Deschutes County approves six‑month, $10.4M amendment with PacificSource amid ongoing claims issues

Deschutes County commissioners on Thursday approved a six‑month amendment to the county’s behavioral health provider agreement with PacificSource Community Solutions that runs from July 1 through Dec. 31, 2026.

Holly Harris, Deschutes County health services director, told the board the amendment covers approximately $10.4 million for the six‑month period and represents a reduction of about $1.25 million — roughly a 10% cut from the prior funding level. Harris said the county negotiated the shorter term because of ongoing claims processing issues with PacificSource and the need to reassess contract terms after state rate releases and PacificSource’s internal financial adjustments later this year.

"It's about a $10,400,000 contract from July 1 to December 31, which is a reduction of about 1,250,000," Harris said. She added that Central Oregon Health Council one‑time support reduced the county's net reduction to about 2% for the six‑month period, which staff considered sustainable for the short term.

Commissioners pressed staff on whether PacificSource's changes and forthcoming state rate information could improve contracting conditions by October, when renegotiations are expected to resume. Harris said the state will release CCO rates in September and PacificSource has taken internal steps — including layoffs and cost reductions — that may affect capacity.

The board moved and seconded the amendment and approved it by roll‑call vote. Commissioners recorded their votes on the motion; the chair thanked Harris and staff for negotiating under a challenging landscape.

Next steps: staff will monitor claims‑processing improvements and return to negotiations later in the year when state rates are released.