By Tara Bannow • The Bulletin

Gary Frederick’s seizure condition has never been worse. He’s up to 19 a day.

“We never know from one minute to the next whether he’s going to be unconscious or not,” said Gary’s wife, Tricia Frederick.

Last fall, the Sunriver couple realized Gary, 52, wouldn’t be able to work anymore, and they would have to find health insurance on their own.

They said their doctor, Daniel Skotte at High Desert Family Medicine in Sunriver, warned them straight away: If they got on the Oregon Health Plan — the state’s version of Medicaid — they’d have to find a new doctor.

But they liked Skotte and wanted to keep him. So while filling out her insurance application, Tricia Frederick made sure to stipulate she did not want OHP. She wanted PacificSource’s gold or silver plan, which she could afford with tax credits.

In the Fredericks’ case, the state’s fast-track enrollment process for OHP worked a little too well. Because the couple receives food assistance, they were automatically enrolled into OHP — and they say it’s been a nightmare ever since.

They can’t find a doctor who will treat Gary’s complicated disability, especially now that he’s trying to apply for social security benefits.

“It’s great for people who have the occasional cold, who just need occasional things — once-a-year checkups,” Tricia said, “but for people who actually need active health care like us, it doesn’t seem to be working.”

The Fredericks are not unique in their struggle to get the care they need with their new OHP cards after being dropped from their original doctors. More than 42,000 people are now enrolled in OHP under the umbrella of Central Oregon’s Coordinated Care Organization, the entity run by PacificSource Community Solutions that oversees the care and billing for patients in Deschutes, Crook and Jefferson counties and part of Klamath County.

CCOs prepared as best they could, but when the Affordable Care Act provision took effect that expanded Medicaid eligibility to 138 percent of the federal poverty level, some were flooded with more people than they could have anticipated.

Oregon officials projected Central Oregon’s CCO would see 8,000 new OHP enrollees by the end of March. By the end of February, that number was already at 14,000, said John Ryan, executive director of the Central Oregon Independent Practice Association, an organization made up of providers whose leadership makes sure each clinic takes on a fair share of OHP patients.

“Everything is happening so fast as far as the expansion,” he said. “The whole community is trying to grapple with it as best we can.”

Many stakeholders

Gaining an overall picture of the Medicaid expansion’s success or failure is complicated by the fact that Central Oregon’s CCO is operated by a number of stakeholders with their own agendas, each struggling to make it work for them.

• Providers: From a hospital system and community health centers to hundreds of small clinics and individual doctors, providers vary widely in their size and capacity to take on OHP patients — as well as in their sense of responsibility to do so.

Mosaic Medical, a provider that receives federal funding to operate community health clinics in Bend, Redmond, Madras and Prineville, sees far and away the largest number of OHP patients in the region: 11,075.

Providers are paid to treat OHP adult patients at a per-person, per-month rate of between $20 to $25, said Ryan, of COIPA. They also can bring in additional reimbursement for services like immunizations and X-rays.

In general, smaller providers have a harder time treating OHP patients at that rate because they have fewer patients with private insurance to offset potential losses.

By the end of February, COIPA’s providers were seeing an average of 245 patients each, Ryan said.

COIPA does not designate a specific number of OHP patients its members must see, but it does expect it to be a “reasonable amount,” Ryan said.

If that doesn’t happen, the providers get calls from COIPA.

“We do know the clinics that are saying ‘no’ after they have a smaller number,” said Stephen Mann, president of COIPA’s board of directors and a physician at High Lakes Health Care in Bend. “We have informal discussions about ‘Take your share.’”

• PacificSource Community Solutions: The insurance company overseeing all patients within Central Oregon’s CCO and reimbursing providers for having those patients on their rosters.

 Central Oregon Independent Practice Association: The nonprofit that individual providers must join in order to treat OHP patients.

COIPA has 664 individual provider members at 110 clinics across Central Oregon. The group’s contract with PacificSource directs it to monitor whether its members are seeing OHP patients, a dynamic that’s caused friction with doctors who want more independence than COIPA membership allows.

Overwhelmed docs, miffed patients

Even before the Affordable Care Act expanded Medicaid, its beneficiaries have long struggled to find doctors to see them because of the program’s low reimbursement rates.

The number of primary care physicians who accept Medicaid has declined over the years. In 2009, 65.4 percent accepted Medicaid, a number that dropped to 50.6 percent in 2013, according to a survey by the health care consulting firm Merritt Hawkins.

After the expansion flooded clinics with new patients, some doctors say they simply had to put an end to it.

That was the case at Central Oregon Family Medicine in Redmond, which sent its adult OHP patients letters in March telling them they had to cut ties in order to stay in business.

Dr. Bruce McElroy said the move became necessary after the clinic’s OHP population grew by between 300 and 400 percent. Many of those were existing patients who had private insurance and then moved into OHP at the beginning of January.

By the end of January, the clinic was just breaking even. In March, it was operating at a loss that was quickly getting worse, he said.

“I’ve had people at the office yelling at me telling that I’m causing hardship, but my honest answer is, ‘I have to pay my employees,’” he said. “I have kids to raise. The hardship would be a lot more if we went out of business and the 5,000 people in our practice had to find a new doctor.”

Providers can stop accepting new OHP patients, but they must inform COIPA and PacificSource first as part of their agreement with COIPA, Ryan said. Providers are not, however, allowed to discriminate among patients based on their insurance provider.

Central Oregon Family Medicine is still a COIPA member, but Ryan said he made them aware of the infringements. McElroy counters that he told COIPA and PacificSource of the clinic’s plan before sending the letters out.

The letter came as a surprise to Larry and Sandra Stewart, of Redmond, both of whom were dropped from their respective longtime doctors. Sandra, 59, had been seeing McElroy but was dropped when she became insured under OHP.

Larry Stewart, 56, assumed he was safe with his doctor of more than six years because he had long been covered under Medicare for a disability.

But his former doctor, Rose Kenny, with the Family Care Center in Redmond, dropped a portion of both her Medicaid and Medicare patients, whom she said in many cases would be better served at Mosaic, which offers a prescription drug program that provides benefits not offered through the public programs. Kenny said she was struggling to provide prescription drugs for patients free of charge and battling over OHP rules, which don’t cover certain drugs, such as those for substance abuse.

Then she reached her breaking point.

“I had to basically say, ‘I’m only one person,’” Kenny said. “I’m working until 8:30 at night. I can’t afford this influx of patients. I just can’t do it.”

Kenny said she still sees 150 OHP patients, a number she said exceeds that of other providers of her clinic’s size.

Although Larry Stewart is happy with his new doctor at Bend Memorial Clinic, he’s still upset about being dropped by Kenny, who for years treated his Type 2 diabetes, congestive heart failure and kidney disease.

“I thought it was b-------,” he said. “I can’t believe I’ve been going to a doctor for six, seven years and all of a sudden they won’t see you anymore?”

Payment for Medicaid

When doctors such as McElroy and Kenny drop their OHP patients, COIPA ultimately steps in to police the providers.

In March, COIPA sent a letter to Kenny — which she provided to The Bulletin — outlining the sections of the member agreement she breached when she closed her clinic to new patients without approval and discriminated by their insurance.

Ultimately, COIPA can revoke a provider’s membership following a hearing process. Ryan said it’s rare for providers to resign from COIPA to avoid seeing OHP patients, but there are more boutique-type clinics that aren’t COIPA members.

Kenny said she’s especially upset about the COIPA rule that says if doctors cut off their clinic to new OHP patients, they must do so across the board, including to those with private insurance. She thinks the rule ultimately will prompt doctors to revolt against COIPA’s rules.

“It’s not going to stick because all of us, we’re going to take BlueCross BlueShield, we’re going to take Moda, we’re going to take those new patients,” she said. “You can’t tell me that I can’t take new patients unless I take new patients from Oregon Health Plan and Medicare.”

To support the availability of primary care providers following the Medicaid expansion, the Affordable Care Act provided that in 2013 and 2014, primary care providers would receive Medicare rates for treating Medicaid patients. Medicaid traditionally pays doctors less than Medicare — in Oregon, the program paid primary care providers 72 percent of what Medicare paid in 2012, according to the Kaiser Family Foundation. Because Medicare pays on a fee-for-service basis and Medicaid pays a flat rate per member per month, PacificSource’s actuaries calculated Central Oregon’s monthly Medicaid reimbursement rates based on Medicare rates. Ryan said the rates vary by provider as well as the patient’s age and health status.

Kenny shared her rate sheet with The Bulletin. For seeing a healthy adult on OHP, she makes $20.49 per month. Disabled adults without Medicare: $35.64. The highest-paid group is children less than 1 year old, who bring in $51.47 per month.

That’s why providers like Central Oregon Pediatric Associates likely are making money off their new OHP patients, Kenny said.

Kenny said she wishes the Medicaid program would return to its pre-Affordable Care Act practice of paying doctors each time they saw a patient.

“If a patient comes in 10 times a year, pay us for 10 times a year,” she said.

In McElroy’s experience, many of the patients newly insured through OHP previously had private, high-deductible plans that prevented them from seeing a doctor.

“When you suddenly have free insurance, you go to the doctor for everything. … They come for colds. They come for rashes. They come for sprained toes,” he said. “They also want the stuff they’ve had for five to six years solved because they haven’t wanted to spend the money on it when they’ve had to pay for their own insurance.”

Better days ahead

Dan Stevens, PacificSource’s senior vice president and the head of Central Oregon’s CCO, said PacificSource has been working with other stakeholders to try to increase Medicaid payments to primary care providers. Today’s reimbursement rates are actually 12 to 15 percent higher than they were two years ago, he said.

“Nobody would probably say, ‘Medicaid is my absolute best payer,’ but there have been some pretty significant increases,” Stevens said.

Mann, of High Lakes Health Care, agreed. Two years ago, he was losing money every time he saw an OHP patient, a loss he had to offset by treating patients with private insurance. Last year, he broke even when he saw them.

“And this year, hopefully, I’m making a tiny profit on this patient, so it’s no longer a loss that I’m subsidizing.”

Doctors see dramatically different Medicaid reimbursement depending on the ages and health statuses of their patients, Ryan said. So while some are losing money, others are breaking even or even making a modest profit — if they’re seeing young children, for example.

CCOs in Lane County and Klamath County, flailing under a massive influx of OHP enrollees, already have closed to new members.

Central Oregon isn’t likely to get to that point, Stevens said. The CCO has already expanded its maximum number of OHP enrollees to 50,000. If enrollment reaches that point, he said, the CCO would probably ask providers to take on additional patients, and he thinks their answers would be “yes.”

Mann said he doesn’t think most providers are operating at losses because of their OHP patients. His own clinic has stopped taking new OHP patients, but it did not drop any existing ones.

“We’ve got that kind of community spirit of everybody pitches in, takes their share,” he said. “Otherwise, you’re dumping on the other guy if you’re not.”

Right now, the system is being flooded with new patients, and doctors are focusing on getting people in for acute issues, Mann said. They’re making phone calls instead of actual office visits and are keeping in touch with patients to make sure they’re going to the right offices, he said.

By the latter half of 2014, Stevens and Mann said they think things will calm down dramatically.

“It seems some patients are saying, ‘I have this card now, but I haven’t been able to access the system in ways that are useful for me,’” Stevens said. “That is going to take a chunk of 2014 for that to really calibrate.”

— Reporter: 541-383-0304,