SALEM, Ore.— Oregon is seeking federal approval to shift Medicaid beneficiaries into organizations that will coordinate patients’ healthcare. Oregon Gov. John Kitzhaber signed into law a bill that would establish, with federal approval, “coordinated-care organizations” to manage medical care using medical homes, if possible, under a global Medicaid budget. “Just one week after the bill was passed out of the Legislature, we sent the request to federal officials to give us the approval we need to implement a smarter model for providing quality care,” Kitzhaber, a physician, said in a news release. “Under our new delivery system, we will focus our efforts and our dollars on improved health, not just billing codes for medical procedures. Based on conversations we have had with our federal partners so far, we believe they share this vision.” Coordinated-care organizations are encouraged to develop payment alternatives to fee-for-service under legislation enacted in 2011. Under alternative payment models, providers would be paid for the quality of care provided rather than the volume of services. Coordinated-care contracts will include quality measures and benchmarks for ambulatory care, inpatient care, chemical dependency and mental healthcare. The bill is projected to save $1 billion over three years, according to the governor’s office. “Today, we are initiating a new era in Oregon where we will no longer be held financially hostage to an inefficient healthcare system,” Kitzhaber said in the release. “The dollars we save on healthcare can be invested in our classrooms, into economic development and into the future of our state.” DOWNEY, Calif.— Downey Regional Medical Center announced that the hospital has emerged from Chapter 11 reorganization proceedings. A court approved the hospital’s Chapter 11 reorganization plan in mid-february, according to a news release from the medical center. The hospital issued $32 million in taxable bonds and secured another $20 million facility, the release stated. The hospital suffered “significant losses” under capitation contracts and faced further financial strain after software created inaccurate invoices, according to court records. The hospital paid down $17 million to creditors since it filed bankruptcy in September 2009 and will continue to pay off creditors, the release stated. “With new healthcare contracts in place and our financial house in order, the hospital management team is very excited about the future, even as we face the uncertainty of the future and challenges in healthcare,” Kenneth Strople, the medical center’s president and CEO, said in the release. POCATELLO, Idaho— The Ensign Group, Mission Viejo, Calif., has acquired Hillcrest Haven Convalescent Hospital, a skilled-nursing facility in Pocatello. Ensign subsidiary Milestone Healthcare will operate Hillcrest. Terms of the cash deal were not disclosed, but Milestone expects Hillcrest operations to be dilutive to earnings this year, according to a news release. The occupancy rate at the skilled-nursing facility was about 45% at the time of the acquisition, according to the news release. The transaction was effective as of March 1. “This opportunistic acquisition further solidifies Ensign’s presence in the important southeastern Idaho area,” Christopher Christensen, Ensign’s president and CEO, said in a statement. Ensign’s portfolio now includes 104 healthcare companies, five of which are in Idaho, including a rehabilitation facility already in Pocatello. The group is actively seeking additional buys of both performing and struggling skilled-nursing, assisted-living and other healthcare facilities across the country, according to the release. PHOENIX— A federal lawsuit alleges the Arizona Corrections Department provides inadequate healthcare services to the state’s inmates. The lawsuit was filed in U.S. District Court in Phoenix by the American Civil Liberties Union and the Prison Law Office, a California-based not-for-profit law firm. The complaint seeks class-action status on behalf of inmates who allegedly were denied appropriate care in violation of the constitutional protection from cruel and unusual punishment. The 78-page complaint recounts the alleged experiences of several named plaintiffs who say the department’s procedures for requesting medical care cause barriers, delays and denials of care, and that the prisons lack sufficient staff and resources to provide adequate emergency care. The Corrections Department had not been served with the suit, spokesman Bill Lamoreaux said at deadline. He added: “We’ve been advised by the attorney general to refrain from commenting on pending litigation.” The Prison Law Office was involved in a California lawsuit that led a judge to put that state’s prisons into receivership and a U.S. Supreme Court opinion last year concluding that overcrowding violated inmates’ constitutional rights, citing inadequate access to medical and mental health services.
Kitzhaber, shown signing the bill that will create coordinated-care organizations with federal approval, called the measure the start of a “new era” in Oregon.