Rationing Health Care in Oregon

March 30, 1993

In the search for ways to cope with the increasing costs of Medicaid, no state's proposal has generated as much publicity, both favorable and adverse, as Oregon's plan to expand the number of poor people who receive health care by limiting the procedures it would pay for. Last summer, when the Bush administration rejected Oregon's request for permission to allow the state to proceed with the plan, an odd assortment of allies cheered the decision. Not least among them was the Children's Defense Fund, formerly chaired by Hillary Rodham Clinton and Donna Shalala, now head of the Department of Health and Human Services.

This time around, Ms. Shalala announced approval of a slightly revised request. But in contrast to the CDF's high profile on the issue last year, the March 19 approval brought only a two-paragraph statement as remarkable for its restraint as it was revealing of a changed political landscape.

The CDF still criticizes the fact that Oregon's proposal confines its experiment to the most vulnerable members of society. But unlike other advocacy groups, the CDF can now afford to take a low profile, with the assurance that its views will be influential in Mrs. Clinton's health care reform effort. The granting of the Oregon waiver suggests that the Clinton administration remains optimistic that a national blueprint can eventually serve as a corrective to flawed state plans.

Many observers felt Oregon deserved a chance to forge ahead because it had put so much effort into its proposal. But not every effort deserves an "A," and there is something inherently disturbing about a plan that rations care only for the poor. If the system proves unworkable or needs tinkering, who will exert the political pressure to fix it? Those affected by the plan are the people least likely to be able to see that needed adjustments are made.

The assumptions underlying Oregon's system of ranking medical procedures are also open to question. On close inspection, the system is a kind of "medicine by the numbers" game that purports to be highly rational but which, in effect, is anything but. For instance, in ranking procedures, the state took public opinion into account -- opinion that can be influenced as easily by uninformed prejudices as by sound medical judgment.

In our view, no plan based on a system of rationing care only for the poor is a suitable model for national reform. But until the federal government comes up with a coherent plan, the states will continue to be the front line for experimentation.

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