Governor Kitzhaber and the Obama Administration today announced an agreement in principle to coordinate care for Medicaid beneficiaries in Oregon, through a new model of care that will reduce the cost trend in Oregon's Medicaid program by at least two percentage points within two years while improving health outcomes.
The U.S. Department of Health and Human Services (HHS) has given preliminary approval of a five-year, $1.9 billion demonstration of a Federal-State partnership to transform the way that care is delivered in Oregon's Medicaid program. The initial investment of $620 million in the second year of the State's current biennium will allow Oregon's new care organizations to better deliver higher-quality, coordinated care for Medicaid patients while reducing preventable errors. Oregon estimates that this will achieve $11 billion in savings over the next decade.
"This is a defining moment for health care transformation in Oregon, and the Obama Administration is a true partner in our efforts to reduce health care costs while improving care," said Governor Kitzhaber. "With unprecedented collaboration between local communities, health care providers and our federal partners, Oregon is on the right track to create a system that will both improve care and reduce costs."
"We are proud to support the State of Oregon as we make an important investment in improving the way that care is delivered to Oregonians in Medicaid," said HHS Secretary Kathleen Sebelius.
"These efforts to coordinate care, which mirror our efforts at the national level thanks to the Affordable Care Act, will mean better care for those on Medicaid, better health outcomes, and lower costs. This is another example of how we are collaborating successfully with States in their efforts to find innovative healthcare solutions that work for their communities."
Governor Kitzhaber expressed his thanks to the Obama Administration for their work and collaboration in investing in this new model of providing care, and his thanks to Oregon's congressional delegation -- in particular Senators Wyden and Merkley and Congressman Blumenauer -- and to the many others who helped bring about this remarkable achievement.