice, which are developed by the American Academy of Actuaries.

To learn more about Oregon's capitation rates and future rate setting cycles, please review this brief on Rate Setting for Coordinated Care Organizations, or review the most recent capitation rate reports listed in the sections below.

Current Rate Setting Cycle Update

October 11, 2016: Today, the Oregon Health Authority (OHA) released the 2017 capitation rates for Oregon's Coordinated Care Organizations (CCOs). The CCOs contract directly with the state of Oregon to manage and deliver health care to cover Oregonians on the Oregon Health Plan (OHP), the state's Medicaid insurance program. OHA pays these capitation rates to CCOs on a monthly basis to cover OHP members for physical, behavioral and oral health services. OHA contracts with Optumas, an actuarial consulting firm, to assist in the rate development. The 2017 capitation rates that were released today to the CCOs and to the Centers for Medicare and Medicaid Services (CMS) have been certified by Optumas as actuarially sound. The rates take into account several factors, including differences in regional costs, population disease risk and hospital reimbursement.

The rates released today show that Oregon is on track to meet its cost containment rate of 3.4%, with an aggregate 2017 rate increase of 3.2%. Oregon has pledged to keep cost growth to 3.4% through 2017 based on a commitment to our federal partner, CMS, and as part of Oregon's current Medicaid waiver.

While the rates show that Oregon is on track for this year, the rates also provide insight into future challenges; one challenge being pharmacy costs. With prices for many pharmaceuticals increasing, OHA is looking at solutions to keep pharmacy costs in check including collaboration with CCOs to align and negotiate for better prices for high-cost drugs

2015-2017 Capitation Rate Reports

2015-2017 Contract Rate Sheets

2015 & 2016 Rate Methodology


Please contact:
Actuarial Services

For more information

American Academy of Actuaries
CMS Medicaid Home
Coordinated Care Organizations
Forecasting Reports
Health Evidence Review Commission (HERC)
Oregon Health Plan
Rates Advisory Panel

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