Oregon Wins OK to Ration Medical Care

By EDWIN CHEN

March 20, 1993 12 AM PT

TIMES STAFF WRITER

WASHINGTON —

The Clinton Administration said Friday that it would permit Oregon to proceed with the nation’s first-ever explicit attempt to ration medical services, launching a controversial program to cover every indigent person in Oregon but reducing the array of medical services available to them.

The federal authorization means that Oregon will become the first state to provide a basic package of Medicaid services to all indigent men, women and children. But to help finance the expansion in eligibility, the state will eliminate Medicaid-financed treatments and therapies for more than 100 medical conditions--primarily costly procedures deemed least likely to save or prolong lives.

In an era of rising medical costs and a growing need to cover the uninsured, Oregon’s innovative plan is seen by some as a harbinger for the nation.

“Sooner or later, the rest of America is going to come to what Oregon is trying,” said Sen. Bob Packwood (R-Ore.).

Rep. Ron Wyden (D-Ore.) called the program “the first big step in the march for national health reform.”

But Donna Shalala, secretary of the Department of Health and Human Services, who announced the Administration decision, cautioned against reading too much into the move.

“I don’t think you should come to any conclusions about the health care reform proposals of the Clinton Administration based on my decision . . . “ she said Friday. A task force chaired by First Lady Hillary Rodham Clinton is currently studying ways to overhaul the nation’s health care system.

Like all other states, Oregon in recent years has seen its Medicaid program take increasingly large chunks of its budget, aggravated by the prolonged recession that threw more people out of work.

As a result, state leaders began exploring the possibility of a rationing program in the late 1980s, forming a broadly based commission to chart the course.

First presented to the federal government more than two years ago, Oregon’s Medicaid rationing plan ranked 688 medical treatments according to their cost and benefit.

Treatments deemed likely to improve quality of life generally were assigned higher priorities than those that do little more than prolong life. Officials then calculated the amount of funds available and drew a line on the list of treatments. The mark came at line 568--all treatments and conditions above the line were covered. The 120 below it were not.

By rationing the care, the state was able to greatly expand eligibility beyond the 240,000 people who now qualify for Medicaid in the state.

The plan will cover an additional 120,000 people who are either working poor or families making too much money to qualify for Medicaid but who still fall under the federal poverty level--$991 in monthly income for a family of three.

The George Bush Administration last August rejected Oregon’s request for a federal waiver, which is required because Medicaid is a joint federal-state program. Justice Department officials said the plan appeared to discriminate against the disabled under provisions of the 1990 Americans with Disabilities Act.

Oregon officials late last year submitted an amended plan that Gov. Barbara Roberts said specifically addressed the concerns.

Shalala said Friday that the changes have met with the Clinton Administration’s approval. “Oregon has significantly modified its initial proposal,” she said at a press conference. “Moreover, we took extraordinary steps to ensure that this plan complies fully with the (disabilities act).”

She also noted that Oregon may not alter the basic benefits package without further federal approval.

But University of Minnesota bioethicist Art Caplan, a longtime Oregon critic, predicted that the program is unlikely to be implemented anytime soon, citing the likelihood of litigation and the possible need for the state Legislature to enact new taxes to finance the plan.

The notion of tinkering with a program that affects only the poor has run into a buzz saw of criticism across the country. Among the early opponents was the liberal Children’s Defense Fund, then chaired by Mrs. Clinton, an attorney at the time in Little Rock, Ark.

As the controversy grew, it made for strange bedfellows. Among those who backed Oregon’s plan was then-Arkansas Gov. Bill Clinton, a strong believer in permitting states to experiment.

Joining the Children’s Defense Fund and Mrs. Clinton in opposing the plan were conservative groups, such as the National Right to Life Committee, which said Oregon’s concept “devalues” life by using a “quality of life” calculation to determine when a particular treatment is to be given or withheld.

Others who opposed the plan included then-Tennessee Sen. Al Gore, now the vice president, who described the plan in 1991 congressional testimony as “a tragic choice and a horrible mistake in responding to the plight of the uninsured by developing a scheme that takes from the poor, and only the poor, to help the poor. . . . “

But Wyden insisted Friday that health services for the poor “are being expanded, not rationed.”

Rationing the Care

Under the Oregon plan, Medicaid will pay for 568 of a possible 688 treatments and conditions ranked according to their costs and benefits. Treatments considered likely to improve quality of life generally were assigned higher priorities than those that do little more than prolong life. NO LONGER COVERED

Common cold

Disorders of the sweat glands

Minor headaches

Chronic back pain

Infertility

Removal of benign tumors of the digestive tract

Benign skin tumors

Phlebitis

Liver transplants for those with liver cancer

Nutritional counseling for the obese COVERED TREATMENTS

Moderate and severe head injuries

Insulin-dependent diabetes