QuickTake:

Oregon Health Authority has ended its contract with PacificSource for Lane County’s Medicaid services, affecting more than 90,000 people. The agency says coverage will continue, but how and when remain unclear.

Nearly 70% of the Lane County residents who rely on Medicaid are facing a transition in their health care coverage.

The Oregon Health Authority ended negotiations with PacificSource on its current contract that manages medical, dental and behavioral health care for 90,000 people. The Springfield-based insurer could exit the Medicaid market Jan. 1.

The change affects only people who use PacificSource through the Oregon Health Plan, the state’s Medicaid program, not those who have the nonprofit’s private insurance or Medicare coverage. The health authority, which manages the Oregon Health Plan, has said members will not lose access to care, but it has not clearly explained next steps or why the change happened.

The Oregon Health Authority has declined Lookout Eugene-Springfield’s requests for interviews. Here is what we know — and what we don’t — to help make sense of a complicated health care system.

What choices have Oregon Health Plan members had? 

When people in Oregon qualify for Medicaid, which typically covers low-income residents, they usually choose a coordinated care organization.

Statewide, about 93% of those who qualify enroll in coordinated care organizations, or CCOs, which are local companies and nonprofits that deliver Oregon Health Plan services.

The remaining 7% of Medicaid members use the “fee-for-service” model, which allows them to see providers outside of their coordinated care organization. In general, people rely on fee-for-service, also called open card, when they cannot get the care they need through their CCO.

In some cases, people use a combination of a coordinated care organization and fee-for-service.

Sixteen CCOs cover different regions of the state. Some regions, like Lane County, have more than one CCO.

What have been the CCO options in Lane County? 

In Lane County, the CCOs are PacificSource Community Solutions and Trillium Community Health Plan. Both manage networks of providers to ensure Medicaid members can access medical, dental and behavioral health services.

PacificSource launched its CCO, PacificSource Community Solutions, in Lane County in 2020. Trillium was the sole CCO in the county before then. 

Do all doctors and practices accept PacificSource and Trillium? 

Not every health provider accepts PacificSource or Trillium. PeaceHealth accepts both Trillium and PacificSource, but earlier this year McKenzie-Willamette Medical Center ended its contract with Trillium and now takes only PacificSource.

How do CCOs work? 

Coordinated care organizations were formed in 2012 as a centerpiece of Oregon’s Medicaid reform efforts. The Oregon Legislature approved them in 2011 to better control costs and improve health outcomes by replacing the state’s traditional managed care Medicaid insurers. 

Through a contract, the Oregon Health Authority pays coordinated care organizations a fixed monthly rate per Medicaid member. CCOs use that money to coordinate and pay for care through contracts with hospitals, clinics, dentists and behavioral health providers.

CCOs contract with physicians, clinics, hospitals, behavioral health providers, dentists and other entities to build provider networks, much like private insurance.

Each year, the Oregon Health Authority sets rates for how much to reimburse the care organizations for covering the Medicaid populations in their regions. The amount the health authority pays varies among the 16 organizations across the state.

Why didn’t PacificSource renew in Lane County? 

This year, the authority proposed a rate that was too low to cover the increased number of Oregon Health Plan members, insurance company executives said.

In September, the authority set PacificSource’s Lane County payment at $582.05 per member per month — nearly 13% higher than last year.

PacificSource leaders said the higher rate still does not cover costs. The Springfield-based insurer, which operates CCOs in nine counties, reported a $68.5 million loss from providing Medicaid services not reimbursed by the state.

When comparing the 2026 rate with projected costs, PacificSource found it would experience a shortfall in Lane County that the nonprofit at large could not afford, spokesperson Lauren Thompson said.

On Sept. 18, the company filed notice it will not renew its Lane County contract, but it will continue serving Oregon Health Plan members in its other eight counties.

Is PacificSource out? 

By filing its intent to not renew Sept. 18, PacificSource will no longer be a CCO in Lane County under its current contract, said Oregon Health Authority spokesperson Kristen Lambert. However, the authority has a few different paths that could bring PacificSource back.

What does the path forward look like? 

During a Sept. 30 Oregon House Interim Committee on Health Care briefing, the health authority’s Deputy Director for Policy and Programs Dave Baden gave some details about a process to ensure coverage.   

First, Oregon law requires the authority to decide whether one coordinated care organization can serve the region. If so, members would be directed to that CCO — in Lane County’s case, Trillium. 

If the authority decides two CCOs are needed, it must announce an opening, read through letters of intent, and then review applicants’ ability to serve Lane County. PacificSource could reapply to serve Lane County, according to the authority, but has not indicated it plans to do so.

Baden was not clear on whether rates could change during the development of a new CCO contract.

Meanwhile, the health authority has asked PacificSource to submit a transition plan. If no new provider is secured, the agency can order PacificSource to continue services for another 90 days after the plan is complete.

The health authority did not provide a deadline for PacificSource’s transition plan. 

Can Trillium take on 90,000 people? 

Trillium currently has more than 30,000 members in Lane County. Spokesperson Courtney Johnston said the organization has the capacity to absorb the 90,000 patients that are now served by PacificSource, but that it is still working with the health authority on whether that will happen.

What has the reaction been? 

Oregon Health Plan members and county commissioners have expressed concern about Trillium’s network of local providers, some of which have been dropped during its operation as a CCO. Despite Trillium’s expressed confidence in handling 90,000 additional enrollees, some providers, patients and Lane County leaders aren’t sure if Trillium’s network can handle that many more people. Even if it can, people may have to find new providers if their current ones aren’t covered by Trillium. 

What should OHP members on PacificSource do? 

The Oregon Health Authority has told Oregon Health Plan members enrolled with PacificSource that they do not need to take action. Still, many worry there may not be enough time to ensure their coverage will be accepted with their clinics if it shifts to Trillium or another provider.

What exactly is next?

It’s unclear. In response to a question about next steps, the Oregon Health Authority issued this statement:

“While working with coordinated care organizations (CCOs) to negotiate rates and contracts for 2026, OHA prioritized addressing CCO needs and minimizing disruption to OHP members. While Lane County will have continued Medicaid coverage in 2026, OHA is currently working through a process, along with PacificSource and all our CCOs, to determine which CCO(s) will facilitate that coverage. OHA is committed to safeguarding quality health care access for all people living in Oregon. We will continue to share updates as this work moves forward.”

This story has been updated to correct the spelling of Courtney Johnston’s name.

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Ashli Blow brings 12 years of experience in journalism and science writing, focusing on the intersection of issues that impact everyone connected to the land — whether private or public, developed or forested.

For two decades, Ben Botkin’s journalism career saw him criss-cross the West, a path with stops in rural Idaho, Las Vegas and, now, finally, Lane County. Ben reported on local government and the statehouse in Idaho before he moved to the Bulletin in Bend and covered education in central Oregon.

Then, for four years, he covered Clark County government, which has oversight over the Las Vegas Strip, and served as the lead political reporter during the 2016 election cycle. During that time, Ben wrote about the county’s child welfare agency, law enforcement, the start of Nevada’s medical marijuana industry and homeland security. His reporting sparked the criminal indictments and convictions of three government officials, including a city animal control supervisor convicted of animal cruelty.

He also covered national stories like the 2016 armed occupation of the Malheur National Wildlife Refuge in eastern Oregon and the 2017 mass shooting in Las Vegas.

Since 2018, Ben has reported on Oregon state government, first for the Statesman-Journal in Salem and then for The Lund Report, a Portland-based nonprofit that covers health care. His reporting on gaps in children’s health coverage led to state Medicaid policy changes.

Most recently, Ben worked more than two years at the Oregon Capital Chronicle, where he covered criminal justice, health and human services. His work often incorporates the voices of vulnerable Oregonians from all walks of life.

As Lookout’s Politics & Policy Correspondent, Ben digs up the most intriguing and relevant stories about how Lane County decisions impact residents.