Stakeholders debate SB 609 requiring higher minimum Medicaid reimbursement for primary care and other services

Senate Committee on Health Care heard testimony on Senate Bill 609 on Feb. 25, 2025. The bill would require certain minimum reimbursement rates for services covered by the Oregon Health Plan (Medicaid) — notably increasing a conversion factor for primary care and optometry and setting floors for behavioral health and dental services tied to commercial reimbursement benchmarks — and would direct the Oregon Health Authority to seek federal approvals if needed.

Sponsor Senator Campos opened with a policy rationale: "The need for this bill is urgent. Access to primary care in Oregon is rapidly declining," she said, noting provider retirements, low reimbursement and administrative burdens that reduce the number of providers accepting OHP members.

Family Care Health representatives described prior experience with raising primary care reimbursement closer to commercial rates and the effect that had on access. Jeff Hetherington said, "If you don't get paid for a procedure, you can do another one somewhere else, but you cannot make up time," arguing that time‑based primary care must be reimbursed to retain providers. Art Sukhozhevsky referenced research showing that small rate increases produced measurable changes in utilization and access and that investments in primary care can reduce higher‑cost services.

Several provider organizations — pediatricians, optometrists, community clinics and behavioral health advocates — testified in favor. Dr. Karen Heisler, a pediatrician at Childhood Health Associates of Salem, described the staffing and administrative work required to complete a typical well visit and said many clinics are cutting programs or staff because current Medicaid payments do not cover the full cost of care. "Without increased payment rates, primary care providers are faced with elimination of some programs that are critical to the medical home," she said.

Opponents included Pacific Source Community Solutions and Eastern Oregon CCO, which both told the committee they oppose the bill in its current form. Pacific Source's Rick Blackwell said concerns include whether the federal Centers for Medicare & Medicaid Services would approve a broad commercial‑rate floor via a state plan amendment and that the bill's funding mechanism could be unsustainable if not incorporated into capitation and alternative payment models. Eastern Oregon CCO's Fawn Berry raised questions about actuarial soundness, how required increases would interact with the state's existing primary care spending rules and the operational impact of directing OHA to set the rates from its legislatively adopted budget.

Committee members and witnesses discussed tradeoffs between raising fee schedules and accelerating value‑based payment reforms. No committee vote was taken at the hearing; the record shows substantial stakeholder engagement and requests for further fiscal and implementation analysis.