Coordinated care organizations had mixed financial results, creating a nearly break-even year
September 19, 2025
SALEM, Ore. – Increased expenses in 2024 created a mixed financial picture for the 16 local Medicaid insurers – also known as
coordinated care organizations, or CCOs – that facilitate Medicaid benefits in Oregon, according to Oregon Health Authority
analysis.
Oregon CCOs collectively had a small net operating income of $129,000 in 2024, resulting in a net operating margin of 0.001% statewide. Nine CCOs operated at a profit, while seven operated at a loss. Financial performance varied for individual CCOs, ranging from a high profit margin of 9.56% to a negative margin of -5.31%.
Total CCO expenditures per member grew by more than 10% between 2023 and 2024. The biggest expense increase was associated with more Medicaid members receiving behavioral health care, for which Oregon Medicaid reimbursement rates were
increased by an average of 30% starting in 2022.
“The mixed financial performance that CCOs experienced in 2024 happened for a good reason – more Medicaid members received the behavioral health care they need and Oregon behavioral health professionals were paid more for providing essential services after years of historic underfunding," said OHA Chief Financial Officer Rochelle Layton. “OHA is committed to partnering with CCOs to ensure they are both financially sound and can continue to help Oregon Medicaid members access the quality health care they need and deserve."
Oregon CCOs' collective highest-recorded net profit margin was 7.5% in 2014, when the Affordable Care Act expanded Medicaid eligibility. The only time that CCOs have had a net operating loss was in 2017, when their collective net operating margin was -0.3%.
In 2024, all 16 CCOs collectively spent 91.74% of their total revenue on member services and spent the remaining 8.26% of revenue on administrative costs.
CCO revenues were also impacted by reduced enrollment in 2024. Membership decreased by an average of -8.46% across all CCOs in 2024. PacificSource Marion-Polk Counties reported a membership decrease of -11.35%, the greatest for any Oregon CCO last year. Jointly funded by states and the federal government,
Medicaid provides no-cost health coverage to adults, children, pregnant people, older adults, people with disabilities and others with lower incomes. OHA oversees Oregon's Medicaid program, which covers approximately 1.4 million people and is known as the
Oregon Health Plan, or OHP. OHA contracts with CCOs to administer benefits for the vast majority of OHP members.
OHA compensates CCOs in two ways: a flat monthly rate for each person whose benefits a CCO coordinates, and an annual incentive bonus for improving care quality for CCO members. The monthly payments, also known as
capitation rates, are updated annually.
To develop 2026 capitation rates, OHA considered 2024 and available 2025 data on both CCO financial performance and benefit usage trends. OHA will finalize 2026 CCO rates by the end of 2025.
The 2025 financial data to-date indicate CCOs continue to face revenue challenges this year. Through June 30, 2025, CCOs collectively spent 91.9% of their total revenue on member services and 8% on administrative services, leaving only .02% profit margin. Recognizing this has created financial pressures on the CCOs, the Oregon Legislature passed a
budget bill during its regular 2025 session that included a one-time, $30-million increase for 2025 CCO capitation rates.
More information is on
OHA's Coordinated Care (CCO) Financial Information website.