- Associated Press - Tuesday, June 17, 2014

PORTLAND, Ore. (AP) - Elements of Gov. John Kitzhaber’s effort to improve the health care system are expanding from Medicaid patients to state employees and their families.

A board that oversees benefits for state workers on Tuesday approved new rates that were negotiated with insurance companies. Insurance companies agreed to adopt changes required of the coordinated care organizations that oversee Medicaid coverage for the poor.

Insurance companies covering state workers will have to collect data on the quality of health care delivered to their customers, and they’ll eventually have to show improvements.

Since he re-entered the governor’s office in 2011, Kitzhaber has been trying to improve care and lower costs in the health care system. He persuaded state lawmakers and the federal government to create coordinated care organizations for Medicaid, and he celebrated Tuesday’s move as the first expansion of that effort into the private insurance market.

“The exciting thing about this is not only are we going to provide better care at a lower cost for state employees, but this is the first step in bringing this care model” to private insurers, Kitzhaber told The Associated Press.

The decision by the Public Employees’ Benefit Board affects health care for state workers and their families, about 130,000 people.

Insurance companies with contracts to serve state employees will have to report data such as emergency room utilization and the rate of screening for colorectal cancer. In future years, a portion of their payments will be tied to improvements in those metrics.

The state is also pushing insurance companies to contract with so-called patient-centered primary care homes, which are clinics that coordinate care between mental health and medical providers and provide easy access to appointments.

The combined premium for full-time employees and the state will range from $911.95 to $1,441.25 per month, depending on the insurance plan chosen and the size of the family covered. Employees will pay 3 percent of the premium if they choose the cheapest plan available to them or 5 percent for all other plans - an effort to lower the state’s overall insurance bill by encouraging workers to choose cheaper options.

Public-employee unions welcomed the results.

“We’re pleased that we’ve been successful in providing more options, bending the cost curve, helping the state budget and also providing some economic benefits to members,” said Paul McKenna, research director for the Service Employees International Union Local 503 and the incoming chairman of the benefits board.

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