In the United States, the gap in access to health insurance is delineated by economic boundaries. The lower limit to the gap is created by State regulations that provide Medicaid support for citizens earning a certain percentage of the federal standard of poverty. As of 1994, many States drew this line at 20 percent of that standard. The upper limit to the gap is created by the cost of insurance extending beyond the middle-class family's ability to pay, and as insurance rates rise, the gap expands to include more people every year. Further, insurance for high-risk citizens became so expensive that only the wealthiest few could afford coverage. In 1993, 16 percent of Oregonians fit into this gap and were forced to live without health insurance.
As early as 1985, this problem came to the attention of the Oregon State Legislature and they created the Oregon Health Plan to solve it. At the lower end of the spectrum, the State increased funding to Medicaid and created a system of health care "rationing" that measured the cost of a procedure against its potential benefits. The goal of this "rationing" was to alleviate the State from supporting costly procedures so that it could provide coverage to a greater number of citizens in need.
At the upper end of the spectrum, the State sought to increase the capacity of small employers to buy health insurance through pooling and tax incentives. The ultimate aim was to create an atmosphere in which mandated, employer-provided health insurance would become feasible. And finally, the State sought to create a purchasing pool for high-risk Oregonians who were denied coverage in the open market.
The rationing process is simple and pragmatic. The State established a deliberative process to set health care priorities through citizen participation and expert assistance that created a list of 709 categories of service. Then the legislature literally drew a line in this list: Medicaid beneficiaries were provided all services above the line and denied services below it. While this rationing created much controversy from ethicists and others, notably outside of the State, the State's citizens supported the decision for the fact that numerous and important remaining benefits were provided to all citizens below the poverty line.
To extend coverage to citizens above the poverty line, the Oregon Health Plan initiated several reform strategies. These efforts include reform measures to maximize coverage availability and affordability, a small employer purchasing pool for over 30,000 employees and their dependents, and a high-risk insurance pool for Oregonians denied coverage on the open market. In 1989, Governor John Kitzhaber drafted legislation calling for an "employer mandate" to institutionalize the extended coverage for those citizens above the poverty line, but still without resources to access services. The mandate was not implemented.
The outcome of the Oregon Health Plan, despite controversy and setbacks, has been significant. Twenty-five percent of citizens traditionally not covered by health insurance, roughly 100,000, are now covered by Medicaid. Thirty thousand citizens above the poverty line can now access affordable health insurance through pool purchasing. Oregon's innovations in insurance access, pool purchasing, and rationing represent a greater innovation at the legislative level. Lawmakers in the State recognized the gap in health insurance early and actively pursued solutions immediately. Their goal of universal health care surely still lies ahead, but the Oregon Health Plan is moving in that direction.
