Transplant Fight Rekindles Health Plan Debate

After Brandy Stroeder's Request, Critics Wonder Whether The Oregon Health Plan Can Control Costs And Still Be Fair

By Joe Rojas-Burke

of The Oregonian staff

An Oregon teen-ager's fight for a potentially lifesaving transplant is reigniting a long-smoldering debate: Can the Oregon Health Plan control medical costs while also giving vulnerable residents fair access to rapid-fire advances in medicine?

Gov. John Kitzhaber insists the answer is yes. Critics aren't so sure.

"For children and young people facing death, you might want to create a more compassionate stance," said Arthur Caplan, director of the Center for Bioethics at the University of Pennsylvania.

One thing is certain: The costs of the health plan have increased every year since it began in 1994, pushing state spending on the plan from $435 million in the 1993-94 biennium to more than $750 million in the current biennium. And these cost increases are ratcheting up the pressure to cut services to enrollees such as Brandy Stroeder, an 18-year-old with cystic fibrosis who has been denied an unusual lung and liver transplant. Doctors say the operation, if successful, could add years to her life. Without the operation, estimated to cost at least $250,000, Stroeder of McMinnville is not likely to reach her 20th birthday.

It's a conflict that harks back to a tragedy that spurred Oregon's health reform experiment more than a dozen years ago. In an attempt to keep health care spending under control in 1987, the Oregon Legislature stopped paying for all but two types of transplant operations. Coby Howard, a 7-year-old from Rockwood who was on public assistance, died of leukemia in December of that year while his unemployed mother struggled to raise the money for a bone marrow transplant that might have saved his life.

The boy's death triggered a statewide crisis of conscience, in the words of then Attorney General David Frohnmayer. And it soon spurred lawmakers to go to work on what would become the Oregon Health Plan.

To extend coverage to tens of thousands of uninsured adults and children, lawmakers approved an unprecedented plan to ration government-funded health care for the poor and for people with disabilities. Unproven treatments and cosmetic procedures would be excluded, along with treatments for the common cold and other conditions that get better on their own. The plan instead would give priority to immunizations, prenatal care and other measures to prevent illness, and only those surgeries and medications rigorously proven to extend life.

A commission of medical experts and citizen representatives now maintains a list of more than 700 condition-treatment pairs, ranked in order of medical effectiveness and importance to the overall health of the population. At the level of funding set by the most recent Legislature, treatments that fall below line 574 aren't covered.

"It's unique to Oregon," says Dr. Ralph Crawshaw, a Portland psychiatrist who organized statewide meetings to get public input for the prioritized list. "No place else in the world has taken such a deep, sustained look at where our resources are best used."

When implemented in 1994, the Oregon Health Plan's accomplishments came swiftly. An estimated 120,000 adults and children without health benefits immediately became eligible for the state and federally funded Medicaid program. The ranks of the uninsured decreased from 17 percent of the state population in 1993, to around 11 percent today. Demand for charity care at hospitals has since fallen by an estimated 30 percent, lifting the cost burden of uncompensated care that hospitals shift to privately insured citizens.

The prioritized list, excoriated at first by social activists, provoked few actual conflicts. By the time the list gained federal approval, it included many benefits previously denied people covered by Medicaid, such as dental care for adults, organ transplants, and in-home hospice care for the terminally ill. The plan also pays for prescription drugs including contraceptives, not to mention abortions and doctor-assisted suicide.

"It's a rationed system but frankly it's a more generous health care program than most private individuals and companies have," says Sen. Neil Bryant, a Bend Republican who sits on the legislative subcommittee that oversees the plan.

Physicians also have found ways to "game" the system. For instance, they may give a diagnosis and treatment above the line for a patient whose primary diagnosis falls below the line. Legal advocates have gained numerous exceptions. A hearings officer ordered the plan to pay for a cochlear implant for a young man with hearing loss compounded by other severe disabilities, according to attorney Laurie Freeman of the Oregon Law Center. Another patient managed to get surgery for TMJ, a jaw pain disorder, on the grounds that it would effectively help treat the patient's clinical depression.

What's more, the prioritized list never directly applied to the 85 percent of the 342,000 current members who are enrolled in private managed-care plans under contract with the state.

The contracting health plans may, and sometimes do, pay for treatments listed below the line. CareOregon, for instance, approved an otherwise excluded $75,000 bone marrow transplant for a 9-year-old with medulloblastoma, a virulent brain tumor, according to a 1997 article in the New England Journal of Medicine. Stroeder is among the 15 percent of enrollees in the fee-for-service program, in which the state pays doctors and hospitals directly and only for services above the line on the priority list.

As costs have risen, advocates for enrollees say the state has clamped down on exceptions to the list. And the drain on the state budget has triggered battles in every legislative session since the plan started. Among other changes, lawmakers have taken eligibility away from many full-time college students, added income-based monthly premiums and required recipients to demonstrate eligibility every six months rather than once a year.

As a result of the most recent legislative session, the state began requiring more proof of eligibility and stepped up scrutiny of applications. The governor is seeking permission from the federal government to cut 10 more treatments from the priority list, a request officials suspect will be denied.

Faced with such budget pressures, Kitzhaber's administration has drawn a line in the sand. To deny Stroeder's request "is completely consistent with the principles of the Oregon Health Plan," says Hersh Crawford, director of the state Office of Medical Assistance Programs.

"We still very strongly believe that those principles are the right principles. We are not stepping back from them one inch."

Giving in to Stroeder's request, he says, may set a precedent that would open the floodgates. "If you were to say, 'Let's just automatically approve exceptions when there is a life-threatening diagnosis involved,' then you break the bank very quickly," Crawford says.

Bryant, the state senator, agrees: "If you start making exceptions pretty soon everything is covered and you can't control costs that way. As a state, we can't afford that."

The health plan could absorb the costs of a narrow court ruling, Crawford says, if it merely required the state to pay for Stroeder's case. The estimated cost amounts to about .01 percent of the health plan's $2.46 billion federal and state budget.

But such a ruling would not answer what happens next time.

"These are tough decisions that you have to make because there is a finite amount of dollars," says Senate Majority Leader Gene Derfler. "If people are willing to give us more of their dollars in taxes to pay for these services, that's the only other answer."

You can reach Joe Rojas-Burke at 503-412-7073 or by e-mail at joerojas@news.oregonian.com

Copyright © 2000 Oregon Live.

This article posted June 25, 2000.