2009 Legislative Report
MONDAY UPDATE

Prepared for OAFP

June 1, 2009

HEALTH CARE REFORM

HB 2116 – Hospitals and insurance companies reach deals on taxes
“It’s pretty remarkable that in this economy we can double the number of low-income adults on the Oregon Health Plan,” said Andy Davidson, CEO of the Hospital Association.
Hospitals and legislators were in a celebratory mood. They successfully negotiated a new tax on hospitals that will leverage enough federal funds to cover 50,000 adults and not hurt hospitals in the process. “The hospital assessment is not a true tax,” John Briton from Legislative Fiscal told the House Revenue Committee, “because the money is returned to the hospitals through enhanced reimbursement.” So the hospital tax actually works more like a no-interest loan to the state.
The insurance premium tax is a very different story. The one-percent premium tax will be passed on to individuals and small employers that purchase commercial insurance (union trusts and large self-insured plans are exempt, though the bill spells out that PEBB must pay the tax even after it goes self-insured).
While most insurance companies agreed to the tax and will honor it, they aren’t actively supporting it. No one from the insurance companies testified in committee or took part in the big press conference announcing the deal. Two major business groups, AOI and NFIB, testified in opposition to the premium tax.
The insurance tax will cover 80,000 kids (60,000 through OHP; 20,000 through a new subsidized private insurance program). At least $9 million from the insurance tax will also be used to provide subsidized commercial insurance for families. Some of that will be used for FHIAP though most of it will go to the kids’ plan.
Combined, the two taxes will pull down $1 billion in federal matching funds. “This is a first step on the way to utopia,” Rep. Mitch Greenlick (D-Portland) said.
Republicans on the Revenue Committee introduced an amendment to separate the premium tax from the hospital tax. After that failed they introduced another amendment to send HB 2116 to the voters. That also failed and the bill passed on a straight party-line vote. It’s expected to be on the House floor by mid-week.

HB 2009 – Health care reform poised to move forward
Legislators were itching to pass the health care reform bill out of Ways and Means on Friday but they put the brakes on to give members enough time to actually read the 589 page bill and 70 pages of amendments that showed up on Thursday.
The amendments include at least four major components:
1. Change the name of the Health Authority Board to the Health Policy Board (though it will still oversee the Health Authority).
2. Eliminate the Quality Care Institute – this was a money-saving measure. They plan to incorporate quality care components in other aspects of the bill.
3. New health insurance rate review criteria – including a public comment period, and review of administrative costs, surplus and reserves. “Compared with existing law this significantly strengthens our authority,” Cory Streisinger, director of DCBS told the Ways and Means subcommittee.
4. Fees (amount to be determined) on health care workers to pay for a new workforce database.
HB 2009 incorporates most of the proposals introduced by the Oregon Health Fund Board including:
· POLST registry for end-of-life physician orders All-payers, all-claims database
· Statewide information exchange that would allow electronic medical records to be shared among providers (and that qualifies for 9:1 federal matching funds
· Focus on patient-centered primary care homes
· Standardized forms and processes for administrative simplification
· Public employer purchasing collaborative, and
· Clinical improvement assessment project to promote the use of evidence-based health care.
The Oregon Health Fund claims these measures will save $10 billion over the next 10 years. Many of the proposals enjoy broad support though the purported cost savings are regarded as a wild exaggeration.
Under HB 2009, the new Oregon Health Authority and Oregon Health Policy Board will start out under the umbrella of the Department of Human Services (DHS). They will be spun off in a separate agency at the beginning of the 2011-13 biennium.
The bill also calls for the Authority and Board to make recommendations to the 2011 Legislative session on a plan for universal coverage, development of an Insurance Exchange, a public health plan option and more.
HB 2009 is expected to be voted on in the House later this week.

OTHER HEALTH CARE ISSUES

HB 3418 – OHP primary care homes
“Didn’t this bill originally have money in it to fund pilot projects?” Sen. Alan Bates (D-Medford) asked supporters of the bill. “Yes,” they said, but the financial realities of the budget shortfall forced them to strip out the funding during hearings in the House.
Sen. Frank Morse (R-Albany) was supportive. “This bill may become the vanguard for defining what a primary care home will become,” he said. “Payment drives the product.”
Jeanine Smith from the Office for Health Policy and Research (OHPR) was asked how this bill meshes with SB 456 from the Oregon Health Fund Board. “This bill only applies to the Oregon Health Plan,” she said. “SB 456 takes a broader view including all payers and providers.”
The Senate Health Care Committee approved the bill 4 to 0. It now moves to the Senate floor.

HB 2702 – Psychologists and psychiatrists fight to the finish
Psychologists have been pushing for two sessions to gain prescription-writing privileges for their members who receive additional training. In the last hour of the last day for committee hearings, the two sides grudgingly agreed to create an interim work group to develop a training program and recommendation for the February 2010 session. The Work Group would include:
1 primary care physician
2 psychiatrists (one from OHSU’s faculty)
1 pharmacist
3 psychologists, 2 of whom have received the Masters in clinical psychopharmacology.
The two sides will have to share the cost of a mediator/facilitator.
This compromise was enough to move the bill out of the Senate Health Care Committee, but it’s not clear it has the votes to pass on either the Senate or House floors.

SB 24 – Telemedicine bill keeps chugging along
Without comment, the House Health Care Committee unanimously approved the telemedicine bill. Supporters of the bill had negotiated the language with the insurance carriers, so there was no opposition.
The bill sets out a framework for what types of telehealth procedures would be paid for by insurance. Details still need to be negotiated in contracts with each carrier.
SB 24 now moves to the House floor.

Obesity Prevention Initiative
In 2007 the Legislature approved a task force to address the growing crisis of obesity. The new report describes the results of eating more and exercising less:
· The proportion of obese adults more than doubled since 1990.
· The proportion of obese children has tripled.
· In 1970, 66 percent of children in the U.S. walked or biked to school. By 2000, that was down to 10 percent.
· A simple breakfast of coffee and bagel has increased from 195 calories in 1989 to as many as 700 calories today.
Among the recommendations in the report is the menu-labeling bill that is moving through the legislative process (see below).

HB 2726 – Menu labeling moves forward
The Senate Health Care Committee was reluctant to tamper with provisions in the proposed menu-labeling law, even though the Public Health Department had a number of suggested changes. “If we pass a different bill than the House, there probably are not 31 votes in the House to pass it,” Sen. Laurie Monnes Anderson (D-Gresham) said.
Multnomah County already has a menu labeling law and Lane County is considering one. This bill would pre-empt those local efforts. Some members of the committee doubt the effectiveness of menu labeling, but support the idea of statewide pre-emption. “If we are going to have a standard, let’s have a state standard,” said Sen. Frank Morse (R-Albany).
The committee approved the bill 4-1. It now goes to the Senate floor.

SB 850 – House supports dentist but not alternative health provider on HSC
The House Health Committee, with agreement from the Health Services Commission, voted to add a dentist as a permanent member of the commission that deals with hundreds of dental codes on the prioritized list for the Oregon Health Plan.
Efforts to piggyback on the bill and add a “complimentary” medicine provider (e.g. acupuncturist, chiropractor, naturopath and so on) fell short. However the committee said it does want to spend some time during the interim taking a closer look at the evidence for complimentary medicine to figure out of legislation should be introduced.
SB 850 now moves to the House floor.

HB 2058 – Health board bills combined into one
The Senate Health Care Committee merged two health board bills into one: HB 2056 became part of HB 2058. These standardize health fund boards, with a few exceptions. For example, the Senate committee granted the Board of Dentistry’s request for four-year terms for its members instead of three. Sen. Jeff Kruse (R-Roseburg) said, “I’m not clear what problem we are trying to solve with this.” But the bill passed 4 to 1.
The bill now moves to the Senate floor, then back to House for concurrence on the amendment.

HB 2194 – Unions escape paying for OMIP, but the fight is not over
Union trusts and the big self-insured companies (e.g., NIKE and Intel) successfully fended off an effort to make them contribute to the high-risk pool (Oregon Medical Insurance Pool). “I find it troubling for the largest companies to escape from their share of the responsibility,” Sen. Frank Morse (R-Albany) said. “That doesn’t seem right.”
Senate Health Care Committee chair Sen. Laurie Monnes Anderson (D-Gresham) said, “I would have to agree with you but if we pass this, we know it would be litigated. That’s my reluctance.” The unions have threatened to sue under ERISA if they are required to contribute.
Sen. Jeff Kruse (R-Roseburg) said, “Passing this amendment is the right thing to do. If we don’t do this, we are just piling on to the those small businesses that pay already.”
On a straight party-line vote, the Democrats defeated the amendment and passed the bill. But Sen. Kruse announced he will file a Minority Report. That means Senators will have a floor debate and vote on whether the unions and self-insured plans should pay their fair share.

HB 2802 – Wrongful death cap bill moves forward
A bill to overturn Hughes v. PeaceHealth and increase Oregon’s wrongful death cap from $500,000 to $1.5 million moved out of the Senate Judiciary Committee last week. The Oregon Medical Association, medical malpractice insurers, and some industry groups are now fully engaged and hope to kill the bill on the Senate floor.

HB 3021 – State tort cap protection for emergency volunteers and hospitals
The Senate Judiciary Committee last week approved a bill saying hospitals providing services “pursuant to directions from a public body” during an emergency will fall under the state tort cap without regard to whether the health care provider is compensated for the services.

BUDGETS AND OTHER ISSUES

How to raise $800 million? – Taxes, taxes, taxes
The greatest challenge with the proposed budget plan is raising the $800 million in new taxes that are part of the package. Last week, Democrats unveiled two proposals in the House Revenue Committee:
1. A higher tax rate for couples with incomes above $250,000. This proposal would raise $500 million.
2. Increasing the corporate minimum tax to $100 plus a new gross receipts tax that would raise $237 million.
Both were introduced as permanent tax increases. Some business groups said they would support a temporary business tax increase but their support wanes if the tax does not include a sunset. The gross receipts portion of the tax drew a parade of opponents who said it would punish businesses that have high receipts but low or no profits.
Conservative anti-tax activists are already organizing to refer one or more tax proposals to the ballot.
The proposed tax plans may be restructured before they are sent to the House floor. House leadership needs all 36 Democrats to support the tax bill or bills if the Republicans stay united in their opposition.

Policy committees close
Most of the major policy committees closed last Thursday. Lobbyists and legislators made a late push to work out deals to beat the deadline. Some of the more politicized bills still sit in the Rules Committees that will stay open until the session ends.
Also still open are the Revenue and Ways and Means Committees. Committees are now on one-hour notice (instead of 48 hour notice during the bulk of the session) so bills can move very quickly when they get going.
You can tell the session is reaching a crescendo. Major pieces of legislation including the Governor’s Transportation package, which passed the House last week, and the health care reform bills (HB 2009 & HB 2116) are moving.
Final details must still be put on the budget but first the Revenue Committees have to figure out how to squeeze an additional $800 out of a down economy.
The end of June is still the target for adjournment though rumors are circulating that they may try to wrap up everything a week or two early.

OAFP’s bill tracking Website: http://www.capitolonramp.com/lts/guests/1477220/
For more information contact Doug Barber at doug@lobbyoregon.com or 541-221-3072.