Clackamas County to apply for $1.13 million OHA grant to prepare jails for Medicaid reimbursement

Clackamas County officials said March 6 they will seek a $1,131,653.48 grant from the Oregon Health Authority to upgrade electronic health records and billing capability at the county jail so the facility can pursue Medicaid reimbursement under a Centers for Medicare & Medicaid Services 1115 demonstration waiver.

County Administrator Gary Schmidt and Undersheriff Lee Eby told the Board of County Commissioners the application would fund infrastructure and two staff positions required to meet CMS participation requirements. The request was presented as new business to be placed on the consent agenda for the board's March 20 meeting.

The proposal rests on a federal‑state 1115 demonstration waiver that would allow Medicaid to reimburse certain health services provided to people while incarcerated and during a 90‑day period before release. "The waiver is crucial in expanding that Medicaid coverage to help that warm handoff that we can start in custody," Undersheriff Lee Eby said. Eby said the county currently has electronic medical records but lacks the billing infrastructure needed to submit Medicaid claims.

Commissioners asked for more financial detail before committing to hiring ongoing staff. Commissioner Paul Savas said he supports pursuing the infrastructure grant but stressed concern about adding positions that could create permanent county costs if reimbursement rates or grant funding change. "A simple $100,000 annual ongoing cost will undermine our ending fund balance in 30 years," Savas said, and asked for cost‑benefit estimates and options to avoid creating unsustainable FTE commitments.

Undersheriff Eby and staff said reimbursement rates and other key details remain under development at the Oregon Health Authority and CMS, making precise forecasting difficult. Eby said the grant is a one‑time infrastructure award; the county's expectation is that some staffing costs could later be covered by Medicaid billing once the program is operational. "What we did do is we kind of looked at some of our partners ... but we definitely believe that there will be a huge cost benefit," Eby said, while acknowledging the uncertainty.

Commissioners also discussed alternatives to county hires, including contracting with vendors or using partner staff to perform billing functions. Schmidt said departments that create positions funded by external grants are generally limited so that when grant funding ends the positions end as well; he said staff would present options for using vendors or temporary arrangements if the board prefers that approach.

On timing, Eby said the county has been working closely with OHA and expects implementation work to align with the waiver timeline; he estimated implementation activity could be underway by January 2026 but stressed that final federal and state decisions will influence the schedule. Commissioner Bethany West described the effort as "long overdue" and supported moving the grant application forward while seeking safeguards on ongoing costs.

The board did not vote on the grant application at the meeting; members agreed to advance the item to the consent agenda for formal action on March 20.

Ending: County staff will return with more detailed cost estimates, vendor options and staffing scenarios before the board takes a final vote. The March 20 consent packet will include the formal grant application request for board action.