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Bill would force mediation and arbitration when insurer–provider contract disputes threaten coverage for 30,000 Oregonians
Summary
Supporters described SB 1529 dash-1 as a tool to preserve access after contract breakdowns that left tens of thousands out of network; insurers, providers and business groups warned the threshold, binding arbitration, enforcement authority, and impacts on rates and fragile providers require clarification.
Sen. Deb Patterson and Rep. Paul Evans told the Senate Committee on Health Care that SB 1529 with the dash-1 amendment aims to prevent large-scale disruptions when insurers and providers fail to agree on contracts. The dash-1 amendment would require state-regulated health plans and providers to enter mediation and, if necessary, binding arbitration when contract negotiations create a substantial risk of a coverage gap affecting at least 30,000 Oregonians. The process would include cooling-off periods, statutory selection of mediators and, if unresolved, arbitration overseen by the governor or the governor’s designee.
"We need a tool that can help the folks who are instructed to make the deals to make the deals," Rep. Paul Evans said, arguing that formal dispute resolution could protect patient access in situations like a recent breakdown in Marion and Polk counties that left about 30,000 people without in-network access to a major hospital and its services.
Several patients and community members gave first-hand testimony about access harms. Erica Frey Hoyer described losing access to local cancer care after a contract breakdown and said the result was an urgent trip to Portland for specialty care. "My life quite literally depends on uninterrupted access to care," she told the committee.
Insurers, health systems and business groups raised multiple concerns. PacificSource and other insurers said the 30,000-member threshold is ambiguous, that binding arbitration could materially affect premiums and regulators’ rate approvals, and that arbitration outcomes might exceed cost-growth targets. The Hospital Association of Oregon warned that binding outcomes could force providers into terms that are not financially sustainable and could jeopardize staffing and services. The Oregon State Ambulance Association asked for clarification about whether EMS contracts would fall under the bill and whether small EMS providers might be inadvertently included.
TK Keenan, Oregon Insurance Commissioner, and Jesse O'Brien of DCBS described network adequacy issues and said the proposed mediation program would fill a role not currently served by state agencies. Keenan noted Oregon is implementing stronger, quantitative network adequacy standards (ORS 743B.505) following last year’s SB 822 legislative work, but that mediation/arbitration is a policy choice for the legislature.
The hearing closed with no final committee action on SB 1529 on Feb. 11; Chair Patterson carried the item over to the committee's next meeting for further consideration.
What’s next: SB 1529 was carried over for a possible work session on Feb. 16; stakeholders requested clarification on the threshold, scope (including EMS and ERISA plans), binding nature of arbitration, and enforcement structure.
