Providence Health Plan’s Acquisition of CareOregon Will Not Move Forward

The state’s largest health care organization had planned to link up with the state’s largest Medicaid insurer.

Providence Portland Medical Center on March 28, with COVID-19 testing tents outside. (Aaron Wessling)

A transaction that would have combined CareOregon, the state's largest Medicaid insurer, with Providence Plan Partners, the insurance arm of Providence St. Joseph's Health, the state's largest health care provider, has been called off, representatives for both companies tell WW.

As WW reported last year, the proposed deal, which was announced last August, raised concerns among advocates who worried that Providence's affiliation with the Catholic Church could mean the end of reproductive health services, including abortions that CareOregon clients might require.

Related: The Merger of Two Health Giants Raises Questions About Access to Reproductive Health Services.

Activists, along with Democratic U.S. Sens. Ron Wyden and Jeff Merkley and U.S. Reps. Earl Blumenauer and Suzanne Bonamici of Oregon, restated their concerns recently.

On April 29, the four members of Oregon's congressional delegation jointly wrote to CareOregon's board.

"We write to share our concern about CareOregon's announced affiliation with Providence Plan Partners," the letter said. "Specifically, we are concerned about CareOregon's ability to ensure continued access to the full range of reproductive health care, trans-affirming, and end-of-life services and providers to the individuals they serve within Oregon's diverse Medicaid population."

On May 1, several advocacy groups, including Service Employees International Union Local 49, Planned Parenthood Advocates, the American Civil Liberties Union of Oregon, Compassion & Choices, Forward Together, and Basic Rights Oregon issued a joint statement urging caution on the merger, as well.

"For years, Providence has been allowed to put religious views ahead of patient health, limiting access to the full range of care and impacting our ability to make personal decisions with providers that is best for our health," the groups said. "It's clear that this corporation is at odds with Oregon values, and we are deeply concerned that a merger with CareOregon will only hurt Medicaid patients who already face barriers to health care." (Providence declined to respond to that statement.)

Robb Cowie, a spokesman for the Oregon Health Authority, which would have needed to approve the combination of the two companies, said the companies, in fact, never actually filed an application for approval with the state.

Today, Elise Burke, a spokesperson for CareOregon, and Gary Walker, a spokesman for Providence, confirmed the deal was off.

"Over the past eight months, both organizations have endeavored to finalize a definitive agreement and align on operational principles necessary to foster greater efficiency and effectiveness in serving Medicaid and Medicare beneficiaries," the companies said in a joint statement.

"The organizations have identified significant opportunities for collaboration," the statement continues. "However, they have been unable to align on operating principles necessary to finalize their agreement. In light of this development and the immediate focus for both organizations to meet the needs of patients, provider partners and members impacted by the COVID-19 pandemic, CareOregon and Providence Plan Partners have decided to suspend discussions to combine."

The advocates who opposed the deal issued a statement praising the two companies' decision not to proceed.

"As a coalition we are incredibly proud and grateful to the CareOregon board for holding to Oregon's values of equity and justice in women's health, gender affirming and end-of-life care. This decision protects thousands of Medicaid patients from Providence's religious directives which limit access to care," said Felisa Hagins, Political Director for SEIU Local 49. "No Oregonian should be judged or shamed for their personal health care needs based on gender or sexual orientation. It's time systems like Providence are held accountable for denying women, the LGBTQ+ community, and persons at the end of their lives the care that patients deserve."

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