FamilyCare Health, Oregon’s second-largest manager of Medicaid patients, is going out of business at the end of January, leaving their roughly 115,000 patients in the Portland metro area to find a new coordinated care organization. There’s no guarantee FamilyCare’s patients can continue to see the same medical professionals with the same coverage, or that the providers they leave behind can stay afloat.
Related: Low-Income Health Provider FamilyCare Really Closing
An ongoing lawsuit reveals FamilyCare has for years maintained they were being treated unfairly by the state of Oregon, citing low reimbursement rates. At $377.57 per member every month, FamilyCare received one of the lower reimbursement rates in the state. Health Share of Oregon, the Medicaid provider that will take on the bulk of FamilyCare’s patients, receives $409.75.
Even though FamilyCare got less money from the state, they generally paid more money to health care providers. The idea was to boost their members' choice of providers and allow providers the ability to spend more time with members, thus reducing future medical costs. Although patients formerly with FamilyCare will not lose their insurance, they could be forced to find new doctors who are willing to be paid federal Medicaid rates — much less than what FamilyCare paid providers.
Recovery Works Northwest, a drug addiction treatment center, is one of the clinics that will be affected by FamilyCare’s closure. Forty to 50 percent of the clinic’s total patients are on FamilyCare, and at their eastside location alone, 80 percent are on FamilyCare.
In an interview with OPB’s “Think Out Loud,” Brian Swartz, a managing partner and physician at Recovery Works Northwest, said 70 percent of their patients going through drug and addiction treatment are able to kick the habit. That, he said, is due to their holistic approach to intervention.
“People get to us and they’re like, ‘I didn’t know a place like you existed,’” Swartz said.
Their approach includes behavioral, mental and medical services plus outpatient follow-up — a strategy that costs more money up front, but which Swartz said ultimately saves the state millions of dollars.
After negotiations, Recovery Works Northwest decided to contract with Health Share, which allows them to keep all of their patients formerly with FamilyCare. The financial impact of the change, and whether it can support the clinics approach to care, is still in question. Swartz said he’s staying optimistic that Health Share understands the needs of his patients and will agree to raise rates so that clinics like Recovery Works can stay financially viable.
Brad Larson Sanchez, a psychologist and owner of Portland Mental Health and Wellness, told "Think Out Loud" his clinic faces similar prospects. Forty percent of his patients are on FamilyCare, and in anticipation of their exodus, wages, benefits and jobs had already been cut.
Sanchez said if they kept their FamilyCare patients and agreed to federal reimbursements rates, revenue would drop 30 to 40 percent. Like Swartz, Sanchez believes the more frequent, high-quality care his clinic provides saves the health system money in the long run.
"When people have a real solid relationship with a therapist and they’re able to feel safe in that relationship and also reach out when they’re in crisis, we can void hospitalization and avoid a more intensive level of care that is far more expensive than paying us at a decent rate," said Sanchez.
Portland Mental Health and Wellness is still in negotiations with Health Share. “We are trying the balance the impact to our patients as well as to our business,” Sanchez said. The organization will have to decide if Health Share’s rates are financially viable and if a contract with them will meet their ethical standards for treatment.
