Gov. John Kitzhaber’s plan for improved health care for Medicaid patients promised better coordination, better outcomes and fewer costs. But launching the new collaborative system has come with a dispute over who gets paid how much.
Salem Hospital has filed a lawsuit against the local coordinated-care organization, consequences from which could mean less revenue for the hospital.
Willamette Valley Community Health is the local coordinated-care organization formed to deliver care to Medicaid patients in the Mid-Valley. Coordinated-care organizations, or CCOs, are a key part of Oregon’s overhaul of the Oregon Health Plan and include a network of providers expected to deliver more comprehensive mental, physical and dental care for thousands of low-income Oregonians on the program.
Willamette Valley Community Health (WVCH) is expected to cover almost 68,000 people in Marion and Polk counties.
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Before WVCH was formed, Marion Polk Community Health Plan (MPCHP) managed the care of local Oregon Health Plan patients through contracts with providers, including Salem Hospital.
WVCH replaced Marion Polk Community Health Plan as the financial conduit for Oregon Health Plan services.
According to the complaint filed Oct. 30 in Marion County Circuit Court, “the WVCH Board unanimously approved the assignment of existing provider contracts, including those of Salem Hospital and West Valley Hospital, from MPCHP to WVCH” in June.
But in October, the complaint alleges that WVCH chairman Jim Russell declared that the assignment of the Salem Hospital provider contract from MPCHP to WVCH is void and that Salem Hospital would only be paid as a non-participating provider, at a lower reimbursement rate.
The suit asks the court to declare that Salem Hospital has a valid and enforceable contract with WVCH.
At the heart of the dispute is compensation — how much WVCH would pay Salem Hospital for its services to enrollees. Hospitals that contract with a managed care organization receive a reimbursement rate that is 68 percent of the Medicare reimbursement rate.