Oregon Therapists Scramble, Again, as Abrupt Pay Cut Looms

A few weeks ago, Tiffany Kettermann received a notice: Owing to a state policy change, her therapy practice of 36 clinicians would soon get paid less for many of its services—if it didn’t make certain changes fast.

Kettermann had already moved to make some of the required shifts, which included applying for a rigorous certification process with the state. But, dealing with a glut of similar applications, the Oregon Health Authority was taking a long time to process her application, filed months ago. It was becoming clear her practice would not satisfy the updated requirements by the new year, when the new payment policy is set to take effect.

Recently, Kettermann says, she announced temporary pay cuts to her staff.

Kettermann’s East Portland-based practice, Health Allies Counseling, is one of numerous therapy businesses around Oregon that have been affected, once again, by an abrupt state policy shift. The change has left many therapists and counselors scrambling—in fear they’ll have to close their practices or refer their Medicaid patients to a network where it can be difficult to find a provider.

Facing soaring costs as more Oregon Health Plan members sought therapy and counseling in recent years, the state and the insurers that run its Medicaid program have sought to route scarce resources toward institutional community mental health organizations—think Cascadia, for example—that tend to serve patients with particularly acute conditions.

In practice, this has meant cutting off funds elsewhere. The state late last year announced plans to stop reimbursing for services from pre-licensed therapists unless they worked under an organization the state had given a certificate of approval, ensuring it meets certain quality standards. This summer, CareOregon, a major Medicaid insurer, said it would stop reimbursing out-of-network providers, including those who have served Oregon Health Plan patients for years.

Despite a spirited opposition, that change went into effect promptly, on Oct. 1.

Then, weeks later, came the latest policy change, this time directed toward therapy practices that had in-network contracts to deliver behavioral health services to Oregon Health Plan members.

For years now, providers that saw mostly Medicaid patients have received enhanced reimbursement rates—part of a state effort to improve behavioral health care access. But now the state would be significantly narrowing eligibility for those rates.

“It was an absolute bombshell to get that news for all of us,” Kettermann says.

Under the new system, many community mental health programs would still qualify for the enhanced rates. But other providers would need to get a “certificate of approval” with OHA. Moreover, they would need to be able to provide “integrated, team-based care,” with peer support services, case management, and an on-staff psychiatric provider—all by Jan. 1.

Many, in other words, would need to make some significant new hires.

“Even for companies that already had completed their COA, two months is not enough time to hire all of those folks,” Kettermann says.

Some details remain unclear and the state say it’s awaiting federal approval on certain changes. But OHA emphasizes that it is not reducing the rates it’s paying Medicaid insurers, like CareOregon, but simply offering them flexibility in managing their budgets while ensuring Oregonians with acute challenges can get care they need.

“While Oregon continues to face high demand for behavioral health services and has increasingly limited financial resources, OHA must focus on delivering care for Oregon Medicaid members who have the greatest and most complex needs,” says OHA spokeswoman Franny White in an email.

CareOregon, one of the Medicaid insurers applying the changes, tells WW in a statement that, with the shift, a subset of providers will see lower reimbursement rates, but that their pay would remain comparable to the national average.

Kettermann says she understands the rationale of funneling money to providers who serve the most acute patients, but feels her own practice’s patients are being overlooked.

“We serve the LGBTQ community,” she says, ”and as you can imagine during this administration, things are pretty intense right now serving our clients. So they’re not not acute."

From her vantage, the OHA seems almost indifferent to the burden she says its hastily deployed and poorly communicated policy changes pose. She says it can feel, as OHA sees it, “If you fall by the wayside as a group practice, oh well, but it’s almost better because then that’s more money to funnel to community mental health.”