Oregon’s New Medical Plan Seeks to Ration Treatment : Health: By cutting off payment on some procedures, officials hope to extend basic coverage to everyone.

Whose pain to ease? What sickness to treat? At how high a cost? For how long?

And, yes: Whose sickness not to treat? What pain must be endured?

In annual budget debates over dollars and cents, God-like health care questions like these seldom are raised.

But the state of Oregon, amid both great promise and grave doubt, stepped forward this weekend and put the finishing touches on a proposal that presumes to turn American health care on its ear and rewrite the basics of the “safety net” health care system for the poor, both those who work and those who cannot.

The philosophy of the Oregon plan is that if government is willing to decide which medical treatment is worthwhile--which is most effective for the most people, and which is or which is not too costly--then hundreds of thousands more citizens can be offered more reliable basic coverage, both through government Medicaid and private-employer insurance plans, without breaking the budget.

In other words, ration the treatment available, and make sure everyone is eligible to receive it, even if it means taking the controversial step of cutting off payment for some treatments.

“Most Americans believe that everyone should have access to health care and Congress has toyed for nearly half a century with the idea. Yet today, the number of Americans without coverage continues to grow. In Oregon, we’ve created an approach that provides coverage for everyone and we’ve reached the political consensus necessary to make it happen,” says John Kitzhaber. He is president of the state Senate, an emergency room physician and the father of the Oregon health care revolution.

After four years of preparing its plan, a process remarkable for the consensus it brought, Oregon took the fateful step Saturday night of “drawing the line” and declaring exactly which treatments it could afford to cover from a priority list of 709 procedures.

In a legislative vote to increase Medicaid spending 10%, the line was drawn at No. 587. Every treatment above that line would be covered for all people in poverty, through the Medicaid program, and private employers would be required to provide coverage for those same treatments for their workers.

Everything below that line, beginning with surgery for a slipped disk, No. 588, the state would not cover and employers need not either, although they could if they wished.

Everyone would be entitled to visit a doctor for a diagnosis. After that, though, medical treatments with limited effectiveness would not be reimbursed in order to save money to cover treatable diseases for those who now are uninsured.

For instance, terminal cancer or end-stage AIDS patients without private insurance would be given comfort care but nothing more. Ditto for medical treatments for the common cold, or surgical repair of uncomplicated hemorrhoids, or heroic costly hospital campaigns to save the lives of premature babies born weighing less than 17.5 ounces and younger than 23 weeks in gestation.

“What we’re excluding on the list are basically those things that will get better on their own or with home remedies and those things that are not likely to get better at all,” says Cynthia Griffin, spokeswoman on the issue for the Legislature, the governor and Oregon’s Health Care Commission.

The result, champions of the plan say, is that nearly all of the 450,000 uninsured Oregonians, nearly one-fifth of the state’s population, will be eligible for basic health care coverage. Perhaps another 200,000 or so underinsured residents will be eligible for better coverage.

Right now, Medicaid eligibility is tightly drawn to cover primarily mothers and children in deep poverty. And private employers are not required to provide health insurance.

Under the new Oregon plan, basic coverage--the floor for everyone--also would be expanded to include some treatments not always associated with Medicaid and certainly not with indigent care--such as mammograms, dental visits and some other preventive services such as physicals. Additionally, the poor will be relieved of having to hunt for a doctor. The plan promises to assign each Oregonian a doctor or a group.

Well, actually, not yet.

Because Oregon wants to go its own way with a program partly financed by federal tax dollars, it needs waivers of federal Medicaid rules. And that means the debate is not over but that it merely advances to the Bush Administration and to the halls of Congress.

With broad support in the state Legislature and backed by Gov. Barbara Roberts, the plan also has slowly won over Oregon’s large employers and some of its New Age health care thinkers.

“We set out to ask Oregonians about their values on health care. . . . It turned out they valued quality of life more than length of life,” says Ian Timm of the group called Oregon Health Decisions, which views itself as the equivalent of a League of Women Voters on medical care issues. It conducted two rounds of community meetings that were influential in shaping the Oregon plan.

“This priority list reflects the values of Oregonians,” he says.

In fact, one of the most remarkable things about the whole effort is that with 25,000 hours of citizen participation, Oregon has been able to devise a consensus on a new approach to health care, while so much of the nation seems paralyzed by the unyielding demands of competing forces.

The Oregon reform emerged out of the sad story of 7-year-old Cody Howard. The Oregon youngster died of leukemia in 1987 after the Legislature voted to curtail spending on bone marrow transplants for a handful of gravely ill individuals in favor of providing prenatal services for more than 1,200 pregnant women.

The boy’s plight attracted widespread news coverage as his desperate family tried to raise $100,000 on its own to pay for the transplant. Suddenly, the public found itself in the mood to listen as people such as Kitzhaber and Timm asked if there were not a wiser way.

That led to formation of a Health Service Commission, made up of five physicians, four citizen consumers, a public health nurse and a social services worker. Their premise was that human beings could, with effort, blend medical science and social values into a comprehensive list of medical procedures

From that came the Oregon priority schedule of 709 separate procedures, ranging from No. 1 in value and effectiveness, the treatment of bacterial pneumonia, to last in line, the treatment of babies born without brains or with reduced brains.

“We want to establish that everyone in Oregon has a right to health care,” says Jean Thorne, state director of Medicaid. “Under this plan, every Oregonian will have access to a set of services that will make a difference in their lives and in a way that is financially responsible.”

But there are doubters and painful lists of doubts about the Oregon plan, too.

Is it moral to ration heath care with such a rote formula? Is it justifiable to take a system that devotes most of its Medicaid money to mothers and children in poverty and spread this scarce money even more thinly among others at the lower end of the economic ladder? And even if Oregon conceived its plan out of concern for inequities, what will prevent future legislatures or other states who follow suit from squeezing more money from budgets by drawing the line higher and higher each year?

Already, health care issues in Oregon are spoken of in a bizarre argot of numbers: “We think we ought to go to line 640. . . . All we can afford is to line 533.” And so forth.

Critics also note that Oregon exempted from its revolution the politically powerful bloc of aged, blind and disabled Medicare recipients. Under the plan as passed, these Oregonians would continue to receive standard Medicare benefits, while mothers with dependent children, traditionally a politically powerless constituency, would find their Medicaid care rationed.

“One can hardy think of a greater insult to intergenerational harmony,” says Rep. Henry A. Waxman (D-Los Angeles), who chairs the House Energy and Commerce subcommittee on health and the environment.

Waxman has expressed repeated and deep reservations about granting Oregon the federal waiver needed to proceed with its plan. He has promised congressional hearings to explore a whole range of questions: Why rank the virtues of health care by procedure alone? Might some procedures be a waste of money on one patient in poor health but make for a long and happy life if performed on another? Why not consider the overall health and prognosis of the individual patient? And does Oregon really know with confidence which procedures are the most valuable to society and which are not?

Oregon sponsors such as Kitzhaber say that the present system of health care could withstand even fewer such criticisms if any official ever had the stomach to raise them. How in the world, he wonders, can anyone defend a system that excludes whole groups of needy people from any level of coverage at all? And to compare Oregon’s proposal to the ideal of wide-open universal health care, he says, renders “meaningful reform at the national level difficult, if not impossible, to achieve.”

“We have never claimed that our proposal represents the best system. We claim only that it represents a better one,” he says.

Even some supporters, though, are getting nervous as Oregon advances from discussion toward implementation of its health care revolution.

Ellen Pinney is the executive director of the Oregon Health Action Campaign, representing 96 different labor, senior citizen and other interest groups on the issue. Her organization originally backed the idea of the Oregon plan because of early promises that it was a first step toward a universal level of health care for everyone in the state.

Now, she says, special interests such as insurance companies are chewing away at the foundations of the idea. Not as many procedures as she would have liked made the cut. And then, in a sharp slap in the face to backers, state senators voted against setting an example and instituting the same cutoff at line 587 in their own health insurance program.

“At the start this was supposed to define an adequate level of health care for all Oregonians. . . . So, why didn’t legislators accept it as their own? If they’re concerned about this for themselves and their children, how come they aren’t concerned about it for people who are much less able to pay for out-of-pocket costs?” she asks. “We’re feeling this is a promise broken.”

By her calculations, the $6.5 billion that all Oregonians paid last year for health care amounts to $200 a month per person in the state, or three times what the state collects in income taxes. “That amount of money should be able to provide us with comprehensive benefits, everyone,” she says.

Her solution is “very heavy regulation” of the profits made by doctors and others in the medical system. Some important consumer-oriented backers of the Oregon plan agree that holding down the profits of society’s healers “is a major piece that needs to be tackled.”

But Pinney cannot be labeled an outright opponent of the plan either. If nothing is done, she worries, Oregonians will be paying $560 a month per person by the year 2000 just to pay for today’s belabored system.

“This may not be a solution but it’s moving us somewhere,” she says.

At the soonest, Oregon officials believe it will take six months and probably longer to get a federal waiver. In the meantime, Oregon is certain to endure the curiosity of health experts from around the nation and in Congress.

Times researcher Doug Conner in Seattle contributed to this story.