Under the limits, CCOs will be required to spend 80 percent of received per-patient Medicaid funds on health services. The remaining 20 percent will be allocated to the CCO for staff wages, executive salaries and shareholder dividends. This spending ratio is required for Medicare and commercials health plans nationwide under the Affordable Care Act, though the ratios were not included for Medicaid plans until recently.
In 2018, the spending ratio for Medicaid will change to 85 percent for health-related services and 15 percent for nonhealth-related services, according to the report. The change reflects the current spending for ratio Medicare plans nationwide.
Oregon previously did not cap coordinated care organizations’ profits, though other states applied the spending ratios years ago, The Register-Guard reports. Oregon currently does not mandate CCOs report spending ratios either.
However, under the new limitations, the state’s CCO spending ratios will be overseen by the Oregon Health Authority and presented in quarterly financial reports and ultimately annual worksheets filed by each CCO. Any excess spending on salaries or wages will result in the CCO paying Oregon the amount equal to the excess, according to the report.
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