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POLICY INSIGHT
BEYOND THE NUMBERS

Oregon’s Medicaid Experiment Shows Need for Coordinated Care

Coordinated care — where patients get help navigating the health system to get the care they need — may be key to reducing emergency room visits by Medicaid patients and cutting state costs, evidence from Oregon and other states shows.

When a recent Oregon study found that people used emergency rooms (ER) more often after enrolling in Medicaid, critics claimed that this shows that health reform’s Medicaid expansion won’t save states money.  But, while necessary, expanding Medicaid eligibility may not be sufficient to reduce emergency room visits.  More recent data from Oregon show that ER use dropped significantly among Medicaid beneficiaries who received care coordination and help navigating the health care system. 

In 2008, Oregon offered Medicaid coverage to 10,000 eligible enrollees using a lottery system.  In 2008, the first year that the lottery winners gained Medicaid coverage, they were likelier to use the ER than eligible people who weren’t selected (or didn’t sign up) and thus remained uninsured, according to previous analyses.  The more recent study showed the trend in ER use continued for the second year as well.

But in 2012 — two years after the period covered by those studies — Oregon established Coordinated Care Organizations: integrated, community-run organizations responsible for providing all medical, mental health, and dental care services for their Medicaid beneficiaries.  They have cut avoidable ER visits in half since 2011 while increasing enrollment in patient-centered primary care homes, which coordinate beneficiaries’ physical and behavioral health care, a recent evaluation showed.  Most Oregon Medicaid beneficiaries enrolled in a Coordinated Care Organization now get care through primary care homes, which design their care around their patients’ needs — often offering after-hours services as alternatives to emergency care and helping people get needed services in their community. 

Like Oregon, many states are developing new ways to coordinate care and prevent unnecessary ER use among Medicaid beneficiaries.  In one Minnesota county, for example, a ten-month pilot program providing coordinated care to people with high health care needs cut hospitalizations by 50 percent.  Strategies like these can enable beneficiaries to get needed care while controlling costs.

Also of note, other states that have expanded Medicaid under health reform have not seen an uptick in emergency room use.  In fact, people in Arkansas and Kentucky, which have expanded, were more likely to get checkups and less likely to visit the ER than people in Texas, which hasn’t expanded, one recent analysis found.