Supporters say Ballot Measure 101 would assess a reasonable fee on health insurers to keep low-income residents, seniors and disabled Medicaid recipients on the Oregon Health Plan. Opponents call that assessment a tax and argue it will disproportionately affect small businesses.
Voters will decide the measure’s fate in a special election Jan. 23.
The measure had its beginnings in House Bill 2391, passed by the Oregon Legislature this summer and signed into law in July. It created 1.5 percent assessments on insurance companies, as well as assessments on hospitals and other health care organizations. The assessments would collectively raise about $320 million to plug a hole in the state’s Medicaid budget created by a decline in federal matching dollars. Rep. Cedric Hayden, R-Fall Creek, who represents North Douglas and South Lane counties, objected to the new law. He and fellow Rep. Julie Parrish, R-Tualatin, decided to take the issue directly to the voters. They’re hoping for a “no” vote on Measure 101.
Health care organizations, including some of the biggest health care providers in Douglas County, like DCIPA, the Douglas County Independent Physicians Association, Umpqua Health Alliance and Mercy Medical Center, have lined up on the “yes” side of the equation.
They argue a “no” vote would push many Oregonians, including thousands of Douglas County residents, off their health insurance. Hayden said that won’t happen. Instead, he said this issue is about converting a previously existing assessment into a higher permanent tax.
Mark Tsuchiya, a spokesman for the Roseburg-based coordinated care organization Umpqua Health Alliance, which serves 26,000 Douglas County residents on the Oregon Health Plan, said Measure 101 is “vitally important” to Douglas County. One in three Douglas County residents is signed up with the Umpqua Health Alliance, Tsuchiya said.
“If it passes, the measure will ensure some of our most vulnerable community members, including children, many hard-working, low-income families, senior citizens and people living with disabilities have access to the health insurance and care they need to maintain their health,” Tsuchiya said.
If Measure 101 doesn’t pass, he said, all its patients would likely be impacted, and thousands would lose their health insurance altogether.
“The fallout of a no vote would be devastating,” he said.
Tsuchiya said opponents talk about health insurance premiums going up if Measure 101 passes, but the measure limits the amount by which premiums can be increased to 1.5 percent, or about $5 per person per month. He said it’s a “no” vote that would ensure premiums rise.
That’s because when thousands of county residents lost their health insurance, there would be a “ripple effect,” Tsuchiya said. Patients would be pushed to seek expensive emergency room care for ailments that could have been managed more cheaply and effectively by primary care doctors. Hospitals would then be forced to pass the cost on to commercial insurers, who would pass it on in the form of higher premiums.
Mercy Medical Center spokeswoman Kathleen Nickel said the hospital will feel some financial impact whether Measure 101 passes or fails. While the hospital would likely pay an additional tax if Measure 101 passes, if it doesn’t pass, “the reality is that we will see more people in our emergency department, uninsured,” she said.
“Ultimately we just think it’s better if people have access to coverage that lets them seek care in more appropriate settings and earlier in any kind of a disease process,” she said.
Greg Brigham, CEO of Adapt, which provides an array of services from primary to mental health care, said he’s shocked by those who oppose Measure 101. He thinks some opponents are just political actors who are seeking to raise their profiles through their involvement in the controversy.
“I think that people who are serious about health care know that this would be devastating to Oregon,” he said. He said no one will benefit from a “no” vote.
He said the opposition’s characterization of the measure as a tax is misleading. Instead, he said, it’s an assessment the hospitals and coordinated care organizations have voluntarily agreed to pay. And it’s money that goes toward a match, bringing in more federal dollars than are spent by the state.
“I hope that people vote ‘yes’ on it, and it passes, because I think if it fails, if it goes down, and the assessment on CCO’s and hospitals is repealed, it will put the state budget into a crisis, and will dramatically decrease the number of people in Oregon who will have health care coverage,” Brigham said.
Brigham said about 40 percent of the people Adapt serves are on the Oregon Health Plan, and about one third of those could lose their health insurance if Oregonians vote “no” on 101. Fewer kids and adults would be covered for primary care. Substance abuse treatment would also be impacted, and it would happen at a time when the county faces an opioid epidemic, he said. Mental health care would suffer too, because it is the most dependent of all Adapt’s programs on OHP.
Hayden said it’s really just about two pages out of the 26-page HB 2391 that are at issue. He said he supports most of the bill, and he supports Medicaid. The problem, he said, is a change the legislature made to an assessment system that’s been used since 2004.
The old assessments fluctuated based on the actual number of patients. The new system creates a true permanent tax amount regardless of the number of patients, with no guarantee that if caseloads drop, the money will stick with the Medicaid program. Hayden said the extra could be used as a back door income source for a general fund facing a crisis fueled by rising costs of the Public Employee Retirement System. He said Gov. Kate Brown has already come out in favor of using other safety net money to pay for PERS.
“It’s only a small percentage of the bill that we’re repealing, and that is the policy shift from Medicaid funds being locked in a box for Medicaid, to opening a back door. So if you open a back door and ... if caseloads drop then public employee unions, organized labor, can in theory sweep this money,” he said.
Hayden said the new system would actually hurt, not help, Medicaid recipients.
Hayden also said the new tax would be unfair, because “the big dogs,” large, self-insured corporations, won’t pay it. But, mom-and-pop businesses with small group insurance plans will.
“Those kind of people are paying the burden of this tax,” he said.
He also said a two-year sunset built into the system guarantees an artificial Medicaid funding crisis in 2019.
Hayden said he really doesn’t know how the vote will turn out.
“I do know this. On Jan. 24, nobody will lose their health insurance either way. This is not a case of anybody losing their health insurance. This is a case of two alternate streams of funding,” he said.
Hayden acknowledged opponents of Measure 101 are being dramatically outspent. According to Oregon Secretary of State records, supporters have generated about $1.7 million in contributions, while the main PACs opposing the measure have generated about $100,000.
Contributors to Yes for Healthcare, a PAC dedicated to Measure 101’s passage, include the Oregon Association of Hospitals and Health Systems, which has donated $350,000 to the campaign. Other major health care contributors include Willamette Valley Community Health and the Nurses United PAC. The biggest contributor to the Protect Our Healthcare PAC is Southern Oregon coordinated care organization AllCare.
Umpqua Health Management, which is connected to the Umpqua Health Alliance, gave $25,000 to Protect Our Healthcare, and another $25,000 to Yes for Healthcare.
The “yes” campaign has also received financial support from public employee unions, including the Oregon Education Association.
Two PACs, Stop Healthcare Taxes and Oregonians Against More Healthcare Taxes, have been collecting funds for the campaign against Measure 101. Stop Healthcare Taxes has received its biggest contribution, of $25,000, from All 36, a separate PAC formed by Hayden. While Stop Healthcare Taxes was created to fight 101, Oregonians Against More Healthcare Taxes lists its mission more broadly as “to support ballot measures that allow a public vote on healthcare tax increases.”
Among the more prominent contributors to these PACs are individual businessmen like Brian Maguire, CEO of Portland-based tech company Net2Vault, who donated more than $14,000 to Stop Healthcare Taxes and another $11,000 to Oregonians Against More Healthcare Taxes. Andrew Miller, CEO of Portland-based Stimson Lumber donated $15,000 to Oregonians Against More Healthcare Taxes and $15,000 to All 36. Norman McDougal, CEO of the Creswell-based timber and land development company McDougal Bros., Inc., gave $50,000 to All 36.