The Oregon Story Health Care Rationing: A Case Study

What Happened in Oregon? §A process: Oregon Health Decisions §A specific policy outcome: Medicaid rationing program

Oregon Health Decisions §Inaugurated in late 1970’s §“Town meetings” to discuss health care priorities §Statewide assembly with representatives from town meetings to draft state health care “constitution” §Statements of desired health care priorities

Oregon Health Decisions-- II §Led to highly educated voters who understood health issues §Led to elected officials not afraid to say the “R-word”

Oregon Medicaid Rationing §Begun in 1980’s but could not get Federal waiver to implement until 1993 §“Ration care not people”

Medicaid in Other 49 States “Poorest poor”-- all care covered Other poor-- no care covered

Medicaid in Oregon All poor covered by program Not all care is covered by program

Argument for Inequality §Ideally would ration care for all citizens of Oregon under uniform statewide plan §However current reality is that only Medicaid program is under state control §Makes sense to improve the justice of Medicaid by covering all poor citizens, even if system as a whole is not perfectly just

How to Decide? §Developed list of about 700 disease/treatment pairs l Intravenous antibiotics for bacterial pneumonia l Surgery for coronary heart disease l Liver transplant for end-stage cirrhosis l etc.

How to Decide?-- II §Complex multi-stage process of rank- ordering pairs based on: l Likelihood of benefit l Cost l Frequency of problem l Value judgments on resulting quality of life

How to Decide?-- III §Rank-ordered list sent to legislature §Legislature could appropriate money for Medicaid but could not change ranking of items §Amount of money appropriated would set a cut-off point, below which care would not be funded by Medicaid

Covered Not covered

Moral Claim §Oregon Medicaid covers all poor people §Oregon Medicaid covers a reasonable package of care which includes the most effective and the most costworthy treatments for the most common health problems §Some pressure placed on state to improve overall Medicaid funding

Assess the overall level of justice or injustice represented by the Oregon Medicaid rationing plan.

Menzel’s Argument §The fact that the program rations care for the poor but not for the rich does not by itself make the plan unethical §Arguments for egalitarianism in medical spending are weak §Poor would rationally choose to spend less of their limited resources on health

Menzel’s Argument-- II §Hypothetical Case: l Rationing for all Oregonians l Plan funds treatments up to #578 l Insurance rider can be purchased which covers treatments #579 and up l Cost of rider: To rich-- $1000 annually To poor-- $200 annually

Menzel’s Argument-- III §Rich person probably has $1000 left over after paying for all necessities of life; may readily decide to buy rider §Poor person may still lack some basic necessities of life and would prefer to spend $200 on some of them, not on rider §If so, not unfair to poor to deny them treatments #579 and higher

Menzel’s Argument-- IV §Even if ethics does not demand egalitarian spending for rich and poor, it does demand fair representation §Oregon plan may be flawed if poor were under-represented when key decisions made