Updates on Coordinated Care Organization (CCO) cuts to Community Mental Health Programs funding, impacts of Mink-Bowman lawsuit on local services, Rural Health Transformation grants, state-county partnership on HR 1 implementation, and the Statewide Shelter Program.
In case you missed it: Jan. 23 Local Government Advisory Committee (LGAC) on Health and Human Services (Meeting recording; Chat transcript)
CCO cuts to Community Mental Health Programs funding
Despite CCO’s ORS 414.153 obligation to maintain the mental health safety net system provided through local mental health authorities in order to meet the needs of their Oregon Health Plan (OHP) members, CCOs across the state are making significant cuts to their 2026 contracts with Oregon’s Community Mental Health Programs (CMHP). The mental health safety net, which includes court-ordered services necessary for the Oregon Health Authority (OHA) to effectively manage the Oregon State Hospital census, requires adequate OHP reimbursement for program viability.
The Association of Oregon Community Mental Health Programs described addressing this threat to Oregon’s safety net as a top priority, along with mitigating the expected loss of federal funding from HR1 and a longer term effort to close the funding gap identified in the latest cost study of required CMHP services. Many CMHPs also rely on Behavioral Health Resource Network grants which just received 14% reductions due to falling cannabis tax revenue projections.
CMHPs have been in discussion with OHA on potential solutions, including joint advocacy to the Legislature for sustainable funding for crisis stabilization centers;
prioritizing approval of CMHPs as new Certified Community Behavioral Health Clinics (CCBHCs); ensuring adequacy of CCO contract exhibit M (adequate networks/funding); and establishing a base rate for CCO reimbursement for priority populations and services set by OHA in the County Financial Assistance Agreement, such as Assertive Community Treatment, Early Assessment and Supports (EASA), Supported Employment, and WRAP.
During discussion at the Jan. 23 meeting, committee members noted that the CCO contract cuts have already resulted in loss of service to hundreds of community members, including medication management. Also on the chopping block are intensive youth services, medication assisted treatment for substance abuse, and supported employment, among others.
This issue will be a standing item on the committee agenda each month until it is adequately addressed, including the next meeting on Feb. 27.
Impacts of Mink-Bowman lawsuit on local services
Court Monitor Dr. Debra Pinals provided an update on her work with the state to address the wait times for persons in county jails to be admitted to the Oregon State Hospital (OSH) for competency restoration. Her latest update, Neutral Expert 10th Quarterly Report Regarding the Consolidated Mink and Bowman Cases, published in December, showed an average wait time of 21 days driven by an increase in court-ordered placements; the federal court-mandated maximum is seven days.
The state is accruing fines now in excess of $2 million on a per person per day basis for noncompliance with the court order. The court is making exceptions to the fine for cases where there is a delay in court orders or in transportation by county sheriffs. Those courts and sheriffs are being notified by OSH in those cases. Dr. Pinals is overseeing a workgroup which will decide how to disburse funding from the fines.
A community restoration program manual overseen by Dr. Pinals is now in draft form. She is also focusing on improvements to transitions out of OSH.
Public Consulting Group (PCG) has been contracted to provide an independent evaluation and is currently conducting a ‘deep dive’ into state budgetary allocations and expenditures for behavioral health services in order to identify what resources are needed and where to bring the state into compliance. Report recommendations are expected to come this spring.
Committee discussion noted the need for ongoing collaboration between Dr. Pinals and state and county partners on these efforts.
Rural health
OHA Policy Director Steph Jarem gave an update on Oregon’s Rural Health Transformation plan development. Oregon was awarded $197.3 million for Year 1 with an expected total over the next five years of about $1 billion. The definition of ‘rural’ is the same as used by Oregon’s Office of Rural Health. A contractor will support OHA in conducting regional conversations for the first of five initiatives within the program which focuses on regional partnerships and system transformation. OHA is still in final negotiation with the federal agency and expects to release its RFP in the spring with local award funding probably released in the summer. Director Jarem’s slides provide helpful details on federal eligibility requirements, allowable and not allowable use of funds, and Oregon’s five initiatives. Awards will prioritize ready-to-go projects and projects that are collaborative among local/regional partners.
State-county partnership on HR 1 implementation and the Statewide Shelter Program
County Health and Human Services directors brought forward a request for guidance from OHA on specific codes to use to demonstrate an individual’s exemption from new Medicaid eligibility requirements, e.g., definition of medical fragility, and noted the need for robust provider education ahead of the July 1 implementation of those new requirements. OHP Community Engagement Director Jessica Deas provided an HR1 Impacts and Strategies update. The committee will revisit this topic for new developments in February.
Oregon Housing and Community Services Department Director of Housing Stabilization Liz Weber provided an update on the implementation of the Statewide Shelter Program. Applications for new regional coordinators are now under review and will be announced “soon.” The new rules and program manual will not go into effect until those new regional coordinators are in place. Committee members recommended that new regional coordinators be required to have an active MOU with counties to ensure effective coordination.
Also presented was the state’s process and rationale for allocating the $65 million dollars directed by the 2025 Legislature to increase behavioral health residential treatment capacity and short overviews of OHA and ODHS rebalance proposals currently before the Legislature.
Contributed by: Jessica Pratt | Legislative Affairs Manager