High ambitions

The Oregon Health Plan was created in 1989 to expand coverage to some of the 400 000 citizens who at the time had no health insurance. Spearheaded by state senator turned governor John Kitzhaber, the plan was intended to extend coverage to people with incomes less than 100% of the federal poverty level ($12 100 (£7000; €9000) for a family of four). To free up money to cover additional people, Kitzhaber needed to find a way to spend less on existing Medicaid recipients.

States tend to favour two approaches to control costs in Medicaid: they either pay providers less or reduce the number of people eligible. Oregon rejected both methods and instead opted for a new, bold approach: it would ration the benefits covered under Medicaid.

Instead of cutting benefits haphazardly, the state decided to approach the task of rationing in a transparent and logical manner by introducing a prioritised list of treatments. The Oregon Health Services Commission was created to develop the list. By law, its 11 members must include five doctors, a public health nurse, …